SAN JOSE, Calif., March 10, 2026, 06:51 PDT.
Lumentum Holdings said on Tuesday it would join the S&P 500 before trading starts on March 23, days after S&P Dow Jones Indices named the optical networking supplier in the benchmark’s quarterly rebalance. The company is moving up from the S&P MidCap 400, and Chief Executive Michael Hurlston said the step reflected Lumentum’s “vital role in helping customers build next-generation AI infrastructure.” 1
The addition matters because the S&P 500 is tracked by trillions of dollars in index and exchange-traded funds. Stocks added to the gauge often get a burst of demand and liquidity as passive funds rebuild portfolios, and Stephens analyst Melissa Roberts wrote last month that index inclusion can reshape trading through passive flows, reduced float and sizing pressures. 2
The move lands just over a week after Nvidia said it would invest $2 billion in Lumentum and make multibillion-dollar purchase commitments for advanced laser components. Those parts sit in the optics layer that carries data with light, not electrical signals, across large AI systems. Nvidia Chief Executive Jensen Huang called the shift the “largest computing infrastructure buildout in history.” 3
A March 2 filing put hard numbers on the deal. Lumentum sold Nvidia 2,876,415 shares of convertible preferred stock at $695.31 each for $2 billion in cash, and the filing said the shares can convert one-for-one into common stock once the U.S. antitrust waiting period is cleared. 4
Lumentum’s latest results help explain why investors are watching. The company reported fiscal second-quarter revenue of $665.5 million, up 65.5% from a year earlier, and guided the current quarter to $780 million to $830 million. Hurlston said in February Lumentum was only at the “starting line” for optical circuit switches, which route traffic with light inside data centers, and co-packaged optics, which move optical links closer to processors. 5
Coherent, another photonics supplier tied to Nvidia’s AI spending, is entering the S&P 500 in the same March 23 rebalance, alongside Vertiv and EchoStar. All four stocks rallied on Monday after investors weighed the index change. 6
Some analysts think the backdrop runs wider than one company. Bank of America analyst Tal Liani said last week AI was fueling a “supercycle” in optical transport, while MarketWatch cited Stephens analyst Melissa Roberts as saying Lumentum and Coherent had become “vastly oversized” for the S&P MidCap 400. 7
But the setup is not risk-free. Lumentum said its outlook depends on adding manufacturing capacity and meeting production, quality and delivery targets, while also warning about demand swings, order cuts or delays, pricing pressure, trade restrictions and geopolitical shocks. The Nvidia stake still sits behind an antitrust waiting period before conversion into common shares. 5
Based in San Jose, Lumentum designs optical and photonic products for cloud and communications networks as well as industrial laser applications. Its businesses now sit squarely in one of the market’s busiest trades: the build-out of AI infrastructure. 8
