Is This the Best Way to Invest in Copper + Optics together? Revisiting Semtech

Gaetano · Gaetano · May 17, 2026 at 22:05 · ⏱ 10 min read  | Read on Substack ↗
Summary
Semtech is becoming a critical signal-integrity platform for AI data centers, spanning copper and optics, with products like CopperEdge, TIAs, drivers, and HieFo lasers. The author, a holder of SMTC, argues the company remains undervalued despite recent stock gains because the full scope of its product ramps and financial transformation is not yet priced in. This reinforces the market thesis that interconnect infrastructure is a key bottleneck in AI scaling.
  • •Semtech helps high-speed signals survive inside AI infrastructure, selling TIAs, drivers, CopperEdge redrivers, and HieFo laser components.
  • •The move from 800G to 1.6T to 3.2T bandwidth steps creates signal-integrity challenges that drive demand for Semtech's analog solutions.
  • •CopperEdge is positioned as a rack-level signal-integrity platform, not just an active copper cable (ACC), sitting between passive DAC and DSP-based AEC.
  • •LPO (linear pluggable optics) increases the value of Semtech's analog content by removing the DSP from optical modules.
  • •The HieFo acquisition adds indium phosphide (InP) gain chips and CW lasers, moving Semtech closer to the light-source layer.
  • •Semtech competes with MACOM, Credo, Marvell, Broadcom, Coherent, Lumentum, and AAOI across different interconnect segments.
Read time 10 min
Length 10,189 chars
Category finance
Trade Ideas
Gaetano Substack author, Gaetano
Author holds Semtech and believes the company is undervalued despite recent gains due to multiple product ramps (CopperEdge, 1.6T optical, LPO, HieFo) and financial transformation, positioning it as a
Author holds Semtech and believes the company is undervalued despite recent gains due to multiple product ramps (CopperEdge, 1.6T optical, LPO, HieFo) and financial transformation, positioning it as a key enabler in AI data center signal integrity.
SMTC HIGH
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This newsletter, published May 17, 2026, features Gaetano discussing SMTC. 1 trade idea extracted by AI with direction and confidence scoring.

Speakers: Gaetano  · Tickers: SMTC