Computed from published fixed rules, not a model's judgement — though one input, the count of high-severity risks, comes from the AI analysis below.
Not investment advice and not a price target: it scores the quarter's fundamentals, not the stock. Full methodology →
AI Takeaway
LITE delivered a dramatic Q2 FY2026 turnaround, swinging to $78.2M net income from a $60.9M loss a year ago, driven by a 137.5% surge in gross profit, though a near-tenfold spike in current liabilities warrants close attention.
EPS (Diluted)
$0.89
+201.14% YoY
Operating Income
$64.3M
+224.61% YoY
Source: SEC XBRL
LITE's fiscal Q2 FY2026 corresponds to calendar Q4 2025.
Last 4 quarters: 4 beats
| Quarter | Actual EPS (USD) | Consensus (USD) | Result |
|---|---|---|---|
| Jun 2026 | 3.23 | 3.03 | Beat +6.6% |
| Mar 2026 | 2.37 | 2.33 | Beat +1.6% |
| Dec 2025This filing | 1.67 | 1.42 | Beat +17.4% |
| Sep 2025 | 1.10 | 1.05 | Beat +4.9% |
Adjusted (non-GAAP) EPS of $1.67 versus the $1.42 analyst consensus — a +17.4% beat for Dec 2025. Analyst consensus is quoted on the adjusted (non-GAAP) basis the street uses. GAAP diluted EPS for this quarter was $0.89.
Compiled by AI from this SEC filing
Gross profit jumped 137.5% YoY to $421.6M, suggesting a significant improvement in pricing power, product mix, or manufacturing efficiency compared to the prior-year period's $177.5M.
Source: 10-Q Income Statement (XBRL Financial Data)
Operating income turned positive at $71.0M versus a loss of $134.0M in Q2 FY2025, and net income reached $78.2M versus a loss of $60.9M, marking a full-cycle recovery in earnings power.
Source: 10-Q Income Statement (XBRL Financial Data)
Operating cash flow nearly tripled YoY to $184.6M from $63.9M, indicating that the profitability improvement is translating into real cash generation rather than being an accounting artifact.
Source: 10-Q Cash Flow Statement (XBRL Financial Data)
R&D expense rose 8.8% YoY to $161.5M and SG&A increased 18.7% to $181.2M, together consuming a significant portion of the gross profit improvement and reflecting ongoing investment in growth initiatives.
Source: 10-Q Income Statement (XBRL Financial Data)
Long-term debt collapsed 98.2% YoY to $47.1M from $2.56B, while financing cash flow was a positive $251.6M, suggesting a major debt refinancing or conversion event occurred during the period.
Source: 10-Q Balance Sheet & Cash Flow Statement (XBRL Financial Data)
Compiled by AI from this SEC filing · 2 high, 3 medium, 0 low
Current liabilities surged 986.1% YoY to $3.77B, while current assets stand at only $2.28B, yielding a current ratio of just 0.61. This implies LITE has significantly more short-term obligations than liquid assets, raising the risk of a liquidity shortfall if obligations cannot be refinanced or met from operations.
Source: 10-Q Balance Sheet (XBRL Financial Data)
The debt-to-equity ratio remains elevated at 4.68x, meaning total liabilities of $3.96B dwarf stockholders' equity of $846.6M. Even after the apparent long-term debt reduction, the company's capital structure carries substantial financial risk if earnings deteriorate.
Source: 10-Q Balance Sheet (XBRL Financial Data)
Stockholders' equity fell 2.9% YoY to $846.6M despite the return to profitability, which may reflect share buybacks, goodwill impairments, or other equity-reducing transactions. Continued erosion of the equity base would further worsen leverage metrics.
Source: 10-Q Balance Sheet (XBRL Financial Data)
Investing cash flow was -$299.2M in Q2 FY2026, nearly four times the -$77.8M in the prior year, indicating a major capital deployment. If these investments do not generate expected returns, they could weigh on future free cash flow and financial flexibility.
Source: 10-Q Cash Flow Statement (XBRL Financial Data)
Combined R&D and SG&A expenses reached $342.7M in Q2 FY2026, up from $301.1M a year ago, representing a meaningful drag on operating leverage. If revenue growth slows, these fixed-cost increases could quickly erode the newly restored profitability.
Source: 10-Q Income Statement (XBRL Financial Data)
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Gross Profit $M | 240.10 $M | 99.60 $M | +141.06% |
Operating Income $M | 64.30 $M | -51.60 $M | +224.61% |
Net Income $M | 78.20 $M | -60.90 $M | +228.41% |
EPS (Basic) $ | 1.10 $ | -0.88 $ | +225.00% |
EPS (Diluted) $ | 0.89 $ | -0.88 $ | +201.14% |
R&D Expense $M | 80.10 $M | 74.20 $M | +7.95% |
SG&A Expense $M | 96.10 $M | 76.30 $M | +25.95% |
Answers draw on this SEC filing and the data on this page
Lumentum (LITE) delivered a sharp Q3 FY2026 turnaround, with revenue rising 90.1% year over year to $808.4M and net income reaching $144.2M, driven by AI/cloud-related demand, stronger factory utilization, and a richer product mix. Source: 10-Q Item 2 MD&A, pp.53-56
Lumentum delivered 83% revenue growth and positive operating income in FY2026 on AI-driven optical demand, but a $7.76B debt extinguishment loss drove a large net loss.
Other companies in Communications Equipment