Lumentum Holdings retires $650.4 million of convertible notes due 2028, reducing debt while adding modest share dilution.
Lumentum Holdings Inc. (LITE) agreed to exchange $650.4 million of its 0.50% convertible senior notes due 2028 for approximately 5 million shares of common stock. The transaction, set to close around June 4, 2026, will leave $172.2 million of the notes outstanding and result in additional share dilution of about 0.8 million shares tied to the principal amount.
The company recently reported strong fiscal third-quarter results, with revenue surging 90.1% to $808.4 million and adjusted earnings per share at $2.37, beating estimates. Fourth-quarter guidance also exceeded expectations, with revenue projected between $960 million and $1.01 billion and adjusted profit of $2.85 to $3.05 per share.
Following the earnings release, Barclays raised its price target on LITE to $1,000 from $750, maintaining an “Equal Weight” rating. The stock has gained momentum amid broader market optimism around AI infrastructure plays.