Lumentum reports its Q3 2024 financial results

09 May 2024

Operating loss widens despite strong data center demand; stock rises 9% following announcement.

Diversified telecoms and industrial photonics systems developer Lumentum has this week reported results for its fiscal third quarter’s trading, which ended March 30th. Highlights of the figures, announced on May 6th, included: net quarter revenue of $366.5 million; and non-GAAP gross margin of 32.6% and operating margin of 4.1%.

“Lumentum is well-positioned to capitalize on surging cloud data center demand driven by the exponentially increasing requirements of artificial intelligence,” said Alan Lowe, President and CEO.

“We are making significant strides in developing new products and customer programs, and expanding production capacity to capitalize on exciting opportunities that we expect will meaningfully increase calendar 2025 revenue and beyond.”

“Our third-quarter revenue and EPS exceeded guidance midpoints, with data center revenues achieving a record quarter. The next few quarters’ revenue will continue to be burdened by telecom customer inventory challenges as telco spending has slowed but we are highly confident in our market position and the future recovery and growth in our telecom business,” said Lowe.

Third quarter highlights

• Net revenue for the fiscal third quarter of 2024 was $366.5 million, with GAAP net loss of $127.0 million, or $1.88 per diluted share.
• Net revenue for the fiscal second quarter of 2024 was $366.8 million, with GAAP net loss of $99.1 million, or $1.47 per diluted share.
• Net revenue for the fiscal third quarter of 2023 was $383.4 million, with GAAP net loss of $39.3 million, or $0.57 per diluted share.
• Non-GAAP net income for the fiscal third quarter of 2024 was $19.6 million, or $0.29 per diluted share.
• Non-GAAP net income for fiscal second quarter of 2024 was $21.7 million, or $0.32 per diluted share.
• Non-GAAP net income for the fiscal third quarter of 2023 was $51.8 million, or $0.75 per diluted share.

Lumentum held $870.9 million in total cash, cash equivalents, and short-term investments at the end of the third quarter, down $353.1 million from the end of second quarter. In March 2024, the company paid the remaining $323.1 million principal amount of the convertible notes due in 2024 in full.

Business outlook

The company stated that it expects the following financial performance for the fiscal fourth quarter: net revenue to be in the range of $290 million to $315 million; a non-GAAP operating margin of (3.0%) to 1.0%; and non-GAAP diluted earnings per share of ($0.05) to $0.10.