Short answer
APPLIED OPTOELECTRONICS, INC. (AAOI) filed its fiscal 2025 10-K annual report with the SEC on Feb 26, 2026. It reported revenue of $456M (+82.8% year over year) and net income of −$38M.
- Top risk flagged: U.S. Supreme Court invalidated IEEPA tariffs Feb 2026; Section 232/301 tariffs remain, causing ongoing cost, supply chain, and margin uncertainties
FY2025 key financial metrics · XBRL
- Revenue
- $456M
- +82.8% YoY
- Net income
- −$38M
- +79.5% YoY
- Operating margin
- -12.0%
- +16.5 pp YoY
- Gross margin
- 30.0%
- +5.3 pp YoY
- EPS (diluted)
- −$0.64
- +85.8% YoY
- ROE
- -5.2%
- +76.3 pp YoY
- Operating cash flow
- −$174M
- −150.9% YoY
Source: XBRL data from the APPLIED OPTOELECTRONICS, INC. (AAOI) FY2025 10-K on SEC EDGAR. USD.
APPLIED OPTOELECTRONICS, INC. FY2025 10-K analysis
AI summary of each section, grounded in the filing text
Business Overview
- Core business: Vertically integrated manufacturer of fiber-optic networking products for internet data center, CATV, telecom, and FTTH markets
- New direct-to-MSO product line in CATV under Quantum Bandwidth™ launched 2023 to address network upgrade needs
- Strategic shift: Increased emphasis on U.S.-based automated production capacity for data center products to meet customer preferences amid supply chain concerns
- Quantitative metric: Revenue growth to $455.7M in 2025, up from $249.4M in 2024; CATV accounted for 53.8% and internet data center 42.9% of 2025 revenue
- Noteworthy fact: Key CATV customer Digicomm’s revenue share surged to 53.1% in 2025 from 11.3% in 2023, reflecting concentration risk and shifting customer dynamics
Management Discussion & Analysis
- Revenue $455.7M in 2025, up 82.8% YoY from $249.4M in 2024, driven by CATV ($245.1M) and data center ($195.7M) growth
- Gross margin 30.1% in 2025 vs 24.8% in 2024 and 27.1% in 2023
- Best performing segment: CATV revenue $245.1M (53.8% of total); worst: FTTH and other $1.2M (0.3%) in 2025
- Net loss $38.2M in 2025, improved from $186.7M loss in 2024
- Top customers Digicomm (53.1% revenue) and Microsoft (28.8% revenue) in 2025
- Operating expenses increasing in dollars but expected to decline as % of revenue over time
- Cash flow details on buybacks, dividends, or capex not disclosed
- Management expects continued strong demand for 40, 100, 400 Gbps products with 800 Gbps sales exceeding 400 Gbps later in 2026
- Key risks: price pressure, customer concentration, product mix, quarterly variability in margin and revenue expected due to technology transitions
Risk Factors
- U.S. Supreme Court invalidated IEEPA tariffs Feb 2026; Section 232/301 tariffs remain, causing ongoing cost, supply chain, and margin uncertainties
- High exposure to China with 4,116 manufacturing/R&D employees there; Lunar New Year closures disrupt Feb production
- Significant capital investment in U.S. manufacturing automation tied to AI demand may underperform due to delays, cost inflation, or weak AI adoption
- Competitor advantage risk as rivals pursue alternative AI technologies or sourcing, potentially obsoleting Applied Optoelectronics' equipment and slowing returns
- Heavy revenue concentration: top 10 customers 96.6% of 2025 revenue, with Digicomm 53.1% and Microsoft 28.8%, risking major impact from order reductions
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