Page 41 - Market Analysis Report of Optical Communications Field in China & Global market 2020

With the merger and acquisition of the global optical bring about a 10-fold increase in the consumption of high-
communication industry, the ranking of the world's top ten speed optical module. Data center growth has slowed
optical device manufacturers has changed in 2019. Chinese during the COVID-19 pandemic, but Internet content
optical device manufacturers have occupied four places providers (ICP) will continue to build as many data centers
among the world's top ten optical device manufacturers as possible wherever they can be built. This drives the
(Accelink, Zhongji Innolight, Hisense Broadband and demand for 100G and 400G optical modules within the data
O-net). center, as well as 400G coherent products for data center
interconnection (DCI). These 400G markets are expected
Figure 10: Global optical device enterprises market
share to accelerate in the second half of 2020, with 800G growth
also expected to begin to be realized. Co-encapsulated
optical devices (CPO) is an area where optical device
suppliers need to invest a lot of research and development
work in 2020. At present, the emerging technologies
including 5G network, ultra-high-rate interconnected data
center and communication cloud, as well as 5G (wireless
access) and data center (Ethernet) will promote the optical
module market to usher in a larger scale of development.
Leading cloud computing companies including Alibaba and
Tencent are accelerating the construction of data centers,
which, along with China's new infrastructure policies,
will drive the development of upstream industries such as
optical modules.
In 2019, the gross profit margin of global optical device
enterprises increased and tended to be similar, generally Section Three: Global Operator Performance
maintaining between 25% and 30%, reflecting the effect
of product structure restructuring of many optical device I. Major Global Operators
enterprises under the new technology breakthrough. Figure 12: Operating Performance of major global
China's optical device industry chain layout is complete, operators in 2019
photoelectric chip domestic breakthrough, with
comprehensive competitiveness.

Figure 11: China optical device enterprises market
share

AT&T
In 2019, AT&T's combined revenue totaled $181.2 billion,
compared with $170.8 billion from a year earlier. Net
income attributable to common stock in 2019 was $13.9
billion, or $1.89 per diluted common share. AT&T had
$48.7 billion in cash from operating activities for the
full year and $23.7 billion in total capital investments
With the rapid advance of 5G industrialization and the (including capital expenditures, vendor financing cash
rapid growth of the number of 5G base stations, the payments and FirstNet expenses). Full-year free cash flow
demand for optical modules is expected to be released was $29 billion, up 30% from $22.4 billion in 2018. The
with the advance of 5G networking. At the same time, the company's full-year free cash flow dividend payout ratio
rapid development of mobile Internet technology and the is 51%. Randall Stephenson, CHAIRMAN and CEO of
wide application of cloud computing technology have led AT&T, said, "We have met the goals we promised in 2019,
to a significant increase in data storage scale, computing and we will remain strong in the wireless space this year."
capacity and network traffic. The data rate of data center AT&T reiterated its 2020 guidance: Revenue growth: from
network will increase from 10/40g, 25/100g to 100/400g 1% to 2%; Adjusted earnings per share growth: $3.60 to
and 400G/ 1.6t, and the rapid growth of internal flow will $3.70, including HBO Max investment; Adjusted EBITDA

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