One of the stock market’s favorite momentum plays from earlier this year is re‑emerging as rising confidence in artificial intelligence spending sends the shares of optical component makers soaring again. Stocks like Applied Optoelectronics Inc., Lumentum Holdings Inc., Coherent Corp., Fabrinet and Corning Inc. are on a scorching run, each climbing more than 25% since late July.

The leader, Applied Optoelectronics Inc. has surged 76% in just nine sessions, while Coherent Corp. has gained 48% over that stretch. The move comes as investors grow increasingly confident that ambitious AI capital expenditure plans from technology giants like Microsoft Corp., Alphabet Inc., Amazon.com Inc. and Meta Platforms Inc. will keep going.

With this renewed optimism, optical component stocks are positioned to benefit from the expanding AI ecosystem, as demand for high‑speed optical hardware rises across data centers and enterprise networks. The rally underscores the broader narrative that AI investment remains a key driver of technology sector momentum.