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Home / Themes / Fiscal Spend '24: Wire and Cable

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Bull / Bear Details has the investment thesis and bull/bear points. Overview is monitoring guidance (hiring, forums, second-order trends, search keywords, Google Trends, datasets).

Bull / Bear Details

The thesis for the fiscal spend on wire and cable as of Spring 2025 is bullish. The surge in infrastructure spending, supported by fiscal policies under the cur

Thesis

The thesis for the fiscal spend on wire and cable as of Spring 2025 is bullish. The surge in infrastructure spending, supported by fiscal policies under the current administration, has led to increased demand for wire and cable products. Companies such as Sumitomo Electric Industries (5802 JP), Fujikura Ltd. (5803 JP), and SWCC Showa Holdings (5805 JP) are positioned to benefit significantly from the anticipated ramp-up in projects requiring extensive wiring and cabling solutions.

Bull case

The Infrastructure Investment and Jobs Act has allocated substantial funds towards upgrading the power grid and broadband infrastructure, directly increasing demand for wire and cable products.
Domestic manufacturing incentives and tax credits under the Inflation Reduction Act are encouraging the localization of supply chains, benefiting domestic wire and cable manufacturers.
The ongoing growth in electric vehicle and renewable energy projects is driving up the need for specialized wiring and cabling solutions, further boosting sector growth.

Bear case

Potential delays in project implementation due to bureaucratic hurdles could slow down the anticipated demand surge for wire and cable products.
Rising raw material costs, particularly for copper, could squeeze margins for wire and cable manufacturers despite increased demand.
Geopolitical tensions and new tariffs could disrupt supply chains, leading to unexpected costs and delays for wire and cable companies.

Overview

Hiring Trend Watchpoints

High-performing operators in the Fiscal Spend '24: Wire and Cable theme are expected to show robust hiring for specialized technical and manufacturing roles, driven by unprecedented demand in AI data centers, grid modernization, and renewable energy projects. Specifically, watch for increased job postings for electrical engineers with expertise in high-voltage transmission, fiber optics, and data center power architectures. Manufacturing technicians and skilled labor for cable production facilities, especially in regions with new capacity expansion (e.g., Prysmian's North America I&C segment [cite: PRY.MI Ticker_KeyFactors]), will also be in high demand. Project managers with experience in large-scale infrastructure deployment (e.g., offshore wind, broadband) are crucial. Credo Technology Group's continued investment in R&D and expansion into optical solutions suggests a focus on hiring engineers for advanced silicon photonics, optical DSPs, and system-level integration. The industry faces a significant skilled labor shortage, particularly in manufacturing and engineering, with many companies looking to recruit and train talent from outside the sector. **Changes that would confirm theme strengthening:** Companies announcing significant increases in headcount for specialized engineering and manufacturing roles, new training programs or partnerships with vocational schools to address the skilled labor gap, and successful ramp-up of new production facilities with adequate staffing. Geographic expansion of hiring efforts in key infrastructure development zones (e.g., Texas for solar/battery storage). **Changes that would warn of theme deterioration:** Reports of project delays or cost overruns explicitly attributed to labor shortages, a slowdown in hiring for critical growth segments (e.g., optical solutions, high-voltage cables), or a shift towards automation replacing skilled roles without a corresponding increase in high-value technical positions.

Forum Watchlist

Forum — American Data Centers ForumHigh
Discussions on data center power infrastructure, cooling solutions, and AI-driven demand for high-speed connectivity.
Forum — NYU Data Center and AI Infrastructure ForumHigh
Insights from developers, investors, and policymakers on financing and enabling the physical backbone of AI, including energy systems and hyperscale data centers.
Forum — Energy Transition Investor ForumHigh
Discussions among institutional investors, fund managers, and developers on investment opportunities in renewables, energy storage, and smart grid infrastructure.
Forum — Wire Association International (WAI) forums/eventsMedium
Technical discussions, industry trends, and supply chain updates specific to wire and cable manufacturing, materials, and applications.
Reddit — r/datahoarderMedium
Niche discussions and user experiences related to high-speed data storage, network infrastructure, and home lab setups, offering ground-level insights into connectivity needs.
Reddit — r/electriciansMedium
Practical insights into electrical installation challenges, material availability, and labor market conditions related to wiring and cabling projects.
Reddit — r/renewableenergyMedium
Community discussions on renewable energy project development, grid integration challenges, and demand for associated electrical infrastructure.
Forum — Commercial Observer Data Centers Development & Infrastructure ForumHigh
Insights on how AI is shifting capital flows, redefining asset value, and creating new opportunities for investors and developers in data center infrastructure, particularly in the Northeast US.

Second Order Trends

The Fiscal Spend '24: Wire and Cable theme is being shaped by several critical second-order trends. Firstly, the **unprecedented power demand from AI data centers is straining existing electrical grids**, forcing a strategic pivot towards direct investment in dedicated, on-site power generation solutions by data center operators, effectively turning them into 'de facto energy companies'. This is driving demand for specialized high-voltage cables and power infrastructure to support these new energy ecosystems. Secondly, within data centers, there's an **accelerating shift towards 800V DC power systems and advanced liquid cooling solutions** to manage the immense heat and power density of AI-optimized racks [cite: PRY.MI Ticker_TranscriptTidbits]. This necessitates new types of cables and connectivity solutions designed for these evolving architectures. Thirdly, the **diversification of connectivity solutions beyond traditional copper** is gaining momentum, with companies like Credo expanding their offerings to include advanced optical solutions such as ZeroFlap Optics, SiPho PICs, optical DSPs, and Active LED Cables (ALCs), alongside copper-based Active Electrical Cables (AECs) [cite: CRDO Ticker_TranscriptTidbits]. This indicates a move towards a heterogeneous mix of interconnect technologies to meet varying performance and distance requirements. Fourthly, **persistent raw material cost volatility and supply chain tightness**, particularly for copper and advanced semiconductor nodes (e.g., 3nm for Credo), continue to impact profitability and production timelines for manufacturers [cite: PRY.MI Ticker_BullBearDetails, CRDO Ticker_BullBearDetails, 9, 15, 22, 35]. Lastly, **localization of supply chains and domestic manufacturing** is being incentivized by fiscal policies like the Inflation Reduction Act, benefiting domestic wire and cable manufacturers and potentially reshaping global production footprints [cite: Theme_BullBearDetails].

Search Keywords Brand Product

Active Electrical Cables
AECs
ZeroFlap Optics
SiPho PICs
optical DSPs
OmniConnect
Active LED Cables
ALCs
subsea cables
high-voltage cables
fiber optic cables
hollow core fibers
800G connectivity
1.6T connectivity
200 gig per lane

Search Keywords Policy Regulatory

Infrastructure Investment and Jobs Act
IIJA
Inflation Reduction Act
IRA
Section 232 tariffs
domestic manufacturing incentives

Search Keywords Event Phrases

AI data center buildouts
grid modernization projects
offshore wind connections
EV charging infrastructure deployment
5G network expansion
power grid upgrades
broadband infrastructure rollouts

Google Trend Product Category Intent

• AI data center cables • electric vehicle charging cables • fiber optic internet installation • smart grid technology • high voltage power cables • submarine power cables

Google Trend Consumer Intent

• best home EV charger • fast internet options • solar panel installation cost • home electrical upgrade

Google Trend Macro Policy Terms

• US infrastructure bill • renewable energy incentives • broadband funding

Top datasets to track

1. Copper Price Index Type: Economic Data · Provider: London Metal Exchange (LME) Cadence: Daily Why it matters: Reflects cost pressures on wire and cable production, a key input for manufacturers. Elevated prices can squeeze margins despite increased demand. [cite: Theme_KeyMetrics, 9, 15, 35] Suggested query: LME Copper Price Confidence: High

2. Infrastructure Spending Rates Type: Economic Data · Provider: U.S. Department of Commerce Cadence: Quarterly Why it matters: Indicates the pace and scale of infrastructure projects, directly impacting demand for wire and cable products. [cite: Theme_KeyMetrics] Suggested query: US infrastructure spending data Confidence: High

3. Electric Vehicle Sales Growth Type: Economic Data · Provider: International Energy Agency (IEA) / BloombergNEF / J.D. Power Cadence: Annually / Quarterly Why it matters: Signals increasing demand for specialized wiring solutions for EVs and charging infrastructure. [cite: Theme_KeyMetrics, 7, 8, 11, 13, 31] Suggested query: Global EV sales data Confidence: High

4. U.S. Non-residential Construction Spending Type: Economic Data · Provider: U.S. Census Bureau Cadence: Monthly Why it matters: A key organic growth driver for industrial and construction (I&C) segments, particularly relevant for Prysmian's North America business and data center buildouts. [cite: PRY.MI Ticker_KeyFactors] Suggested query: US non-residential construction spending Confidence: High

5. Global Data Center Power Demand / Capacity Additions Type: Alternative Data / Economic Data · Provider: Gartner / S&P Global Market Intelligence / CBRE Cadence: Annually / Quarterly Why it matters: Reflects the accelerating demand for high-speed connectivity and power infrastructure driven by AI, directly impacting both copper and optical cable markets for companies like Credo and Prysmian. Suggested query: Global data center capacity additions forecast Confidence: High

Industry Publications: [{"name": "Wire and Cable Technology International", "domain": "wiretech.com", "why": "Bimonthly technical magazine for manufacturers, processors, distributors, and users of all types of wires, cables, wire harnesses, and cable assemblies, covering technical articles, news, and market trends."}, {"name": "Cabling Installation & Maintenance", "domain": "cablinginstall.com", "why": "Focuses on structured cabling, fiber optics, and network infrastructure, directly relevant to data center and broadband expansion."}, {"name": "Wire Journal International", "domain": "wirenet.org", "why": "Monthly trade publication for executives, engineers, and professionals in the global ferrous and nonferrous wire and cable manufacturing industry, covering technical developments, industry news, and trends."}, {"name": "Network World", "domain": "networkworld.com", "why": "Provides coverage on data center electricity consumption, AI-optimized servers, and power demands, crucial for understanding connectivity infrastructure."}, {"name": "S&P Global Market Intelligence", "domain": "spglobal.com/marketintelligence", "why": "Offers analysis on the US energy grid outlook, renewable capacity additions, and data center demand's impact on grid stability."}, {"name": "BloombergNEF", "domain": "about.bnef.com", "why": "Specializes in clean energy, advanced transport, and commodities, providing forecasts for global EV sales and renewable energy deployment."}, {"name": "International Energy Agency (IEA) Reports", "domain": "iea.org", "why": "Publishes comprehensive reports on global EV outlook, renewable energy statistics, and electricity supply, offering macro-level insights into demand drivers."}, {"name": "Mission Critical Magazine", "domain": "missioncriticalmagazine.com", "why": "Covers critical facilities, including data centers, power infrastructure, and cooling, directly relevant to high-performance cabling needs."}]

Key Metrics3 rows

Metric	Cadence	What It Signals	Update Source
Electric Vehicle Sales Growth	Annually	Signals increasing demand for specialized wiring solutions	Google_Sheets
Copper Price Index	Daily	Reflects cost pressures on wire and cable production	Google_Sheets
Infrastructure Spending Rates	Quarterly	Indicates the pace and scale of infrastructure projects	Google_Sheets

Upcoming Catalysts13 rows

Catalyst ID	Estimated Timing	Estimated Date Start	Estimated Date End	Catalyst	Why It Matters	Ticker Or Theme Specific	Transcript Date	Source Type	Catalyst Source
CRDO_748f3f61	first half fiscal '27	2026-05-01	2026-10-31	Mass production release of Credo's PCIe Gen6 Active Electrical Cables (AECs).	This product ramp will contribute new revenue streams and expand Credo's market presence in high-speed connectivity for AI and data centers, validating product development and market adoption.	Ticker	2026-03-02	earnings_transcript	CRDO (ticker)
CRDO_020cc7e9	fiscal '27	2026-05-01	2027-04-30	Conversion of PCIe Gen6 retimer design wins to production revenue.	This signifies successful customer qualification and initial revenue contribution from a new product line, demonstrating execution on the IC business roadmap and market traction.	Ticker	2026-03-02	earnings_transcript	CRDO (ticker)
CRDO_335de533	beginning in first quarter of fiscal '27 and continuing throughout the year.	2026-05-01	2027-04-30	Significant production ramp of Credo's ZeroFlap Optics.	ZeroFlap Optics represent a multibillion-dollar TAM expansion, and a successful ramp will drive substantial revenue growth and establish Credo's leadership in high-reliability optical connectivity for AI data centers.	Ticker	2026-03-02	earnings_transcript	CRDO (ticker)
CRDO_4cf61897	fiscal '27	2026-05-01	2027-04-30	Sampling and qualification of Credo's first Active LED Cables (ALCs).	ALCs are a new product category expanding Credo's TAM into mid-reach optical connectivity, and successful qualification is a critical step towards future production and revenue generation in fiscal '28.	Ticker	2026-03-02	earnings_transcript	CRDO (ticker)
CRDO_e8efbabf	fiscal '27	2026-05-01	2027-04-30	Credo achieving sequential revenue growth in the mid-single digits and over 50% year-over-year growth for fiscal '27.	This is management's overall financial guidance for the upcoming fiscal year, and meeting or exceeding these targets will positively impact investor sentiment and valuation, while underperformance could lead to negative revisions.	Ticker	2026-03-02	earnings_transcript	CRDO (ticker)
CRDO_dce9c09b	throughout fiscal '27	2026-05-01	2027-04-30	Expanding the number of ZeroFlap Optics customers to more than four.	Broad customer adoption, especially among hyperscalers and Neoclouds, validates the product's value proposition and is crucial for the significant production ramp and market share gains.	Ticker	2026-03-02	earnings_transcript	CRDO (ticker)
CRDO_14f93af5	fiscal year 2027	2026-05-01	2027-04-30	Credo's achievement of its fiscal year 2027 revenue guidance, including over 80% year-over-year total revenue growth and more than $600 million from its optical portfolio (ZeroFlap optics, SiPho PICs, optical DSPs).	Achieving or exceeding this guidance would validate Credo's growth trajectory, especially in its new optical segments, and reinforce investor confidence. Missing it could negatively impact valuation.	Ticker	2026-06-01	earnings_transcript	CRDO (ticker)
CRDO_0f4df8fd	fiscal 2027 will have relatively light revenue as it relates to 200 gig per lane	2026-05-01	2027-04-30	The actual revenue contribution and ramp trajectory of Credo's 200 gig per lane products, including PCIe Gen 6 AECs and retimers, in fiscal year 2027.	A stronger-than-expected ramp could signal faster industry adoption of higher speeds and boost Credo's revenue and market share. A weaker ramp could indicate delays in customer transitions.	Ticker	2026-06-01	earnings_transcript	CRDO (ticker)
CRDO_5a4a9cac	over the coming years	2026-06-01	2029-06-01	Neocloud customers collectively growing to represent approximately 20% of Credo's total revenue.	This would signify successful diversification beyond hyperscalers, reducing customer concentration risk and opening a substantial new growth vector for the company.	Ticker	2026-06-01	earnings_transcript	CRDO (ticker)
CRDO_d39073ab	Throughout the next year or even longer	2026-06-01	2027-06-01	Resolution or continued impact of industry-wide supply chain tightness, particularly for 3nm wafer capacity, on the broader AI connectivity market.	While Credo expresses confidence in its own position, persistent industry tightness could lead to production delays or increased costs for the sector, potentially impacting Credo's customers or overall market demand.	Theme	2026-06-01	earnings_transcript	CRDO (ticker)
CRDO_af168dde	fiscal '28	2027-05-01	2028-04-30	Production ramp for Credo's first OmniConnect gearbox.	OmniConnect addresses the memory-to-compute interconnect, representing another multibillion-dollar TAM expansion, and its production ramp will unlock new revenue streams in AI infrastructure.	Ticker	2026-03-02	earnings_transcript	CRDO (ticker)
CRDO_133a8b45	expected in our fiscal 28	2027-05-01	2028-04-30	Credo's recognition of initial revenue from its Co-Packaged Optics (CPO) and Near-Packaged Optics (NPO) designs, leveraging the acquired Dust Photonics SiPho technology.	This marks Credo's entry into advanced optical packaging architectures, crucial for long-term growth and competitive positioning in next-generation AI infrastructure.	Ticker	2026-06-01	earnings_transcript	CRDO (ticker)
CRDO_c3f425ee	production ramps for both ALC and OmniConnect solutions beginning in our fiscal 28	2027-05-01	2028-04-30	The commencement of production ramps and associated revenue generation for Credo's Active LED Cables (ALC) and OmniConnect gearbox solutions.	These new product categories represent significant TAM expansion and diversification beyond AECs and traditional optical components, critical for sustained long-term growth.	Ticker	2026-06-01	earnings_transcript	CRDO (ticker)

Constituents

PRY.MIT2
— Prysmian S.p.A.
CRDOT3
— Credo Technology Group Holding Ltd
229640.KOT3
· no notes yet
5801.TT3
· no notes yet
5802.TT3
· no notes yet
5803.TT3
· no notes yet
5805.TT3
· no notes yet
BDCT3
· no notes yet
NEX.PAT3
· no notes yet
NKT.COT3
· no notes yet
POLYCAB.NST3
· no notes yet
WCCT3
· no notes yet

Fiscal Spend '24: Wire and Cable (view performance)