New York, Feb 4, 2026, 11:42 ET — Regular session
Lumentum Holdings Inc (LITE) shares jumped 7.3% to $466.89 in late-morning trading Wednesday, bouncing around from a low of $443.10 to a high of $509.90.
This matters because the market is trying to gauge the next surge in spending on artificial-intelligence data centers, with optical parts acting as a bottleneck. When demand outpaces factory output, even a slight shift in order flow can quickly impact revenue and margins.
The San Jose, California-based firm reported fiscal second-quarter revenue of $665.5 million and projects third-quarter revenue between $780 million and $830 million. CEO Michael Hurlston highlighted that demand for optical circuit switches pushed the backlog past $400 million. He also mentioned an additional “multi-hundred-million-dollar” order for co-packaged optics lasers, expected to ship in the first half of 2027. 1
Lumentum reports using “non-GAAP” numbers, excluding items like stock-based compensation and costs from acquisitions and restructuring, to highlight its core operating trend. It forecasted a non-GAAP operating margin between 30% and 31% for the quarter, reflecting operating profit as a percentage of sales. 1
Optical circuit switches, known as OCS, direct light through fiber paths within data-center networks. Co-packaged optics, or CPO, places optical components nearer to computing chips, reducing power consumption and heat generation.
“Most importantly, dramatically better guidance” sparked renewed buying, Susquehanna analyst Christopher Rolland noted, highlighting rising demand for transceivers and newer optical systems. 2
Analysts responded to the report by hiking price targets. Ryan Koontz at Needham raised his to $550, Ruben Roy of Stifel bumped his up to $480, Vivek Arya from BofA Securities pushed his target to $520, and Vijay Rakesh at Mizuho lifted his to $525. Meanwhile, Dave Kang at B. Riley Securities upgraded the stock to “buy,” slashing his target from $147 all the way up to $526. 3
The wide trading swings underline how sensitive the stock is to execution details. On the earnings call, Hurlston noted that the bulk of the OCS backlog won’t ship until the second half of calendar 2026. He singled out manufacturing and supply-chain disruptions as the main downside threats. 4
Traders are also eyeing peer Coherent, slated to release fiscal second-quarter results after the close on Feb. 4, as another gauge of demand in high-speed optical components. 5
Alphabet is set to report earnings after Wednesday’s closing bell. Investors will be watching closely for shifts in big-tech spending that could send ripples through the data-center supply chain. 6
