Data Center Optical Cable Market - Global Forecast 2026-2032

The Data Center Optical Cable Market size was estimated at USD 7.93 billion in 2025 and expected to reach USD 8.48 billion in 2026, at a CAGR of 7.10% to reach USD 12.84 billion by 2032.

Optical cabling has emerged as the foundation of modern data center infrastructure, enabling the high-speed, low-latency connectivity required for applications ranging from cloud computing to artificial intelligence. Since the release of advanced generative AI models like ChatGPT in late 2022, capital expenditures on data center construction have quadrupled compared to 2020, reflecting the industry’s urgent push to support ever-larger GPU clusters and data-intensive workloads.

As organizations seek to reduce latency and increase bandwidth, data center interconnect (DCI) solutions have gained prominence. In 2025, the global DCI market is projected to grow by 14.3%, surpassing US$40 billion, driven by collaborations between telecom operators and optical equipment providers in North America, Northern Europe, and Southeast Asia.

Driven by the surging demand for AI applications, global optical cable consumption within data centers grew by 138% in 2024, with single-mode fiber dominating long-haul links and multimode variants addressing in-rack connectivity. This trend is expected to sustain an 80% increase in 2025 as data centers migrate towards 400G and 800G solutions, underscoring the critical role of next-generation fiber technologies in meeting evolving network requirements.

Technological breakthroughs are reshaping the data center optical cable landscape, with silicon photonics and co-packaged optics (CPO) taking center stage. The recent collaboration between Corning and Broadcom on the Bailly CPO system exemplifies this shift, pairing high-density optical engines with advanced fiber harnesses to significantly increase interconnect density and power efficiency within AI clusters.

Meanwhile, the migration to IP over Dense Wavelength Division Multiplexing (IPoDWDM) is accelerating, driven by cloud providers seeking cost-effective long-haul connectivity. Revenues for ZR and ZR+ optics are forecast to grow at an average annual rate of 20%, contributing nearly 12% of the optical transport market over the next five years and highlighting the rising importance of disaggregated WDM subsystems in metro and long-distance data center interconnect.

On the horizon, hollow-core fiber technology promises ultra-low latency and reduced signal distortion by guiding light through an air-filled core. Prysmian’s partnership with Relativity Networks to industrialize hollow-core optical fiber at scale underscores the industry’s pursuit of transformative fiber solutions that address the latency and energy bottlenecks of next-generation AI data centers.

The introduction of steep reciprocal tariffs by the United States in 2025 poses significant challenges for the data center optical cable supply chain. Tariffs of 34% on Chinese imports, 32% on Taiwanese, and 25% on South Korean equipment have elevated component costs and compelled companies to reassess procurement strategies. This policy has already led major hyperscalers to reconsider expansion timelines and explore alternative sourcing options outside traditional manufacturing hubs.

These measures are disrupting established supply networks, prompting data center operators and hardware manufacturers to explore reshoring or nearshoring options. However, building domestic manufacturing capacity for complex optical components is capital-intensive and time-consuming, risking extended deployment timelines and pricing volatility during the transition period.

Analyzing the tariff exposure specifically for optical cables, U.S. importers are projected to incur over $1.1 billion in additional levies on top of the $2.5 billion of cable imports in 2024. Such increases underscore the need for end-to-end value chain visibility and strategic collaboration to mitigate cost pressures while maintaining competitive margins in an inflationary environment.

The data center optical cable market can be navigated through a series of strategic segmentation lenses that reveal distinct opportunity spaces. Within the cable type dimension, multimode fibers-spanning OM3, OM4, and OM5 variants-address high-density, short-reach interconnects, while single mode fibers-encompassing OS1 and OS2 types-facilitate long-haul and metro data center links with minimal attenuation. Assembly preferences differentiate between field-terminated solutions, offering on-site flexibility, and pre-terminated assemblies that accelerate deployment and reduce installation risk.

Application-based segmentation further refines market positioning, distinguishing between access networks and intra data center connectivity, as well as inter data center interconnect, which itself splits into metro and long-haul scenarios. Data rate requirements range from 10 Gigabit to 400 Gigabit per second, driving the adoption of specialized fiber and connector technologies. Finally, end users such as cloud service providers, enterprises, hyperscale operators, and telecommunications firms each exhibit unique procurement criteria and scale demands, underlining the importance of tailored product portfolios.

The Americas continue to lead in data center optical cable adoption, driven by robust AI investment and federal initiatives supporting broadband expansion. The U.S. economic landscape defied recession expectations in early 2025 largely due to surging AI-related capital expenditures, which have fueled data center spending and underscored the critical role of fiber infrastructure in sustaining digital growth.

In Europe, the Middle East, and Africa, data center projects are increasingly aligned with sustainability and energy efficiency mandates, prompting regional operators to upgrade to low-loss fiber and high-density cable systems. Asia-Pacific markets, notably in North Asia and Southeast Asia, are expanding their optical component manufacturing capacities, with Taiwanese suppliers playing a pivotal role in meeting global DCI demand and enabling hyperscale interconnect deployments across the region.

Corning has positioned itself at the forefront of fiber innovation through its GlassWorks AI™ Solutions portfolio, which includes the Contour™ Flow Cable designed to double fiber density within existing conduit spaces. This end-to-end offering integrates high-performance fiber, advanced connectivity hardware, and deployment services to accelerate network rollouts in AI data center environments.

The company’s collaboration with Broadcom on the Bailly co-packaged optics platform further highlights Corning’s strategic emphasis on co-packaged solutions, supplying precision fiber harnesses and polarization maintaining fibers to support 51.2 Tbps switch engines that bring optics and electronics together for maximum efficiency.

CommScope’s Propel XFrame™ solution addresses the challenges of high-density fiber management with a modular frame system that simplifies reconfigurations and optimizes space in mission-critical facilities. CommScope’s enterprise fiber business, which grew 96% year-over-year in Q4 2024, exemplifies the company’s success in aligning product innovation with the demands of AI-driven data centers.

Prysmian has made strategic investments in next-generation fiber technologies by partnering with Relativity Networks to scale hollow-core fiber production and acquiring Channell Commercial Corp to strengthen its North American footprint. These moves underscore Prysmian’s commitment to expanding capacity and offering a comprehensive suite of cable solutions for hyperscale and telecom operators alike.

Industry leaders must prioritize supply chain resilience by diversifying manufacturing footprints beyond traditional hubs. Establishing partnerships with alternative suppliers in Southeast Asia, Mexico, or domestic facilities can mitigate the impact of U.S. tariffs and ensure continuity of optical cable availability during geopolitical disruptions.

Simultaneously, organizations should invest in next-generation connectivity technologies such as co-packaged optics, IPoDWDM, and hollow-core fiber to capitalize on emerging performance gains. Collaborating with innovation partners and participating in pilot deployments will enable early adoption advantages and position companies to meet the evolving demands of AI-centric data center architectures.

This study combines primary interviews with C-suite executives, network architects, and procurement leaders across cloud, hyperscale, enterprise, and telecommunications segments. Secondary research sources include regulatory filings, company press releases, trade association publications, and proprietary industry databases.

Quantitative data was triangulated using shipment statistics from leading market research firms, trade data from customs and import/export records, and technology adoption rates reported by analytical agencies. Qualitative insights were validated through expert panel reviews and cross-referenced against industry trend analyses to ensure the accuracy and strategic relevance of findings.

The convergence of AI, cloud, and hyperscale computing is driving unprecedented demand for high-performance optical cabling, compelling the industry to adopt advanced fiber technologies and flexible deployment models. Meanwhile, geopolitical factors such as U.S. tariffs on key manufacturing regions are reshaping supply chain strategies and cost structures.

Robust market segmentation and regional analysis enable stakeholders to align product offerings with specific use cases-from short-reach multimode interconnects in hyperscale racks to single-mode long-haul links between campus sites. Leading companies are differentiating through integrated solutions, strategic partnerships, and targeted expansions, underscoring the importance of innovation and agility.

This executive summary offers a strategic foundation for decision-makers to navigate complex market dynamics and capitalize on growth opportunities in the rapidly evolving data center optical cable landscape.

For tailored insights and comprehensive analysis of the data center optical cable market, please connect with Ketan Rohom, Associate Director, Sales & Marketing. Ketan can guide you through the breadth of our research findings and help you secure access to the full market research report, ensuring you have the strategic intelligence needed to make informed decisions and drive growth in this dynamic sector.