- Net revenue of $402.2 million
- GAAP gross margin of 24.8%; Non-GAAP gross margin of 32.3%
- GAAP operating loss of 12.8%; Non-GAAP operating margin of
7.9%
- GAAP diluted net loss per share of $0.88; Non-GAAP diluted net
income per share of $0.42
Lumentum Holdings Inc. (“Lumentum” or the “Company”) today
reported results for its fiscal second quarter ended December 28,
2024.
“In the second quarter, we exceeded the high end of our guidance
ranges for both revenue and earnings per share, driven by strong
demand in the cloud end market. This is an exciting time for
Lumentum as we position ourselves to capitalize on expanding cloud
opportunities and the recovery of the broader networking market.
Our foundational technologies enable us to win in these markets,”
said Alan Lowe, President and CEO. “With our strong market position
and improving industry trends, we remain confident in achieving our
previously stated goal of reaching $500 million in quarterly
revenue by the end of calendar year 2025.”
“On a personal note, serving as Lumentum’s President and CEO
over the last decade has been the highlight of my career, and I am
deeply grateful to our talented team for their dedication. I look
forward to continuing my role on the Lumentum Board and serving as
an advisor to ensure a smooth transition to Michael Hurlston,”
concluded Mr. Lowe.
Fiscal Second Quarter Highlights:
Net revenue for the fiscal second quarter of 2025 was $402.2
million, with GAAP net loss of $60.9 million, or $0.88 per diluted
share. Net revenue for the fiscal first quarter of 2025 was $336.9
million, with GAAP net loss of $82.4 million, or $1.21 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.
Non-GAAP net income for the fiscal second quarter of 2025 was
$30.0 million, or $0.42 per diluted share. Non-GAAP net income for
the fiscal first quarter of 2025 was $12.2 million, or $0.18 per
diluted share. Non-GAAP net income for the second quarter of 2024
was $16.4 million, or $0.24 per diluted share(1).
The Company held $896.7 million in total cash, cash equivalents,
and short-term investments at the end of the fiscal second quarter
of 2025, down $19.4 million from the end of the fiscal first
quarter of 2025.
Financial Overview – Fiscal Second Quarter Ended December 28,
2024
GAAP Results ($ in
millions)
Q2
Q1
Q2
Change
FY 2025
FY 2025
FY 2024
Q/Q
Y/Y
Net revenue
$
402.2
$
336.9
$
366.8
19.4%
9.7%
GAAP gross margin
24.8
%
23.1
%
17.4
%
170 bps
740 bps
GAAP operating loss
(12.8
)%
(24.5
)%
(28.7
)%
1,170 bps
1,590 bps
Non-GAAP Results ($ in
millions)
Q2
Q1
Q2
Change
FY 2025
FY 2025
FY 2024 (1)
Q/Q
Y/Y
Net revenue
$
402.2
$
336.9
$
366.8
19.4%
9.7%
Non-GAAP gross margin
32.3
%
32.8
%
31.4
%
(50) bps
90 bps
Non-GAAP operating margin
7.9
%
3.0
%
1.9
%
490 bps
600 bps
Net Revenue by Segment ($ in
millions)
Q2
% of
Q1
Q2
Change
FY 2025
Net Revenue
FY 2025
FY 2024
Q/Q
Y/Y
Cloud & Networking
$
339.2
84.3
%
$
282.3
$
286.7
20.2
%
18.3
%
Industrial Tech
63.0
15.7
%
54.6
80.1
15.4
%
(21.3
)%
Total
$
402.2
100.0
%
$
336.9
$
366.8
19.4
%
9.7
%
(1) During the first fiscal
quarter of 2025, the Company refined its methodology to report
non-GAAP measures. The change does not impact the Company’s
financial position, cash flows, or GAAP consolidated results of
operations. Prior period non-GAAP financial measures presented in
this press release have been recast to conform to the current
presentation.
The tables above provide comparisons of quarterly results to
prior periods, including sequential quarterly and year-over-year
changes. A reconciliation between GAAP and non-GAAP measures is
contained in this release under the section titled “Use of Non-GAAP
Financial Measures.”
Business Outlook
Lumentum expects the following for the fiscal third quarter
2025:
- Net revenue in the range of $410 million to $425 million
- Non-GAAP operating margin of 9.5% to 10.5%
- Non-GAAP diluted earnings per share of $0.47 to $0.53
We have not provided reconciliations from GAAP to non-GAAP
measures or the equivalent GAAP measure for non-GAAP measures in
our outlook, as they cannot be provided without unreasonable
effort. A large portion of non-GAAP adjustments, such as
restructuring charges, stock-based compensation, non-GAAP income
tax reconciling adjustments, acquisition related costs, and other
costs and contingencies unrelated to current and future operations
are by their nature highly volatile and we have low visibility as
to the range that may be incurred in the future.
Related Announcement and Conference Call
Lumentum will host a conference call today, February 6, 2025, at
2:00 pm PT / 5:00 pm ET to discuss its fiscal second quarter
results. A live webcast of the call will be available in the
Investors section of the Lumentum website at
http://investor.lumentum.com. To listen to the live conference
call, dial (833) 470-1428 or (404) 975-4839 and reference the
conference ID 360050. Supporting materials outlining the Company’s
latest financial results will be posted on
http://investor.lumentum.com under the “Events and Presentations”
section concurrently with this earnings press release. Lumentum has
used, and intends to continue to use, its Investor Relations
website as means of disclosing material nonpublic information and
for complying with its disclosure obligations under Regulation FD.
This press release is being furnished as an exhibit to a Current
Report on Form 8-K filed with the Securities and Exchange
Commission and will be available at http://www.sec.gov/.
About Lumentum
Lumentum (NASDAQ: LITE) is a market-leading designer and
manufacturer of innovative optical and photonic products enabling
optical networking and laser applications worldwide. Lumentum
optical components and subsystems are part of virtually every type
of telecom, enterprise, and data center network. Lumentum lasers
enable advanced manufacturing techniques and diverse applications
including next-generation imaging and sensing capabilities.
Lumentum is headquartered in San Jose, California with R&D,
manufacturing, and sales offices worldwide. For more information,
visit www.lumentum.com and follow Lumentum on LinkedIn, X (formerly
known as Twitter), Facebook, Instagram and YouTube.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. These include
statements regarding our belief and expectations with respect to
our markets, including the cloud end market and the broader
networking market, customers and industry, any anticipation or
guidance as to demand for our products and technology from our
customers, statements regarding our quarterly revenue goal, and our
guidance with respect to future net revenue, non-GAAP diluted
earnings per share, and non-GAAP operating margins, and related
assumptions. These forward-looking statements involve risks and
uncertainties that could cause actual results to differ materially
from those projected. Among the factors that could cause actual
results to differ from those contemplated are: (a) uncertainty and
volatility in the global markets, including uncertainty and
volatility in the macroeconomic environment, volatility and
uncertainty in banking and financial services sectors, inflationary
pressures, changes in the political or economic environment, such
as geopolitical conflicts, war, trade and export restrictions and
the imposition of tariffs or other duties, and the effect of such
market disruptions on demand for our products, technology spending
by our customers and our ability to obtain components for our
products; (b) quarter-over-quarter product mix fluctuations, which
can materially impact profitability measures due to the broad gross
margin ranges across our portfolio; (c) decline of average selling
prices across our businesses or increase in costs, either of which
will also decrease our margins; (d) effects of seasonality; (e) the
ability of our suppliers and contract manufacturers to meet
production, quality, and delivery requirements for our forecasted
demand; (f) changes in customer demand, including due to changes in
inventory practices and end-customer demand; (g) our ability to
attract and retain new customers, particularly in the cloud
photonics and imaging and sensing markets; (h) the risk that our
markets will not grow or develop as expected or that our strategies
and ability to compete in those markets are not successful, (i) the
risk that Lumentum’s financing or operating strategies will not be
successful; and (j) failure to successfully integrate Cloud Light
into our business or that we will not achieve the expected
benefits. For more information on these and other risks, please
refer to the "Risk Factors" section included in the Company’s
Annual Report on Form 10-K for the fiscal year ended June 29, 2024
filed with the Securities and Exchange Commission (the “SEC) and
the Company’s other filings with the SEC, including the Quarterly
Report on Form 10-Q for the fiscal quarter ended December 28, 2024
to be filed with the SEC. The forward-looking statements contained
in this press release are made as of the date hereof and the
Company assumes no obligation to update such statements, except as
required by applicable law.
Category: Financial
The following financial tables are presented in accordance with
GAAP, unless otherwise specified.
LUMENTUM HOLDINGS INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(in millions, except per share
data)
(unaudited)
Three Months Ended
Six Months Ended
December 28, 2024
December 30, 2023
December 28, 2024
December 30, 2023
Net revenue
$
402.2
$
366.8
$
739.1
$
684.4
Cost of sales
281.2
281.3
517.7
504.2
Amortization of acquired developed
intangibles
21.4
21.5
43.9
39.5
Gross profit
99.6
64.0
177.5
140.7
Operating expenses:
Research and development
74.2
78.3
148.5
151.8
Selling, general and administrative
76.3
85.1
152.6
158.1
Restructuring and related charges
0.7
5.8
10.4
16.8
Total operating expenses
151.2
169.2
311.5
326.7
Loss from operations
(51.6
)
(105.2
)
(134.0
)
(186.0
)
Interest expense
(5.6
)
(9.7
)
(11.1
)
(19.4
)
Other income, net
14.9
13.4
23.6
34.6
Loss before income taxes
(42.3
)
(101.5
)
(121.5
)
(170.8
)
Income tax provision (benefit)
18.6
(2.4
)
21.8
(3.8
)
Net loss
$
(60.9
)
$
(99.1
)
$
(143.3
)
$
(167.0
)
Net loss per share:
Basic
$
(0.88
)
$
(1.47
)
$
(2.09
)
$
(2.49
)
Diluted
$
(0.88
)
$
(1.47
)
$
(2.09
)
$
(2.49
)
Shares used to compute net loss per
share:
Basic
68.9
67.2
68.6
67.0
Diluted
68.9
67.2
68.6
67.0
LUMENTUM HOLDINGS INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(in millions, except per share
data)
(unaudited)
December 28, 2024
June 29, 2024
ASSETS
Current assets:
Cash and cash equivalents
$
479.7
$
436.7
Short-term investments
417.0
450.3
Accounts receivable, net
226.9
194.7
Inventories
402.3
398.4
Prepayments and other current assets
125.5
110.0
Total current assets
1,651.4
1,590.1
Property, plant and equipment, net
663.4
572.5
Operating lease right-of-use assets,
net
32.9
72.8
Goodwill
1,060.9
1,055.8
Other intangible assets, net
534.9
617.5
Deferred tax asset
11.0
10.7
Other non-current assets
11.6
12.5
Total assets
$
3,966.1
$
3,931.9
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current liabilities:
Accounts payable
$
184.7
$
126.3
Accrued payroll and related expenses
40.1
36.1
Accrued expenses
46.2
52.4
Current portion of long-term debt
9.8
—
Operating lease liabilities, current
11.2
13.4
Other current liabilities
54.9
41.1
Total current liabilities
346.9
269.3
Long-term debt
2,561.2
2,503.2
Operating lease liabilities,
non-current
26.1
43.0
Deferred tax liability
45.4
55.7
Other non-current liabilities
114.2
103.4
Total liabilities
3,093.8
2,974.6
Stockholders’ equity:
Common stock, $0.001 par value, 990
authorized shares, 69.1 and 67.9 shares issued and outstanding as
of December 28, 2024 and June 29, 2024, respectively
0.1
0.1
Additional paid-in capital
1,892.4
1,835.0
Accumulated deficit
(1,030.4
)
(887.1
)
Accumulated other comprehensive income
10.2
9.3
Total stockholders’ equity
872.3
957.3
Total liabilities and stockholders’
equity
$
3,966.1
$
3,931.9
Use of Non-GAAP Financial Measures
In this press release, Lumentum provides investors with certain
non-GAAP financial measures: gross profit, gross margin, research
and development expense, selling, general and administrative
expense, operating margin, income from operations, interest and
other income (expense), net, income before income taxes, provision
for income taxes, net income (loss), and net income (loss) per
share on a non-GAAP basis, as well as the non-GAAP measures of
EBITDA and Adjusted EBITDA. Lumentum believes this non-GAAP
financial information provides additional insight into the
Company’s on-going business operations and results, and has
therefore chosen to provide this information to investors for a
more consistent basis of comparison and to help them evaluate the
results of the Company’s on-going operations and enable more
meaningful period to period comparisons. In addition, the Company
believes that providing certain of these measures allows investors
to better understand the Company’s operating performance and
importantly, to evaluate the methodology and information used by
management to monitor, manage, evaluate and measure the Company’s
business and results of operations. However, these measures may be
different from non-GAAP measures used by other companies, limiting
their usefulness for comparison purposes. The non-GAAP financial
measures used in this press release should not be considered in
isolation from measures of financial performance prepared in
accordance with GAAP. Investors are cautioned that there are
material limitations associated with the use of non-GAAP financial
measures as an analytical tool. In particular, many of the
adjustments to our GAAP financial measures reflect the exclusion of
items that are recurring and will be reflected in our financial
results for the foreseeable future. Further, these non-GAAP
financial measures may not be comparable to similarly titled
measurements reported by other companies.
Our non-GAAP measures used in this press release exclude (i)
stock-based compensation, (ii) acquisition related costs, (iii)
amortization of acquired intangibles, (iv) amortization of acquired
inventory fair value, (v) restructuring and related charges, (vi)
foreign exchange (gains) losses, net, (vii) non-cash interest
expense on convertible notes, (viii) intangible assets write-off,
(ix) integration related costs, (x) non-GAAP income tax reconciling
adjustments, and (xi) other charges or income related to
non-recurring activities.
We utilize a long-term projected non-GAAP tax rate to compute
our non-GAAP income tax provision. The long-term projected non-GAAP
tax rate is based on a multi-year projection of our estimated
annual GAAP income tax forecast, adjusted to account for the tax
effect of non-GAAP pretax adjustments as well as the effects of
significant non-recurring and period specific tax items. Our
non-GAAP tax provision for fiscal 2025 is 16.5%. The difference
between our GAAP income tax provision and our non-GAAP income tax
provision is presented as non-GAAP income tax reconciling
adjustments.
A quantitative reconciliation between GAAP and non-GAAP
financial data with respect to historical periods is included in
the supplemental financial table attached to this press
release.
LUMENTUM HOLDINGS INC.
RECONCILIATION OF GAAP
MEASURES TO NON-GAAP MEASURES
(in millions, except per share
data)
(unaudited)
Three Months Ended
Six Months Ended
December 28, 2024
September 28, 2024
December 30, 2023(1)
December 28, 2024
December 30, 2023(1)
Gross profit on GAAP basis
$
99.6
$
77.9
$
64.0
$
177.5
$
140.7
Stock-based compensation
9.2
9.7
9.0
18.9
15.0
Amortization of acquired intangibles
21.4
22.5
21.5
43.9
39.5
Amortization of acquired inventory fair
value adjustments
—
—
3.4
—
3.4
Integration related costs
1.1
1.2
8.3
2.3
11.6
Other charges (income), net
(1.3
)
(0.9
)
8.9
(2.2
)
9.2
Gross profit on non-GAAP basis
$
130.0
$
110.4
$
115.1
$
240.4
$
219.4
Gross margin on non-GAAP basis
32.3
%
32.8
%
31.4
%
32.5
%
32.1
%
Research and development on GAAP
basis
$
74.2
$
74.3
$
78.3
$
148.5
151.8
Stock-based compensation
(11.4
)
(9.3
)
(10.0
)
(20.7
)
(20.3
)
Amortization of acquired intangibles
(0.4
)
(0.4
)
(0.4
)
(0.8
)
(0.7
)
Acquisition related costs
—
—
(0.1
)
—
(0.4
)
Integration related costs
—
—
0.7
—
0.3
Intangible asset write-off
—
(1.9
)
—
(1.9
)
—
Other income (charges), net
—
—
(0.1
)
—
(0.8
)
Research and development on non-GAAP
basis
$
62.4
$
62.7
$
68.4
$
125.1
$
129.9
Selling, general and administrative on
GAAP basis
$
76.3
$
76.3
$
85.1
$
152.6
$
158.1
Stock-based compensation
(18.2
)
(16.6
)
(15.6
)
(34.8
)
(31.4
)
Amortization of acquired intangibles
(17.2
)
(18.8
)
(15.7
)
(36.0
)
(26.4
)
Acquisition related costs
—
—
(8.9
)
—
(12.6
)
Integration related costs
(2.0
)
(2.2
)
(1.6
)
(4.2
)
(3.9
)
Other (charges) income, net
(3.0
)
(1.0
)
(3.5
)
(4.0
)
(3.2
)
Selling, general and administrative on
non-GAAP basis
$
35.9
$
37.7
$
39.8
$
73.6
$
80.6
Loss from operations on GAAP
basis
$
(51.6
)
$
(82.4
)
$
(105.2
)
$
(134.0
)
$
(186.0
)
Stock-based compensation
38.8
35.6
34.6
74.4
66.7
Amortization of acquired intangibles
39.0
41.7
37.6
80.7
66.6
Amortization of acquired inventory fair
value adjustments
—
—
3.4
—
3.4
Acquisition related costs
—
—
9.0
—
13.0
Integration related costs
3.1
3.4
9.2
6.5
15.2
Restructuring and related charges
0.7
9.7
5.8
10.4
16.8
Intangible asset write-off
—
1.9
—
1.9
—
Other charges, net
1.7
0.1
12.5
1.8
13.2
Income from operations on non-GAAP
basis
$
31.7
$
10.0
$
6.9
$
41.7
$
8.9
Operating margin on non-GAAP basis
7.9
%
3.0
%
1.9
%
5.6
%
1.3
%
Interest and other income, net on GAAP
basis
$
9.3
$
3.2
$
3.7
$
12.5
$
15.2
Foreign exchange (gains) losses, net
(5.9
)
0.7
3.8
(5.2
)
4.2
Non-cash interest expense on convertible
notes and other income and expenses, net
0.8
0.7
4.8
1.5
9.7
Interest and other income, net on
non-GAAP basis
$
4.2
$
4.6
$
12.3
$
8.8
$
29.1
Loss before income taxes on GAAP
basis
$
(42.3
)
$
(79.2
)
$
(101.5
)
$
(121.5
)
$
(170.8
)
Stock-based compensation
38.8
35.6
34.6
74.4
66.7
Acquisition related costs
—
—
9.0
—
13.0
Integration related costs
3.1
3.4
9.2
6.5
15.2
Amortization of acquired intangibles
39.0
41.7
37.6
80.7
66.6
Amortization of acquired inventory fair
value adjustments
—
—
3.4
—
3.4
Restructuring and related charges
0.7
9.7
5.8
10.4
16.8
Intangible asset write-off
—
1.9
—
1.9
—
Foreign exchange (gains) losses, net
(5.9
)
0.7
3.8
(5.2
)
4.2
Non-cash interest expense on convertible
notes and other income and expenses, net
0.8
0.7
4.8
1.5
9.7
Other charges, net
1.7
0.1
12.5
1.8
13.2
Income before income taxes on non-GAAP
basis
$
35.9
$
14.6
$
19.2
$
50.5
$
38.0
Income tax provision (benefit) on GAAP
basis
$
18.6
$
3.2
$
(2.4
)
$
21.8
$
(3.8
)
Non-GAAP income tax reconciling
adjustments
(12.7
)
(0.8
)
5.2
(13.5
)
9.3
Income tax provision on non-GAAP
basis
$
5.9
$
2.4
$
2.8
$
8.3
$
5.5
Net loss on GAAP basis
$
(60.9
)
$
(82.4
)
$
(99.1
)
$
(143.3
)
$
(167.0
)
Stock-based compensation
38.8
35.6
34.6
74.4
66.7
Acquisition related costs
—
—
9.0
—
13.0
Integration related costs
3.1
3.4
9.2
6.5
15.2
Amortization of acquired intangibles
39.0
41.7
37.6
80.7
66.6
Amortization of acquired inventory fair
value adjustments
—
—
3.4
—
3.4
Restructuring and related charges
0.7
9.7
5.8
10.4
16.8
Intangible asset write-off
—
1.9
—
1.9
—
Foreign exchange (gains) losses, net
(5.9
)
0.7
3.8
(5.2
)
4.2
Non-cash interest expense on convertible
notes and other income and expenses, net
0.8
0.7
4.8
1.5
9.7
Non-GAAP income tax reconciling
adjustments
12.7
0.8
(5.2
)
13.5
(9.3
)
Other charges, net
1.7
0.1
12.5
1.8
13.2
Net income on non-GAAP basis
$
30.0
$
12.2
$
16.4
$
42.2
$
32.5
Net income per share on non-GAAP
basis
$
0.42
$
0.18
$
0.24
$
0.60
$
0.48
Shares used in per share calculation -
diluted on GAAP basis
68.9
68.3
67.2
68.6
67.0
Non-GAAP adjustment (2)
2.7
0.8
0.2
1.8
0.3
Shares used in per share calculation -
diluted on non-GAAP basis
71.6
69.1
67.4
70.4
67.3
(1) During the first fiscal
quarter of 2025, the Company refined its methodology to report
non-GAAP measures. The change does not impact the Company’s
financial position, cash flows, or GAAP consolidated results of
operations. Prior period non-GAAP financial measures and the
associated GAAP to non-GAAP reconciliations presented in this press
release have been recast to conform to the current
presentation.
(2) The adjustment represents the
dilutive impact of equity-based compensation awards in accordance
with the treasury stock method and dilutive shares from our
convertible debt instruments under the if-converted method, which
are anti-dilutive for GAAP purposes as we recognized a GAAP net
loss.
LUMENTUM HOLDINGS INC.
RECONCILIATION OF GAAP NET
INCOME TO ADJUSTED EBITDA
(in millions, except per share
data)
(unaudited)
Three Months Ended
Six Months Ended
December 28, 2024
September 28, 2024
December 30, 2023(1)
December 28, 2024
December 30, 2023(1)
GAAP net loss
$
(60.9
)
$
(82.4
)
$
(99.1
)
$
(143.3
)
$
(167.0
)
Interest and other expense, net
(9.3
)
(3.2
)
(3.7
)
(12.5
)
(15.2
)
Income tax provision (benefit)
18.6
3.2
(2.4
)
21.8
(3.8
)
Depreciation
25.9
27.0
27.2
52.9
55.4
Amortization of acquired intangibles
39.0
41.7
37.6
80.7
66.6
EBITDA
13.3
(13.7
)
(40.4
)
(0.4
)
(64.0
)
Amortization of inventory fair value
adjustments
—
—
3.4
—
3.4
Restructuring and related charges
0.7
9.7
5.8
10.4
16.8
Stock-based compensation
38.8
35.6
34.6
74.4
66.7
Acquisition related costs
—
—
9.0
—
13.0
Integration related costs
3.1
3.4
9.2
6.5
15.2
Intangible asset write-off
—
1.9
—
1.9
—
Other charges (gains), net
1.7
0.1
11.3
1.8
7.8
Adjusted EBITDA
$
57.6
$
37.0
$
32.9
$
94.6
$
58.9
(1) During the first fiscal
quarter of 2025, the Company refined its methodology to report
non-GAAP measures. The change does not impact the Company’s
financial position, cash flows, or GAAP consolidated results of
operations. Prior period non-GAAP financial measures and the
associated GAAP to non-GAAP reconciliations presented in this press
release have been recast to conform to the current
presentation.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20250206910132/en/
Investors: Kathy Ta, (408) 750-3853;
investor.relations@lumentum.com
Media: Noël Bilodeau, 408-439-2140;
noel.bilodeau@lumentum.com
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