Goldman Sachs Says That This Is the Next Big AI Infrastructure Megatrend With a 9X Growth Potential. 3 Stocks You Can Buy to Capitalize on This $154 Billion Opportunity

Artificial intelligence (AI) has created a terrific demand for several hardware components used in data centers to help train AI models and run inference applications. The demand for some of these components, such as memory chips, has exceeded supply, thereby creating a significant shortage that's expected to last for years.

In fact, memory chips are expected to remain in short supply until the end of the decade. That's because memory solves an important bottleneck in the AI infrastructure ecosystem, enabling the rapid transport of massive amounts of data that allows accelerator chips to unlock their full potential.

However, the need to quickly transmit large datasets is also driving significant demand for optical networking components. Goldman Sachs sees optical networking as the next megatrend in the AI infrastructure space. The investment bank estimates that the total addressable market (TAM) of optical networking components could jump by a whopping 9x to $154 billion in just two years.

That's great news for Lumentum Holdings (NASDAQ: LITE), Ciena (NYSE: CIEN), and Coherent (NYSE: COHR), three optical networking specialists that have jumped impressively in 2026 so far. Let's see why these three AI stocks have room for more upside.

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Lumentum, Ciena, and Coherent have been delivering phenomenal earnings growth

The parabolic jump in demand for optical networking components has created a massive supply shortage. According to management consulting firm McKinsey, optical transceivers that transfer data at 800 gigabits per second (Gbps) will fall short of demand by 40% to 60% through 2027. Meanwhile, optical transceivers capable of transporting data at 1.6 terabits per second (Tbps) will fall short of demand by 30% to 40% through 2029.

This explains why Lumentum, Ciena, and Coherent have been witnessing stunning earnings growth lately.

Data by YCharts

Importantly, their red-hot earnings growth is here to stay. We have already seen that Goldman Sachs anticipates a stunning rise in the optical networking TAM, and it is unlikely that equivalent supply will come online so quickly. Not surprisingly, all three companies noted in their latest earnings calls that demand will exceed supply.

This explains why these companies can raise the prices of their products. For example, Lumentum CEO Michael Hurlston remarked on the May earnings call that "there's room from here to continue to really step up margin." The company's non-GAAP earnings per share increased by just over 4x year over year to $2.37 per share.

Lumentum's earnings are expected to increase by 236% year over year in the ongoing quarter, while its full-year earnings could jump by 4x, according to consensus estimates. Ciena, which recently released its fiscal 2026 second-quarter results (for the quarter ended May 2), posted a 290% year-over-year increase in earnings. Even better, Ciena raised its full-year forecast due to improving demand for optical components.

The company's backlog increased by more than $600 million sequentially in fiscal Q2, taking its overall backlog to an impressive $7.7 billion. That's higher than Ciena's fiscal 2026 revenue guidance of $6.3 billion, suggesting that it can further increase guidance as the year progresses. So, don't be surprised if Ciena's fiscal 2026 earnings growth exceeds the 147% spike analysts are estimating.

Coming to Coherent, the company clocked a 55% year-over-year increase in earnings per share to $1.41 in the third quarter of fiscal 2026 (which ended on March 31). Just like the other two companies, Coherent is also focused on rapidly expanding its production capacity to meet rapidly rising end-market demand.

Importantly, Coherent management notes that it is now receiving orders for calendar 2028 and is signing long-term agreements (LTAs) with customers that extend into 2030. Not surprisingly, Coherent anticipates its fiscal 2027 growth rate to improve from this fiscal year's levels. Analysts are expecting a 55% increase in its earnings in the current fiscal year to $5.45 per share, and the good part is that its growth is likely to accelerate nicely going forward.

Data by YCharts

These stocks are expensive, but investors should look at the bigger picture

All three stocks have appreciated substantially this year, which explains why they are trading at expensive multiples.

Data by YCharts

However, the chart above also shows that their forward earnings multiples are significantly lower. That's because all three companies are on track to deliver substantial increases in earnings. Also, the dynamics of the optical networking market, where demand is likely to substantially exceed supply due to the enormous investments in AI data centers, suggest that these companies can sustain their terrific growth rates beyond the next three years.

That's why investors looking to add growth stocks capitalizing on the next big AI megatrend can consider buying Lumentum, Ciena, and Coherent before they soar higher.

Harsh Chauhan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Ciena, Coherent, Goldman Sachs Group, and Lumentum. The Motley Fool has a disclosure policy.