The Bull Case: Lumentum is leading the charge in shifting hyperscale data centers toward 800G & next generation 1.6T optical modules.
$NVIDIA(NVDA)$ multi billion dollar contract with Lumentum validates its proprietary Indium Phosphide lasers & optical transceivers as vital components for future AI scale out architecture.
Lumentum reported an 83.2% surge in fiscal 2026 revenue to USD 3.01 billion, proving that the AI infrastructure boom has translated into concrete order backlogs.
The Bear Case:
Trading at a steep 26.2x sales relative to sector average, leaves zero margin for execution error.
Highly reliant on few tech giants hyperscalers.
A good strategy is to DCA Lumentum to remove emotional decision making.
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