Sivers Semiconductors: A Photonics Monopoly, a Short Squeeze, and a Dilution Dilemma

Sivers stock surged 2,732% from March low, but a 6% drop, short squeeze margin hikes, and a shareholder dilution vote pose significant risks to investors.

The rally in Sivers Semiconductors has been nothing short of breathtaking. Over the past 30 days, the Swedish photonics specialist surged more than 61%, and at one point it touched a 52-week high of €10.23. Yet on Friday the stock slumped 6% to €7.50, a reminder that even the most compelling technology stories can get caught in violent crosswinds. The question for investors now is whether the bull case—built on a near-monopoly in a critical chip-making component—can survive a punishing short squeeze, a shareholder vote that could flood the market with new stock, and a pair of investigations that have cast a shadow over the company's governance.

At the heart of the bull thesis is Sivers' role in co-packaged optics (CPO), a technology that directly connects optical fibers to silicon chips. The company controls a large share of production capacity for continuous-wave lasers, the essential building block of CPO modules, through strategic deals with foundries like Win Semi. With demand for bandwidth exploding in AI data centers, a recent analysis by Serenity predicted the CPO market will mushroom from a niche to between $81 billion and $91 billion in roughly 18 months. Sivers is also the standard laser-design partner for GlobalFoundries, and the two firms announced a strategic collaboration on June 2 to develop silicon-photonics solutions for AI infrastructure. Sivers' laser arrays are now part of GlobalFoundries' reference designs.

That technology story has been enough to pull the stock 91% above its 50-day moving average and, from its March low of €0.27, an eye-watering 2,732% higher. But the rally has also attracted a swarm of short sellers. Bearish bets have surged to about 17% of the free float, up from just 1.6% in early March. Among the largest short positions are Voleon Capital with 1.86% and Two Sigma with 1.78% of shares outstanding.

The short squeeze has become a costly proposition for bears. On June 3, Nordea Bank slapped drastically higher margin requirements on all its bear certificates and mini-future short products tied to Sivers. For a -1 leverage bear certificate, the margin now stands at 76.5%; for -2 leverage, 152.5%; and for the most aggressive -3 product, a staggering 228.5%. Nordea cited poor liquidity in the securities lending market and rising borrowing costs. With annualized 30-day volatility at 242%, the bank is effectively pricing in extreme risk.

The volatility isn't just a function of the short squeeze, though. Sivers' stock has been whipsawed by a series of corporate developments. On the positive side, Nasdaq admitted the stock to the OMX Stockholm Benchmark Index on June 1, and MSCI confirmed an upcoming inclusion—both events that force index funds to buy shares. On the negative side, the company faces a shareholder meeting on June 15 that could significantly dilute existing holders.

The meeting's agenda includes two major items. First, a long-term incentive program granting up to 7 million stock options, representing roughly 2% dilution. Second—and far more consequential—a blanket authorization for the board to issue up to 53.8 million new shares, options, and convertible bonds. That would allow dilution of around 15% of the current share count. The company says it needs the authority for organic growth, acquisitions, attracting strategic investors, and potentially a secondary listing on Nasdaq New York. A previous capital raise in May placed 8.62 million new shares (about 2.5% dilution) via a directed share issue.

The timing of the vote is particularly delicate because Sivers is under two clouds of suspicion. On June 1, the short-seller research firm Ningi Research published a report alleging questionable revenue recognition and hollow customer contracts. These are unsubstantiated claims, but they land in a period of intense regulatory scrutiny. Separately, the Swedish Economic Crime Authority is investigating whether confidential details about the planned Nasdaq New York listing leaked before the official announcement in April.

That backdrop makes the company's recent operating results all the more sobering. In the first quarter of 2026, net sales fell 22% to SEK 61.9 million, adjusted EBITDA swung to a loss of SEK 13.8 million, and the net loss widened to SEK 42.7 million. Management nevertheless reiterated its full-year targets. The automotive LiDAR business expects series production with a major carmaker in the fourth quarter. The 5G/6G business now has its Daybreak beamforming ICs for FR3 applications generally available. A development contract with a major U.S. defense contractor continues, and the second phase of the EW-Star project under the CHIPS Act has been confirmed, pending successful completion of first-year technical milestones.

The company has called 2027 a "transformative year" and set a long-term target of 25% to 30% annual revenue growth. Whether shareholders give management the tools—and the time—to execute that vision will become clearer after June 15. For a stock that has already swung from cents to double digits and back, the final vote may be the most consequential catalyst yet.