Eoptolink Technology's inventory rose 61% in the first half as the Chinese optical-transceiver maker stockpiled components to meet strong artificial-intelligence demand and guard against supply constraints.

Inventory climbed to 11.7 billion yuan ($1.7 billion) from 7.2 billion yuan a year earlier, according to a company filing.

Eoptolink, headquartered in Wuhan, China, and listed on the Shenzhen Stock Exchange, is one of the world's largest suppliers of optical transceivers — components that convert electrical signals into optical signals so servers, switches, and storage systems can be linked across data centers via fiber-optic cable. Industry researcher LightCounting has ranked Chinese vendors including Eoptolink and Zhongji Innolight at the top of the global optical-module market by revenue, placing the company at the center of the AI networking supply chain.

Surging orders for high-speed transceivers lifted first-half net income 91% to 7.53 billion yuan.

Eoptolink said supplies of core raw materials remained tight and that it needed to ensure timely delivery of products at scale. Holding larger inventories is a common practice among hardware manufacturers to buffer against component shortages and extended lead times when demand outpaces supply. Because transceivers ship as cloud and AI clusters are installed, inventory and delivery levels at major module makers are watched as near-term signals of data-center equipment demand, and Eoptolink's second-half results will show how much of the stockpile converts into sales.

The rapid build-out of AI computing infrastructure has driven cloud providers and data-center operators to expand capacity, boosting demand for high-bandwidth networking equipment such as 400G and 800G optical modules used to interconnect processor clusters. The next generation of 1.6T modules is also beginning to enter commercial use as chipmakers roll out faster AI accelerators, extending the industry's upgrade cycle.