New York, March 3, 2026, 10:55 ET — Regular session
- Lumentum shares fell about 13% in morning trade, reversing part of Monday’s Nvidia-driven rally.
- A filing showed Nvidia’s $2 billion stake was structured as convertible preferred stock priced at $695.31 per share.
- Traders are watching deal mechanics, capacity buildout plans and the company’s March 17 OFC investor briefing.
Lumentum Holdings Inc. shares fell about 13% on Tuesday, a day after the optical components maker jumped on news that Nvidia would invest $2 billion in the company and lock in future supply.
The pullback came as the broader market sold off, with growth and chip names under pressure. The Nasdaq 100-linked Invesco QQQ was down about 2.2% and the iShares Semiconductor ETF fell about 5.5%.
The Nvidia tie-up matters because it points to a tighter supply chain around “photonics” — using light rather than electrical signals to move data — as AI data centers strain power and bandwidth. “AI has reinvented computing,” Nvidia CEO Jensen Huang said in the joint announcement. 1
A regulatory filing on Monday put more detail around the money. Lumentum said it issued 2,876,415 shares of Series A convertible preferred stock to Nvidia at $695.31 per share in a private placement; the preferred converts one-for-one into common shares, but only after a U.S. antitrust waiting period under the Hart-Scott-Rodino law expires or is terminated. 2
Nvidia also said on Monday it would invest $2 billion in rival photonics supplier Coherent, in a move aimed at bolstering optics used in AI infrastructure. Lumentum shares were up about 5% in early trading on Monday after the announcement. 3
Lumentum CEO Michael Hurlston framed the deal as a mix of capital and demand visibility. “Perhaps more importantly,” he said at a Morgan Stanley conference on Monday, it came with “a multibillion-dollar purchase commitment.” 4
By Tuesday morning, some of that enthusiasm had cooled across the group. Coherent shares fell about 8% and Nvidia was down about 2% as investors stepped back from semiconductors and adjacent suppliers.
The filing price for the preferred — $695.31 — also sat below Lumentum’s prior close, a detail traders tend to fixate on when a deal can eventually convert into common stock. The stock opened sharply lower and traded in a wide range.
But the big picture is still messy. The preferred cannot convert until the antitrust waiting period runs, and Lumentum still has to execute on a U.S. manufacturing expansion while meeting tighter delivery and quality demands from large AI customers.
The next hard date on the calendar is March 17, when Lumentum is set to host an investor briefing at the Optical Fiber Communication Conference in Los Angeles. Traders will be looking for clearer timelines on capacity, the new fab plans and how quickly Nvidia’s commitments show up in revenue. 5
