Lumentum Revenue Jumps 136.5% To $1.26 Billion, And Its CEO Sees Roughly $350 Million More Next Quarter
Pump lasers and optical circuit switches led the quarter, and the company forecast second-quarter revenue of $1.575 billion to $1.625 billion.
Lumentum, which makes optical and photonic products for AI and cloud networks, said first-quarter revenue rose 136.5% from a year earlier to $1.26 billion, led by pump lasers and optical circuit switches. The results, reported Monday in an 8-K, arrive as Bloomberg-reported takeover talks with Marvell hang over the stock.
Systems revenue more than tripled
Revenue for the quarter ended September 26 was $1,262.6 million, up 25.5% from the prior quarter's $1,006.3 million. Systems, which includes optical modules and circuit switches, brought in $508.4 million, up 228.8% from a year earlier. Components added $754.2 million, up 98.9%.
Standard-accounting net income was $360.3 million, or $3.54 per diluted share, against $4.2 million a year earlier. Adjusted net income was $461.1 million, or $4.57 per share. The adjusted operating margin reached 42.3%, from 36.6% in the prior quarter and 18.7% a year earlier.
A large part of the gap between the two profit measures is stock pay: the company excluded $146.7 million of stock-based compensation and related payroll taxes, including $89.4 million tied to equity award modifications for the retirement of certain executives announced during the quarter. Cash and short-term investments stood at $2.0 billion, down $758.8 million from the end of the fourth quarter.
A $5 billion commitment and a bigger next quarter
CEO Michael Hurlston said Lumentum secured its second major NPO/CPO win, optical interfaces placed close to AI chips, backed by purchase commitments exceeding $5 billion. He said demand visibility for optical circuit switches has expanded significantly, positioning the product to become a multi-billion-dollar annual revenue stream.
For the second quarter, Lumentum forecast revenue of $1.575 billion to $1.625 billion, an adjusted operating margin of 45.0% to 46.0% and adjusted earnings of $5.90 to $6.20 per share. Hurlston said the company anticipates adding approximately $350 million in sequential growth, "a figure greater than the quarterly revenue of the whole company just two years ago."
Marvell talks overshadow the print
Bloomberg News reported Wednesday that Marvell and Lumentum were discussing a possible Marvell purchase, with an announcement possible the week of November 2, according to a MarketWatch account. Marvell shares fell about 12% on Thursday while Lumentum rose about 2%.
Evercore ISI analyst Amit Daryanani wrote that clients question why Lumentum would sell, given its commentary that the business is sold out through fiscal 2029.
Lumentum's second-quarter forecast of $1.575 billion to $1.625 billion is the number the market now has to weigh against the Marvell talk.
Sources
- 8-K Filing — Lumentum Holdings Inc. (LITE) — SEC EDGAR
- Exhibit lite_ex991xq1fy27.htm — Lumentum Holdings Inc. 8-K exhibit — SEC EDGAR
- Lumentum (LITE) Earnings Expected to Grow: Should You Buy? — Yahoo Finance
- LITE's Transceivers Gain From AI Infrastructure Demand: What's Ahead? — Yahoo Finance
- Lumentum (LITE) Stock Looks Like A Bargain On Its Huge Run — Yahoo Finance
- All the reasons Marvell investors are 'freaking out' as Lumentum deal rumors swirl — morningstar.com
- Lumentum Shares Jump 135% YTD: Can AI Momentum Sustain the Rally? — Yahoo Finance
