Harris Isaac Hosojiro sold $3.4M of LITE

Applied Optoelectronics (AAOI) shares rose about 13% after it reported Q2 2026 GAAP revenue of $191.9M, up from $103M a year earlier, and shifted to non-GAAP net income of $5.5M from a $8.8M non-GAAP loss. Coherent (COHR) gained about 13% and Lumentum (LITE) about 8% as AI-linked photonics stocks rallied amid a weaker July jobs report and lower Fed hike expectations.

Lumentum (LITE) reported fiscal Q3 revenue of $808.4M, GAAP net income of $144.2M, and non-GAAP net income of $225.7M, or $2.37 per diluted share. Non-GAAP gross margin rose to 47.9%. Q4 guidance calls for $960M to $1.01B revenue and non-GAAP EPS of $2.85 to $3.05. Analysts at Barclays, JPMorgan, and Citi kept bullish ratings and raised/maintained price targets.

Reuters reports the US FCC is drafting a ban on imports of new Chinese-made optical transceivers used in AI data centers, citing national security. Officials said it could bar new models from Chinese manufacturers and take effect before end-2026. Reuters also says Western suppliers Lumentum and Coherent rely on indium phosphide, with China controlling most supply.

Reuters reports the Trump administration is drafting an FCC measure to ban imports of new Chinese-made data center optical transceivers. Officials aim to publish later this year, with effect afterward, citing risks of data theft, malware, or disruption. Shares rose for Lumentum, Coherent, and Applied Optoelectronics; Innolight could be affected.

Lumentum Holdings (LITE) rose 9.24% to $779.89 on Aug. 3 after Reuters said the FCC is drafting a rule to ban U.S. imports of new-model Chinese optical transceivers for national-security reasons. If finalized, cloud operators would seek alternatives, potentially benefiting Lumentum. The article cites fiscal Q3 2026 revenue of $808.4M and adjusted EPS of $2.37.

The S&P 500 and Dow hit record highs as Caterpillar and Palantir raised annual revenue outlooks tied to AI data-center demand. Palantir shares rose 26% and Caterpillar gained 5.8%. Oil fell about 4% on hopes for an Iran deal. At 11:37 a.m. ET, Dow +1.44% and S&P 500 +1.29%.