Applied Optoelectroncis (AAOI) Climbs 21% on AI Deals

We recently published 10 Stocks Investors Are Gobbling Up. Applied Optoelectronics, Inc. (NASDAQ:AAOI) is one of the top performers on Monday.

Applied Optoelectronics soared by 20.98 percent on Monday to finish at $33.79 apiece, tracking the overall optimism for the artificial intelligence sector, thanks to a flurry of dealmaking developments in the industry.

Applied Optoelectronics, Inc. (NASDAQ:AAOI), a leading developer of advanced optical products, including those used in modern data centers, stands to benefit from the booming AI growth as more technology giants continue to invest billions of dollars to advance the sector.

In other news, Applied Optoelectronics, Inc. (NASDAQ:AAOI) showcased its 100G VCSEL technology with the demonstration of an 800G OSFP 2xSR4 multimode optical transceiver at the recently concluded ECOC 2025 in Copenhagen, Denmark.

Applied Optoelectronics, Inc. (NASDAQ:AAOI) said its vertically integrated design and manufacturing capabilities enable the production of 100G VCSELs at 850nm—the industry’s preferred solution for short-reach connections under 100 meters in hyperscale data centers and AI and machine-learning clusters.

“By leveraging these VCSELs in its 800G OSFP 2xSR4, AOI delivers a cost-efficient, low-power optical solution designed for the next generation of short-reach multimode links,” it said.

While we acknowledge the potential of AAOI as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock.

READ NEXT: 30 Stocks That Should Double in 3 Years and 11 Hidden AI Stocks to Buy Right Now.

Disclosure: None. This article is originally published at Insider Monkey.