On June 16, Dongshan Precision issued an announcement regarding its foreign investment plan. The company's subsidiary, Source Photonics Holdings (Cayman) Limited, along with its affiliates, will implement expansion projects for optical chips and optical modules in Changzhou and other locations. The total investment for the projects is US$1.2 billion, aimed at increasing Source Photonics' overall production capacity to meet the demands of the industry and downstream customers. The investment funds will be sourced from the company's self-raised capital.
According to the announcement, optical chips and optical modules are core foundational components of the AI computing industry. The existing production capacity of Source Photonics for these products can no longer satisfy the needs of the industry and its downstream clients. Through this capacity expansion, the company aims to effectively bridge the capacity gap, fulfill the mid‑ to long‑term large‑scale procurement needs of downstream customers, continuously optimize Source Photonics' product mix, and further enhance the company's overall profitability and industry standing.
In 2025, Dongshan Precision acquired Source Photonics for a total price of no more than RMB 6 billion, thereby entering the optical communications sector. The acquisition made the company one of the few players in the industry capable of mass‑producing high‑end EML optical chips, with a product rate covering the full 2.5G to 200G matrix, and a particular focus on the high‑end 100G/200G PAM4 EML series. In the optical module field, the company has achieved a full‑industry‑chain layout, with products covering rates from 10G to 1.6T, and is continuing R&D on next‑generation optical modules of 3.2T and beyond, establishing this as a new core growth driver.
Dongshan Precision stated that Source Photonics has been consolidated into the company's financial statements starting from October 2025, and its operations remain stable, orderly, and fully normal. For fiscal year 2025 and the first quarter of 2026, Source Photonics' consolidated revenue accounted for 3.58% and 16.02%, respectively, of the company's total consolidated operating income, while its profit contributions represented 22.69% and 52.92% of the company's consolidated profit, respectively.