For Immediate Release

Chicago, IL – April 1, 2026 – Zacks Equity Research shares Lumentum (LITE Quick QuoteLITE - Free Report) as the Bull of the Day and D-Wave Quantum (QBTS Quick QuoteQBTS - Free Report) as the Bear of the Day. In addition, Zacks Equity Research provides analysis on —NIKE (NKE Quick QuoteNKE - Free Report) and RH (RH Quick QuoteRH - Free Report) ,

Here is a synopsis of all three stocks:

Bull of the Day:

I last wrote about Lumentum as the Bull of the Day on February 11 after the company delivered a very strong beat-and-raise quarter and shares launched to new highs near $600.

Since then, LITE as etched more new highs near $800. There have also been many exciting industry developments that suggest estimates for this maker of optical systems for NVIDIA datacenter networking will keep going higher.

As I wrote in February, "The growth showcases the strength of the company’s plans for both optical components and systems in a world where NVIDIA is building next-gen GPU rack-scale datacenter architectures based on silicon photonics connectivity, switching, and networking."

I also noted CEO Michael Hurlston's extreme optimism on the earnings call where he said...

“Our forward guidance calls for over 85% year-over-year revenue growth, yet we are only at the starting line for two substantial opportunities: optical circuit switches (OCS) and co-packaged optics (CPO)."

CPO is the general category of lasers being built into the designs of NVIDIA GPU systems, or what Jensen calls "extreme co-design." OCS is a network device that establishes direct, physical paths of light between ports, allowing data to stay in the optical domain without Optical-Electrical-Optical (OEO) conversion.

OCS acts as a software-controlled reconfigurable fiber patch panel, reducing latency and power consumption in data centers and AI clusters by bypassing traditional electrical switches.

NVIDIA Locks Down All the Lasers

On March 2, Jensen & Co. announced $2 billion investment and partnership deals with both LITE and fellow laser leader Coherent (COHR) to "advance the frontier" of advanced optics technologies, including manufacturing capacity and R&D, to enable next-generation AI infrastructure and systems designs.

The nonexclusive multiyear strategic agreement includes an NVIDIA multibillion purchase commitment and future capacity access rights for advanced laser components. In addition, NVIDIA is investing $2 billion in Lumentum to support R&D, future capacity and operations as the company builds out its U.S.-based manufacturing capabilities in a new fab.

“AI has reinvented computing and is driving the largest computing infrastructure buildout in history,” said Jensen Huang, founder and CEO of NVIDIA. “Together with Lumentum, NVIDIA is advancing the world’s most sophisticated silicon photonics to build the next generation of gigawatt-scale AI factories.”

“This multiyear strategic agreement reflects our shared commitment to advancing the optics technologies that will power the next generation of AI infrastructure,” said Michael Hurlston, CEO of Lumentum. “In support of this collaboration, we are also investing in a new fabrication facility to increase capacity and accelerate innovation. We’re excited to work together to expand what’s possible for the AI optical architectures of tomorrow.”

GTC + OFC = A Laser Light Show for the Newest Compute Bottleneck

The week of March 16 brought two big conferences for Lumentum and other optical industry players.

NVIDIA's GTC in San Jose unveiled new GPU system designs for the Vera Rubin platform and highlighted many of the optical technologies that will be included.

And the Optical Fiber Communications conference (OFC) in Los Angeles saw more detailed presentations by LITE, Coherent, and their peers and partners.

Lumentum gave a great overview of their business and the opportunities ahead at OFC in a 40-slide presentation. As optical components are becoming sold-out through 2027, they see market demand only continuing to expand.

>>Announced closing of deal to buy North Carolina chip plant from Qorvo; LITE will retrofit the facility to make indium phosphide-based optical devices, including continuous-wave and ultra-high-power (UHP) lasers for CPO.

Lumentum said it plans to invest hundreds of millions of dollars over the next several years in the 240,000-square-foot facility in Greensboro.

Besides NVIDIA, Lumentum said it also plans to support other AI infrastructure customers for their scale-out and scale-up optical requirements through the plant.

In their OFC presentation, LITE management revealed that when this new fab ramps up in early 2028, it will add a whopping $5 billion in annual revenue capacity at chip-level margins.

>>Lumentum officially targeting $2 billion in quarterly revenue, for an $8 billion annualized run rate. They laid out a timeline to hit $1.25 billion per quarter in the next 9 to 12 months, and then reach that $2 billion quarterly target in another 9 to 12 months. As they scale, they are targeting operating margins to expand to 38% to 42%.

Management announced a brand-new multi-year, multi-billion-dollar OCS agreement with a major hyperscaler. They already have a $400 million backlog to ship in the second half of this year, but with this new mega-deal, they project OCS will ramp to a greater than $1 billion run rate in 2027.

Lumentum is aggressively targeting the scale-up market (connectivity of GPUs within racks) to replace copper. They noted that the first phase of this scale-up market will be 3X to 4X larger than the current scale-out market.

To capture customers who don't have NVIDIA's massive optical engineering teams, they are building turnkey External Light Source (ELS) modules, which will actually double their revenue content compared to just selling bare lasers. They are also launching volume shipments of 1.6T transceivers in Q2, which carry significantly better margins.

Management showed a chart projecting the AI optical TAM (total addressable market) exploding from $18 billion today to over $90 billion by 2030. They are currently under-shipping customer demand by 25-30% and have customers asking for lasers in the billions of units.

Visible LITE Above $800?

In my February post-earnings article, when newly-raised Wall Street analyst price targets were gathering around the $550 level, I said "See ya next quarter when Lumentum surprises again and they raise their PTs to $650."

That's already been happening, and then some, with these recent bumps...

Rosenblatt to $900
Jefferies to $900
Craig Hallum to $900
Needham to $850
Northland to $775
Barclays to $750 (Hold)
Mizuho to $750
Cowen to $675 (Hold)

And on 3/23 after GTC and OFC, BNP Paribas analyst Karl Ackerman grabbed the Street-high target of $1040.

I still own shares from $350 and I'm not interested in selling. In fact, I hope I get another chance to add as I told my investors to do in March near $550.

Kevin Cook is a Senior Stock Strategist for Zacks Investment Research where he runs the TAZR Trader portfolio and holds shares of NVDA and LITE.

Bear of the Day:

D-Wave Quantum shares have fallen hard from their peak above $46 last October. Besides general euphoria for quantum stocks igniting an unsustainable bubble, earnings estimates have crashed back to earth.

The Zacks full-year 2026 EPS consensus among six analysts has dropped from a loss of 19-cents to -$0.35 in the past two months.

Despite D-Wave Quantum’s reported 179% revenue growth in 2025, bookings volatility (down 22% over 2024), widening adjusted EBITDA losses and continued heavy cash burn signal a distant path to profitability. Moreover, much of its recent momentum, including large system sales and QCaaS deals, is subject to delayed revenue recognition, limiting near-term financial visibility.

QBTS Business Challenges in 2026

To learn more about the challenges for the stock, I referred to this article...

D-Wave Quantum Plunges 49% in 3 Months: Time to Sell as Losses Widen?

D-Wave entered 2026 with several key challenges despite its strong 2025 top-line performance. While revenue grew to $24.6 million in 2025, it remains uneven across quarters, with a 22% drop in bookings showing reliance on a few big deals. Much of its recent wins, like system sales and long-term contracts, will take time to show up as revenue, limiting near-term visibility.

Losses are still high (about $71.8 million EBITDA loss) and spending is expected to increase further due to R&D expansion and the Quantum Circuits acquisition. Lastly, although the company is pushing a dual-platform strategy, its gate-model technology is still early-stage. It may lag larger, better-funded competitors, raising concerns about how quickly it can deliver real commercial results.

Industry-Wide Headwinds

At a macro level, conditions are equally challenging. The quantum computing sector remains in the Noisy Intermediate-Scale Quantum (NISQ) Phase meaning systems are not yet widely practical or commercially scalable, with meaningful adoption likely years away (closer to 2030). This keeps stocks driven more by sentiment than fundamentals.

At the same time, competition from giants like IBM and rising global investments are increasing both the pace and cost of innovation. Combined with macro pressures like geopolitical tensions, tight financial conditions and reduced appetite for high-risk tech, 2026 could be a tough year for D-Wave Quantum as it works to prove real commercial traction in a still-maturing industry.

Bottom line on QBTS: Long-term investors may see favorable risk/reward in QBTS at a sub-$5 billion market cap. But until the EPS estimate stop going down and stabilize, the near-term risks remain front and center. The Zacks Rank will keep you informed.

Additional content:

Month of March Goes Out Like a Bull

It was the final trading day of a dismal month of March and Q1 overall yesterday — it was shaping up to be the worst trading month in four years, but it fought back valiantly. The Dow gained +1125 points, +2.49%, the S&P 500 was +104 points, +2.91%, and the Nasdaq a whopping +795 points, +3.83%. The small-cap Russell 2000 was +82, +3.40%.

We should also be realistic here, and not fully forget the ebb-and-flow directly related to Iran War policies, which kick the stock market into gear when President Trump calls for an end to the conflict, but much less so when he says the opposite. Then again, buying in ahead of the new quarter does display some innate hopefulness that the crisis does get resolved sooner than later.

Economic Prints from Today: JOLTS, Chicago Biz & More

We got a slew of post-open data this morning, collecting a decent range — if not outsized importance — of economic figures that may have added a dollop of positivity in the markets today, as well. But these reports tend not to move the needle all too much.

The Job Openings and Labor Turnover Survey (JOLTS) for February reached expectations almost exactly, at 6.88 million openings (6.92 million projected) for the month. This is down from the upwardly revised 7.2 million from the previous month. All four regions saw job openings recede, led by -160K in the South and -110K in the Northeast. Both Quits and Layoffs remained at subdued levels.

The Chicago Business Barometer for March came down, as analysts had expected, but by a deeper cut: 52.8 versus 55.1 estimated. This follows a 12-month high at 57.7 for February. It’s the first month in four that didn’t take the barometer, but remains comfortably above the 50-level, which indicates growth. Prices paid increased to their highest rate since December.

Consumer Confidence for March, however, surprised to the upside: 91.8, well above the 87.5 estimated and the slightly downwardly revised 91.0 in February. “…[A] modest improvement in consumers’ views of current conditions outweighed a slight downshift in expectations for the future,” the CEO of The Conference Board was quoted as saying.

Earnings After the Bell: NIKE & RH

NIKE, which has only missed on earnings estimates once in the past five years, beat expectations again after today’s close. Earnings of +$0.35 per share outpaced the +$0.29 analysts were looking for, on $11.28 billion in revenues, which surpassed the $11.23 billion in the Zacks consensus. Business in China outperformed to $1.62 billion, from the $1.50 billion expected.

RH, formerly Restoration Hardware, missed estimates after Tuesday’s close, with earnings of $1.53 per share well shy of the $2.21 expected in the Zacks consensus. Revenues of $843 million were shy of the $872.4 million analysts had been seeking. Further, revenue guidance for the current quarter (Q1) has been brought down considerably, to a range of +4-8%. Shares are trading down another -17% in late market activity, following -22% losses year to date.

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