Lumentum Guides First-Quarter Fiscal 2027 Revenue of $1.225-$1.275 Billion

Qualcomm shares rose 7% to $190.82 in Monday afternoon trading after Lumentum Holdings announced a joint demonstration with Qualcomm Technologies and Corning of a high-density die-to-die optical interconnect built for artificial intelligence scale-up architectures. The demo, to be shown at an optical communications industry conference in Málaga, Spain, pairs a die-to-die interface subsystem from Qualcomm Technologies with Lumentum's laser-based optical interconnect platform and Corning multimode fiber connectivity. Qualcomm's advance far outpaced the broader chip tape, with the iShares Semiconductor ETF up 4% to $555.42 and the Invesco QQQ Trust up 2.51% to $738.79. Skyworks Solutions and Qorvo, the two radio frequency front-end suppliers typically grouped with Qualcomm in the handset supply chain, each gained just 0.4%, to $89.11 and $117.60 respectively, confirming the rally is specific to Qualcomm's AI story rather than a handset-cycle move. The demonstration carries no product or customer order, leaving investors to weigh whether Qualcomm has found a genuine AI second act.

Credo Technology Group Holding Ltd launched a new family of 224G-based ZeroFlap optical transceivers, extending its optical architecture to 1.6T port speeds. The new transceivers combine Credo's 224G-per-lane optical digital signal processor with the Kfir200 silicon photonics PIC and its latest-generation PILOT diagnostics platform, and the family includes 2xDR4, 2xFR4 and DR8 configurations supporting AI scale-out interconnect architectures at 1.6T port speeds. The launch matters because management expects more than $600 million in optical revenues in fiscal 2027, with ZeroFlap optics, silicon photonics PICs and optical DSPs each expected to contribute more than $100 million. Credo's May acquisition of DustPhotonics brought silicon photonics capabilities in-house, and the company recorded its first silicon photonics revenues in the fiscal first quarter while its optical digital signal processor business generated record revenues during the period. Management expects additional fiscal 2027 customer ramps across both 800G and 1.6T products involving hyperscalers and NeoCloud operators, as well as its first 1.6T optical DSP revenues later in fiscal 2027, though GAAP research and development expense rose 118% year over year to $114.5 million in the fiscal first quarter and results remain sensitive to deployment timing.

Credo Technology Group Holding Ltd. expects fiscal 2027 revenues to grow more than 85% year over year, with the Zacks Consensus Estimate calling for revenues of $2.5 billion and earnings of $6.23 per share. Near-term guidance also points higher, with fiscal second-quarter revenues projected at $525 million to $535 million, compared with $479 million in the first quarter, when revenues rose 114.7% year over year. Active Electrical Cables remain Credo's largest business unit, but management projects more than $600 million in fiscal 2027 optical revenues, with ZeroFlap optics, silicon photonics PICs and optical DSPs each expected to contribute more than $100 million. First-quarter fiscal 2027 non-GAAP gross margin was 68%, operating margin reached 48.2% and net margin was 49.3%, while management expects non-GAAP operating expenses to rise about 55% in fiscal 2027. The stock trades at 11.1X forward 12-month sales, compared with 5.0X for the Zacks sub-industry and 6.1X for the Zacks sector, and the four largest end customers generated 33%, 28%, 13% and 10% of first-quarter fiscal 2027 revenues, with the top two accounting for 61%.