Ciena Corporation (NYSE:CIEN) is emerging as one of the most compelling growth stories in AI-driven networking, with Bank of America highlighting its expanding market share and central role in a multi-year buildout of data center infrastructure. The brokerage raised its price target on the company to $550 from $355, citing sustained demand and strong long-term growth potential.
The brokerage said there are no signs of a slowdown in demand for the networking equipment maker, pointing to a growing backlog and continued spending from hyperscale data center operators.
Ciena’s backlog rose by $2 billion in the most recent quarter to about $7 billion, while hyperscaler capital expenditures are expected to climb 65% year-over-year in 2026, following roughly 70% growth last year.
Bank of America said Ciena is “at the heart of an optical super-cycle” expected to extend through at least 2027, driven by surging bandwidth requirements tied to both AI and traditional data center workloads.
Analysts highlighted large-scale data center construction between 2026 and 2028 as a key catalyst, particularly for interconnect technologies linking facilities.
The analyst also raised revenue growth forecasts, now expecting Ciena to deliver annual increases of 28.5%, 21% and 20% over the next three years, reflecting stronger demand across cloud and telecom customers.
Ciena’s position in cloud networking remains a key driver, with the company holding roughly 48% market share in the segment through its routing and pluggable optics offerings, according to the note. The bank sees further upside from expanding deployments of higher-speed optical technologies, including 800G pluggables, where Ciena’s share is expected to rise from about 30% in 2025 to at least 50% in 2026 as the market grows rapidly.
The report also pointed to additional growth avenues, including coherent optics within data centers and newer platforms such as routing and switching solutions, as well as emerging technologies like co-packaged optics.
“Within the Networking segment, Ciena represents one of the more attractive growth prospects in AI networking,” analysts wrote.
Shares of Ciena gained around 1.9% on Thursday afternoon.