Summary
Lumentum Holdings Inc. reported a challenging quarter with a net loss of $0.4 million (or $0.01 per diluted share) for the three months ended October 1, 2022, a significant shift from the $81.5 million net income ($1.08 per diluted share) reported in the same period last year. This decline was primarily driven by increased operating expenses, particularly in R&D and SG&A, and a substantial decrease in gross profit margin, which fell to 39.7% from 51.8% year-over-year. The company completed two significant acquisitions during the quarter: NeoPhotonics Corporation and IPG Photonics’ telecom transmission product lines. These acquisitions contributed to a 13.0% increase in net revenue to $506.8 million, primarily from the OpComms segment. However, the integration of these businesses, along with increased amortization expenses and supply chain costs, impacted profitability. The substantial increase in goodwill and intangible assets reflects these acquisitions. Despite the reported net loss, Lumentum maintained a strong liquidity position with $605.3 million in cash and cash equivalents and $1,019.6 million in short-term investments. The company continues to invest in R&D, signaling a focus on future growth despite the near-term profitability pressures. Investors should monitor the integration progress of recent acquisitions and the impact of ongoing supply chain constraints on future margins.
Financial Highlights
49 data points| Revenue | $506.00M |
| Gross Profit | $166.20M |
| R&D Expenses | $75.80M |
| SG&A Expenses | $98.40M |
| Operating Expenses | $188.10M |
| Operating Income | -$21.90M |
| Interest Expense | $8.90M |
| Net Income | -$400K |
| EPS (Basic) | $-0.46 |
| EPS (Diluted) | $-0.46 |
| Shares Outstanding (Basic) | 68.30M |
| Shares Outstanding (Diluted) | 68.30M |
Key Highlights
- 1Net loss of $0.4 million ($0.01 EPS) compared to net income of $81.5 million ($1.08 EPS) in the prior year period.
- 2Net revenue increased 13.0% year-over-year to $506.8 million, driven by acquisitions and improved OpComms segment performance.
- 3Gross margin significantly decreased to 39.7% from 51.8% in the prior year, impacted by acquisition-related amortization, higher supply chain costs, and a less favorable product mix.
- 4Operating expenses increased substantially, with R&D up 34.4% and SG&A up 67.0%, largely due to headcount additions from recent acquisitions and higher stock-based compensation.
- 5The company completed two significant acquisitions: NeoPhotonics Corporation and IPG Photonics’ telecom transmission product lines.
- 6Goodwill and intangible assets increased significantly due to the acquisitions, reflecting the strategic expansion.
- 7Maintained a healthy liquidity position with $605.3 million in cash and cash equivalents and $1,019.6 million in short-term investments.