AI Networking: The InfiniBand vs. Ethernet War

As clusters scale from 8k to 100k+ GPUs, networking becomes the “AI Backplane.” The ability to move data across the cluster without latency (tail-latency) is the primary constraint on training speed.

1. Infrastructure Topology

graph TD
    A[GPU Clusters] --> B[Leaf Switches]
    B --> C[Spine Switches: InfiniBand/Ethernet]
    C --> D[Optical Transceivers: 800G/1.6T]
    D --> E[Data Center Spine]

2. Fundamental Analysis

Arista Networks (ANET): Leader in AI-Ethernet. Gaining share as “Ultra Ethernet Consortium” standards mature.
NVIDIA (Mellanox): Deep InfiniBand moat. Tightly coupled with the GPU stack.
Optical Pluggables: Shift to LPO (Linear Drive) and CPO (Co-Packaged Optics) to reduce power by 30%. High alpha for small-cap optics players.

3. Technical Levels

ANET: Strong momentum. Support at $380 level. Target $450 on AI-Ethernet adoption.
Broadcom (AVGO): The “Switch Silicon” king. Trading in a massive multi-month base. Breakout above previous high targets significant upside.

4. Trading Narrative

Networking is a Leading Indicator for GPU build-outs. Watch switch orders to predict the next quarter’s GPU revenue.

Last Updated: May 9, 2026