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Applied Optoelectronics Inc. (NASDAQ:AAOI) is one of the 10 Stocks That Would Have Boosted Your Portfolios by Double Digits.

Applied Optoelectronics surged to a new all-time high on Wednesday, as the stock mirrored the rally in the broader market alongside developments in the artificial intelligence sector.

In intra-day trading, the stock climbed to its highest level of $134.49 before paring gains to finish the day just up by 12.80 percent at $132.70 apiece.

Photo from Applied Optoelectronics website

Wednesday also marked its fifth consecutive day of gains, helped by news earlier this month of strong demand for its next-generation transceivers, following a major customer’s upsized order for the 800G variant.

According to Applied Optoelectronics Inc. (NASDAQ:AAOI), the customer, which it refused to identify, hiked its 800G orders to $124 million from $53 million, more than doubling its existing backlog for the latter.

“This increased order for our 800G transceivers reflects both the customer’s confidence in AOI and the growing demand for 800G optics,” Applied Optoelectronics Inc. (NASDAQ:AAOI) Chairman and CEO Dr. Thompson Lin said.

Following product qualification, Applied Optoelectronics Inc. (NASDAQ:AAOI) expects to kick off the delivery for both the initial and upsized orders in the second quarter of the year, with completion targeted by the end of 2026.

“We also recently shipped the first 10,000 units of an 800G single-mode transceiver order to another hyperscale datacenter customer,” Lin noted.

Launched in September last year, the 800G optical transceivers are built for high-performance AI and cloud data center networks requiring superior port density and bandwidth efficiency. It is available in standard pluggable form factors and is essential for high-capacity spine switching and high-speed GPU cluster interconnects.

While we acknowledge the potential of AAOI as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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