Network and optical communication equipment stocks are surging on the KOSDAQ market as concerns mount over a shortage of optical components tied to the global expansion of artificial intelligence infrastructure. Analysts attribute the rally to expectations of spillover gains from surging demand, following news of large-scale long-term fiber optic contracts by Big Tech companies and the development of next-generation optical connectivity solutions.
RF Materials jumped 19.86% from the previous session as of 9:35 a.m. on the 9th, according to the Korea Exchange. Sungho Electronics rose 14.83%, Woori Technology 12.45%, OE Solutions 10.9% and TAIHAN Fiberoptics 10.15%, all gaining more than 10%. Lightron Fiber-Optic Devices climbed 7.28%, Daeduck Electronics 6.01% and RFHIC 5.49%. The KOSDAQ index stood at 822.56 at the same time, up 10.68 points, or 1.32%, from the prior session, extending intraday gains on 83.8 billion won in net foreign buying.
A surge across the global optical communication value chain on the New York market overnight is lifting Korean network equipment shares. Lumentum soared 11%, while Corning gained 8%, Coherent 7% and AXT 12%. The catalyst was news that U.S. telecom giant Verizon signed a multibillion-dollar long-term supply agreement with Corning for high-density optical fiber through 2032 and will build a nationwide long-haul network connecting AI hyperscalers.
Amazon Web Services and Qualcomm also boosted sentiment by signing a $60 billion AI data center partnership and announcing joint development of 1.6-terabit and next-generation optical connectivity solutions. Expectations of a surge in data center traffic following OpenAI's unveiling of its next-generation model Astra further fueled concerns about component scarcity.
Market watchers say structural gains have begun for Korean component makers, centered on the data center interconnect (DCI) segment. As the supply-demand imbalance in optical communications drags on, the position of Korean non-Chinese suppliers with proven technology and supply stability is expected to strengthen within the global supply chain. Observers say the industry could enter a phase of substantial earnings growth in 2027.
"Verizon's long-term contract is a clear signal of strong end-market demand and the possibility of a prolonged shortage of global optical components," said Kim Jung-chan, an analyst at Korea Investment & Securities. "In Korea as well, orders are surging centered on the DCI segment, and these are unlikely to be one-off deals but are highly likely to lead to repeat orders."
