Lumentum (LITE) Q1 2026 earnings summary

Executive summary

• Achieved record quarterly revenue of $533.8 million in Q1 FY26, up 58% year-over-year, driven by strong AI, cloud, and data center demand, with significant contributions from hyperscale customers and robust growth in both Components and Systems products.

• Non-GAAP diluted EPS reached $1.10, at the high end of guidance; GAAP net income was $4.2 million ($0.05 per share), marking a turnaround from a net loss in the prior year.

• Over 60% of revenue now comes from cloud and AI infrastructure, with cloud transceivers and laser chips leading growth.

• Transitioned to a single reportable segment, with revenue now broken out by components and systems.

• Strong momentum in data center, interconnect, and long-haul markets, with new product lines such as optical circuit switches and co-packaged optics gaining traction.

Financial highlights

• Q1 FY26 GAAP revenue was $533.8 million, up from $480.7 million in Q4 FY25 and $336.9 million in Q1 FY25.

• Non-GAAP gross margin was 39.4%, up 660 bps year-over-year; GAAP gross margin improved to 34.0% from 23.1% year-over-year.

• Non-GAAP operating margin reached 18.7%, up from 3.0% in Q1 FY25; GAAP operating margin improved to 1.3% from -24.5%.

• Adjusted EBITDA was $127.6 million, up from $37.0 million a year ago.

• Cash and short-term investments rose to $1,121.8 million, up $244.7 million sequentially.

Outlook and guidance

• Q2 FY26 revenue guidance is $630–$670 million, with a midpoint of $650 million, and non-GAAP operating margin expected at 20–22%.

• Non-GAAP EPS guidance is $1.30–$1.50; sequential growth expected in both Components and Systems segments.

• Management expects continued strong demand from AI and cloud customers, with ongoing manufacturing expansion and new product momentum.

• FY26 non-GAAP effective tax rate projected at 16.5%.

• Ongoing volatility in gross margins anticipated due to competitive pressures and supply chain dynamics.