An unassuming chip supplier launched by the AI data-center boom
Picture a stock that traded as low as $46 and as high as $177 in a single year. No cryptocurrency, no meme name, but a sixty‑five‑year‑old California semiconductor company most retail investors have never heard of. While the headlines belong to Nvidia $NVDAand the like, this company “sells shovels” in the AI gold rush: it makes tiny but indispensable chips without which data in modern data centers simply wouldn’t move.
Key points
From a debt crisis after the Sierra Wireless acquisition, the company bounced back to record revenue of $1.05 billion for fiscal 2026, nine straight quarters of growth, and its first GAAP profit after three years of losses.
FiberEdge and CopperEdge interconnect chips for the 800G and 1.6T era are driving growth, demand exceeds production capacity three‑fold, and analysts’ average price target points to $205.
A forward P/E of around 60 is double the sector median, and the share price has tripled from last year’s lows. On top of that, investors must factor in shareholder dilution from convertible bonds and persistent insider selling.
Three years ago, however, the company looked like a cautionary tale. A botched and overpriced acquisition loaded it with debt, brought billion‑dollar write‑downs, and the stock plunged far below $30. Today the picture is reversed: in fiscal 2026 it posted record sales, reported its ninth straight quarter of revenue growth, and the CEO talks about a “breakthrough year.” The latest quarter (ended April 2026) delivered revenue of $291 million, 16 percent year‑on‑year growth, and analysts scrambled to raise price targets after the results: the boldest goes as high as $230.
In mid‑July 2026 the stock trades around $136, giving the company a market value of roughly $12.7 billion. That is many times higher than a year ago. Is the current bet on data centers, super‑fast optics and the Internet of Things strong enough to justify a price that has tripled from last year’s lows? Or is the retail investor jumping onto a speeding train just when insiders are selling shares? Who are we talking about, anyway?
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