Zhongji Innolight and Eoptolink, the two Chinese makers in Counterpoint Research’s top three for datacom optical transceivers, sold about RMB 60.1 billion of product abroad in the first half of 2026, by our arithmetic from their half-yearreports. That is about $8.8 billion, and more than the RMB 58.5 billion (about $8.3 billion) they sold abroad in all of 2025.
Overseas sales were 94.8% of Innolight’s first-half revenue and 97.8% of Eoptolink’s, by our arithmetic. These are the companies behind the roughly 60% revenue share Counterpoint gives Chinese makers, the figure at the centre of Microsoft’s reported push against an expected FCC ban on new Chinese transceiver models.
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The key insight: Zhongji Innolight and Eoptolink sold about RMB 60.1 billion abroad in the first half of 2026, about $8.8 billion and more than the RMB 58.5 billion they sold abroad in all of 2025, by our arithmetic from their filings; overseas sales were 94.8% and 97.8% of their first-half revenue.
Innolight’s 2025 annual report puts overseas revenue at RMB 34.64 billion, 90.58% of its RMB 38.24 billion total, up from 86.81% in 2024. It sold 21.09 million optical modules, up 44.55%. The report says its products are mainly sold to North America, Europe and other regions, and that some key raw materials are bought overseas (our translation).
In the first half of 2026, Innolight’s overseas businessrevenue was about RMB 39.61 billion, up 209.9% from RMB 12.78 billion a year earlier, its half-year report says. Total revenue was RMB 41.78 billion. The company says shipments of its 800G and 1.6T modules grew fast and took a rising share, and that its 1.6T silicon photonics modules entered volume ramp, with shipments rising quarter by quarter (our translation).
Eoptolink’s 2025 annual report puts overseas revenue at RMB 23.89 billion, 96.16% of its RMB 24.84 billion total, up from 78.70% in 2024. Domestic revenue fell 48.19% to RMB 954 million. In the first half of 2026, overseas sales of its optical interconnect products were RMB 20.46 billion, against total revenue of RMB 20.91 billion.
Neither report splits unit volumes by speed. Innolight gives 18.99 million modules sold in the first half; Eoptolink gives 11.19 million optical interconnect products. Both third-quarter reports give no geographic split. The Innolight and Eoptolink third-quarter reports put revenue for January to September at RMB 69.55 billion and RMB 31.85 billion, up 178.13% and 92.97%.
Overseas sales of Zhongji Innolight and Eoptolink, RMB billion, from their 2025 annual and 2026 half-year reports. Combined, the first half of 2026 (RMB 60.1 billion) topped all of 2025 (RMB 58.5 billion), by our arithmetic.
Where the Margin Sits
Overseas sales carry the higher margin at both companies. Innolight’s 2025 overseas gross margin was 44.64%, against 42.61% for its module business as a whole. Eoptolink’s was 48.36%, against 47.81% company-wide.
The margin rose again in 2026. Innolight’s module gross margin was 46.59% in the first half, up from 39.96% a year earlier; Eoptolink’s was 48.46%, up from 47.48%. For January to September, gross margin works out to 46.4% at Innolight and 47.7% at Eoptolink, by our arithmetic from revenue and cost of revenue in the third-quarter reports.
Five Customers, No Names
Both companies name no customers. Innolight’s five largest took 75.98% of its 2025 sales, RMB 29.06 billion, and the largest, listed as Customer A, took 24.06%. Sales to related parties within that top five were 8.10% of annual sales, the same share as Customer E. Eoptolink’s top five took 72.34%, RMB 17.97 billion, with the largest at 22.97%.
Counterpoint estimates that leading Chinese module makers rely on overseas buyers, primarily US hyperscalers, “for 90%+ of their high-value 800G and 1.6T module revenue”. The filings show overseas shares of 90.58% and 96.16% for all of 2025 revenue, across every speed. They do not say which overseas buyers are American.
What the Risk Factors Say
Innolight lists a risk of trade barriers and falling demand. Its main export markets are North America and other regions, it says, and most key raw materials come from overseas. If China-US trade disputes escalate and trade sanctions deepen, demand for its modules would fall, key materials would be harder to buy, and in extreme cases results could fall sharply or turn to a loss, the report says (our translation). The half-year report repeats the factor in the same words. A separate factor covers tariff changes since April 2025.
Eoptolink’s risk section says international trade frictions, changes in trade policy and other uncertainties may affect its import and export sales (our translation). We searched the six reports for the FCC and for the Covered List and found no reference to either.
Against Counterpoint’s 60%
Counterpoint puts Innolight first with about 27% of datacom transceiver revenue and Eoptolink third, behind Coherent, and gives Chinese makers about 60% in total. The filings show where that revenue lands: 92.8% of the pair’s combined 2025 revenue was booked abroad, by our arithmetic, rising to 95.8% in the first half of 2026. Our earlier pieces track the US side, Coherent’s capex and Lumentum’s order book.
The dollar figures are our conversions at the rates the companies use in their own reports: 7.0288 yuan per dollar at 31 December 2025, and 6.8109 (Innolight) and 6.8067 (Eoptolink) at 30 June 2026.
The Structural Read
As we read the filings, the roughly 60% share Counterpoint gives Chinese makers is mostly export revenue: 92.8% of the two companies’ combined 2025 revenue was booked abroad, by our arithmetic.
As we read the margins, overseas sales were the more profitable sales in 2025 at both companies: 44.64% against 42.61% at Innolight, and 48.36% against 47.81% at Eoptolink, per their annual reports.
Counterpoint Research, on US makers Coherent and Lumentum
“currently lack the cleanroom capacity, automated packaging infrastructure, and yield scale required to absorb Innolight and Eoptolink’s volume within a 12-to-24-month horizon”
Three Implications
FOR THE FCC DEBATE Innolight and Eoptolink booked 95.8% of their combined first-half 2026 revenue abroad, by our arithmetic; neither filing names the FCC or the Covered List.
FOR BUYERS Five unnamed customers took 75.98% of Innolight’s 2025 sales and 72.34% of Eoptolink’s, per their annual reports.
FOR THE MAKERS Innolight’s own risk factors say escalating China-US trade disputes and deeper sanctions would cut demand for its modules (our translation).
The framework argues: “It’s a fundamental constraint on the speed of AI transformation, and it’s creating geopolitical leverage that operates independently of who has the best models.”
As we read it, the leverage in optical transceivers runs both ways: the two largest Chinese makers book over 90% of their revenue abroad, per their filings, while US cloud builders depend on their volume. The framework predates these filings and does not discuss transceivers.
What Is Not Established
Overseas is not the same as the United States: neither company breaks out US revenue, and neither names its customers. The filings give no unit split by speed, so the share of 800G and 1.6T modules is not disclosed. The FCC has not published a proposal on optical transceivers, as our earlier report noted, and neither company was contacted for this piece. Our coverage of Applied Optoelectronics covers a US-based rival.
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Innolight and Eoptolink sold about RMB 60.1 billion, about $8.8 billion, abroad in the first half of 2026, more than in all of 2025, by our arithmetic from their filings. Overseas sales were 94.8% and 97.8% of their revenue and carried higher margins than the company averages in 2025. Innolight’s risk factors name escalating China-US trade disputes and sanctions as a risk to demand; Eoptolink’s cite international trade frictions.
A note on sourcing. All company figures are from Zhongji Innolight’s and Eoptolink’s 2025 annual, 2026 half-year and 2026 third-quarter reports filed on cninfo.com.cn, which are in Chinese; passages marked as our translation are ours. Market shares are Counterpoint Research estimates. Totals, shares, dollar conversions and nine-month margins are our arithmetic. Neither company was contacted for this piece.
Gennaro Cuofano is a CRO and tech executive who has worked in AI since late 2015, starting with bringing NLP, natural-language generation, voice and chatbot products to the marketing industry. His background is in law and finance: he holds a Master's degree in Law and an International MBA with an emphasis on corporate finance (LUISS Business School and the University of San Diego, 2012), and worked as a financial analyst at a real-estate investment firm in San Diego and as an assistant controller. His work focuses on business model strategy, business engineering and, more broadly, structural analysis: how companies make money, read from their own filings. He created FourWeekMBA and leads research there and at The Business Engineer, his newsletter on AI and business strategy, with over 95,000 subscribers and more than 1,000 published analyses. His writing has also appeared on Entrepreneur (for example, How to Digitize a Family Business in Europe) and HackerNoon. Find him on LinkedIn and Substack. See how we source.
