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AAOI, Applied Optoelectronics Inc.

Semiconductors capital-intensive UnprofitableDistress / turnaroundCapital build-out

Applied Optoelectronics Inc. is a leading, vertically integrated provider of fiber-optic networking products, primarily for four networking end-markets: internet data center, cable television, telecommunications,, and fiber-to-the-home.

We design and manufacture a range of optical communications products at varying levels of integration, from components, subassemblies and modules to complete turn-key equipment.

In designing products for our customers, we typically begin with the fundamental building blocks of lasers and laser components.

Latest annual: FY2025 10-K

AAOI · Applied Optoelectronics Inc.

The business

What it sells, where the money comes from, the kind of company it is.

Revenue · FY2025

$456M

+82.8% YoY · 14% 5-yr CAGR

Vital signs · TTM, with 5-yr average

Revenue $507M 5-yr avg $271M

Gross margin 30% 5-yr avg 23%

Operating margin −11.6% 5-yr avg −22.5%

ROIC −6% 5-yr avg −15%

Owner-earnings margin −82% 5-yr avg −30%

Free cash flow margin −82% 5-yr avg −30%

The business in brief

read the 10-K →

What this business is and what moves its needle, from its own SEC filings.

What it is: Revenue is CATV (54%), Data Center (43%) and Telecom (3%).
Situation: Unprofitable. No sustained operating profit across the record; an earnings multiple has nothing to rest on. What the record does show is revenue, the gross-margin trajectory, and the burn against the cash on hand. Distress / turnaround. Thin interest coverage, or operating cash burned against real debt, across the record. The balance sheet carries this situation; the debt schedule sets the clock. Capital build-out. Capital spending has surged to 39% of sales, today's earnings are charged less depreciation than tomorrow's will be.
What moves the needle: Operating margin has reached 23% at its best but run negative through the cycle (median −21%) on a 25% gross margin — so the question is which reading is truer: whether the median was pulled below zero by one-off charges, by the cycle, or by spending it is still growing into, and whether it settles back at a profit. Inventory runs near 35% of sales, so how fast it turns back into cash — and the risk of writing it down when demand softens — sits alongside the margin. Read this kind of business on process leadership and the capex cycle. On its own account, the filing leans hardest on customer concentration, set against the numbers in what the filing emphasizes, below.
Is it a good business?: Return on capital has rarely cleared the cost of capital (median −13%, above 15% in 1 of 10 years). Owner earnings, the cash-based check, have been thin too. This is price-taker territory, where the balance sheet and the cycle matter more than any multiple; the rest is in the 10-K.

Every line is arithmetic on the company's filings, shown in full in the sections below.

Where the money comes from

read the 10-K →

Revenue spreads across 4 lines, the largest CATV at 54%.

Revenue by product line, FY2025

CATV54%$245M
Data Center43%$196M
Telecom3%$14M
FTTH and Other0%$1M

By geographyChina58%Taiwan38%United States4%

From the segment footnote of the company's own 10-K. Shares are of total revenue; the profit bar shows each segment's share of segment operating profit, before unallocated corporate costs.

The record

Ten years of arithmetic, read across the cycle.

The record, 2016–2025

realized figures from each filing · older years to the left

2016’16	2017’17	2018’18	2019’19	2020’20	2021’21	2022’22	2023’23	2024’24	2025’25	TTMTTMMar 2026
											Income statement
$261M	$382M	$267M	$191M	$235M	$212M	$223M	$218M	$249M	$456M	$507M	RevenueRevenue
33%	43%	33%	24%	22%	18%	15%	27%	25%	30%	30%	Gross marginGross mgn
10%	9%	15%	22%	18%	20%	21%	24%	24%	17%	17%	SG&A / revenueSG&A/rev
12%	9%	19%	23%	18%	19%	16%	17%	22%	19%	18%	R&D / revenueR&D/rev
$23M	$87M	($11M)	($49M)	($49M)	($57M)	($59M)	($41M)	($71M)	($55M)	($59M)	Operating incomeOp. inc.
8.8%	22.7%	−4.0%	−25.5%	−20.8%	−26.8%	−26.5%	−19.0%	−28.4%	−12.0%	−11.6%	Operating marginOp. mgn
$31M	$74M	($2M)	($66M)	($58M)	($54M)	($66M)	($56M)	($187M)	($38M)	($43M)	Net incomeNet inc.
											Cash flow & returns
$57M	$84M	$14M	($2M)	($44M)	($12M)	($14M)	($8M)	($70M)	($174M)	($209M)	Operating cash flowOp. cash
$14M	$20M	$30M	$24M	$25M	$25M	$23M	$20M	$21M	$28M	$31M	DepreciationDeprec.
$8M	($18M)	($25M)	$28M	($23M)	$5M	$20M	$16M	$82M	($176M)	($210M)	Working capital & otherWC & other
$49M	$67M	$72M	$29M	$16M	$8M	$3M	$9M	$43M	$179M	$209M	CapexCapex
19.0%	17.5%	26.9%	15.1%	6.7%	3.8%	1.4%	4.2%	17.4%	39.3%	41.2%	Capex / revenueCapex/rev
$8M	$17M	($58M)	($31M)	($60M)	($20M)	($17M)	($17M)	($113M)	($354M)	($418M)	Owner earningsOwner earn.
2.9%	4.5%	−21.6%	−16.0%	−25.5%	−9.3%	−7.7%	−7.8%	−45.3%	−77.6%	−82.4%	Owner earnings marginOE mgn
$8M	$17M	($58M)	($31M)	($60M)	($20M)	($17M)	($17M)	($113M)	($354M)	($418M)	Free cash flowFCF
2.9%	4.5%	−21.6%	−16.0%	−25.5%	−9.3%	−7.7%	−7.8%	−45.3%	−77.6%	−82.4%	Free cash flow marginFCF mgn
10%	25%	-2%	-13%	-12%	-15%	-19%	-13%	-19%	-7%	-6%	ROICROIC
14%	22%	-1%	-24%	-21%	-21%	-36%	-26%	-82%	-5%	-4%	Return on equityROE
14%	22%	−1%	−24%	−21%	−21%	−36%	−26%	−82%	−5%	−4%	Retained to equityRetained/eq
											Balance sheet
$50M	$83M	$56M	$60M	$43M	$35M	$25M	$45M	$67M	$206M	$446M	Cash & investmentsCash+inv
$50M	$60M	$31M	$35M	$43M	$48M	$61M	$48M	$117M	$244M	$299M	ReceivablesReceiv.
$52M	$76M	$93M	$85M	$110M	$93M	$80M	$64M	$88M	$183M	$206M	InventoryInvent.
$36M	$44M	$30M	$33M	$29M	$34M	$48M	$33M	$105M	$144M	$148M	Accounts payablePayables
$65M	$92M	$94M	$87M	$124M	$106M	$93M	$79M	$100M	$284M	$357M	Operating working capitalOper. WC
$158M	$230M	$194M	$193M	$209M	$194M	$183M	$173M	$301M	$676M	$993M	Current assetsCur. assets
$60M	$71M	$77M	$91M	$103M	$109M	$139M	$93M	$170M	$257M	$259M	Current liabilitiesCur. liab.
2.6×	3.2×	2.5×	2.1×	2.0×	1.8×	1.3×	1.8×	1.8×	2.6×	3.8×	Current ratioCurr. ratio
$322M	$453M	$467M	$467M	$481M	$454M	$408M	$389M	$547M	$1.2B	$1.6B	Total assetsAssets
$43M	$50M	$84M	$77M	$78M	$79M	$80M	$76M	$134M	$130M	$130M	Total debtDebt
($7M)	($33M)	$28M	$17M	$34M	$44M	$55M	$31M	$67M	($76M)	($316M)	Net debt / (cash)Net debt
13.4×	101.3×	-9.7×	-9.0×	-8.7×	-10.1×	-9.3×	-4.4×	-10.4×	-15.6×	-17.1×	Interest coverageInt. cov.
$227M	$333M	$329M	$274M	$278M	$255M	$185M	$215M	$229M	$734M	$1.1B	Shareholders’ equityEquity
1.5%	2.0%	4.2%	6.2%	5.6%	5.7%	4.3%	5.5%	5.9%	2.6%	2.7%	Stock comp / revenueSBC/rev
											Per share
17.7M	20.1M	19.6M	20.0M	21.9M	26.9M	27.8M	31.9M	41.5M	60.2M	76.0M	Shares out (diluted)Shares
$14.72	$18.98	$13.61	$9.55	$10.73	$7.86	$8.00	$6.81	$6.00	$7.57	$6.67	Revenue / shareRev/sh
$1.76	$3.67	$-0.11	$-3.31	$-2.67	$-2.01	$-2.38	$-1.75	$-4.50	$-0.64	$-0.57	EPS (diluted)EPS
$0.43	$0.86	$-2.94	$-1.53	$-2.73	$-0.73	$-0.62	$-0.53	$-2.72	$-5.87	$-5.50	Owner earnings / shareOE/sh
$0.43	$0.86	$-2.94	$-1.53	$-2.73	$-0.73	$-0.62	$-0.53	$-2.72	$-5.87	$-5.50	Free cash flow / shareFCF/sh
$2.79	$3.33	$3.66	$1.44	$0.72	$0.30	$0.12	$0.28	$1.04	$2.98	$2.75	Cap. spending / shareCapex/sh
$12.84	$16.55	$16.75	$13.70	$12.71	$9.46	$6.63	$6.73	$5.52	$12.19	$14.56	Book value / shareBVPS

The diluted share count moved ×1.45 into 2025 — shares issued, not a split the totals corroborate — and the per-share figures carry the counts as filed.

Per-share growththe realized rate an owner's share compounded

	9-yr	5-yr
Revenue / share	−7.1%/yr	−6.7%/yr
Capital spending / share	+0.7%/yr	+32.7%/yr
Book value / share	−0.6%/yr	−0.8%/yr

The record, charted

FY2016–2025

Each measure over its full record; the current point and the worst year marked.

Share count

60Mpeak FY2025

ROIC

−7%low FY2022

Gross margin

30%low FY2022

Owner earnings vs. net income

Owner earningsNet income

The accountant's number, and the cash an owner can take; the gap is the tell.

($354M)owner earningsvs.($38M)net incomelow FY2025

Where the cash went

ReinvestBuybacksDividendsAcquisitionsRetained

Each year's operating cash, by what management did with it: the mix, and how it drifts.

FY2016FY2018

Owner-earnings bridge

FY2021–FY2025cash-flow statement, SEC EDGAR →

Net income is the accountant's number; owner earnings is the cash an owner could take out. The walk between them, off the cash-flow statement, and whether the gap is widening or holding.

In fiscal 2025 the business reported a $38M loss but ($354M) of owner earnings: $315M less than the profit line, taken out by capital spending and the timing of cash.

	FY2025	FY2024	FY2023	FY2022	FY2021
Reported net income	($38M)	($187M)	($56M)	($66M)	($54M)
Depreciation & amortizationnon-cash charge added back	+$28M	+$21M	+$20M	+$23M	+$25M
Stock-based compensationreal costnon-cash, but a real cost	+$12M	+$15M	+$12M	+$10M	+$12M
Working capital & othertiming of cash in and out, other non-cash items	−$176M	+$82M	+$16M	+$20M	+$5M
Cash from operations	($174M)	($70M)	($8M)	($14M)	($12M)
Capital expenditurecash put back in to keep running and to grow	−$179M	−$43M	−$9M	−$3M	−$8M
Owner earnings	($354M)	($113M)	($17M)	($17M)	($20M)
Owner-earnings marginowner earnings ÷ revenue	-78%	-45%	-8%	-8%	-9%

Owner earnings is the cash an owner could pull out without starving the business: operating cash less the capital it must spend to hold its position . The cash-flow statement also adds stock comp back as non-cash, but it is a real cost paid in shares; counted as the expense it is (less $12M), owner earnings is nearer ($365M).

Maintenance capex is estimated as depreciation where a growing business invests above it; free cash flow is the figure the scorecard's free-cash margin reads.

III

Quality & stewardship

Returns, the balance sheet, capital allocation, and pay.

Owner’s Scorecard

FY2025 10-K · source on SEC EDGAR →

Will it survive?

Can it pay its interest? -15.6×

Does not cover its interest

Operating income ($55M) ÷ interest expense $3M

What this means
A full year of operating profit didn't cover the interest bill. This is the zombie zone: the business depends on refinancing, asset sales, or forbearance to service its debt.
How heavy is the debt, net of cash? +$76M

Net cash

Cash $206M + ST investments $36K − debt $130M

What this means
Cash and short-term investments exceed every dollar of debt by $76M, on net the company owes nothing, and can act from strength when others can't. Net debt is the leverage figure that matters: the cash is already set against the debt. Strategic or illiquid investments aren't counted here.
How long is cash tied up? 241d

Long (60+ days)

DSO 196 + DIO 210 − DPO 165 days

What this means
Days cash is tied up between paying suppliers and collecting from customers. Lower is better; a long cycle means growth itself eats cash.

Is it a good business?

Return on invested capital -13%

Below average through the cycle

10-yr median, range -19%–25%; -7% latest = NOPAT ($43M) ÷ invested capital $658M

Industry peers: median -8%

What this means
The rate the business earns on the money tied up in it, Buffett's north star, because over time a stock tracks the ROIC beneath it. Above ~15% sustained hints at a moat; a return below the cost of capital (~8%) erodes value as a business grows rather than building it — the test Buffett weighs most. The headline is the median of the last 10 years (it ran -7% most recently), so one peak or trough year doesn't set the verdict. Asset-light businesses (R&D expensed, little capital) read artificially high, pair this with Owner Earnings.
Owner-earnings margin -16%

Consumes cash through the cycle

10-yr median margin, range -78%–5%; latest ($354M) = operating cash ($174M) − maintenance capex $179M

Industry peers: median -2%

What this means
What an owner could take out without starving the business: operating cash less the maintenance capital it must spend to hold its position — Buffett's owner earnings. That's -78% of revenue this year, a -16% median across 10 years. Treating stock comp as the real expense it is (less $12M of SBC) leaves ($365M).
Are earnings backed by cash? ($174M)

Loss, and burning cash

Net income ($38M) · cash from operations ($174M)

What this means
The company reported a net loss, so a conversion ratio isn't meaningful. What matters then is whether operations still threw off cash, here, they did not.

How is the cash used?

Where do the earnings go? —

Not enough data

What this means
The filing data didn't include the inputs for this check.
Investing or harvesting? 6.47×

Expanding

Capex $179M ÷ depreciation $28M

What this means
Descriptive, not a grade. Above ~1× means investing faster than assets wear out (growth, or, sustained for years, today's earnings carrying less depreciation than tomorrow's will). Below means spending less than it's wearing out (efficiency, or a melting asset base). The ratio won't tell you which; the filings will.

Graham’s defensive tests · 2 of 6 met

Graham’s numerical criteria for the defensive investor (The Intelligent Investor, ch. 14), run on the filings. A floor of safety, not a buy signal; many fine modern businesses fail his strictest liquidity rules by design.

Adequate size Miss

Revenue ≥ $2B · $456M

What this means
Big enough to weather a storm. Graham's 1972 floor was ~$100M of sales (≈ $700M today); we use a $2B revenue line as a conservative modern stand-in.
Strong liquidity Pass

Current ratio ≥ 2× · 2.63×

What this means
Current assets at least twice current liabilities, near-term bills covered without touching the business. Strict by design: many cash-rich modern firms run leaner and miss it, holding their cushion in longer-dated securities.
Conservative debt Pass

Debt ≤ working capital · $130M vs $418M WC

What this means
Graham's rule that borrowings not exceed net current assets. Capital-heavy and buyback-heavy firms routinely fail it, read it next to interest coverage, not alone.
Earnings stability Miss

A profit every year (10-yr record) · 8 loss years

What this means
Graham wanted earnings in each of the past ten years, the stability a defensive owner leans on.
Dividend record Miss

Uninterrupted dividends · none paid

What this means
An unbroken dividend was Graham's mark of durability. He wanted twenty years; the filings show about ten, and a single suspension breaks the streak. Non-payers, many fine modern compounders, fall outside his defensive net by design.
Earnings growth Miss

Earnings +33% over the record · −373%

What this means
At least a third more earnings than a decade ago, averaging three years at each end. Net income (not per-share), so stock splits don't distort it, buybacks and dilution show up in the share-count line instead.
Moderate price —

P/E ≤ 15 and P/E × P/B ≤ 22.5 · decided by the price

What this means
Graham's valuation gate, the wall he kept between a sound business and a sound investment. Three-year average earnings are $-1.17/share (latest year $-0.48), the averaged base the calculator's gate runs on, and book value is $9.15/share. Enter a price in “What the price implies” just below for the P/E, P/B, and whether it clears. But this is the rule Buffett outgrew: there's no hard P/E law, and a wonderful business can deserve a far richer multiple if the thesis holds, treat it as the bargain-hunter's floor, not a verdict on the price.

Durability & moat, 2016–2025

Whether the record’s returns held, and what the capital reinvested earned.

Profitable years 2 of 10

What this means
Lost money in 8 year(s), look at what happened there before trusting the average.
Return on capital ≥ 15% 1 of 10 yrs

What this means
A moat shows up as a high return on invested capital that holds year after year, not one good vintage.
Operating margin 9% → −20% (3-yr avg ends)

In the filing’s words The filing attributes gains to higher prices but names price competition too — and the margin slipped, so the pressure is winning here.

What this means
Through the cycle the operating margin slipped — about 9% early to −20% lately, median −21% — competition or costs are biting in.
Reinvestment, incremental ROIC —

What this means
The reinvested base moved too little against the change in profit to read a reliable return on it here — the figure would be a small-denominator artifact, not a moat. Judge this one on the owner-earnings record and the cash it returns instead.
Worst year 2024 · −28.4% op. margin

What this means
Operations went underwater in 2024, understand why before trusting the good years.

Does AI threaten the moat?

Low contestability

The moat is physical, regulated or balance-sheet-funded, the kind AI cuts costs within but does not contest.

In its own filing A competitive risk, new this year

Its FY2025 10-K names artificial intelligence as a competitive threat, in language that was not in the prior year's filing.

“In addition, our competitors may accelerate or alter their strategies in response to the evolving AI ecosystem, including by pursuing alternative technologies, sourcing models, or geographies.”

AI is unlikely to contest a moat that is physical, regulated or balance-sheet-funded; here it reads more as a cost tool than a threat, and the company is using it that way.

Read from the filing's own risk factors, paired with the industry's structure under its SIC code; the durability is read above, the price below.

All figures as filed; the source filing is linked above.

Current Position

as of the latest quarter, Mar 31, 2026

Can the business pay what it owes this year, off the freshest balance sheet: the quality of the assets, the debt actually coming due, and what a low ratio means here.

Current assets$993M

Cash & short-term investments$446M
Receivables$299M
Inventory$206M
Other current assets$42M

Current liabilities$259M

Debt due within a year$41M
Accounts payable$148M
Other current liabilities$70M

Current ratio3.83×all current assets ÷ what's due · Graham looked for 2×

Quick ratio3.03×stricter: inventory excluded

Cash ratio1.72×strictest: cash alone against what's due

Working capital$733Mthe cushion left after near-term bills

Debt due this year vs. cash$41M due · $446M cash covered by cash on hand, no refinancing forced · both figures from the Mar 31, 2026 balance sheet

Cash runway1.1 yrsthe business is consuming cash; this is how long the cash on hand lasts at that rate

Revenue, latest quarter vs. a year ago+51.4%the freshest read on whether the business is still growing

Current ratio, recent quarters1.6× → 3.8×

Deeper floors

Tangible book value$1.1Bequity stripped of goodwill & intangibles

Net current asset value$533MGraham's net-net: current assets less all liabilities

Debt incl. operating leases$115M$74M of it operating leases

Deferred revenue$2Mcustomer cash collected before delivery; operating float

From the company's latest filing.

Management, ownership & pay

read the proxy →

From the proxy: how much of the business the people running it own, and how they are paid, beside what the business earned for its owners in the same years.

Fiscal year	Chief executive	Pay, as filed	“Actually paid”	Owner earnings
2021	Chih-Hsiang (Thompson) Lin	$3.7M	$2.7M	($20M)
2022	Chih-Hsiang (Thompson) Lin	$2.2M	$457k	($17M)
2023	Chih-Hsiang (Thompson) Lin	$6.0M	$38.4M	($17M)
2024	Chih-Hsiang (Thompson) Lin	$3.7M	$33.3M	($113M)
2025	Chih-Hsiang (Thompson) Lin	$4.8M	−$3.2M	($354M)

Both pay figures are the company’s own, from the pay-versus-performance table its proxy statement files. “As filed” is the Summary Compensation Table total: salary, bonus, and equity awards at their value on the day of grant. “Actually paid” is the SEC’s prescribed recalculation, which re-marks those equity awards to what they became as they vested; it can swing far above or below the filed figure in either direction, and negative years occur. Owner earnings are the whole business's, from the record above, for the same fiscal years.

Insider ownership3.8%
The stake all directors and executive officers hold together, per the 2026 proxy: skin in the game, the first thing Munger reads.
CEO pay ratio91:1
What the chief earns for every dollar the median employee makes, per the 2026 proxy. A high ratio alone settles nothing; some businesses are genuinely top-heavy in scarce skill. A runaway figure is where Buffett starts asking whether the board is doing its job.
Stock-based compensation$12M
The slice of the business handed to employees in shares this year, 3% of revenue. Buffett's oldest accounting fight: this is compensation, compensation is an expense, real whether or not the headline earnings admit it. One trap: the cash-flow statement adds SBC back, so the operating cash, and the owner earnings drawn from it, are flattered by exactly this amount; counted as the cost it is, what an owner keeps is lower.

Inverting the record

Invert: instead of why Applied Optoelectronics Inc. is a good business, the question is what would make owning it a mistake, and whether those marks are in the record. Disconfirming tests across 2016–2025.

All 3 tests turned up something to look into. A record that trips every wire is one to understand slowly.

Look hereIs it less profitable than it was?−43.6% vs −4.7%
The business ran at a loss early in the record (an owner-earnings margin of −4.7%) and the loss has widened to −43.6% across the last three years, with the latest year at −77.6%. Ask the filing where the widening sits — price, cost, or spending growing faster than revenue — and what would narrow it.
Look hereDid debt outgrow the business?$43M → $130M
Debt rose from $43M to $130M while owner earnings went from about ($11M) to ($161M): the borrowing grew and the earnings that would carry it are not there now. Debt raised for buybacks or deals rather than growth is the kind that bites in a downturn.
Look hereDid receivables and inventory outpace sales?39% → 100% of sales
Receivables and inventory grew from $102M to $505M while revenue grew 94%: working capital is climbing faster than sales (39% of revenue then, 100% now). That can mean customers paying slower, stock building up, or revenue pulled forward. The filing's cash-flow and receivables notes say which.

Each test is read from the filings and is noisy alone; a flag can mark a cyclical trough or a year of heavy investment as easily as a problem. The filing says which.

What an owner would ask, FY2025

read the 10-K →

How much of the revenue rides on one buyer?
≈$51M · 10% of revenue on the largest customers (TTM)
“We had two customers that accounted for more than 10% of our revenue in 2025 and three customers that accounted for more than 10% of our revenue in 2024.”verify →
Which reported numbers are a judgment call?
Management names Revenue recognition, Income taxes, Inventory, Stock compensation as critical estimates
each rests partly on management's judgment; the filing's note sets out the assumptionsverify →

The questions the record and the charts do not answer on their own; each carries the figure and the place to look.

Peers, Semiconductors

The same industry, side by side on owner economics. Each figure is a through-cycle median, so a peak or trough year can’t distort it; the group median at the foot is the line to read each against.

Company	Revenue	Gross margin	Op. margin	ROIC	Owner earn. margin
PLABPhotronics	$849M	25%	13.3%	11%	13%
FORMFormFactor	$785M	40%	8.4%	7%	12%
AAOIApplied Optoelectronics Inc.	$456M	26%	-19.9%	-13%	-13%
AIOTPowerFleet Inc.	$444M	50%	-7.1%	-8%	-2%
MVSTMicrovast Holdings Inc.	$428M	10%	-34.8%	-30%	-9%
SITMSiTime	$327M	53%	-8.3%	-8%	8%
PLPlanet Labs PBC	$308M	49%	-77.3%	-40%	-40%
MXMagnachip Semiconductor Corporation	$179M	24%	2.5%	8%	-5%
Group median	—	33%	-7.7%	-8%	-3%

The price

What a price has to assume.

What the price implies

reverse-DCF

Applied Optoelectronics Inc. is profitable, but owner earnings are negative this year because capital spending currently outruns operating cash, a build-out, so the owner-earnings reverse-DCF has no positive base to grow. We read the price from both ends instead: type a price to see the steady-state profitability it demands, then set the mature margin you would believe and weigh the two against each other. Nothing leaves your browser unless you enter it in your notebook.

Today’s price $

The assumptions Required return 9% Years to get there 10 Revenue growth 0%

Revenue, delivered11%/yr’20→’25

Mature owner-earnings margin 15%

Enter a price to run it.

Owner earnings it must reach—

Margin the price demands—

Owner-earnings margin today−82%

Two reads of one future. From your price: the owner earnings the company must reach, valued at a mature multiple and discounted back at your rate, expressed as the margin it implies on revenue grown at your rate. From your belief: the mature margin you would credit, set on the dial above. When the margin the price demands runs above the one you would believe, you are paying for a future taken on faith. For a deep cyclical at a trough, normalized through-cycle earnings are the better lens; this mode is for the genuinely unprofitable, and for the profitable business whose capital spending currently outruns its cash.

Weigh AAOI against another business →

The owners of AAOI: the meeting and the votes →

Cite: Owner Scorecard, "Applied Optoelectronics Inc. (AAOI), the owner's record," https://ownerscorecard.com/c/AAOI, data as of 2026-07-09.

Manual order: ← AAMI its page in the Manual AAON →

Industry order: ← 6963 the Semiconductors chapter ADI →