UBS: The fiber optic price hike has spread worldwide

Global fiber-optic cable prices are undergoing a new round of sharp increases, and the uptrend has already spread from the China market to Europe and the United States. A surge in data-center demand and a simultaneous tightening of upstream preform supply jointly drive this price cycle, significantly improving the earnings outlook for industry leader Yangtze Optical Fibre and Cable (YOFC).

According to Chasing the Wind Trading Desk, an updated UBS research report cites the latest CRU data from an industry research firm. In March 2026, the spot price of China’s G652.D bare optical fiber reached 83.40 yuan RMB per fiber-kilometer (about $12.07), up 165% month over month from January 2026, and up as much as 418% year over year. The cumulative increase of this price since May 2025 has already exceeded 400%, and it is also the first time it has broken above the prior cycle high of 78.80 yuan RMB per fiber-kilometer. Meanwhile, in the European market, prices for similar products were also up 136% month over month versus January, and the global trend of tightening supply is becoming increasingly evident.

UBS analysts Jasmine Huang and Sara Wang believe that YOFC’s profitability has entered an upward correction cycle, and they have significantly raised the company’s 2026 to 2028 earnings forecasts. They expect 2026 earnings per share to reach 4.98 yuan RMB, far above the market consensus of 1.85 yuan RMB.

China’s fiber-optic prices hit an all-time high, and the rally outpaces the prior cycle

Based on CRU’s bi-monthly report data, in March 2026 China’s spot price for G652.D bare optical fiber recorded 83.40 yuan RMB per fiber-kilometer. Year over year, it rose 418%; month over month (versus January 2026), it rose 165%. Compared with the year-over-year increase of 92% and the month-over-month increase of 79% announced in January 2026, the pace has further accelerated.

This price level indicates that China’s G652.D bare optical fiber has seen a cumulative increase of more than 400% since May 2025, and it has, for the first time, surpassed the previous cycle high of 78.80 yuan RMB per fiber-kilometer, setting a record high.

Of note is that since January 2026, the price of China’s G652.D bare optical fiber has moved above that of similar products in Europe. According to the UBS report, the last time this situation occurred was in November 2018, when the large-scale rollout of FTTH in China and 4G network construction together drove a surge in demand for optical cables.

The price rally spreads to Europe and the U.S., and G657.A1 fiber strengthens in parallel

Fiber-optic price increases are no longer limited to the China market. CRU data shows that in March 2026, the spot price of Europe’s G652.D bare optical fiber reached 7.94 euros per fiber-kilometer (about $9.1), up 136% month over month versus January 2026, and up 159% year over year. The positive effect of supply tightening is spreading globally.

CRU data also shows that the price of G657.A1 bare optical fiber—used in indoor and bend-insensitive scenarios—has climbed sharply as well.

CRU data shows that the month-over-month price increases for Europe and the United States of G657.A1 bare optical fiber versus January 2026 were 130% and 69%, respectively. These moves are mainly supported by strong demand for data communications and the dual effect of supply tightening.

Demand structure diverges: data centers take up the baton from telecom operators

On the demand side, China and overseas markets show different structural characteristics.

CRU data shows that in Q1 2026, China’s consumption volume of optical cables was flat year over year. Telecom operator demand remains weak, but growth in data-center demand offsets this drag. Fiber-optic manufacturers are reallocating capacity to emerging application areas such as data centers and fiber-optic drones. Upstream preform supply continues to tighten, while the industry’s overall pace of capacity expansion remains relatively restrained.

For overseas markets, YOFC’s key overseas markets (Europe, Southeast Asia, and Latin America) saw demand rise 2% year over year in Q1 2026, continuing the 2% growth momentum seen across full-year 2025. This is consistent with UBS’s earlier view that overseas demand would recover. The U.S. market stands out particularly: in Q1 2026, demand rose 24% year over year and 29% month over month, with faster demand growth driven jointly by telecom network construction and the expansion of hyperscale data centers.

Earnings forecasts sharply raised, valuation still attractive

UBS believes that the sharp rise in fiber-optic spot prices aligns with its channel survey results. YOFC profitability has entered an upward correction cycle, and improved visibility into rising fiber-optic prices and upgrades in product mix will provide ongoing support.

On earnings forecasts, UBS expects YOFC’s revenue from 2026 to 2030 to grow from 21.062 billion yuan RMB to 33.742 billion yuan RMB, and net profit to rise from 4.122 billion yuan RMB to 8.526 billion yuan RMB. The EBIT profit margin is expected to jump from 11.4% in 2025 to 24.3% in 2026, and expand further to 32.9% in 2027.

At present, YOFC’s share price implies a forward P/E ratio of about 19 times based on 2027 expectations. UBS noted that the core issue investors are currently focused on is whether the price rebound is sustainable, and to what extent the increase in spot prices can be transmitted into the company’s profits.

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