On Monday, optical communication stocks experienced a broad selloff, with Nokia Oyj (NOK.US), Corning (GLW.US), and Coherent (COHR.US) all dropping more than 10%, while Lumentum (LITE.US) fell over 8%.

Applied Optoelectronics (AAOI.US) and Credo Technology (CRDO.US) each declined by more than 7%, with POET Technologies (POET.US) and Marvell Technology (MRVL.US) also sliding over 6%.

On the news front, the three major AI leaders made a rare joint call to "slow down frontier model development," which has sparked concerns that capital expenditure on computing infrastructure could be reduced. As optical communication sits at the forefront of the AI hardware supply chain, it has borne the brunt of these worries.

However, several analysts believe these statements remain at a "verbal level" for now, with no concrete signals of capital spending cuts or order reductions having materialized yet.