AI Optical Communication Beneficiary Sees Market Cap Plummet by 7 Trillion Won in One Day

Lumentum Holdings Inc. (NASDAQ: LITE), long touted as an AI photonics play, closed down 10.7% at $694.80 on the Nasdaq on March 25. Trading volume reached 4.71 million shares during the session, and its current market capitalization stands at about $49.6 billion—roughly KRW 70 trillion at an exchange rate near KRW 1,450 to the dollar. In a single day, the company shed about $4.8 billion in market value, equivalent to nearly KRW 7 trillion.

On March 2, Lumentum secured a $2 billion strategic investment from NVIDIA to jointly develop optical interconnects and laser technologies for AI data centers, backed by a sizable purchase commitment. Then on March 23, S&P Global announced Lumentum’s inclusion in the S&P 500 index, propelling its valuation to nearly ten times its level a year ago as a leading AI photonics stock. However, recent “run-up fatigue” and valuation concerns have driven greater volatility.

Founded in 2015 as a spin-off from JDS Uniphase, Lumentum is a photonics specialist that manufactures optical communication modules and lasers, supplying key components across data centers, telecom networks, industrial lasers, and 3D sensing applications. It has notably expanded its footprint in the optical component market for high-speed network and AI server data transmission, embedding itself deeply in the supply chains of global big-tech firms—including NVIDIA—telecom equipment vendors, and smartphone manufacturers.