The CFO said a few more words in the live broadcast, causing a Nvidia concept stock to lose half of its market value.

null

Author: Curry, Deep Tide TechFlow

Because of a single statement, the valuation of AI concept stocks can disappear by half in a day. Yesterday during the US stock market session, a small company called POET Technologies set a bad example.

It is a photonic communication chip company listed both in the US and Canada, specializing in optical engines used for data center GPU optical signal communication. Earlier this year, its market cap was less than $500 million, and for most of the past decade, it has been unprofitable.

According to POET’s own financial report released on March 31, 2025, the company’s revenue for Q4 was $341k, with a net loss of $42.7 million. By AI concept stock standards, this scale is roughly equivalent to an academic research project.

But yesterday, POET’s stock price plummeted 47% in a single day, the largest single-day drop since the company went public.

Even stranger, in the five trading days prior, POET’s stock price rose from just over $7 to $15.50, a weekly increase of 108%, hitting an 11-year high.

Doubling in seven days, halving in two days—those unfamiliar might think it’s a meme coin.

Such volatility usually indicates one of two things: either the market’s perception of a certain fact has completely changed, or the market is betting on a story that won’t happen. POET’s case this time belongs to the second.

The story that sent the stock soaring is a publicly disclosed customer relationship.

Its customer is Marvell, a US company that makes AI data center chips. On March 31 this year, Nvidia invested $2 billion in Marvell, integrating it into its NVLink Fusion ecosystem.

Overnight, Marvell transformed from a company that makes supporting chips for data centers into one of Nvidia’s most important supporting partners within its AI ecosystem.

POET is further downstream in this supply chain, supplying a subsidiary of Marvell that deals with optical interconnects. The market views it as the furthest supplier within Nvidia’s AI ecosystem.

It’s a bit distant from the table, but still within reach.

What caused the stock to fall was also related to this relationship. On April 23, Marvell sent POET a letter canceling all orders. The reason was a single sentence: “You are suspected of violating confidentiality obligations.”

How POET personally handed over this relationship is linked to a financial live broadcast from a week earlier.

The CFO, who is quite removed from the table, said something wrong.

How far is POET from Nvidia’s table? There are two companies in between.

Nvidia invested in Marvell, bringing it into its AI ecosystem. Marvell acquired a startup called Celestial AI, which specializes in optical interconnects. POET has been supplying Celestial AI for several years as a small supplier.

This is a chain similar to a distant relative. At the end of the chain, POET’s market cap was less than $500 million earlier this year. It has no direct relationship with Nvidia.

But the market prefers to see the chain as straight, believing POET’s connection to Nvidia’s AI ecosystem is through Marvell. That’s enough.

On April 21, POET’s CFO Thomas Mika appeared on Stocktwits’ financial interview. Stocktwits is a US financial community platform, roughly comparable to a mix of Snowball, Stock Bar, and financial live streams, mainly used by retail investors.

It has its own video interview program, inviting listed company executives to discuss recent developments, targeting retail investors discussing specific stocks.

When the host mentioned the cooperation with Marvell, Mika revealed some details, such as confirming that Marvell had placed an order exceeding $5 million, to be shipped next quarter.

Within five trading days after the video went live, POET’s stock surged from around $7 to a peak of $15.50 intraday, a weekly increase of 108%, reaching an 11-year high. The discussion threads with high praise titles all included the words “Nvidia.”

But the cost of speaking out came two working days later.

On April 23, Marvell sent POET a written notice canceling all orders. The reason was brief: POET disclosed order and shipment information, violating confidentiality obligations. Every word the CFO said during the live broadcast was directly incorporated into the confidentiality breach.

POET remained silent initially, only announcing the matter to shareholders on April 27. That day, POET’s stock price dropped 47% in a single day, the largest single-day decline since its IPO, nearly erasing the 108% gain from the previous week.

As a result, retail investors in the community felt a sense of being greatly deceived.

The next day, several US law firms began posting online, calling on retail investors who lost money on this stock to join class-action lawsuits, accusing POET’s executives of misconduct.

Thus, a “distant relative” Nvidia concept stock finished a five-day dream.

The valuation of AI concept stocks is a rope spun from imagination.

POET’s total revenue last quarter was $34,100. In the same quarter, it posted a net loss of $42.7 million.

For a company of this scale, based on fundamentals, its market value shouldn’t exceed its cash on hand. POET has $430 million in cash, mainly raised through continuous share issuance over the past two years. In other words, if you exclude the cash raised from financing, the intrinsic value of POET’s business is negative.

But the market doesn’t think this way.

At the beginning of April, POET’s market cap was less than $500 million, but on April 25 during trading, it surged to over $800 million. The extra $300 million was driven by market belief that its received orders are backed by Nvidia.

A few million-dollar indirect supply contracts, multiplied by the words “Nvidia AI ecosystem,” double the valuation.

What supports this valuation is obviously a rope of imagination. POET supplies a startup acquired by Marvell, which in turn was invested in by Nvidia. Each link seems plausible on its own, but there are two gaps in between, and neither is under POET’s control.

If any link breaks, the market’s FOMO on small-cap AI concept stocks will immediately fade.

Domestic readers should be very familiar with this valuation approach.

In China’s A-shares, there is a long-standing sector called “Fruit Chain Concept Stocks,” supporting Apple’s supply chain. At its peak, the combined market cap exceeded one trillion yuan. The valuation logic is exactly the same as POET’s: being on the Apple supplier list justifies high valuation; falling off it causes a sharp drop.

For example, Goertek’s stock fell 30% in two days in 2022 after being cut from Apple’s supply chain. O-film, removed from Apple’s supply chain in 2021, saw its stock price drop 80% over three years.

Nvidia is the Apple of the AI era.

Around Nvidia, the global capital markets have already grown a whole circle of “Nvidia concept stocks”: supporting Nvidia itself, supporting Nvidia’s clients, supporting the clients of Nvidia’s clients…

The main character of this article, POET, is positioned at the farthest layer from Nvidia within this circle. The farther away, the thinner the rope.

Nvidia’s corner is crowded with companies like POET. Their valuations all rely on their respective ropes. This week, POET’s rope snapped; next week, whose will snap? No one can know in advance.