Optical components

Optical Outlook

4:00 PM -- If you were a privately held optical components company, 2007 was a great year. Demand is up. Funding got strewn about like Silly String. (See AOI Raises $28M More, Intune Gets $17.75M, Gemfire Lights Up $37M, Santur Raises $26.5M, Talks IPO, and Capella Raises $20M.)

Not everyone made out so well. (See Is Xponent Xpiring?) But for most, this was a good year to be in optical, if you didn't already go public.

If you did, though...

Optium Corp. (Nasdaq: OPTM) shares are down 65 percent since Jan. 1. Opnext Inc. (Nasdaq: OPXT), since its May IPO, is down nearly 50 percent. The big winner appears to be JDSU (Nasdaq: JDSU; Toronto: JDU), down only 20 percent -- but it's got a test-and-measurement cushion.

So, business appears good until your business is publicly measurable? Is that the moral here? Maybe it means Santur Corp. should rethink those IPO aspirations, or that NeoPhotonics Corp. (NYSE: NPTN) executives were being smart back at OFC when they shrugged off suggestions of going public.

Consolidation is reeling in bigger fish, but it's still limited. (See JDSU Picks Up Picolight for $115M, Oplink & OCP Seal Deal, and Oplink & OCP Seal Deal.) The question remains: What will success look like in this industry? (See Optical Future.)

The closest answer so far is Fabrinet Co. Ltd. (NYSE:FN) , but that's a different business. (See IPO Alert: Fabrinet.)

— Craig Matsumoto, West Coast Editor, Light Reading

Pete Baldwin 12/5/2012 | 2:57:07 PM
re: Optical Outlook Yes, that occurred to me after I'd posted the entry. It's just a poor headline on my part, sorry. Didn't mean to pull a bait-and-switch there.

Maybe I'll just change the head.

This started as an exercise in listing those startup financings, part of our year-end roundup pieces (which will start appearing in the next couple of days). But then I startd flipping through the public companies and saw they'd done even worse than I realized.

Outlook? I'd say it will be a good, busy year for the private companies that got money. I'd question why any of them would go public, though, given the way the public markets are treating optical. (Fabrinet's an exception.)

I still don't know where the much needed consolidation is going to come from. Anyone have thoughts on that?
olsen 12/5/2012 | 2:57:07 PM
re: Optical Outlook Just to clarify my point:
You blog "Optical Outlook", but you pretty much talk about what didn't happen in 2007.

olsen 12/5/2012 | 2:57:07 PM
re: Optical Outlook Why not look into those companies that most likely will do well going into 2008?
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