Applied Optoelectronics Reports 145.5% Revenue Growth to $99.9 Million in Latest Quarter

Applied Optoelectronics, Inc. (AOI) reported significant financial growth in its latest quarterly filing, with net revenue reaching $99.9 million for the three months ending March 31, 2025, a substantial increase of 145.5% compared to $40.7 million in the same period last year. The company attributed this growth primarily to heightened demand in its cable television (CATV) and data center markets, with CATV revenue soaring by 638.3% to $64.5 million, driven by a major network upgrade project by a North American multiple system operator. The data center segment also saw a 10.6% increase, contributing $32.0 million to the total revenue.

Despite the revenue surge, AOI reported a net loss of $9.2 million, an improvement from a loss of $23.2 million in the prior year. The loss per share was $(0.18), compared to $(0.60) in the same quarter of 2024. The company’s gross profit increased to $30.5 million, representing a gross margin of 30.6%, up from 18.7% a year earlier. This improvement was attributed to higher sales of high-margin products and ongoing cost reduction efforts in production.

Operationally, AOI's total operating expenses rose to $39.5 million, up 35.0% from $29.2 million in the previous year, primarily due to increased research and development costs and higher general and administrative expenses. The company invested $17.8 million in R&D, reflecting a 52.1% increase as it seeks to meet customer demands for new products. The total headcount also increased, aligning with the company's growth strategy and operational needs.

In terms of strategic developments, AOI issued a warrant to an Amazon affiliate on March 13, 2025, allowing the purchase of up to 7.9 million shares at an exercise price of $23.70 per share, contingent on future purchases of $4 billion worth of AOI products. This agreement is expected to enhance AOI's market position and customer relationships. The company also completed an at-the-market offering, raising approximately $98 million in April 2025, which will support its operational and growth initiatives.

Looking ahead, AOI anticipates continued demand for its products, particularly in the data center market, driven by the increasing need for higher processing capacities. The company is focused on diversifying its customer base to mitigate risks associated with reliance on a limited number of clients. However, AOI remains cautious about potential impacts from ongoing geopolitical tensions and trade restrictions, particularly between the U.S. and China, which could affect its supply chain and cost structure.