Applied Optoelectronics (AAOI) investor relations material

Executive summary

• Record Q3 revenue of $269.9M, up 127.5% YoY and 40.6% QoQ; sixth consecutive quarter of record revenue.

• Returned to GAAP profitability, with $6.3M net income, and non-GAAP profitability, with $14.8M net income; demand was strong across data center and CATV.

• Customer demand exceeds production capacity; facility delays and component constraints limit growth.

Financial highlights

• Q3 GAAP net income was $6.3M, or $0.07 per diluted share, versus a $17.9M net loss in Q3 2025; non-GAAP net income was $14.8M, or $0.17 per diluted share.

• Q3 non-GAAP operating income was $7.2M, versus a $10.3M operating loss in Q3 2025; GAAP operating loss narrowed to $1.4M from $18.2M.

• Q3 gross profit rose 128.9% YoY to $76.2M; other income, net was $8.2M, including $8.2M of government subsidy income.

• 9M revenue increased 90.7% YoY to $612.9M; net loss narrowed to $30.8M from $36.2M.

Outlook and guidance

• Q4 revenue guidance: $385M–$420M; non-GAAP gross margin of 29.5%–31%, net income of $45.9M–$60.4M and diluted EPS of $0.48–$0.63.

• Q4 data center revenue expected at $270M–$300M; CATV revenue expected at $105M–$115M.

• 1.6T revenue is expected to begin in Q4, with a larger ramp in 2027; 800G remains the largest near-term data center growth driver.

• Monthly revenue run-rate target of $471M remains achievable toward end-2027, pushed out several months by phase 2 construction delays.

• Capacity target by year-end is over 500,000 800G and 1.6T units/month; target exceeds 1M transceivers/month by end-2027.