Lumentum(US:LITE) KAIYUAN SECURITIES·2025-11-09 02:27Core Insights - The report maintains a positive investment rating for the communication industry, indicating a favorable outlook for future growth [1] - Lumentum's financial performance is highlighted, with significant revenue growth driven by cloud computing and AI infrastructure needs [5][13] - The report emphasizes the importance of optical chips as a core growth engine for Lumentum, with substantial increases in sales across various product categories [6][14] Group 1: Lumentum's Performance - Lumentum reported Q1 FY26 revenue of $533.8 million, a year-on-year increase of 58.44% and a quarter-on-quarter increase of 11.05% [5][13] - The company's non-GAAP operating profit reached $99.8 million, with an operating margin of 18.7%, reflecting a 15.7 percentage point increase year-on-year [5][13] - The growth in revenue is primarily attributed to the acceleration of cloud computing and AI business [5][13] Group 2: Optical Chip Sales - Lumentum's component business generated $379.2 million in revenue for Q1 FY26, a year-on-year increase of 63.9% and a quarter-on-quarter increase of 18.4% [6][14] - The report notes record shipments of 100G and 200G EML lasers, as well as significant growth in DCI lasers used for data center interconnects [6][14] - The system business also saw revenue of $154.6 million, driven by cloud transceiver business, although it experienced a slight quarter-on-quarter decline [6][14] Group 3: Future Guidance - Lumentum expects Q2 FY26 revenue to be between $630 million and $670 million, with non-GAAP operating margins projected between 20.0% and 22.0% [15][16] - The company anticipates continued growth in both component and system business revenues, with a strong outlook for data center and optical switching markets [15][16] - The report highlights the potential for significant growth in AI-related sectors, particularly in optical communication [17][16] Group 4: Communication Industry Trends - As of August 2025, China had a total of 4.646 million 5G base stations, with a net increase of 395,000 stations since the end of 2024 [26][29] - The number of 5G mobile phone users reached 1.154 billion, reflecting a year-on-year growth of 19.46% [26][29] - The report indicates that 5G mobile phone shipments in August 2025 were 19.992 million units, with a year-on-year increase of 1.2% [26][29] Group 5: Operator Performance - In the first half of 2025, China Mobile's cloud revenue reached 56.1 billion yuan, a year-on-year increase of 11.3% [42][40] - China Telecom's Tianyi Cloud revenue for the same period was 57.3 billion yuan, reflecting a year-on-year growth of 3.8% [42][41] - China Unicom's cloud revenue for the first three quarters of 2025 reached 52.9 billion yuan [42][43]