# EP 188: The Wild West of Optical, Cisco's AI Hack, and Is Compute an Investable Asset

- Show: [The Circuit](https://hardwarepodcasts.com/podcast/the-circuit)
- Published: 2026-08-17
- Length: 56m
- Episode: 181
- Page: https://hardwarepodcasts.com/podcast/the-circuit/2026-08-17-ep-188-the-wild-west-of-optical-ciscos-ai-hack-and-is-compute-an-investable-asse
- Listen: https://share.transistor.fm/s/d1877677

## Summary

Hosts Ben Bajarin and Jay Goldberg analyze the optical networking sector, contrasting Lumentum's success with Coherent's struggles in transitioning to 6-inch indium phosphate wafers, while debating the adoption timelines for Near-Packaged Optics (NPO) versus Co-Packaged Optics (CPO). They discuss Cisco's resurgence driven by its Silicon One chips and a strategic partnership with Anthropic to use the Mythos model for security audits, and examine Applied Materials' strong earnings backed by Long-Term Agreements (LTAs), attributing guidance hesitation to Intel's pending capital plans. Finally, the hosts critique NVIDIA's $500 billion data center financing initiative and Jensen Huang's claim that compute is a non-obsolescent asset class, arguing that rapid hardware obsolescence makes such an investment model risky.

## Chapters

- [0:05](https://hardwarepodcasts.com/podcast/the-circuit/2026-08-17-ep-188-the-wild-west-of-optical-ciscos-ai-hack-and-is-compute-an-investable-asse#t=5) Optical Networking: Lumentum, Coherent, and Wafer Economics
- [5:49](https://hardwarepodcasts.com/podcast/the-circuit/2026-08-17-ep-188-the-wild-west-of-optical-ciscos-ai-hack-and-is-compute-an-investable-asse#t=349) Optical Interconnect Architectures: LPO, NPO, and CPO
- [14:57](https://hardwarepodcasts.com/podcast/the-circuit/2026-08-17-ep-188-the-wild-west-of-optical-ciscos-ai-hack-and-is-compute-an-investable-asse#t=897) Cisco's AI Strategy: Silicon One and Anthropic Mythos
- [22:43](https://hardwarepodcasts.com/podcast/the-circuit/2026-08-17-ep-188-the-wild-west-of-optical-ciscos-ai-hack-and-is-compute-an-investable-asse#t=1363) Applied Materials Earnings and the LTA Waterfall
- [36:16](https://hardwarepodcasts.com/podcast/the-circuit/2026-08-17-ep-188-the-wild-west-of-optical-ciscos-ai-hack-and-is-compute-an-investable-asse#t=2176) NVIDIA's $500B Financing and Compute as an Asset

## Topics

- [Chips, FPGAs & semiconductors](https://hardwarepodcasts.com/topic/chips-and-fpgas)
- [Sourcing & supply chain](https://hardwarepodcasts.com/topic/sourcing-and-supply-chain)
- [Pricing, margins & unit economics](https://hardwarepodcasts.com/topic/pricing-and-unit-economics)
- [Manufacturing partners & offshoring](https://hardwarepodcasts.com/topic/manufacturing-partners)
- [Growth, exits & acquisitions](https://hardwarepodcasts.com/topic/growth-exits-and-acquisitions)

## Most relevant to

large enterprises

## Mentioned

- Lumentum (company)
- Coherent (company)
- Cisco (company)
- Silicon One (chip)
- Anthropic (company)
- Mythos (product)
- Applied Materials (company)
- Intel (company)
- NVIDIA (company)
- Jensen Huang (other)
- CoreWeave (company)
- Nebius (company)

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- [Can the Nvidia Monopoly on AI Chips Be Broken?](https://hardwarepodcasts.com/podcast/ee-times-current/2026-03-16-can-the-nvidia-monopoly-on-ai-chips-be-broken) (EE Times Current)
- [ON Semi’s Acquisition | TSMC’s Finer Nodes | Tesla’s AI Chip | China’s Fabless Companies](https://hardwarepodcasts.com/podcast/ee-times-current/2019-04-26-on-semis-acquisition-tsmcs-finer-nodes-teslas-ai-chip-chinas-fabless-companies) (EE Times Current)
- [Inside the emerging frontier of models, machines and manufacturing hell.](https://hardwarepodcasts.com/podcast/built-2-scale/2025-12-11-inside-the-emerging-frontier-of-models-machines-and-manufacturing-hell) (Built 2 Scale)
- [From Apple to OpenLight: Silicon Photonics and Integrated Lasers with Dr. Tom Mader](https://hardwarepodcasts.com/podcast/moores-lobby/2023-04-18-from-apple-to-openlight-silicon-photonics-and-integrated-lasers-with-dr-tom-made) (Moore's Lobby)

## Citing this page

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