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Research Alert: Lite Tops Estimates Amid Ai Data Center Boom, Record Revenue, Margin Expansion

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-- CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:

Lumentum delivered exceptional Q3 FY26 results with record revenue of $808.4M (+21.5% Q/Q, +90.1% Y/Y) and non-GAAP EPS of $2.37, demonstrating remarkable operating leverage. Non-GAAP operating margins expanded 700 bps Q/Q to 32.2%, validating management's scaling strategy to meet hyperscaler demand. Both Components ($533.3M, +20.2% Q/Q) and Systems ($275.1M, +24.0% Q/Q) segments delivered robust growth, reflecting comprehensive positioning across AI infrastructure. Management's optimistic Q4 guidance signals sustained momentum with revenue midpoint of $985M (~22% Q/Q growth) and operating margins expanding to 35.0%-36.0%. The company remains sold out with significant supply-demand imbalance, undershipping customer demand by ~30% despite 40% capacity expansion progress. We believe the scalability of Lumentum's photonics platform positions it well to capitalize on AI buildout, with all EML capacity covered by LTAs through 2027 providing revenue visibility and pricing stability.

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