Research Insight: CPO gains momentum as AI interconnect demands outpace chip gains

The rapid adoption of CPO technology is fundamentally reshaping the interconnect landscape in AI data centers. Upstream, optical module and silicon photonics components face capacity and yield constraints, while midstream packaging and testing will see early gains. Downstream server vendors must rearchitect systems to accommodate new interfaces. The root cause is bandwidth saturation outpacing compute improvements, making CPO a critical enabler. Geopolitically, the U.S.-China tech decoupling has disrupted supply chains, forcing companies to seek alternative sourcing strategies. In market competition, NVIDIA and AMD are racing to integrate CPO support into their platforms, while domestic players are positioning themselves in mid-tier optical component manufacturing. Over the next 12–24 months, CPO will expand beyond high-end AI clusters into general-purpose data centers, triggering a structural upgrade across the entire photonic interconnect ecosystem.