Shares of Aeva surged after the company posted a narrower loss in the second quarter and said it has entered into a new business focused on getting photonics technology to data centers.

The stock was up 27% to $24.91 in Thursday trading, extending gains in the shares to 88% this year.

The company posted a net loss of $79.62 million, or $1.23 a share, compared with a loss of $192.7 million, or $3.49 a share, a year earlier.

Adjusted loss was 41 cents a share, which was better than the 43 cents a share loss analysts polled by FactSet expected.

Revenue rose to $6.14 billion from $5.51 billion. Analysts polled by FactSet expected $6.2 billion.

Chief Executive Soroush Salehian said with the launch of optical connectivity Aeva is expanding into a new market where it can leverage its photonics technology to enable next-generation AI data centers. The new business is meant to deliver high optical power, low noise and scalability to address rapidly growing bandwidth and power demands.

Aeva said a high-speed optical engine provider has already signed a joint development agreement to integrate the company's optical sources for deployment by a major hyperscaler.

Deployment is targeted for the second-half of 2027 and its production ramp is targeted for 2028, the company said.

Separately, the company said Chief Financial Officer Saurabh Sinha will resign to pursue a new opportunity outside of the industry, effective Sept. 5.

Sinha will be succeeded on an interim basis by Rupesh Maheshwari, Aeva's vice president corporate controller.

Maheshwari joined the company last December, and has more than 20 years of experience having held positions at Waabi, Covariant, Logitech and Fundbox.