Can you tell me about connectivity in data center. Who are the companies, what capex is going to them and compare them and tell me who is positioned to win
Data center connectivity: who makes it, where the money goes, who leads
01Summary
On our read, NVIDIA holds the scale-up layer through NVLink and InfiniBand, and Broadcom is best placed in the Ethernet scale-out layer, where most of the share shift is expected, plus co-packaged optics.
Marvell has the broadest optical exposure and Credo the strongest copper-cable momentum. Arista turns this into very profitable switch systems, while Coherent and Fabrinet carry the weakest cash economics in the group. Our modelled capex figures are reliable only for NVIDIA and Broadcom, and for both they cover the whole company, not networking alone.
- Connectivity splits into four layers: scale-up links inside the rack (NVLink, PCIe/switch fabrics), scale-out switching between racks (InfiniBand and Ethernet), optics (DSPs, lasers, transceivers, co-packaged optics), and short-reach copper (active electrical cables and retimers).
- Modelled 2026 AI capex inflow: NVIDIA at a $270.8B mid-point (range $197B to $315.1B) and Broadcom at $50.6B (range $36.3B to $62.5B). Both are whole-company estimates, not reported revenue and not networking-only. We do not have a reliable connectivity-only figure for the other names.
- Ethernet is expected to take scale-out share from InfiniBand after the UEC 1.0 specification1, and Broadcom's Tomahawk 6 is the highest-bandwidth switch chip at 102.4 Tbps2.
- Financials split the group in two. NVIDIA, Broadcom, Arista, Credo and Astera Labs convert 30% to 48% of revenue to free cash. Coherent is at negative 14.5% and Fabrinet at 0.1%.
- Co-packaged optics is still early. Broadcom is on its third generation3, while Coherent is at pilot stage and Arista at research stage.
02Thesis
Our read is that connectivity is a two-horse race at the silicon level, with specialists winning particular layers. NVIDIA owns scale-up inside the rack through NVLink/NVSwitch, which drives our modelled inflow. It also dominates InfiniBand through Mellanox, an ecosystem TrendForce calls relatively closed4. Broadcom leads Ethernet switch chips: Tomahawk doubles total bandwidth every two years5, and the two are competing for scale-out dominance6.
The direction of the share shift favours Broadcom. TrendForce expects Ethernet to gradually take scale-out share from InfiniBand after UEC 1.0, with InfiniBand staying strong in high-performance computing1. InfiniBand hardware costs about three times as much as Ethernet switches4. NVIDIA has hedged by building its own Ethernet line, Spectrum, which it prices above rivals on the strength of hardware and software integration7.
Among the specialists, Marvell (MRVL) has the broadest optical footprint in our research. Arista (ANET) is the highest-margin systems vendor. Credo (CRDO) and Astera Labs (ALAB) are growing fastest in copper and scale-up links. Coherent (COHR) and Fabrinet (FN) are exposed to optics demand but convert little of it into cash.
NVIDIANVDA
- Owns scale-up through NVLink/NVSwitch in GB200 NVL72; modelled 2026 inflow mid-point $270.8B, up 42.8%.
- Dominates InfiniBand switches via Mellanox4; Quantum-X800 delivers 115.2 Tbps8.
- Revenue growth 83.4%, free cash flow margin 44.8%, ROIC 62.9%, at 24.8x forward earnings.
- Hyperscalers and Tier-2 operators are buying GB/VR rack-scale platforms more eagerly9.
BroadcomAVGO
- Technology leader in Ethernet switch chips5; Tomahawk 6 at 102.4 Tbps supports UEC 1.02.
- Co-packaged optics leader, on its third CPO generation since 20223.
- Revenue growth 48.7%, free cash flow margin 42.1%, gross margin 69.1%.
- Much of its modelled $50.6B inflow comes from custom accelerator programs (TPU, MTIA, OpenAI), not networking alone.
- At 30.8x forward earnings it is valued above NVIDIA; ROIC is 16.4%.
- The modelled inflow is a low-confidence estimate.
Marvell TechnologyMRVL
- Broadest optical DSP exposure: 800G demand strong, 1.6T ramping quickly.
- Scale-out switching on track to more than double this year on 51.2T products; Teralynx 10 competes with Broadcom, NVIDIA and Cisco11.
- Covers co-packaged and near-packaged optics, and supports the UALink, ESUN and NVLink scale-up protocols.
- TradeStory AI Sentiment Score of 79, the highest in the group.
- Free cash flow margin of only 17% and ROIC of 6%.
- Expensive at 65.2x forward earnings and 25.6x EV/sales.
Arista NetworksANET
- Free cash flow margin 47.2%; operating margin 43.1%, above its 5-year range.
- Consensus expects 49.2% revenue growth over the next twelve months, well above its 4-year history of 32.2% a year.
- Our moat and pricing research is thin; competitors include Cisco and NVIDIA.
- Co-packaged optics only at research stage; 800G/1.6T pluggables at pilot.
- Smallest upside to the median target among the chip and systems names, at 18.5%.
Credo TechnologyCRDO
- Active electrical cables and retimers at volume; revenue growth 165.1%, Rule of 40 at 195.6.
- Operating margin 31.7%, at the top of its 5-year range; consensus expects 88.6% growth over the next twelve months.
- Stock-based pay equals 14.8% of revenue.
- Its operating margin history is volatile, and copper's reach and bandwidth limits push scale-up toward optics over time.
Astera LabsALAB
- Scorpio X-Series scale-up switches are shipping to first customers; revenue growth 98.5%, free cash flow margin 33.1%.
- Gross margin of 73.3%.
- The most expensive name here, at 49.4x EV/sales and 86.9x forward earnings.
- Gross margin fell 2.6 points year on year.
CoherentCOHR
- At pilot stage on co-packaged optics lasers; upside to the median target of 38.9%.
- Free cash flow margin negative 14.5%, ROIC 5.4%.
- Its co-packaged optics evidence in our research dates from 2023; short interest is 5.6% of float.
FabrinetFN
- Revenue growth 35.7% at 26.8x forward earnings and 3.69x EV/sales, the cheapest sales multiple here.
- Free cash flow margin of 0.1%.
- Its latest results flagged supply constraints across lasers, memory and ASICs, and the stock fell.
03Overview & stack
Connectivity is best read as a stack, from links inside the rack out to links between buildings. Each layer has a different leader and a different maturity.
- Scale-up interconnectinside the rack
- NVDAALABMRVLNVLink/NVSwitch is at volume and owned by NVIDIA. Astera Labs is an early-volume entrant with Scorpio X. Marvell supports the UALink, ESUN and NVLink protocols, and its outlook for scale-up optics rose meaningfully.
- Scale-out switch siliconEthernet and InfiniBand
- AVGONVDAMRVLBroadcom's Tomahawk 6 runs at 102.4 Tbps2. NVIDIA has Quantum-X800 InfiniBand at 115.2 Tbps8 and Spectrum-X800 Ethernet at 51.2 Tbps12. Marvell's Teralynx 10 and Cisco's Silicon One G200 also compete11,13.
- Switch systems
- ANETArista sells switches built around its EOS software, competing with Cisco and NVIDIA.
- Optical DSPs and lasers
- MRVLCOHRMarvell supplies 800G and 1.6T DSPs, plus coherent DSPs for links between data centers, where bandwidth needs are projected at more than 10x today's front-end links. Coherent supplies lasers and is at pilot on co-packaged optics.
- Optical module manufacturing
- FNFabrinet builds the modules; supply of lasers is the current constraint.
- Copper: active electrical cables and retimers
- CRDOALABCopper is used first for short-reach scale-up and is at volume at Credo. Copper and optics should coexist for several years.
04Industry & competition
Demand is still rising. TrendForce raised its 2026 AI server shipment growth forecast from 28% to nearly 31%, citing stronger buying of NVIDIA GB/VR rack-scale platforms9, and expects AWS to use GB300 as its main GPU server platform in 202616. Every rack-scale system pulls through scale-up links, switches and optics.
The structural shift is in scale-out networking. Ethernet is expected to regain the mainstream from InfiniBand1, which helps Broadcom, Arista and Marvell. A second, slower shift is from copper to optics: copper's reach and bandwidth limits push scale-up toward optics, with Marvell pointing to deployments as early as next year, even as the two coexist for several years.
05Financials
Growth leaders on revenue: Credo at 165.1%, Astera Labs at 98.5%, NVIDIA at 83.4% and Broadcom at 48.7%. Behind them are Fabrinet at 35.7%, Arista at 32.6%, Marvell at 30.6% and Coherent at 22.5%.
Cash conversion is where the group splits. Free cash flow margins are 47.2% at Arista, 44.8% at NVIDIA, 42.1% at Broadcom, 33.1% at Astera Labs and 30.5% at Credo, against 17% at Marvell, 0.1% at Fabrinet and negative 14.5% at Coherent. Gross margins are 75.0% at NVIDIA, 73.3% at Astera Labs, 69.1% at Broadcom, 67.1% at Credo and 63% at Arista. ROIC is highest at NVIDIA (62.9%), then Arista (22.6%) and Credo (21%).
On capex flow, our model puts the 2026 mid-point at $270.8B for NVIDIA, equal to 89.4% of revenue, and $50.6B for Broadcom, equal to 56.8% of revenue. These are modelled estimates built from approved hyperscaler capex guidance, not reported revenue, and neither is a networking-only figure. We do not have a reliable connectivity-only inflow for Marvell, Arista, Coherent, Fabrinet, Astera Labs or Credo.
| Company | Revenue growth, TTM% | FCF margin% | Rule of 40 | NTM EPS growth% | ROIC, last fiscal year% |
|---|---|---|---|---|---|
| NVIDIA (NVDA) | 83.4 | 44.8 | 128.1 | 70.0 | 62.9 |
| Broadcom (AVGO) | 48.7 | 42.1 | 90.8 | 65.3 | 16.4 |
| Marvell Technology (MRVL) | 30.6 | 17.0 | 47.7 | 72.5 | 6.0 |
| Arista Networks (ANET) | 32.6 | 47.2 | 79.8 | 27.5 | 22.6 |
| Coherent (COHR) | 22.5 | -14.5 | 8.0 | 49.8 | 5.4 |
| Fabrinet (FN) | 35.7 | 0.1 | 35.8 | 19.4 | 15.7 |
| Astera Labs (ALAB) | 98.5 | 33.1 | 131.5 | 62.2 | 12.4 |
| Credo Technology (CRDO) | 165.1 | 30.5 | 195.6 | 53.2 | 21.0 |
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Stored values on or before the 2026-10-09 close. Rule of 40 = revenue growth plus FCF margin, as our quant job stores it.
06Valuation
NVIDIA is the cheapest of the quality names on forward earnings at 24.8x, against 30.8x for Broadcom, 33.6x for Credo, 51.4x for Arista, 65.2x for Marvell and 86.9x for Astera Labs. On EV/sales, Astera Labs stands out at 49.4x, followed by Marvell at 25.6x, Arista at 24.98x, Credo at 24.55x, Broadcom at 19.63x and NVIDIA at 18.48x. Fabrinet is at 3.69x and Coherent at 8.64x.
Upside to the median analyst target is 43.2% for NVIDIA, 40.2% for Broadcom, 38.9% for Coherent, 37.8% for Credo, 34.7% for Marvell, 22.5% for Astera Labs, 18.5% for Arista and 17% for Fabrinet. The TradeStory AI Sentiment Score is 79 for Marvell and 69 for NVIDIA, both above balanced. The other names are not scored.
| Company | Forward P/Ex | Forward PEG | Trailing PEG | EV/Sales | Cohort EV/S percentile | Upside to median target% |
|---|---|---|---|---|---|---|
| NVIDIA (NVDA) | 24.8 | not stored | 0.57 | 18.5x | 29 (chip design) | 43.2 |
| Broadcom (AVGO) | 30.8 | not stored | 0.26 | 19.6x | 43 (chip design) | 40.2 |
| Marvell Technology (MRVL) | 65.2 | not stored | -0.06* | 25.6x | 86 (chip design) | 34.7 |
| Arista Networks (ANET) | 51.4 | not stored | 2.05 | 25.0x | 77 (connectivity) | 18.5 |
| Coherent (COHR) | 32.0 | not stored | -0.10* | 8.6x | 20 (optical modules) | 38.9 |
| Fabrinet (FN) | 26.8 | not stored | 0.92 | 3.7x | 0 (optical modules) | 17.0 |
| Astera Labs (ALAB) | 86.9 | not stored | -0.41* | 49.4x | 92 (connectivity) | 22.5 |
| Credo Technology (CRDO) | 33.6 | not stored | 0.09 | 24.6x | 69 (connectivity) | 37.8 |
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Stored values on or before the 2026-10-09 close. Cohort percentile ranks EV/S within the company's own group (lower = cheaper).
* A negative trailing PEG means earnings fell over the period; it is not a cheap reading.
"not stored": there is no stored value for this metric on the facts date.
07Risks
Timing: a TrendForce report says NVIDIA's Rubin ramp has slipped to 2027 on an HBM supply problem10, which would push back the next wave of rack-scale connectivity.
Supply: Fabrinet's latest results flagged constraints across lasers, memory and ASICs. That caps how fast optics revenue can grow, whatever the demand.
Technology choice: co-packaged optics could displace pluggable transceivers, and optics could displace copper at short reach. Credo, Fabrinet and pluggable-focused suppliers are most exposed to that. Co-packaged optics is still at pilot or research stage for most players.
Insider selling: three-month insider sales were roughly $968 million at NVIDIA, $686 million at Arista and $534 million at Broadcom, with no meaningful buying.
Valuation: Astera Labs and Marvell trade at multiples that leave little room for a slower ramp.
| Company | Short interest, % of float% | Days to cover | Insider open-market buys, 3 months | Insider open-market sales, 3 months |
|---|---|---|---|---|
| NVIDIA (NVDA) | 1.29 | 2.8 | none | $967.6M |
| Broadcom (AVGO) | 1.14 | 2.3 | $374K | $533.7M |
| Marvell Technology (MRVL) | 2.68 | 1.4 | none | $10.2M |
| Arista Networks (ANET) | 0.95 | 2.3 | none | $686.4M |
| Coherent (COHR) | 5.61 | 1.7 | none | $8.2M |
| Fabrinet (FN) | 4.60 | 2.1 | none | $2.7M |
| Astera Labs (ALAB) | 5.29 | 2.2 | none | $127.3M |
| Credo Technology (CRDO) | 6.00 | 1.3 | none | $61.8M |
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Short interest at the last settlement on or before 2026-10-09; insider values are Form 4 open-market trades by month (planned 10b5-1 trades excluded).
08TradeStory edge
What the crowd may be missing is the split between the two leaders. The NVIDIA story is scale-up and rack-scale lock-in. The Broadcom story is the Ethernet share shift plus co-packaged optics, where it is generations ahead3,1. Our model also flags the Broadcom inflow as under-discovered, though with low confidence.
Among the specialists, social attention is moving toward the optical and photonics layer, including smaller names. The cash numbers point the other way: the best returns are at Arista, Credo and Astera Labs, not at the optical component makers.
| Company | TradeStory AI Sentiment Score0-100 |
|---|---|
| NVIDIA (NVDA) | 69 |
| Broadcom (AVGO) | not scored |
| Marvell Technology (MRVL) | 79 |
| Arista Networks (ANET) | not scored |
| Coherent (COHR) | not scored |
| Fabrinet (FN) | not scored |
| Astera Labs (ALAB) | not scored |
| Credo Technology (CRDO) | not scored |
TradeStory AI Sentiment Score: 50 is balanced, above 50 leans bullish, read on or before the 2026-10-09 close. "not scored" = too little conversation in the window to score.
09Evidence
- 1After the UEC 1.0 specification, TrendForce expects Ethernet (championed by Broadcom) to gradually take scale-out share from InfiniBand (NVIDIA/Mellanox) and..., trendforce.com, Oct 30, 2025.
- 2Broadcom launched Tomahawk 6 in 2025. It is the world's highest-bandwidth switch chip at 102.4 Tbps total (1.6 Tbps per port across 64 ports) and supports th..., trendforce.com, Oct 30, 2025.
- 3Broadcom leads in co-packaged optics (CPO). It released a CPO version of Tomahawk 4 (Humboldt) in 2022 and of Tomahawk 5 (Bailly) in 2024, and continues with..., trendforce.com, Oct 30, 2025.
- 4NVIDIA's Mellanox has long dominated InfiniBand switches, which makes the scale-out InfiniBand ecosystem relatively closed. InfiniBand hardware costs about t..., trendforce.com, Oct 30, 2025.
- 5Broadcom remains the technology leader in Ethernet switch chips. Its Tomahawk series doubles total bandwidth every two years., trendforce.com, Oct 30, 2025.
- 6Broadcom and NVIDIA are competing for dominance in scale-out data center networking., trendforce.com, Oct 30, 2025.
- 7NVIDIA's Spectrum switches are priced above other vendors' Ethernet switches. The source attributes this to deep hardware/software integration, such as pairi..., trendforce.com, Oct 30, 2025.
- 8NVIDIA's Quantum-X800 InfiniBand switch provides 800 Gbps per port across 144 ports, for 115.2 Tbps in total., trendforce.com, Oct 30, 2025.
- 9TrendForce reports that hyperscale CSPs and Tier-2 data center operators are now noticeably more eager to buy NVIDIA GB/VR rack-scale AI server platforms. Th..., trendforce.com, Aug 3, 2026.
- 10A TrendForce report title (2026-09-21) says NVIDIA's Rubin ramp has been delayed to 2027 because of an HBM supply problem., trendforce.com, Dec 1, 2025.
- 11Marvell (Teralynx 10, 2024) competes with Broadcom, NVIDIA and Cisco in scale-out switch chips., trendforce.com, Oct 30, 2025.
- 12NVIDIA has entered the Ethernet market with its Spectrum series. Spectrum-X800 provides 800 Gbps per port across 64 ports, for 51.2 Tbps in total., trendforce.com, Oct 30, 2025.
- 13Cisco (Silicon One G200, 2023) competes with Broadcom, NVIDIA and Marvell in scale-out switch chips., trendforce.com, Oct 30, 2025.
- 14The co-packaged optics (CPO) version of NVIDIA's Quantum-X800 is expected in 2H25., trendforce.com, Oct 30, 2025.
- 15The co-packaged optics (CPO) version of NVIDIA's Spectrum-X800 Ethernet switch is expected in 2H26., trendforce.com, Oct 30, 2025.
- 16TrendForce expects AWS to use NVIDIA GB300 as its primary GPU AI server platform in 2026., trendforce.com, Aug 3, 2026.
How we answered, and what we could not
Stored research, company dossiers and quant reads for the named companies.
Our research agents' own read of the layer and its companies.
Public pages, each quoted with its date and listed under Evidence.
Not covered yet
- A reliable modelled connectivity-only capex inflow for Marvell, Arista, Coherent, Fabrinet, Astera Labs and Credo.
- Market share data for Ethernet versus InfiniBand switching, or for Arista switch revenue.
- Coverage of Cisco, Lumentum and other optical module makers.
Data caveats
- Modelled capex inflows are bands built from approved capex guidance and layer shares, not forecasts of reported revenue. The NVIDIA and Broadcom figures cover the whole company, not networking alone.
- Our research on Arista's moat and pricing power, and on Credo's pricing power, is thin.
- Coherent's co-packaged optics evidence dates from 2023.
What we will research next
- Watch the timing of NVIDIA's co-packaged Spectrum-X800, expected in 2H2615, against Broadcom's Tomahawk 6 Davisson.
- Watch whether the Rubin delay to 202710 is confirmed and how it shifts 2026 orders for networking and optics.
- Watch Marvell's 1.6T DSP ramp and its first optical scale-up deployments.
- Watch laser supply commentary in the next Fabrinet and Coherent results.
For information only. Not financial advice: this page answers a reader's question and is not a recommendation to buy or sell any security.
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