Key points
- Lumentum reported fiscal Q4 revenue of $1.006 billion, up 109% year over year, and non-GAAP EPS of $3.23. Both beat Wall Street.
- Lumentum guided fiscal Q1 to $1.225 to $1.275 billion in revenue and $4.05 to $4.35 in non-GAAP EPS, above the $1.15 billion the Street had modeled.
- LITE had lost 8.6% Monday to $813.51 and COHR 14.2% to $325.15, giving back part of runs of 25% and 44% into earnings.
- Coherent reports fiscal Q4 after the close Wednesday, August 12, with analysts at $1.58 a share.
From July 31 to August 7, Coherent (COHR) climbed 44% on reports that Washington wants Chinese optical transceivers out of American data centers. Days before its earnings report, the stock fell 14.2% to $325.15.
Lumentum (LITE) made the same round trip. The stock rose 25% from July 31 through Friday, closed at $890.17, and then dropped 8.6% on Monday to $813.51. 24/7 Wall St described the decline as traders taking profits across the AI optics group ahead of this week's earnings reports.
| Stock | Run, Jul 31 to Aug 7 | Monday |
|---|---|---|
| COHR | +44% | -14.2% |
| LITE | +25% | -8.6% |
| AAOI | +44% | -2.1% |
The rally began with a trade story. According to Reuters, the Trump administration has been drafting rules that would bar new Chinese-made optical transceivers, the components that move data over fiber between servers inside AI data centers, from US networks. Counterpoint Research puts Zhongji Innolight, the largest Chinese supplier, at about 27% of the global market for data center transceivers.
However, the measure is still a draft. It has not been voted on or adopted, and Tom's Hardware reported that the White House wants restrictions in place sometime in 2026 while Beijing has said it will respond if necessary. It is the second move against Chinese hardware this summer, after the FCC's action on Chinese-made robots in July.
But not every optical name gave the gains back. Applied Optoelectronics (AAOI), a Texas-based transceiver maker and the smallest of the three, ran 44% over the same five days and slipped just 2.1% on Monday, closing at $132.81.
Lumentum's numbers
Lumentum reported fiscal fourth-quarter results after the close on Tuesday, August 11. Revenue was $1.006 billion, up 109% from a year earlier and 24% from the prior quarter. Non-GAAP earnings were $3.23 a share, against a consensus near $3.00. Both figures beat.
The guidance ran higher than the quarter. For the fiscal first quarter, Lumentum guided to revenue of $1.225 billion to $1.275 billion and non-GAAP earnings of $4.05 to $4.35 a share. The Street had modeled about $1.15 billion. Full-year revenue was $3.014 billion, up 83%.
The GAAP number showed a loss of $84.65 a share, the result of a $7.8 billion non-cash charge tied to retiring convertible debt. It does not reflect the operating business, and the non-GAAP figure is the one the company and analysts measure against.
The stock swung after the report. Lumentum fell as low as $777.50 in the first minutes of after-hours trading, about 4% under its close, then recovered to trade higher. It is up more than 600% over the past year. 24/7 Wall St noted the same setup a quarter ago, when Lumentum beat and the shares still fell the next day with expectations already ahead of the numbers.
Coherent reports next
Coherent and Lumentum both make optical transceivers and components for AI data centers, parts that sit in the middle of the AI hardware stack. Lumentum's 109% revenue growth is the freshest read on that demand before Coherent reports.
Both stocks steadied on Tuesday, with Coherent near $330 and Lumentum near $820 before the report. Coherent's fiscal fourth-quarter results are due after the close on Wednesday, August 12. Analysts are looking for $1.58 a share.
