Ciena is experiencing growth due to the high demand for high-speed data transmission in data centers. The company’s latest results show it is on track for healthy revenue and earnings growth. Despite already rising impressively in 2025, the stock’s valuation suggests it has room for further upside.

Nvidia and Broadcom are leading names in the AI hardware space, with their chips deployed in large numbers by cloud computing companies and AI companies. Nvidia reported a 62% revenue increase for the third quarter of fiscal 2026, while Broadcom saw a 28% revenue increase with a 74% jump in AI revenue. Both companies have seen stock gains in 2025.

Ciena’s optical networking components and software ensure that AI processors from companies like Nvidia and Broadcom can perform optimally. The company’s products enable high-speed data transmission over fiber networks, used in data centers, telecom networks, and cloud computing. Ciena reported a 20% revenue increase and a 68% earnings jump from the year-ago quarter in its fiscal 2025 fourth-quarter results.

Ciena’s revenue growth is expected to accelerate in the current quarter, with a 30% year-over-year increase forecasted. The company is seeing stronger demand for its networking products from Meta Platforms, leading to potential revenue growth. Analysts are bullish on Ciena’s prospects, forecasting stronger earnings growth and price appreciation.

Ciena’s revenue backlog and negotiations with hyperscalers indicate potential to exceed revenue estimates for fiscal 2026. The company is trading at a lower price-to-sales ratio compared to other AI stocks, suggesting room for market cap expansion. Analysts believe Ciena could outperform competitors like Nvidia and Broadcom in the coming year.

Investors may find Ciena stock attractive for its growth potential, with the company poised to sustain its rally in 2026. The company’s fiscal first-quarter revenue is set to rise by 30% year-over-year, with potential to exceed full-year expectations. With a strong revenue backlog and growth trajectory, Ciena could see significant market cap gains.

Ciena’s consistent 30% growth rate could lead to a market cap increase and price appreciation, outperforming competitors. The company’s accelerating growth and potential premium valuation could drive significant market cap gains. Investors could consider buying Ciena stock given its growth prospects and market position in the AI infrastructure space.

Read more at Yahoo Finance: This Glorious Artificial Intelligence (AI) Stock Has Crushed Nvidia and Broadcom With 147% Returns in 2025. It Can Jump by 111% in 2026