Applied Optoelectronics (AAOI) stock soared 5.73% in pre-market trading on Tuesday, following positive market sentiment driven by a significant new business announcement.

The optical communication company announced it received an initial volume order worth over $53 million from a major hyperscale customer for its 800G single-mode data center transceivers. The undisclosed customer plans to use these transceivers to expand network capacity for AI-driven workloads, specifically supporting GPU cluster buildup as part of large-scale infrastructure expansion plans.

CEO Thompson Lin highlighted that AI infrastructure expansion is accelerating and requires significantly higher bandwidth at scale. The company expects shipments to begin in the second quarter and be completed by mid-third quarter, with anticipation of subsequent orders from the same customer. The news was further supported by Rosenblatt Securities reiterating its Buy rating on the stock earlier in the pre-market session.