Acacia Communications and the Data Center Race

Here is Investor’s Business Daily recent interview with Raj Shanmugaraj, CEO of Acacia Communications, a fiber optic device maker that plugs into high speed communication networks/data centers.

Acacia Communications (ACIA), which recently IPOed earlier this year, had twice raised its guidance for the September quarter and the Street expects Acacia Communications to raise its December-quarter forecast as well. Demand from China is driving revenue growth for fiber-optic component makers.  New demand also is coming from interconnecting cloud computing data centers packed with computer servers.

“We’re seeing some segments growing simultaneously, a cycle where there’s a need for bandwidth, video and cloud services that are eating up bandwidth, and things are happening in parallel,” Shanmugaraj said. “Whether it’s a supercycle may be debatable, but we see it continuing for the long term. We don’t see the need for bandwidth subsiding.”

Both Acacia Communications and Intel are members of the Open Compute Project, started by Facebook (FB), to develop standards for next-generation data centers. A big part of Acacia’s growth, analysts say, could come from providing optical devices that speed up communications within data centers and interconnecting data centers.

Information Credit: Information and quotes were taken from the Investor’s Business Daily article in the writing of this post.

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