This Top Artificial Intelligence (AI) Stock Is Benefiting From the Next Infrastructure Bottleneck, and It Just Became an Attractive Buy

This Top Artificial Intelligence (AI) Stock Is Benefiting From the Next Infrastructure Bottleneck, and It Just Became an Attractive Buy

Artificial intelligence (AI) infrastructure investments have been booming this year, with the top four hyperscalers in the U.S. expected to splurge a staggering $725 billion in capital spending in 2026.

That's a 77% increase over last year's $410 billion capital expenditure incurred by Google, Amazon, Meta Platforms, and Microsoft. These hyperscalers are sitting on massive backlogs, fueled by the phenomenal demand for their AI services. However, the scope of AI spending isn't limited to these hyperscalers, as pure-play AI companies, such as OpenAI and Anthropic, and neocloud providers, such as CoreWeave and Nebius, are also rapidly scaling up their infrastructure.

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Not surprisingly, there is a shortage of several components that power AI data center infrastructure, such as graphics processing units (GPUs), server processors, and memory chips. There is another mission-critical component that's now in overwhelming demand due to the AI infrastructure build-out, and it is expected to create the next bottleneck -- optical networking.

Ciena (NYSE: CIEN) is one of the top players in the optical networking space, and it has been reaping the benefits of the solid demand for these components. The company recently released its results, and the stock price action following its quarterly report suggests investors have a great opportunity to buy this fast-growing AI stock.

Ciena's growth is picking up as AI fuels solid demand for optical components

Optical networking components help transport enormous amounts of data in AI data centers and GPU clusters. As the name suggests, optical networking uses light rather than traditional copper cables to move data, which is why it offers high bandwidth, energy efficiency, and low latency. So, using optical transport networks means that GPUs and other AI accelerator chips won't be sitting idle for data to arrive, allowing them to quickly execute tasks.

This explains why Ciena reported a 40% year-over-year increase in revenue for the second quarter of fiscal 2026 (which ended on May 2) to $1.57 billion. That was faster than the 33% revenue jump Ciena saw in fiscal Q1. What's more, the supply shortage in optical networking means the prices of these components are rising.

That's why Ciena's operating margin more than doubled year over year in the previous quarter to 19.5%. The company's non-GAAP earnings per share jumped by a stunning 290% from the year-ago period to $1.64 per share. Its revenue and earnings were well ahead of consensus estimates. Even better, the company has raised its full-year revenue guidance to $6.3 billion from the earlier estimate of $6.1 billion.