The good news, according to LightCounting, is that optical component and module sales should grow 14% this year, despite supply chain issues and macroeconomic uncertainty. The bad news is that the space won’t be as resilient to such factors in 2023, with the market research firm now pegging optics revenues to climb only 4% in 2023.
The comparative weakness in 2023 won’t last long, however, as LightCounting predicts in a new research report that a 11% CAGR in the 2022-2027 timeframe. That figure is down slightly from the 13% forecasted in a similar report LightCounting issued at this time last year.
Despite the more cautious outlook for 2023, LightCounting asserts that demand for optics remains strong across the board. However, several supply chain constraints will continue to place a drag on the market, as will the softness in the global economy. The market research firm reports that Meta has reduced its buying forecast substantially for 2023 and LightCounting believes Amazon and other cloud companies may do the same if economic headwinds reduce their advertising, streaming, and retail incomes.
Still growth is growth, which LightCounting predicts will be led by DWDM and Ethernet optics (see chart above). Optical interconnect sales, mostly active optical cables (AOCs), also will be strong enough to create double-digit increases over the next 5 years. PON optics sales will remain steady, as a tailing off of deployments in China will offset broadband infrastructure roll outs and evolution toward 10G PON in North America and Europe.
The updated forecast comes shortly after LightCounting also reduced its predictions for Ethernet optics (see “LightCounting shrinks Ethernet optics forecast”).
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