Applied Optoelectronics, Inc.
AAOI Technology Communication Equipment
Applied Optoelectronics, Inc.’s revenue for fiscal 2025 (year ended December 2025) was $455.7 million, up 82.8% from fiscal 2024. In the quarter to June 2026, revenue grew 86.4%, EPS fell 75.0%, free cash flow fell 191.6% and total debt rose 69.0%, each against the same quarter a year earlier.
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Applied Optoelectronics, Inc. (AAOI) Altman Z-score
Applied Optoelectronics, Inc.'s Altman Z-score for fiscal 2025 is 2.98, in the grey zone (1.81–2.99).
Altman Z-score, annual
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Annual newest first
| Period | Altman Z-score | Change (points) |
|---|---|---|
| FY2025 | 2.98 | 0.93 |
| FY2024 | 2.05 | 0.43 |
| FY2023 | 1.62 | 2.00 |
| FY2022 | −0.38 | (0.63) |
| FY2021 | 0.25 | (0.46) |
| FY2020 | 0.71 | (0.26) |
| FY2019 | 0.97 | (1.25) |
| FY2018 | 2.23 | (3.41) |
| FY2017 | 5.64 | 1.84 |
| FY2016 | 3.80 | 1.45 |
How fiscal 2025’s score is made up
| Component | This year | Year before | Result | Points |
|---|---|---|---|---|
| Working capital / total assets | 0.36 | — | 0.43 | |
| Retained earnings / total assets | (0.42) | — | −0.59 | |
| EBIT / total assets | (0.05) | — | −0.15 | |
| Market value of equity / total liabilities | 4.83 | — | 2.90 | |
| Sales / total assets | 0.39 | — | 0.39 | |
| Altman Z-score | Grey zone | 2.98 | ||
| Z″ Variant for non-manufacturing and asset-light companies (drops the sales/assets term, uses book equity) | Grey zone | 2.44 | ||
How the Altman Z-score works
Z = 1.2 × working capital ÷ total assets + 1.4 × retained earnings ÷ total assets + 3.3 × EBIT ÷ total assets + 0.6 × market value of equity ÷ total liabilities + 1.0 × revenue ÷ total assets (Altman, 1968). The market value of equity is the close on the last trading day of the fiscal year times weighted basic shares.
Z″ = 6.56 × working capital ÷ total assets + 3.26 × retained earnings ÷ total assets + 6.72 × EBIT ÷ total assets + 1.05 × book equity ÷ total liabilities (Altman, Hartzell and Peck, 1995), the variant for non-manufacturing and asset-light companies.
| Zone | Z | Z″ |
|---|---|---|
| Safe zone | above 2.99 | above 2.60 |
| Grey zone | 1.81–2.99 | 1.10–2.60 |
| Distress zone | below 1.81 | below 1.10 |
Not worked out for banks, insurers and REITs, whose balance sheets the model does not describe, nor when a figure is missing or there is no share price in the week to the fiscal year end.
Altman Z-score against peers
| Company | Altman Z-score |
|---|---|
| ASTS AST SpaceMobile, Inc. compare | 4.4× |
| DGII Digi International Inc. compare | 4.0× |
| ZBRA Zebra Technologies Corporation compare | 3.3× |
| BDC Belden Inc compare | 3.1× |
| AAOI Applied Optoelectronics, Inc. | 3.0× |
| EXTR Extreme Networks, Inc. compare | 2.5× |
| ONDS Ondas Holdings Inc. compare | 1.9× |
| VSAT Viasat Inc. compare | 0.8× |
| VIAV Viavi Solutions Inc. compare | −29.9× |
What Altman Z-score is
The Altman Z-Score weighs working capital, retained earnings, operating profit, market value and sales against assets and debts to gauge the risk of distress.
1.2 × working capital ÷ total assets + 1.4 × retained earnings ÷ total assets + 3.3 × EBIT ÷ total assets + 0.6 × market value of equity ÷ total liabilities + 1.0 × revenue ÷ total assets