Soitec is finalizing multi-year capacity reservation agreements with more than 10 photonics customers seeking wafers for optical interconnects in AI data centers. Roughly 80% of the agreements are expected to be signed within one to two weeks, with the remainder due within a month. The contracts include fixed pricing and cash deposits tied to customer volume commitments: deposits are returned when customers take the agreed volume but forfeited if they fall short. Volumes above the reservation level reopen pricing discussions, while customers must share inventory data to discourage capacity hoarding. Soitec's Photonics-SOI revenue barely exceeded $100 million in fiscal 2026 and is projected to surpass $200 million in fiscal 2027. UBS estimates the company holds about 95% of the Photonics-SOI substrate market. The wafers underpin optical transceivers that convert electrical signals to light and back again, a technology gaining importance as Google, Amazon and Microsoft, among other hyperscalers, expand AI infrastructure and copper connections face bandwidth and power constraints. Existing facilities are expected to cover current and near-term demand, with no new fabrication plant needed until approximately 2029. Additional capacity could be added at a Singapore site within six to 12 months if required, while Soitec does not currently see a need for a U.S. plant.