News about LITE

Marvell Technology (MRVL) shares fell 10% by 12:54 p.m. EDT after the company agreed to buy optical laser maker Lumentum (LITE) in an all-stock deal valuing it at roughly $115 billion, a 24% premium. Investors worried Marvell may be paying a steep price, since Lumentum's stock had already risen sharply over two years and the purchase price was more than five times its share price a year earlier. The article says Marvell is drawn to Lumentum's indium phosphide laser technology, which could be combined with Marvell's digital signal processors and connectivity for next-generation AI systems as co-packaged optics spread inside server racks. It also notes AI stocks are volatile and have recovered from past selloffs, while investors fear the upcoming midterm elections.

Lumentum (LITE) shares are up 383% over the past year, though they have fallen 24% from their 52-week high. Fiscal 2026 revenue rose 83% to $3.01 billion, and Nvidia invested $2 billion, but new shares from that deal and a debt swap slowed per-share earnings growth. In the June quarter, adjusted EPS rose 267% to $3.23 even as diluted shares climbed 40% to 101.1 million. CEO Michael Hurlston said its optical parts are sold out through early 2029, while rival Coherent is adding laser capacity. The stock trades around 40x forward earnings, close to its three-year average, and the author says the next test is the Nov. 5 report, focusing on the share count and whether EML shortfalls remain above 30% of demand.

Lumentum (LITE) shares fell 11.5% in mid-day trading on Thursday, last trading at $752.54 versus a previous close of $850.70, with volume of 6,092,261 shares, 11% above the average session. The article attributes the drop mainly to a sector-wide selloff in AI-optics stocks after a hotter-than-expected September inflation report, with peers Coherent and Applied Optoelectronics also declining. It notes the CFO reportedly sold about $25.7 million of stock ahead of earnings, though insider selling does not necessarily signal weaker fundamentals. Jefferies raised its price target to $1,250 and Stifel to $1,232, while the consensus target is $1,080.83. Lumentum's fiscal first-quarter update is scheduled for November 4.