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Jun 30, 2025
Applied Optoelectronics Q2 2025 Earnings Report
Applied Optoelectronics' Q2 2025 earnings were reported, showing revenue and gross margin in line with expectations, but EPS fell short due to elevated operating expenses.
Key Takeaways
Applied Optoelectronics reported strong year-over-year revenue growth and gross margin expansion in Q2 2025, driven by strength in both datacenter and CATV businesses. Despite a net loss, the company made strategic investments in R&D and SG&A, particularly for 800G and 1.6Tb transceivers, which are expected to translate into future revenue opportunities.
Revenue for Q2 2025 was $103.0 million, a significant increase from $43.3 million in Q2 2024.
GAAP gross margin improved to 30.3% in Q2 2025, up from 22.1% in the same period last year.
The company reported a GAAP net loss of $9.1 million, or $0.16 per basic share, primarily due to elevated operating expenses from strategic investments.
Strong demand was observed in both the datacenter and CATV segments, underscoring the value of diversified revenue streams.
Revenue by Segment
Forward Guidance
For the third quarter of 2025, Applied Optoelectronics expects revenue between $115 million and $127 million, non-GAAP gross margin between 29.5% and 31.0%, and non-GAAP net loss per share between $0.10 and $0.03.
Positive Outlook
- Expected revenue growth in Q3 2025, with a range of $115 million to $127 million.
- Anticipated non-GAAP gross margin to remain strong, ranging from 29.5% to 31.0%.
- Continued progress on increasing production capacity for 800G transceivers, aiming for over 100,000 units per month by year-end.
- Strategic investments in R&D and SG&A are expected to translate into higher customer engagement and future revenue opportunities.
- Approval of Taiwan factory for 800G product production from a major hyperscale customer, nearing qualification for meaningful shipments in H2 2025.
Challenges Ahead
- Expected non-GAAP net loss for Q3 2025, ranging from $5.9 million to $2.0 million.
- Non-GAAP income per share is projected to be a loss, ranging from $0.10 to $0.03.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
Analyze how earnings announcements historically affect stock price performance
Avg. Return Before/After Earnings
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