{"id":42452,"date":"2026-06-02T23:56:00","date_gmt":"2026-06-02T15:56:00","guid":{"rendered":"https:\/\/www.granitefirm.com\/blog\/us\/?p=42452"},"modified":"2026-06-01T23:27:04","modified_gmt":"2026-06-01T15:27:04","slug":"lumentum-optical-lasers","status":"publish","type":"post","link":"https:\/\/www.granitefirm.com\/blog\/us\/2026\/06\/02\/lumentum-optical-lasers\/","title":{"rendered":"Lumentum, an expert in optical communications and lasers"},"content":{"rendered":"\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_84 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #ffffff;color:#ffffff\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #ffffff;color:#ffffff\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2026\/06\/02\/lumentum-optical-lasers\/#Company_Introduction\" >Company Introduction<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2026\/06\/02\/lumentum-optical-lasers\/#Spun_off_from_JDSU\" >Spun off from JDSU<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2026\/06\/02\/lumentum-optical-lasers\/#Core_Business\" >Core Business<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2026\/06\/02\/lumentum-optical-lasers\/#Business_Overview\" >Business Overview<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2026\/06\/02\/lumentum-optical-lasers\/#Optical_Communications_and_Commercial_Lasers\" >Optical Communications and Commercial Lasers<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2026\/06\/02\/lumentum-optical-lasers\/#New_Business\" >New Business<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2026\/06\/02\/lumentum-optical-lasers\/#Operating_Performance\" >Operating Performance<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2026\/06\/02\/lumentum-optical-lasers\/#Q1_2026_result\" >Q1 2026 result<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2026\/06\/02\/lumentum-optical-lasers\/#Q2_2026_Guidance\" >Q2 2026 Guidance<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-10\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2026\/06\/02\/lumentum-optical-lasers\/#Outlook\" >Outlook<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-11\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2026\/06\/02\/lumentum-optical-lasers\/#Demand_Exceeds_Supply\" >Demand Exceeds Supply<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-12\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2026\/06\/02\/lumentum-optical-lasers\/#How_Big_is_the_Market\" >How Big is the Market?<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-13\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2026\/06\/02\/lumentum-optical-lasers\/#Benefiting_from_the_AI_%E2%80%8B%E2%80%8BBoom\" >Benefiting from the AI \u200b\u200bBoom<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-14\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2026\/06\/02\/lumentum-optical-lasers\/#Extensive_Use_in_AI_Data_Centers\" >Extensive Use in AI Data Centers<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-15\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2026\/06\/02\/lumentum-optical-lasers\/#Why_Use_Lumentums_Products\" >Why Use Lumentum&#8217;s Products?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-16\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2026\/06\/02\/lumentum-optical-lasers\/#AI_is_driving_Lumentums_growth\" >AI is driving Lumentum&#8217;s growth<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-17\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2026\/06\/02\/lumentum-optical-lasers\/#Optical_communications_are_the_future\" >Optical communications are the future<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-18\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2026\/06\/02\/lumentum-optical-lasers\/#Nvidias_Strategic_Investment\" >Nvidia&#8217;s Strategic Investment<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-19\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2026\/06\/02\/lumentum-optical-lasers\/#Risks\" >Risks<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-20\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2026\/06\/02\/lumentum-optical-lasers\/#The_Artificial_Intelligence_Bet\" >The Artificial Intelligence Bet<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-21\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2026\/06\/02\/lumentum-optical-lasers\/#Insider_Stock_Sales_Worth_Noting\" >Insider Stock Sales Worth Noting<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-22\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2026\/06\/02\/lumentum-optical-lasers\/#Capital_Market_Performance\" >Capital Market Performance<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-23\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2026\/06\/02\/lumentum-optical-lasers\/#Stock_Price_Performance\" >Stock Price Performance<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-24\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2026\/06\/02\/lumentum-optical-lasers\/#Market_Valuation\" >Market Valuation<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-25\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2026\/06\/02\/lumentum-optical-lasers\/#Related_articles\" >Related articles<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Company_Introduction\"><\/span>Company Introduction<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Spun_off_from_JDSU\"><\/span>Spun off from JDSU<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p><a href=\"https:\/\/www.lumentum.com\/en\" target=\"_blank\" rel=\"noopener\">Lumentum (ticker: LITE)<\/a> is an optical and photonics products manufacturing company. In August 2015, JDSU split into two separate companies\u2014Viavi Solutions and Lumentum.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Core_Business\"><\/span>Core Business<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Lumentum&#8217;s products are used in end-market applications such as optical communications and commercial lasers, and also in industries such as manufacturing, inspection, and life sciences.<\/p>\n\n\n\n<p>Lumentum manufactures and markets optical and photonic products in the Americas, Asia Pacific, Europe, the Middle East, and Africa.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Business_Overview\"><\/span>Business Overview<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Optical_Communications_and_Commercial_Lasers\"><\/span>Optical Communications and Commercial Lasers<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Lumentum has two main divisions: the Optical Communications division and the Commercial Lasers division. The Optical Communications division manufactures and markets optical and photonic components, modules, and systems that enable high-speed data transmission. The Lasers division focuses on industrial laser products.<\/p>\n\n\n\n<p>In terms of products, Lumentum offers two types of optical and photonic products: optical components for telecommunications network equipment, and commercial lasers for manufacturing, inspection, and life science laboratories.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"New_Business\"><\/span>New Business<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Lumentum has also expanded into new optical applications, such as 3D sensing semiconductor lasers for consumer electronics. It generates the largest revenue from its OpComms division. OpComms&#8217; products include a variety of components, modules, and subsystems to support customers, including carrier networks for access (local), metro (urban), long-haul, and submarine (submarine) applications.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Operating_Performance\"><\/span>Operating Performance<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Q1_2026_result\"><\/span>Q1 2026 result<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>In its Q1 2026 earnings report, Lumentum reported net income of $808.4 million. While this represents a 90% year-over-year increase, it is still approximately $12 million lower than the consensus estimate of $820.4 million. Despite recent strong profit growth, the company&#8217;s profits have declined at an annualized rate of 33.1% over the past five years.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Q2_2026_Guidance\"><\/span>Q2 2026 Guidance<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>The company issued guidance for its Q2 2026 results, projecting:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Net revenue is expected to be between $960 million and $1.01 billion, exceeding the consensus estimate of $917.27 million.<\/li>\n\n\n\n<li>Non-GAAP operating margin is expected to be between 35.0% and 36.0%.<\/li>\n\n\n\n<li>Non-GAAP diluted earnings per share are projected to be between $2.85 and $3.05, exceeding the consensus estimate of $2.69.<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Outlook\"><\/span>Outlook<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Driven by AI-driven demand for data centers, Lumentum is experiencing rapid revenue and profit growth. In the first nine months of fiscal year 2026, ending March 28, its revenue increased 72% year-over-year, slightly exceeding $2 billion. Lumentum expects second-quarter revenue to reach $985 million, meaning it will more than double the $480.7 million in the same period last year.<\/p>\n\n\n\n<p>More importantly, Lumentum points to its high-margin data center products. This translates into robust net profit growth, with projected earnings per share for the first nine months of fiscal year 2026 to increase 4.5 times year-over-year to $5.27. Furthermore, Lumentum expects strong revenue growth to translate into healthy profit growth.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Demand_Exceeds_Supply\"><\/span>Demand Exceeds Supply<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>The completion of its fifth indium phosphide wafer fab directly addresses the growing demand for connectivity in artificial intelligence (AI) and hyperscale data centers, potentially becoming a significant driver of Lumentum&#8217;s optical product portfolio.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"How_Big_is_the_Market\"><\/span>How Big is the Market?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>According to market research firm Cignal AI, the optical components market is projected to grow at an annual rate of 21% by 2029, generating $30 billion in revenue by the end of the forecast period. Therefore, Lumentum&#8217;s target market is expected to experience strong growth in the coming years, which explains analysts&#8217; expectations of stable revenue growth for the company.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Benefiting_from_the_AI_%E2%80%8B%E2%80%8BBoom\"><\/span>Benefiting from the AI \u200b\u200bBoom<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Extensive_Use_in_AI_Data_Centers\"><\/span>Extensive Use in AI Data Centers<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Lumentum&#8217;s optical products are widely deployed in data centers to enable rapid data transfer and meet the significant growth in demand from AI workloads. Lumentum benefits from the demand for AI infrastructure and data centers because it is a supplier to Ciena, and its parent company is considered by some analysts to be an undervalued peer in the optical components field.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Why_Use_Lumentums_Products\"><\/span>Why Use Lumentum&#8217;s Products?<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Lumentum&#8217;s prominence is well-deserved. The company is at the heart of one of the fastest-growing parts of the AI \u200b\u200binfrastructure stack\u2014optical networks. As AI systems grow larger and more powerful, the amount of data transferred between servers and chips is exploding.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"AI_is_driving_Lumentums_growth\"><\/span>AI is driving Lumentum&#8217;s growth<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Lumentum manufactures optical and photonic devices such as lasers, transceivers, and amplifiers, widely used in cloud computing, networking, and industrial markets. Its products enable high-speed connectivity in data centers, making them highly sought after by hyperscale data center operators to reduce latency when transmitting large datasets.<\/p>\n\n\n\n<p>Lumentum&#8217;s accelerated growth reflects increasing demand for its products. This is not surprising, as Lumentum&#8217;s optical and photonic components eliminate a key bottleneck in AI model training and inference tasks. The high-speed connectivity enabled by Lumentum&#8217;s products means that AI acceleration chips do not need to idle while waiting for data, thus reducing the time required to run workloads in the cloud.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Optical_communications_are_the_future\"><\/span>Optical communications are the future<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Because efficient data transmission within data centers may be just as important as data processing. As a leading developer of optical and photonic technologies, Lumentum uses light instead of traditional electrical connections to transmit data. In the long term, copper wire transmission will be replaced by photonic communication, thus Lumentum is poised to benefit significantly from this artificial intelligence revolution.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Nvidias_Strategic_Investment\"><\/span>Nvidia&#8217;s Strategic Investment<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Nvidia and Lumentum have entered into a multi-year agreement on advanced optical technologies for artificial intelligence infrastructure. This includes a multi-billion dollar procurement commitment from Nvidia, future access to laser component production capacity, and joint development of next-generation artificial intelligence systems.<\/p>\n\n\n\n<p>Nvidia has agreed to invest $2 billion in Lumentum through a private placement, issuing 2,876,415 Series A convertible preferred shares at $695.31 per share, convertible 1:1 to common stock under certain conditions.<\/p>\n\n\n\n<p>Lumentum plans to build a 240,000-square-foot U.S. manufacturing facility in Greensboro, North Carolina, to produce indium phosphide optical components for large-scale artificial intelligence data centers. The plan involves an investment of hundreds of millions of dollars and will retain or create over 400 manufacturing jobs.<\/p>\n\n\n\n<p>Nvidia plans to invest $2 billion in Lumentum, along with billions more in commitments to purchase advanced optics components. Analysts believe this is related to co-packaged optics and potential profitability.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Risks\"><\/span>Risks<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"The_Artificial_Intelligence_Bet\"><\/span>The Artificial Intelligence Bet<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Lumentum has benefited from surging spending on AI infrastructure, driven by growing demand for optical connectivity. In many ways, Lumentum has successfully bet on AI infrastructure.<\/p>\n\n\n\n<p>However, the problem is that once the market fully embraces an investment story, the expected rate of increase can exceed what the company&#8217;s actual performance can sustain. This explains why the stock price has risen far faster than the company&#8217;s actual financial growth. For example, the company&#8217;s revenue growth in the most recent quarter was &#8220;only&#8221; 90%.<\/p>\n\n\n\n<p>At current stock price levels, investors are no longer simply expecting Lumentum to benefit from AI demand. They are betting that even if AI spending remains high for the next few years, the company will continue to operate near-perfectly. This significantly reduces the likelihood of the company disappointing.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Insider_Stock_Sales_Worth_Noting\"><\/span>Insider Stock Sales Worth Noting<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Over the past few months, several senior executives and insiders at Lumentum have sold substantial amounts of stock, worth tens of millions of dollars. Senior executives have many legitimate reasons for selling stock, including diversification, tax planning, and pre-arranged deal plans.<\/p>\n\n\n\n<p>However, long-term investors should at least take note when insiders reduce their holdings after a historic surge in the stock price. Why? Because insiders often understand better than anyone how much optimism the stock price has already reflected.<\/p>\n\n\n\n<p>This doesn&#8217;t necessarily mean management believes the company&#8217;s business is weakening. In fact, the opposite could be true. But it could indicate that some insiders have a different view of the current risk-reward profile than momentum investors who aggressively chase the rally.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Capital_Market_Performance\"><\/span>Capital Market Performance<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Stock_Price_Performance\"><\/span>Stock Price Performance<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>The company&#8217;s stock price has risen nearly 170% in the past six months. Over the past 12 months, the stock has risen more than 1,100%.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Market_Valuation\"><\/span>Market Valuation<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Lumentum&#8217;s current price-to-earnings ratio of 56 is high, which is considered overvalued, but its strong earnings growth justifies this valuation. Assuming that a few years from now, this AI stock&#8217;s price-to-earnings ratio drops to 50 and earnings per share reach $28.12, its share price could potentially reach $1,406. This represents a 64% potential upside, making now a good time for investors to buy.<\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"135\" height=\"80\" src=\"https:\/\/www.granitefirm.com\/blog\/us\/wp-content\/uploads\/sites\/2\/2026\/06\/LITE-Custom.jpg\" alt=\"Lumentum\" class=\"wp-image-42453\"\/><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Related_articles\"><\/span>Related articles<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2026\/05\/20\/cpo-optical-transmission\/\">CPO Optical Transmission inevitable is changing data transmission<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2024\/09\/06\/what-are-silicon-photonics\/\" target=\"_blank\" rel=\"noreferrer noopener\">What are silicon photonics? Why it&#8217;s important? and current progress<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2025\/06\/10\/spectrum-x-and-quantum-x\/\">Spectrum-X and Quantum-X switches, Nvidia&#8217;s new territory<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2025\/10\/14\/nvidia-investment-empire\/\">Portfolio of Nvidia investment empire <\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2024\/12\/02\/broadcom-share-price\/\">The reasons behind Broadcom share price consistantly outperformance<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/07\/23\/significant-changes-in-broadcoms-business-approach\/\" target=\"_blank\" rel=\"noreferrer noopener\">Significant changes in Broadcom\u2019s business approach<\/a>&#8220;<\/li>\n<\/ul>\n\n\n\n<p><em>Disclaimer<\/em><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><em>The content of this site is the author\u2019s personal opinions and is for reference only. I am not responsible for the correctness, opinions, and immediacy of the content and information of the article. Readers must make their own judgments.<\/em><\/li>\n\n\n\n<li><em>I shall not be liable for any damages or other legal liabilities for the direct or indirect losses caused by the readers&#8217; direct or indirect reliance on and reference to the information on this site, or all the responsibilities arising therefrom, as a result of any investment behavior.<\/em><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Driven by AI-driven demand for data centers, Lumentum has experienced rapid revenue and profit growth. In the first nine months of fiscal year 2026, ending March 28, its revenue increased by 72% year-over-year. Furthermore, with copper wire transmission expected to be replaced by photonic communication in the long term, Lumentum is poised to benefit significantly from this AI revolution.<\/p>\n","protected":false},"author":1,"featured_media":42453,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[454],"tags":[1597],"class_list":["post-42452","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-communication","tag-lite"],"_links":{"self":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts\/42452","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/comments?post=42452"}],"version-history":[{"count":5,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts\/42452\/revisions"}],"predecessor-version":[{"id":42460,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts\/42452\/revisions\/42460"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/media\/42453"}],"wp:attachment":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/media?parent=42452"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/categories?post=42452"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/tags?post=42452"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}