Marvell Falls More Than 8% After Advanced Talks to Buy Lumentum, Valued at $83 Billion
Key Facts
Marvell shares fell more than 8% in extended trading on October 29, 2026, after Bloomberg reported that the company was in advanced talks to buy Lumentum, according to Reuters. Lumentum shares rose about 9% in extended trading, marking a contrast in investor reactions on the two sides of the potential deal. Bloomberg did not report that a final agreement had been reached, leaving the talks unresolved. Lumentum has a market value of about $83 billion, compared with about $221 billion for Marvell, according to Bloomberg. Interest in the company comes amid rising demand for data-transport components in computing centers tied to AI.
Lumentum makes optical components used in telecommunications networks and data centers, infrastructure that is gaining importance as AI workloads grow. The company’s chief executive said that the rising speed and bandwidth of these workloads are prompting data center architects to adopt optical connections as a primary means of communication. That puts Lumentum’s business at the heart of the infrastructure expansion needed to move larger volumes of data. It also explains the overlap with Marvell’s products and why the talks are linked to Marvell’s push into data centers. But the potential deal has not yet become an announced agreement.
The talks are taking place as both companies report growth driven by data center demand. Lumentum said revenue in the fourth quarter of its fiscal 2026 reached 1,006.3 million dollars, up 109.3% year over year from 480.7 million dollars in the year-earlier quarter. Marvell, meanwhile, posted record quarterly revenue of 2.739 billion dollars in the second quarter of its fiscal 2027, up 37% year over year. Marvell’s data center revenue in that quarter was 2,171.5 million dollars, up 46% from the year-earlier period. The results point to the weight of data center business in Marvell’s revenue growth, alongside Lumentum’s expansion in optical components.
Earlier in October, Marvell raised its fiscal 2028 revenue forecast to 20 billion dollars, from a previous forecast of 15 billion. The company attributed the increase to strong demand for custom AI chips and networking products used in data centers, and said it was raising its revenue forecasts for fiscal 2027 and 2028. That guidance preceded the report of the talks, so the raised forecast is not tied to an announcement of the potential deal. The context provides a backdrop to Marvell’s business growth, while the talks with Lumentum remain a separate, unresolved matter. Marvell reported cash and cash equivalents of 3,932.8 million dollars as of August 1, 2026, according to the latest balance sheet published in its earnings release.
The two companies did not immediately respond to requests for comment, according to Reuters. The agency said an announcement on the deal could come as soon as the following week, while the talks remained nonfinal. Lumentum, meanwhile, expects revenue of between 1.225 and 1.275 billion dollars in the first quarter of fiscal 2027, and a non-GAAP operating margin of between 39.5% and 40.5%. Those forecasts outline the company’s near-term outlook as markets await developments in the talks. No announcement confirming a completed deal between the companies has been made so far.