Dongshan Precision Says Optical Module Sourcing Policy Rumor Is Unofficial, Eyes U.S. Capacity Expansion

On October 8, Dongshan Precision (002384.SZ) responded to market speculation about a claimed "65% U.S.-origin material" requirement for optical modules, saying the figure is an unofficial market rumor rather than a formally issued or effective policy, and that it has not yet affected the company's operations.

The company said some of the laser chips used in its optical module business are self-developed and self-produced, accounting for no more than 10% of the total BOM cost of an optical module. It added that the majority of other materials can be sourced in a way that better fits potential local-content requirements, leaving sufficient room for compliance. Dongshan Precision has already established capacity in Taiwan and said it does not rule out building capacity in the United States to meet future origin requirements.

The company said it has production capacity in multiple regions and is building a more diversified supply chain. If relevant policy adjustments are implemented, its Taiwan capacity may be eligible for exemption arrangements, and the company could also adapt by adjusting production layouts and optimizing its supply chain structure.

On the business side, Dongshan Precision said customer adoption in its optical module business has been improving since it acquired Source Photonics. Global AI computing demand continues to grow, keeping optical module demand strong. The company noted that 800G optical modules remain the mainstream product, while 1.6T products are gradually ramping up. It also said its DSP component supply is generally under control and that both its optical module and AI PCB businesses now cover mainstream AI cloud vendors.