Lumentum (LITE) Is Up Nearly 999% in the AI Portfolio: What's Driving It

Eric Bleeker added Lumentum to the AI Portfolio in November 2024, and the position has returned 998.8% since that call, well past the milestone threshold the portfolio tracks and in under two years.

The return is rooted in the optical networking buildout that underlies modern AI infrastructure. Data centers running large-scale AI workloads require high volumes of optical transceivers and photonic components, and Lumentum is a key supplier into that layer of the network. Capital spending on that infrastructure has continued to expand rather than plateau.

The position has not climbed in a straight line, with normalized values swinging widely across recent months. That kind of volatility is typical for a component supplier whose order flow tracks large, lumpy data-center buildout cycles.

What investors will want to watch is whether the optical networking ramp Bleeker identified in late 2024 continues into the next capital expenditure cycle for major cloud providers. A position that has already returned roughly ten times the original stake still carries meaningful upside if hyperscaler spending on AI infrastructure keeps expanding, but the same cyclicality that produced the gains can compress them quickly if orders soften.