Lumentum Holdings Inc. (LITE) surged 7.45% in pre-market trading on Wednesday, as investors cheered the optical-networking company's fiscal fourth-quarter results and a first-quarter outlook that vastly exceeded Wall Street expectations.

The company reported revenue of $1.01 billion for the quarter ended June 27, more than doubling from a year earlier and surpassing the consensus estimate of $987.9 million. Adjusted earnings per share came in at $3.23, a 267% jump from the prior year and well above the $2.97 analysts had projected. Non-GAAP gross margin improved to 50.4%, and the operating margin reached 36.6%, reflecting strong operating leverage and robust demand for AI-driven optical components.

Looking ahead, Lumentum forecast fiscal first-quarter revenue between $1.225 billion and $1.275 billion, with adjusted EPS of $4.05 to $4.35, both significantly ahead of consensus estimates. CEO Michael Hurlston highlighted that data center architects are increasingly turning to optical links as AI workloads grow in speed and bandwidth, positioning the company at the heart of a secular industry shift. The strong results and guidance prompted several analysts to raise their price targets, further fueling the stock’s pre-market rally.