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Since March, the A-share market has sparked a capital frenzy around the Micro LED concept, ignited by market rumors that &#34;Micro LED is expected to replace copper cable connections in computing centers.&#34;
The rally began on March 4 and reached a peak on March 5, with the concept index soaring 8% in a single day and trading volume approaching 60 billion, as hundreds of billions of funds rushed to buy, and 20 companies collectively hit the daily limit. Leading stocks like Huacan Optoelectronics and Sanan Optoelectronics saw their prices surge significantly in a short period. Against the backdrop of exponential growth in demand for computing power from generative AI, any technology that could potentially break through transmission bottlenecks is scrutinized under a magnifying glass by the market, with high hopes of changing the game.
However, as the capital drums beat loudly, we need to penetrate the fog and examine several fundamental questions: How far is this frenzy, which began with &#34;replacement expectations,&#34; from actual industrial implementation? Are the concentrated statements from companies solid steps in industrial advancement or merely floating conceptual narratives? What thresholds must be crossed between the vast sea of technology and the long journey of industrialization?
<h2>Short-term Excitement Ignited by &#34;Replacement Expectations&#34;</h2>
In March 2026, the A-share market staged a classic &#34;rumor-driven&#34; market script. The plot revolves around the expectation that &#34;Micro LED CPO (Co-Packaged Optics) technology is likely to disrupt copper cable interconnections in data centers,&#34; with a tight rhythm and intense emotions, making it a phenomenal case of thematic investment in 2026.
The starting point of this capital feast is fixed on March 4, and by the next day (March 5), market sentiment was pushed to a boiling point. On that day, the Micro LED concept index boasted an astonishing 8% increase, dominating the scene, with the sector's trading volume hitting nearly 60 billion, a historical high. At the moment the market opened, a surge of buying funds created a &#34;buying storm,&#34; with hundreds of billions piling up at the limit price, creating a scarcity illusion of &#34;hard to get a ticket.&#34;
By the close of the morning session, the stock prices of over 20 listed companies in the industrial chain, including Huacan Optoelectronics, Sanan Optoelectronics, Leyard, and Zhouming Technology, were firmly locked on the daily limit. Among them, the limit order for Huacan Optoelectronics once reached as high as 1.35 million hands, vividly showcasing the market's fervent pursuit of the &#34;computing power replacement&#34; narrative.
The celebration was not a fleeting firework display. In the following trading days, the market entered a phase of differentiation and consolidation, with the leading effect becoming increasingly prominent, as funds voted with their feet, selecting the true &#34;story protagonists.&#34;
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As of the closing price on March 12, leading stock Huacan Optoelectronics saw its share price soar from 8.08 yuan to 13.41 yuan in just 8 trading days, with a cumulative increase of 66%. Another giant, Sanan Optoelectronics, once again hit the daily limit on March 12, with the company's total market value surging by over 20 billion yuan compared to early March, reaching a high of 93.494 billion yuan.
Market sentiment requires continuous &#34;fuel.&#34; The interactive platforms, announcements, and industry conferences of listed companies play a fitting role as &#34;catalysts.&#34;
Leyard claims that its Hi-Micro substrate-free Micro LED technology shares the same underlying technology as CPO and has reserves of LiFi optical communication and semi-polar gallium nitride materials; Zhouzhi Co., Ltd. revealed that the Micro LED light source chip has completed its research and development work and is currently in the sample validation testing phase.
The essence of this frenzy is a collective prepayment and emotional overspending by funds on the grand narrative of &#34;computing power substitution.&#34; Against the backdrop of exponential growth in computing power demand from generative AI, any potential technology that could break through existing transmission bottlenecks is enough to ignite a prairie fire in an anxious market.
<h2>The Origin of Frenzy: &#34;Light in, Copper out&#34;</h2>
The reason the Micro LED concept can trigger such a large-scale, industry-wide capital resonance is not without basis, but rather based on a clear and urgent market expectation: in the generational revolution of AI computing power infrastructure, it is seen as one of the ultimate technological solutions to replace traditional copper cables and even some traditional pluggable optical modules.
The solidity of this expectation is deeply rooted in the two current realities of computing power development: the &#34;ceiling&#34; and the unique technical endowment of Micro LED itself.
First, the physical and energy consumption &#34;walls&#34; of traditional copper cables have reached their peak. As AI clusters evolve towards 800G, 1.6T, and even higher speeds, the long-dominant copper cables for short-distance interconnections within data center cabinets and between servers have exposed their shortcomings. The most pressing issue is the &#34;unbearable weight&#34; of energy consumption.
Research shows that the unit transmission energy consumption of traditional copper cables can exceed 10 picojoules/bit, making them one of the main &#34;energy hogs&#34; in data centers. Under the dual pressure of &#34;dual carbon&#34; goals and increasing computing power density, their high power consumption has become a heavy burden.
In contrast, the rumored Micro LED CPO solution reportedly can reduce unit transmission energy consumption to about 5% of that of copper cables, with theoretical power consumption advantages close to 20 times, directly addressing the core pain points of &#34;cost reduction and efficiency enhancement&#34; and &#34;green intensification&#34; in data centers.
Secondly, there is the &#34;disaster&#34; of transmission density and wiring. High-density GPU clusters require extreme space utilization, while the large volume and complex wiring of copper cables have become obstacles to improving physical space and heat dissipation efficiency. Micro LED chip sizes can be reduced to below 50 microns, making it easy to achieve ultra-high-density array integration, providing an ideal path for the compact layout of future computing power clusters
It is precisely under the &#34;inability of traditional copper cables&#34; that the rumor of &#34;Micro LED is expected to replace copper cables&#34; has quickly gained support from industrial logic and has escalated into a capital narrative about technological generational change.
Reports from institutions such as CITIC Securities indicate that Micro LED CPO, as the next-generation potential solution for silicon photonics CPO, uses self-emissive Micro LED chips with direct current modulation, theoretically achieving higher interconnection rates, higher on-chip integration, greater stability, and lower power consumption, deeply aligning with the medium and short-distance interconnection needs of future AI supercomputing clusters.
Thus, &#34;light replaces copper&#34; has evolved from a technological trend into a certainty expectation storm sweeping through capital.
<h2>Leading Positioning and the Long &#34;Last Mile&#34;</h2>
Driven by grand narratives, industry chain enterprises are accelerating their &#34;positioning.&#34; From the current situation, progress at the upstream chip level is seen as the key to victory, and domestic leaders have begun substantial layouts.
San'an Optoelectronics revealed that it has achieved breakthroughs in Micro LED optoelectronic devices and high-speed optical communication in collaboration with top universities and operators, extending technology to data center optical interconnection scenarios. HC Semitek has also clarified that its optical interconnection business has entered the customer sample testing and optimization stage. This indicates that leading chip companies have made key strides in technological breakthroughs and preliminary commercialization validation.
However, some concept stocks have also clarified their business relevance. Jufei Optoelectronics announced that its Micro LED products are currently mainly applied in display terminals and have not yet been applied in the CPO field, nor have they generated related revenue from CPO.
Amidst a statement of &#34;active layout,&#34; it is essential to recognize a core reality: for the vast majority of listed companies, Micro LED CPO is still in a strategic cultivation period characterized by &#34;mainly R&amp;D investment, with small-scale trial production as a supplement.&#34; It has not yet formed stable, large-scale revenue and profit contributions.
This prevalent situation of &#34;statements preceding performance&#34; precisely reveals the significant &#34;temperature difference&#34; between the current enthusiasm in the capital market and the actual maturity of the industry.
Undoubtedly, Micro LED has clear theoretical advantages in low power consumption, high density, and high reliability, and its long-term technological prospects are highly attractive. However, from laboratory samples to the yield ramp-up of pilot lines, and then to scalable, economical commercial products, Micro LED CPO still needs to overcome several seemingly low but extremely critical &#34;challenges&#34; related to cost, ecology, and yield efficiency.
Some optimistic institutions expect that Micro LED CPO may accelerate technological validation and pilot projects in 2026-2027, forming initial scale around 2028, with a penetration rate in the short-distance interconnection field of data centers expected to reach 20%-30% in the next two to three years.
But this is merely a prediction based on linear extrapolation of technological progress; the non-linear characteristics of industrialization mean that any timetable is full of variables
When the noisy drums and gongs pause, what we need to discern is not only the fluctuations of stock prices but also who is swimming naked in the bubble of concepts, and who, in silence, is truly building that high wall of industry leading to the future.
For Micro LED CPO, the carnival is just the prelude, and the real test begins now, and now, the test has just started. (Author | Zhou Jian, Editor | Cao Shengyuan)

Since March, the A-share market has sparked a capital frenzy around the Micro LED concept, as market rumors suggest it may replace copper cable connections. It began to rise on March 4, peaked on the 5th, with the concept index soaring 8% in a single day and a trading volume of nearly 60 billion. The stock prices of 20 companies surged significantly. Despite the market's enthusiasm, attention must still be paid to the actual challenges of industrialization and technological implementation

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"Light in, copper out" narrative ignites Micro LED: Amidst the frenzy of concepts, industrialization still needs to traverse the cycle | Industry Trend Indicator