US Department of Commerce announced on April 16th, Eastern Time that because Chinese telecommunications equipment manufacturer ZTE (31.310, 0.00, 0.00%) violated US sanctions regulations, US companies were banned from making advances to ZTE in the next 7 years. This move will affect chip manufacturers such as Qualcomm, Acacia , as well as American optical device companies.
After the news that ZTE was banned, the share prices of optical device vendors fell. The most affected ones were Acacia (ACIA, -35.5%) and Oclaro (OCLR, -14.9%). Acacia generated 30% of its sales revenue in fiscal year 2017 from ZTE. After the stock price fell, the company responded positively by issuing a statement that it was aware of the move and to take measures to suspend the affected transactions and assess the impact of these moves on Acacia. Oclaro has not made an opinion at present, and the Lumentum that announced to purchase Oclaro some time ago also is affected, the share price drops 8.9%. Other less affected optical device vendors include: Finisar (FNSR)-3.8%, NeoPhotonics (NPTN)-3.4%, II-VI (IIVI)-4%, and AOI (AAOI)-1.3%.