Lumentum Holdings Inc. (LITE) shares plummeted 8.77% during intraday trading on Tuesday, deepening a prolonged correction that has seen the stock slide over 30% from its May highs. The sharp decline came amid a broad-based rout across the optical communication and semiconductor sectors.

The sell-off was triggered by mounting investor caution over the pace of AI infrastructure capital expenditure, with market sentiment shifting from a high-investment AI buildout narrative to more conservative pricing. This unease was compounded by a negative reaction to Corning's latest quarterly results, which sent its shares down over 16% in pre-market trading and dragged the entire optical space lower. Key peers such as Applied Optoelectronics, Coherent, Marvell Technology, and Ciena all recorded significant declines, reflecting sector-wide headwinds.

Lumentum had already been under pressure following sharp losses in the Philadelphia Semiconductor Index on July 24–25, which hit optical networking names especially hard. With the company's next earnings report expected on August 11, traders remain cautious ahead of the release, adding to the downward momentum.