Lumentum Shares Drop 14.9% Following Marvell Technology Acquisition Announcement
Lumentum Holdings (LITE) shares fell nearly 15% despite reporting strong fiscal first-quarter results that exceeded Wall Street expectations. The company reported revenue of $1.26 billion, a 136.5% year-over-year increase, and adjusted earnings per share of $4.57, surpassing the consensus estimate of $4.21. The stock decline is primarily driven by an all-stock merger agreement with Marvell Technology (MRVL). Under the terms, Lumentum shareholders will receive 4.5 Marvell shares for each Lumentum share. Because of a fixed exchange ratio, Lumentum's valuation has become tethered to Marvell's stock price; as Marvell shares declined, so did the implied value of the acquisition deal. The merger aims to combine Marvell’s electrical connectivity chips with Lumentum’s optical components to serve AI data centers. The transaction is expected to close in the first half of 2028 and targets over $1 billion in annual cost savings.
Topics: Earnings Beat M&A Optical Networking Semiconductors
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Part of the story Marvell Technology Announces $115 Billion All-Stock Acquisition of Lumentum Holdings (19 articles)