Semtech (SMTC): 224G Optical Chips Strengthen Its Role in AI Data Center Interconnects

Semtech Corporation (NASDAQ:SMTC) is one of the best AI networking stocks to buy according to analysts . The company gave investors a fresh AI infrastructure angle in mid-March when it launched a family of 224 Gbps per lane Transimpedance Amplifiers and Mach-Zehnder Modulator drivers for LRO, LPO, XPO, Near-Packaged Optics, and Co-Packaged Optics interconnect applications.

The products are designed to enable 800G, 1.6T, and 3.2T transceivers and optical engines for AI/ML clusters, hyperscale data centers, and next-generation cloud infrastructure. That makes Semtech a direct participant in one of the most important bottlenecks in AI infrastructure: moving data faster and more efficiently between accelerators, switches, and optical links. The company also said its linear interconnect architecture can remove the power-intensive digital signal processor from optical modules while maintaining link integrity, addressing power, cooling, and cost pressures in AI data centers.

Close-up of Silicon Die are being Extracted from Semiconductor Wafer and Attached to Substrate by Pick and Place Machine. Computer Chip Manufacturing at Fab. Semiconductor Packaging Process.

The launch followed a stronger fiscal year. On March 16, Semtech reported fiscal 2026 record net sales of $1.05 billion, up 15% year over year, while non-GAAP adjusted diluted earnings per share rose to $1.71.

Semtech Corporation (NASDAQ:SMTC) provides high-performance semiconductors for AI data center networking, IoT connectivity, and intelligent connected devices worldwide.

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