COHR, LITE, POET, AAOI, MRVL Stocks Gain On Trump’s Reported China Ban On Data Center Import Parts

• Reuters said the proposal aims to curb cybersecurity risks from Chinese-made AI networking components.
• It added that the restriction could raise AI infrastructure costs for U.S. hyperscalers, including Amazon.
• The FCC is reportedly drafting the rule for release later this year, though it could still change or be shelved.

Shares of Coherent (COHR) and Lumentum (LITE) rallied in pre-market trade on Tuesday after a report that the Trump administration is drafting a ban on U.S. imports of new models of Chinese data center components, which could make things more expensive for American hyperscalers and reshape the supply chain.

According to a Reuters report, the Federal Communications Commission (FCC) is working on a measure to bar imports of new Chinese optical transceivers. These components that allow data to travel across fiber-optic cables at light speed inside data centers. 

It stated that a ban would likely push American cloud giants like Amazon Web Services (AMZN) toward U.S.-based alternatives Coherent (COHR) and Lumentum (LITE), both of which stand to benefit directly. 

COHR stock rallied as much as 13% in pre-market trade, while LITE stock jumped over 10%. On Stocktwits, retail sentiment around Coherent remained in ‘bullish’ territory over the past day, and sentiment around Lumentum stayed in the ‘neutral’ zone. 

Meanwhile, AMZN stock dropped over 2% in pre-market trade, with retail sentiment trending in ‘extremely bullish’ territory over the past day. 

Nvidia (NVDA) has already been positioning both companies as strategic suppliers, signing multi-year agreements in March that included billions of dollars in procurement commitments and a $2 billion investment in each to secure production capacity for next-generation co-packaged optics technology. 

Retail Sees Gains For POET, AAOI, MRVL Stocks 

According to retail traders on Stockwits, Poet Technologies (POET) is also a likely winner on this ban. POET stock rose more than 10% in pre-market trade and was among the top trending tickers on the platform. Data showed a more than 300% jump in message volume over the past 24 hours. 

Retail traders also pointed to Applied Optoelectronics Inc (AAOI) and Marvel Technology (MRVL) as potential replacements to Chinese vendors. AAOI stock jumped more than 16% in pre-market trade, while MRVL stock was up over 8%. AAOI stock was also among the top trending tickers on Stocktwits.

Chinese Components Face New Regulatory Scrutiny

The ban is reportedly being planned to address concerns that Chinese-made networking hardware could pose cybersecurity risks, including the potential for data theft, malware installation, or service disruption at AI data centers. 

The proposal has not been finalized and could still be modified or withdrawn before publication, according to the report. 

It added that the proposed restrictions would likely target Zhongji Innolight, one of the world's largest manufacturers of optical transceivers. The company was added to the Pentagon's list of alleged Chinese military-backed companies in June.

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