Surging demand for photonic chips amid the AI optics boom has boosted the shares of Yuanjie Semiconductor Technology in China by about 780% over the past year. The stock surge has made the company's founder, chairman and CEO, Zhang Xingang, a billionaire.

The 56-year-old mogul, who is a U.S. citizen, has amassed a fortune of $1.7 billion based on his stake in the Shanghai-listed company, according to Forbes estimates. Yuanjie jumped almost to its daily trading limit of 20% on Friday, following share gains by optics peers Lumentum and Coherent in the U.S. the day before.

The company didn’t respond to a request for comment. Behind the eye-popping surge is rising demand for Yuanjie’s laser chips, which are used to transmit data in the form of light inside AI data centers.

Such photonic chips play an increasingly important role in modern data centers, as the training of AI requires better performing hardware. In early March, Nvidia announced that it would invest $2 billion each in Lumentum and Coherent, as part of a multiyear strategic partnership to support their research of advanced AI infrastructure products.

“Optical communication represents a bottleneck in the global AI arms race,” says Shen Meng, Beijing-based managing director of boutique investment bank Chanson & Co. “Whoever invests more in boosting production capacity might end up getting more market share.”

Investor sentiment remains strong as Yuanjie, which is backed by Chinese tech giant Huawei, seems to have such plans. The company also announced in early March its decision to pursue a separate listing in Hong Kong, likely with the goal of using any proceeds raised to enlarge production, says Shen. In February, it announced a 1.3 billion yuan ($181.3 million) investment in a new production base in the Xixian New Area in China's central Shaanxi province, which also houses its headquarters. Two years ago, the chipmaker said it would invest $50 million in the U.S. to boost its overseas presence.

Zhang himself has worked in the U.S. before returning to China. The mogul, who holds a Ph.D. in materials science from the University of Southern California, got a research job at fiber optic components maker Luminent in 2001. After it merged in 2007 with China’s Fiberxon to become California-headquartered Source Photonics, which also makes components and transceivers used in data centers, he became a research director at the then newly formed entity.

But the mogul eventually decided to return to China, after Source Photonics was sold in 2010 to private equity firm Francisco Partners for an undisclosed amount (Francisco Partners sold the firm again in 2017). He founded Yuanjie in 2013 and took it public on Shanghai Stock Exchange’s Nasdaq-style STAR Market in 2022, raising $219 million.

In the first few years after the listing, Yuanjie’s financial performance wasn’t strong as it supplied chiefly to the fiercely competitive telecommunications market in China. But as AI advances lead to rising demand, the company has swung into the black.

During the first nine months of 2025 (the latest financial results available), sales jumped 115% year-on-year to 383.2 million yuan.It posted a net profit of 117 million yuan, compared with a loss of 550,131 yuan during the same period a year ago. Amid strong demand and a continued pivot to the AI market, total sales might more than double to 506 million yuan for the entire 2025, while net profit might reach 138 million yuan, according to S&P Global.

Zhang is the latest Chinese billionaire to make a fortune from the optics sector. Liu Sheng, chairman and CEO of optical device maker Zhongji Innolight, joined the three-comma club in December. Shares of Innolight, which is a customer of Yuanjie, are up 480% over the past year.

© Forbes