Is Optical Networking the Next Big Thing After GPUs? Why a Small AI-Related Stock in Norway is Gaining Attention

The Movement to Find the "Invisible Winners" of the AI Boom Begins

At the center of the generative AI boom have been GPU companies like NVIDIA, major cloud providers, and semiconductor manufacturing equipment makers. The market's focus has been on "who will create the most high-performance AI chips" and "who will build massive data centers."

However, the essence of AI infrastructure is not just about chips. Whether it's training AI models or delivering inference services worldwide, vast amounts of data need to move quickly and reliably. Inside data centers, between data centers, metropolitan networks, and connections between cloud providers and telecom operators—all of these are supported by network infrastructure using optical fiber.

A German investment media outlet highlighted "the next AI winner comes from Norway," focusing precisely on this area. Although the original article did not specify the company name, the described business content and performance figures match the recent financial results of Smartoptics Group ASA, based in Oslo, Norway. The company provides optical network equipment, optical transceivers, open line systems, and DWDM-related solutions.

If the first act of the AI market was investment in "computing power," the second act could be investment in "how to transport data." The reason Smartoptics is gaining attention is precisely because its products are positioned at the center of this trend.

What Does Smartoptics Do?

Smartoptics provides optical network solutions to data centers, telecom operators, internet-related companies, enterprise networks, and government customers. While it may sound complex, in essence, it is a company that deals with "equipment and software for efficiently transmitting large amounts of data over optical fiber."

The company's distinguishing feature is its emphasis on open network design. Traditional communication infrastructure tends to be tied to specific vendors' equipment and management systems. Once large-scale communication equipment is introduced, it often becomes necessary to continue purchasing products from the same manufacturer for expansions and updates.

Smartoptics offers flexible and cost-efficient optical network configurations to customers who wish to avoid such vendor lock-in. There is room for the company's products to be used in scenarios where bandwidth demand is rapidly increasing, such as data center interconnections, metro networks, regional communication networks, and connections for cloud providers.

In the AI era, this flexibility becomes even more important. AI workloads involve larger data movements and faster traffic growth than traditional web services. Companies and telecom operators are compelled to expand their networks to be "larger capacity," "lower cost," and "shorter timeframes." The structural change is why open-type optical network companies like Smartoptics are gaining attention.

Rapid Growth Shown in Q1 Financial Results

The catalyst for Smartoptics' reevaluation in the market was its Q1 2026 financial results. The company's revenue reached $22.91 million, a 59.6% increase year-over-year. EBITDA was $2.676 million, a 121.6% increase year-over-year. Operating profit also grew significantly to $1.81 million from $591,000 in the same period last year.

Notably, it's not just the revenue that has grown; profit margins have also improved. The gross profit margin rose to 48.2% from 47.3% in the same period last year, and the EBITDA margin improved to 11.7%. Excluding one-time costs associated with production relocation, the adjusted EBITDA margin was reported to be 13.7%.

Regionally, the Americas saw a significant increase of 77.8% year-over-year to $13.9 million. EMEA also grew by 46.5% to $7.8 million, indicating strong demand centered in Europe and the Americas. APAC remained relatively flat at $1.2 million, with the company itself explaining that this region is highly project-dependent.

By business area, Solutions grew by 73% to $14.2 million, Software & Services by 35% to $3.4 million, and Devices by 47% to $5.3 million, indicating growth across multiple areas. This suggests that the growth is not reliant on a single project but is driven by overlapping demands for AI-related network expansion, data center interconnections, and telecom operators' capacity enhancement.

Why AI Infrastructure and Optical Networks Are Linked

When it comes to AI investment, many people think of GPUs, servers, power, and cooling equipment. However, what ultimately determines AI performance is not just the computing resources themselves. How fast, stable, and low-latency data can be moved also becomes crucial.

In training large-scale AI models, multiple data centers and cloud environments may be involved. Inference services require connections to edge and regional hubs to process data closer to users. As video generation, voice AI, real-time analysis, and industrial AI become more prevalent, the volume of data flowing through networks will further increase.

Therefore, the investment targets for AI infrastructure are expanding from GPUs to servers, power equipment, cooling, data center construction, and optical networks. The data center interconnection and DWDM technology handled by Smartoptics are technologies for expanding this "data pathway."

Smartoptics itself cites AI-driven network capacity expansion and increased data center interconnection activities as growth factors for Q1 2026. In CEO comments, it is explained that hyperscale companies and cloud customers are investing to support AI training and inference workloads, and traditional telecom operators are expanding metropolitan and regional networks to accommodate the resulting traffic increase.

In other words, Smartoptics is not creating AI apps or AI chips. However, it is a "behind-the-scenes infrastructure company" that benefits from the increased data demand generated by AI.

Gaining Attention on Social Media as a "Small AI Infrastructure Stock"

Interest in Smartoptics is also rising on social media. Particularly on X, posts from individual investors viewing the company as a creator of "data highways for AI infrastructure" can be found.

The bullish perspective is generally consistent. First, the company's growth rate is accelerating. The 59.6% increase in revenue for Q1 2026 is seen not as a mere temporary recovery but as reflecting structural changes in AI infrastructure investment and optical network demand.

Secondly, Smartoptics has the potential to directly or indirectly ride the massive capital investment cycles of major cloud and telecom operators. On X, there are posts suggesting that while the winner of AI apps is uncertain, the continuous flow of data through optical fiber remains unchanged. This reflects a mindset of investing in more fundamental infrastructure rather than the competitive AI app market.

Thirdly, the fact that the company is not yet a large-cap stock and is a relatively unnoticed Nordic-listed company also stimulates investors' imagination. It is being talked about as a "discovery-type" stock that may not yet be fully valued by the market, unlike AI stocks already known worldwide.

However, the reaction on social media should not be viewed as entirely bullish. As a small-cap stock, risks such as liquidity, stock price volatility, dependency on specific projects, supply chain, currency, and competitive environment are significant. The more the AI-related theme intensifies, the more the stock price may move based on expectations. The excitement on social media serves as an indicator of high interest but is not a basis for investment decisions.

Evaluation Points Are Not Just "Revenue Growth"

When looking at Smartoptics, it's important to consider more than just the revenue growth rate. To be evaluated as an AI-related stock by the market, at least three points need to be confirmed.

The first is whether growth will continue. The Q1 figures are very strong, but demand for optical network equipment can be influenced by project timing. While large projects may make growth appear rapid, quarterly figures can fluctuate if delivery schedules shift. The company itself explains that APAC is highly project-dependent, and investors need to view quarterly fluctuations calmly.

The second is whether profit margins will continue to improve. In this financial report, EBITDA grew more than revenue, demonstrating the scalability of the business. If the ratio of selling, general, and administrative expenses to revenue is kept in check, profit margins could improve further. However, increased investment in product development, personnel, supply chain response, and regional expansion could weigh on profit margins in the short term.

The third is competitive advantage. The optical network market also includes major telecom equipment manufacturers and optical component makers. For Smartoptics to succeed, it needs to maintain strengths such as open architecture, cost efficiency, ease of implementation, software management, and customer support while expanding its reach to large customers.

The company aims to increase its market share in related markets by 2 to 3 times from 2026 to 2030. It also targets an operating profit margin of 13 to 16%. These are quite ambitious goals, and if achieved, the evaluation will change significantly. However, goals are just goals, and results will be influenced by future orders, deliveries, competitive environment, and macroeconomic conditions.

More of a "Company Needed by AI" Than an "AI Stock"

Calling Smartoptics an "AI stock" might be somewhat misleading. The company is not developing AI models or providing generative AI services. Rather, it is more accurately viewed as a telecommunications infrastructure company whose necessity increases with the proliferation of AI.

This distinction is important. In the world of AI apps and AI software, winners can change significantly. Even if one service grows rapidly, another service might take over the market in six months. However, regardless of which AI service wins, the direction of increasing data volume is unlikely to change.

In that sense, optical networks are the "common infrastructure" of the AI boom. Regardless of who holds the hegemony in AI apps, data centers, clouds, telecom operators, and enterprise networks are compelled to increase capacity. The bullish view on Smartoptics is rooted in this common infrastructure nature.

Of course, being common infrastructure does not automatically guarantee success. There are many practical challenges, such as price competition with major players, the speed of technological updates, customer acquisition costs, inventory management, and material procurement. However, the Q1 2026 financial results show that the company is not just a thematic stock but is accompanied by actual business growth.

Conclusion: The Spread of AI Infrastructure Seen in a Nordic Small-Cap Stock

The story of AI investment can no longer be told solely through semiconductors. Building data centers requires power, cooling, land, and networks to carry vast amounts of data.

Smartoptics is a company positioned in the area of "transporting data." The figures of 59.6% revenue growth and 121.6% EBITDA growth in Q1 2026 suggest that the company is beginning to capture the wave of AI infrastructure investment.

It is natural that voices on social media are seeing the company as a "hidden AI infrastructure winner." While it lacks the flashiness of GPUs or major cloud players, more investors are considering it as a company supporting data distribution in the AI era, with room for reevaluation.

However, as an investment target, it is a small growth stock, and if expectations lead, the stock price can fluctuate significantly. What should be watched going forward is whether high growth continues in subsequent quarters, whether the large customer strategy translates into actual orders, whether improvements toward profit margin targets progress, and whether AI-related demand becomes a medium-term growth foundation rather than a temporary tailwind.

The true winners of the AI boom are not necessarily in the spotlight. As long as data continues to move around the world, companies creating those pathways will also be highlighted. Smartoptics can be said to be one such company in the Nordics where that light is now beginning to shine.

Source URL

An article titled "The Next AI Winner Comes from Norway" distributed by DER AKTIONÄR on aktiencheck.de. The starting point of the text, mentioning a small Norwegian optical network company with Q1 revenue growth of about 60% and EBITDA growth of about 120%.
https://www.aktiencheck.de/news/Artikel-naechste_KI_Gewinner_kommt_aus_Norwegen-19763359

Smartoptics Official Release: Q1 2026 Financial Results. Revenue of $22.9 million, a 59.6% increase year-over-year, used to confirm AI-driven network expansion and data center interconnection demand.
https://smartoptics.com/cision-post/smartoptics-group-asa-smop-q1-2026-financial-results/

Smartoptics Q1 2026 Report PDF: Used to confirm performance figures such as revenue, EBITDA, operating profit, regional sales, CEO comments, and goals for 2026-2030.
https://mb.cision.com/Main/17802/4345634/4081090.pdf

Smartoptics Product Page: Used to confirm business content such as open optical networks, transceivers, DWDM, and applications for data centers and telecom operators.
https://smartoptics.com/products/

Smartoptics Data Center Interconnect Page: Used to confirm data center interconnection demand driven by AI workloads, real-time analysis, video distribution, and scalability to 400G and 800G.
https://smartoptics.com/solution/enterprise-data-center-interconnect/

X Search Results on Smartoptics: Used to confirm individual investors' reactions on social media, viewing the company as AI infrastructure, optical fiber, and data highways.
https://x.com/search?q=Smartoptics%20SMOP%20Q1%202026