IT Home, November 2 news: Marvell and optical communication equipment manufacturer Lumentum today announced a final acquisition agreement, under which Marvell will acquire Lumentum through an all-stock transaction.
Under the agreement, each Lumentum shareholder will receive 4.5 shares of Marvell common stock for each share held. Upon completion of the transaction, existing Marvell shareholders will own approximately 67% of the combined company, while Lumentum shareholders will own approximately 33%. The transaction is expected to close in the first half of 2028, subject to approval by shareholders of both companies and regulatory authorities.
Marvell expects the merger to generate over $1 billion in annual cost synergies and to enhance non-GAAP earnings per share in the first year following closing. The combined company's target market size is expected to expand to $550 billion.
Marvell and Lumentum plan to integrate their technologies in AI infrastructure connectivity. Marvell brings expertise in electrical and optical interconnects, network switching, custom XPU, and advanced semiconductor technologies, while Lumentum contributes high-performance lasers, optical transceivers, optical circuit switching (OCS), and compound semiconductor manufacturing capabilities. Together, the combined company will offer optical interconnect solutions spanning from distributed data centers to within advanced semiconductor packaging, covering CMOS, silicon photonics, compound semiconductors, advanced packaging, and manufacturing.
Lumentum also announced its first-quarter fiscal year 2027 results today. As of September 26, the company reported revenue of $1.263 billion, a 136.5% year-over-year increase; net income of $360 million, compared to $4.2 million in the same period last year. Non-GAAP net income was $461 million, with diluted earnings per share of $4.57.
The company expects second-quarter revenue to reach $1.575 billion to $1.625 billion, with non-GAAP diluted earnings per share of $5.90 to $6.20. The company stated that pump lasers and optical circuit switches (OCS) were the primary drivers of growth this quarter, and it has secured a second major NPO/CPO order with purchase commitments exceeding $5 billion.
Marvell announced preliminary revenue guidance for the third quarter of fiscal year 2027, expecting revenue to meet the midpoint of its previously provided guidance, while narrowing the revenue guidance range to ±2% from the prior range of ±5%. The company stated that final results are subject to completion of the quarter-end closing process and audit review.