Research Notes
4 notes in cpo
What problem does co-packaged optics (CPO) actually solve?
Traditional AI cluster networking uses pluggable transceivers (QSFP-DD, OSFP) on the switch faceplate. At scale — 100,000+ GPU clusters — the electrical trace from ASIC to faceplate consumes 15–20W per port and creates a power/bandwidth wall you cannot scale past. CPO moves the optical engine directly onto the switch ASIC package, shrinking that electrical trace from ~30cm to ~3mm. Result: 30–50% power reduction and 4x+ bandwidth density improvement, enabling 800G and 1.6T per port economically.
Who are the key players in the CPO supply chain and what role does each play?
Switch ASICs (the hub): Marvell (MRVL) with Teralynx 10 is the most advanced CPO roadmap in merchant silicon; Broadcom (AVGO) competes with Tomahawk 5. Optical engines: Coherent (COHR) is the leading transceiver maker (800G ZR, 1.6T), vertically integrated after acquiring Finisar and II-VI. Laser sources: Lumentum (LITE) supplies pump lasers for CPO optical engines. Advanced packaging equipment: Applied Materials (AMAT) for glass substrates, Lam Research (LRCX) for ALD/etch, KLA (KLAC) for inspection. Contract manufacturing: Fabrinet (FN) assembles transceivers at volume. Adjacent: Credo Technology (CRDO) for active electrical cables within rack.
Which hyperscalers have committed to CPO and what is the adoption timeline?
Meta is piloting CPO switches internally, targeting 2025–26 AI cluster deployment. Microsoft is committed — OpenAI cluster specs include CPO with Marvell Teralynx design wins. Google is in deep co-design with Marvell on Teralynx CPO for TPU pod networking. Amazon (AWS) is still evaluating, watching CPO for Graviton cluster expansion alongside their own Trainium silicon. The market inflection is 2025–2027 as hyperscaler qualification cycles complete and volume ramps begin.
What is the CPO market size and how does it compare to the existing pluggable market?
LightCounting (2024 estimates): CPO addressable market ~$3B by 2027, growing to $10B+ by 2030. The traditional pluggable transceiver market is ~$15B today and is being partially displaced, but CPO is also additive — AI clusters are net-new bandwidth demand, not a direct 1:1 substitution. The equipment supply chain (AMAT, LRCX, KLAC) benefits from CPO increasing packaging complexity, which drives tool intensity per wafer.