Recently, Light Counting (LC) released its latest optical device forecast for the next five years. LC believes that after 9% and 17% growth in 2021 and 2020, the global transceiver market revenue will continue to grow strongly (17%) in 2022. Demand for optical products is strong across all segments, and continued bottlenecks in the global supply chain may have created some additional demand (over-ordering) and of course moderated price declines leading to higher-than-expected sales growth in 2021 and the increase of forecast for 2022-2027, which is as shown in the chart below.

According to the latest forecast, the CAGR (compound annual growth rate) for 2022-2027 is 12% which is not too much different from the CAGR announced in October 2021 which is 13%. Strong sales of DWDM and Ethernet optics account for most of the growth in 2021, and these segments are expected to continue to lead growth in 2022-2027.

Sales of optical interconnect (mainly active optical cables) will also grow at a double-digit (10%) CAGR over the next five years. The wireless fronthaul segment was a weak area, with falling prices coupled with cyclical declines in unit shipments resulting in negative sales growth.