Shares of China’s biggest AI winners, Zhongji Innolight and Eoptolink, fell after Reuters reported that the US FCC might ban Chinese optical transceivers from data centres. The stocks slid 8.6% and 6.9%, pulling the CSI 300 telecoms index down as much as 9% before narrowing to about 4% lower.
Both firms have been hit hard by a broader sell‑off of AI “picks and shovels” that hit memory‑chip makers. They are among China’s top performers from the AI build‑out, having surged roughly 4,500% since the start of 2023 and generating most of their revenue overseas.
Last year, Innolight’s net profit rose to Rmb10.8bn ($1.6bn) from Rmb2.2bn in 2023, while Eoptolink’s profits climbed from Rmb688mn to Rmb9.5bn. More than 90% of Innolight’s Rmb38.2bn revenue came from outside China, with Eoptolink’s share at 96%.
Kenny Ng of Everbright Securities International warned that continued US restrictions will push China to accelerate its push for self‑reliance in key technologies, while the FCC has yet to comment.
Source: Financial Times Companies · Summarized by HeadlinesBriefing