In the era of explosive growth in artificial intelligence, the demand for computing power is increasing at an astonishing rate. With the surge in cross-regional collaboration needs for AI clusters, the optical communication field is experiencing unprecedented development opportunities.
In this technological race, CPC (Co-Packaged Copper) technology, as a new breakthrough in connection solutions, is addressing the pain points of high-speed interconnects within data centers, attracting widespread market attention.
01 What is CPC Technology?
CPC (Co-Packaged Copper) is an innovative interconnect solution aimed at short-distance, high-density scenarios such as AI computing centers and GPU clusters.
The core idea of CPC is to integrate high-speed copper cable connectors directly into the ASIC/Switch package, allowing high-speed signals to be transmitted immediately upon exiting the chip, thereby minimizing losses, reflections, and crosstalk associated with traditional PCB routing.
Compared to CPO (Co-Packaged Optics), which follows the “optics in, copper out” approach, CPC does not require optoelectronic conversion, offering lower costs, reduced latency, and compatibility with existing copper cable ecosystems. It is regarded as one of the most feasible routes for mass production from 224 Gbps/channel to 448 Gbps.
02 Why is CPC Technology Important?
In an environment of explosive AI demand, data centers face significant challenges in bandwidth and power consumption. The CPC solution is expected to become the mainstream technology for transmitting high-speed signals online.
In traditional solutions, signal transmission requires passing through the PCB (Printed Circuit Board) stage, while CPC allows the 224 Gbps copper cable connector to be “co-packaged” directly on top of the ASIC package substrate, completely bypassing PCB routing.
This change brings two key advantages: first, channel loss is reduced to below 3dB, and power consumption decreases by 30%, aligning with the extreme low-power demands of AI servers; second, it addresses the maintenance difficulties of CPO technology, significantly lowering the entry barriers.
In the data center field, external interconnections primarily use optics, while internal connections rely on copper. CPC technology is an optimized solution for short-distance, high-bandwidth scenarios within cabinets.
03 Differences Between CPC and Traditional Interconnect Technologies
There are several main short-distance transmission solutions for data centers: AOC (Active Optical Cable), DAC (Direct Attach Copper), ACC (Active Copper Cable), and AEC (Active Electrical Cable).
AOC is based on the principle of optoelectronic conversion, with optical fibers in the middle and optical modules at both ends, featuring long transmission distances, high bandwidth, and compact size, but with higher costs and power consumption.
DAC is the most basic form of copper cable connection, with copper cables in the middle and connectors at both ends, offering low cost, low power consumption, low latency, and good heat dissipation, but is limited by the physical properties of copper, resulting in very short transmission distances (generally within 3 meters).
ACC builds on DAC by incorporating Redriver chips for signal amplification and equalization, extending the transmission distance compared to DAC. AEC, on the other hand, integrates Retimer chips into DAC, supporting higher speeds and longer transmission distances (up to 7 meters), and is considered a future trend.
The biggest difference between CPC and these traditional solutions is that it directly integrates high-speed connectors with the chip substrate, eliminating PCB routing losses and achieving external interconnections through copper cables.
04 Overview of the CPC Industry Chain
The CPC industry chain encompasses multiple segments from connector brand manufacturers to component manufacturers.
(1) CPC Connector Brand Manufacturers
Major overseas manufacturers include Molex, Amphenol, and TE Connectivity, leading international connector companies.
Domestic major manufacturers include Luxshare Precision (002475), a leading domestic connector company that independently developed the KOOLIO CPC solution, and Yihua Co., Ltd. (002897), a supplier of Huawei cable IO connectors.
(2) Pluggable Optical Module Manufacturers
Although CPC is a copper interconnect technology, it is used in conjunction with pluggable optical modules, significantly extending the lifecycle of these modules and alleviating the urgency of CPO.
Key manufacturers include Zhongji Xuchuang (300308) and Xinyi Sheng (300502).
(3) IO Connector Component Manufacturers
These manufacturers provide core components for CPC connectors, including Dingtong Technology (688668) and Yidong Electronics (301123).
(4) Copper Cable Component Manufacturers
CPC technology requires high-quality high-speed copper cables, with major manufacturers including Jin Xin Nuo (300252), which has certified 800G high-speed copper cables and is a CPC component manufacturer, binding with Xuchuang, and AEC products entering the XAI supply chain; Wolke Material (002130), which produces high-density copper cables for the NVIDIA GB200 CPC solution; and Zhaolong Interconnect (300913), which has certified 800G high-speed copper cables and is a CPC component manufacturer.
(5) PCB Manufacturers
Although CPC technology bypasses PCB routing, it imposes higher “extreme requirements” on PCBs, necessitating the use of laser cutting technology.
Major PCB manufacturers include Shenghong Technology (300476), a leading AI server PCB manufacturer that supports CPC architecture; Huadian Co., Ltd. (002463), a high-end PCB manufacturer and core supplier of CPC backplanes; and Xingsen Technology (002436), another leading AI server PCB manufacturer that supports CPC architecture.
(6) Laser Cutting Equipment Manufacturers
The implementation of CPC imposes higher requirements on PCB processing, making laser cutting equipment essential: Kuaike Intelligent (603203) has achieved significant breakthroughs in PCB laser cutting technology, with related equipment already entering Foxconn, Luxshare, and others.
05 Comparison of Domestic and Foreign Manufacturer Layouts
Overseas manufacturers have started earlier in the CPC technology field, with leading international connector companies such as Molex, Amphenol, and TE Connectivity already establishing a presence in this area.
These companies possess deep technical accumulation and customer resources, dominating the high-end connector market.
Domestic manufacturers have rapidly risen in recent years, with Luxshare Precision, as a leading domestic connector company, independently developing the KOOLIO CPC solution and jointly proposing the CPC concept with Zhongji Xuchuang at the Optical Expo, attracting market attention.
Zhongji Xuchuang, as a leading optical module company, is also coordinating the layout of CPO and CPC, showcasing its technical strength.
In terms of technical strength, overseas manufacturers still maintain a lead in certain high-end fields, but domestic manufacturers are quickly catching up and have advantages in cost control and customer response speed.
06 Application Scenarios and Prospects of CPC Technology
The application scenarios of CPC technology are mainly concentrated in short-distance high-bandwidth scenarios in data centers, such as interconnections between devices within cabinets (switches and servers, servers and storage, switch interconnections).
With the explosive demand for AI servers, CPC is expected to become the mainstream interconnect solution. The commercialization process of CPC is accelerating, and in the 2025 AI server PCB project bidding, leading manufacturers such as Luxshare Precision, Huadian Co., Ltd., and Shenghong Technology have included “laser cutting” in their technical agreements as a prerequisite for introducing CPC interconnects.
From a market perspective, the explosive demand for AI servers is driving CPC to become the mainstream interconnect solution, and each CPC architecture server requires matching laser cutting equipment and processes. As the adoption of 224G and 400G high-speed copper cables increases, the demand for equipment replacement will continue to be released.
In terms of technological development paths, CPC is regarded as one of the most feasible routes for mass production from 224 Gbps/channel to 448 Gbps. It pairs well with pluggable optical modules, effectively addressing bandwidth and loss issues driven by AI, and is expected to significantly extend the lifecycle of pluggable optical modules.
07 Latest Industry Dynamics and Market Performance
On September 11, 2025, at the Optical Expo, both Zhongji Xuchuang and Luxshare Precision emphasized the promising application prospects of CPC in the next generation of switches, attracting market attention.
Driven by the CPC concept, Luxshare Precision saw its stock hit the daily limit on September 11 and continued to rise by 2.48% on the morning of September 12, with a transaction volume of 16.054 billion yuan, ranking first in A-shares, and a latest market value of 393.13 billion yuan.
In addition to Luxshare Precision, other CPC concept stocks also performed actively, with Jin Xin Nuo hitting the daily limit yesterday and rising over 14% in the morning; Wolke Material, Qipai Technology, and Ashichuang also saw increases.
The technology sector continued its active trend in the morning, with the semiconductor industry chain leading the way. The non-ferrous metals sector rose, with the industrial metals sector leading. By the close of the morning session, the Shanghai Composite Index rose by 0.24%, the Shenzhen Component Index rose by 0.15%, and the ChiNext Index fell by 0.52%.
Recently, the non-ferrous metals sector has remained active, with market participants indicating that this is a structural opportunity driven by macro liquidity, industrial policies, and geopolitical factors. Among them, industrial metals need to closely monitor changes in supply and demand balance, while precious metals benefit from the long-term logic of monetary system reconstruction.
08 Challenges and Opportunities
Although CPC technology has broad prospects, it also faces several challenges.
From a technical perspective, CPC currently has high costs and process requirements. The implementation of CPC imposes “extreme requirements” on PCBs, necessitating solutions to the contradiction of “thick copper and ultra-thin coexistence,” as well as the processing challenges of ultra-low loss materials and stringent dimensional accuracy requirements.
In terms of market competition, CPC needs to compete with other technological routes such as CPO (Co-Packaged Optics). CPO integrates optical engines with switching chips to reduce signal transmission paths; essentially, it is optical interconnect, allowing for longer transmission distances but with higher power consumption.
From a supply chain perspective, the commercialization of CPC requires the cooperation of the entire industry chain, from connectors, copper cables, PCBs to processing equipment, all needing to meet higher standards.
Despite these challenges, CPC technology still faces significant development opportunities. The growth in AI and computing power demand is the core driving force behind the development of CPC technology. As the demand for cross-regional collaboration in AI clusters surges, the need for high-speed, low-power, low-latency interconnect solutions is becoming increasingly urgent.
The trend of domestic substitution also provides development opportunities for domestic CPC industry chain enterprises. Driven by both technological upgrades and domestic substitution, those enterprises that strategically position themselves in key segments are likely to enjoy the dividends of industry development.
As the demand for AI servers explodes, the CPC solution is becoming the mainstream interconnect solution. Global data traffic is growing at a rate of 30% per year, and CPC technology is expected to become an important component of a trillion-dollar market by 2026.
Technological innovation never ceases. The rise of CPC technology not only extends the lifecycle of pluggable optical modules but also creates new development space for copper interconnect technology in high-speed transmission fields.
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