Is the business good?
How good a business is AAOI?
Applied Optoelectronics, Inc. earns −4.3% on the capital it employs against a 9.0% cost of capital, so growth costs more than it returns.
−4.3%
Return on invested capital · cost of capital 9.0% · 13 points below what the capital costs: growth destroys value
- Operating margin
- −11%
Operating margin · Communication Equipment median 4.4% · 12 months to Q2 2026
- Share count, year on year
- +44%
Share count, year on year · shareholders own a smaller slice than a year ago
- R&D as % of revenue
- 18%
R&D as % of revenue
| Year | Operating margin |
|---|---|
| FY2020 | −21% |
| FY2021 | −27% |
| FY2022 | −26% |
| FY2023 | −19% |
| FY2024 | −28% |
| FY2025 | −12% |
Details›
- Gross margin12 months to Q2 2026
- 29%
- Operating margin12 months to Q2 2026
- −11%
- Net margin12 months to Q2 2026
- −9.6%
- Free cash flow margin
- −148%
- R&D as % of revenue
- 18%
- Revenue, trailing twelve months
- $596M
- Free cash flow, trailing twelve months
- −$881M
- Net income, trailing twelve months
- −$57M
- Return on invested capitaloperating profit after tax ÷ debt + equity − cash
- −4.3%
Margins, capital and share counts from the statements as filed with the SEC; cash conversion from the cash flow statement.
Communication Equipment
Ranks #6 of 21 by Smart Score