Applied Optoelectronics

Full year revenue reached 476 million dollars, up 83 percent from the year before. The fourth quarter alone brought in 134 million dollars with gross margins climbing to 31 percent. Management is guiding to roughly 1 billion dollars next year, which would more than double the business again.

Microsoft is now their largest customer, and Amazon signed a performance based deal that could be worth up to 4 billion dollars over time. Recent orders for their fastest 800G products added up to 124 million dollars in just a few weeks. The forward plan calls for a 12 percent operating margin, a big swing from last year's loss.

The company lost 13.6 million dollars over the past year and net margins sit around negative 8.6 percent. Building out new factory capacity eats cash fast, and the balance sheet only holds about 40 million dollars of net cash. If the expansion costs more than planned, they may need to raise money on unfriendly terms.

Their top ten customers make up 97 percent of all revenue, with the two biggest alone accounting for over 80 percent. Back in 2017 they fumbled a similar technology shift and lost a major buyer. One delayed order from one whale could knock a hole in a whole quarter.