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07 May 2025
Photonic component and industrial laser company sees quarterly revenues rising to $500M by the end of 2025.
Lumentum, the California-headquartered manufacturer of photonic components and industrial lasers, has posted sales revenues of $425.2 million for the opening three months of 2025 - up 16 per cent year-on-year and just beating its forecast from February.
The San Jose firm is busy ramping production across several of its product lines used in cloud and artificial intelligence (AI) networking applications, with new CEO Michael Hurlston confident that quarterly sales will surpass $500 million by the end of this year.
“In my first 90 days as CEO, it’s become clear that Lumentum is uniquely positioned to lead as the convergence of optics and electronics accelerates AI data center scaling,” he said.
“Our innovations - from advanced EMLs [externally modulated lasers] to ultra-high-power lasers - are driving transformative power efficiencies across cloud, AI, and long-haul networks, making us an essential partner in this next era of connectivity."
$750M pathway
Appointed in February, Hurlston told an investor conference call discussing the latest results that the firm was “on the right path” to meet that $500 million milestone, and that with key markets currently growing at annual rates in excess of 25 per cent there was a pathway to reach quarterly sales of $750 million in the medium term.
With Lumentum’s components embedded across the communications ecosystem, and found inside both its own products and those of competitors, Hurlston said that the company was well positioned to benefit from demand driven by cloud computing and hyperscale data center operators, and in spite of wider macroeconomic and geopolitical concerns.
“Markets are growing at unprecedented rates because of the convergence of optics and electronics,” he said. “The opportunity ahead is significant, our components business is performing extremely well, and our wafer fabrication facility expansion remains on track.”
As well as its expertise fabricating indium phosphide lasers and photodiodes, as well as vertical cavity surface-emitting lasers (VCSELs), optical transceivers and various other optical networking products, Hurlston highlighted new 1310 nm lasers for co-packaged optics that should start delivering additional sales revenues next year as customers look to improve power efficiencies in data center architectures.
Industrial research cut
While revenues are on the up, Lumentum’s latest figures showed that the firm was not quite yet back to full profitability, although its operating loss of $38 million was much-improved from the figure of $115 million a year ago.
Hurlston told investors that he was focused on further improving margins, partly through actions taken to reduce costs within the company’s industrial technology business unit.
That business unit, which includes industrial lasers and 3D sensing products, delivered sales revenues of $60 million in the latest quarter, up 14 per cent year-on-year and partly the result of strong demand for ultrafast lasers now being used in solar cell production.
And while Hurlston pointed out that the company was continuing to explore other industrial laser applications in display and next-generation semiconductor manufacturing, the company has recently shuttered two research and development sites and three research programs in a bid to improve profit margins.
Looking ahead, the Lumentum executive team is expecting sales in the June quarter to rise to somewhere between $440 million and $470 million. That would represent a sequential jump of as much as 10 per cent, largely driven by a ramp in production of optical transceivers now under way in Thailand.
• The latest outlook appeared to please investors, with the company’s Nasdaq-listed stock price rising in value by around 7 per cent in after-hours trading following the investor call.
At $69, the stock price is still down more than 20 per cent from the start of the year on fears about the wider economic impact of US import tariffs, although Lumentum has indicated previously that it expects any direct impact on its business to be minimal.
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