New York, Feb 9, 2026, 11:03 EST — Regular session underway.
- Lumentum was up roughly 7% in late-morning action, building on last week’s rally.
- Focus among investors stayed on the company’s bullish forecast, driven by AI data-center optics demand.
- A recent filing pointed to risks if convertible debt is cleared for early conversion.
Lumentum Holdings Inc. jumped over 7% on Monday, extending last week’s surge for the Nasdaq-listed AI optics stock.
Lumentum plays a pivotal role in the AI infrastructure, handling the optical gear responsible for moving data inside and between data centers. Its shares now act as something of a sentiment gauge for traders betting on the AI story’s next leg.
Another thread running through investor conversations: as shares climb, convertible notes become simpler to flip, which can quickly put pressure on a company’s liquidity numbers if big holders decide to act.
Lumentum jumped 7.3% to $592.50 in late-morning action after reaching $598.89 earlier. Coherent, another optics name, climbed 6.4%. The Invesco QQQ, packed with tech stocks, was up around 0.5%.
Last week, the company posted fiscal Q2 revenue of $665.5 million, with non-GAAP earnings landing at $1.67 per share. For the third quarter, the outlook calls for revenue somewhere between $780 million and $830 million, and non-GAAP EPS in a $2.15 to $2.35 range. CEO Michael Hurlston pointed to surging demand for optical circuit switches, pushing backlog “well beyond $400 million.” He also mentioned a fresh “multi-hundred-million-dollar” co-packaged optics order, set for delivery in the first half of calendar 2027. 1
Lumentum disclosed in its latest quarterly filing that its stock traded high enough during the December period to trigger conversion rights for its convertible notes—an option holders can exercise if the shares hit certain price levels. The company said it’s on the hook to pay out the principal in cash. It flagged a risk: if a large number of noteholders choose to convert at once, liquidity could take a hit, and the conversion feature “raises a substantial doubt” about Lumentum’s ability to stay afloat. 2
Right now, traders are eyeing the stock’s rally to see if it actually brings in conversions and cash, or if it ends up as nothing more than an accounting overhang. They’re also tracking whether Lumentum manages to clear out its switch backlog with deliveries—without sacrificing margins along the way.
The risk is clear enough: should the AI-fueled capex cycle lose steam or clients delay deployments, orders could fall off—and these volatile optics stocks tend to tumble quickly. On the flip side, if conversions pick up speed, Lumentum might feel forced to tap financing options it would ideally prefer to leave on the table.
Tech stocks facing rate pressure will get their next reality check this week: U.S. January jobs numbers hit Feb. 11, January CPI lands Feb. 13. Both drop at 8:30 a.m. Eastern. 3
