LightPath stock jumps after selling China subsidiary

LightPath Technologies Inc (NASDAQ:LPTH) shares rose 8.5% Friday after the company announced the completion of its China subsidiary sale to local management.

The optical components manufacturer closed the sale of LightPath (Zhenjiang) Optical Instrumentation Co., Ltd. on October 30, 2026, to an entity owned by members of the subsidiary's management team. The transaction eliminates LightPath's manufacturing presence in China.

The divestiture will result in the loss of approximately $4.5 million in annual revenue, representing sales from the China operation's third-party customers averaged across fiscal years 2025 and 2026. This revenue will no longer be included in LightPath's consolidated results.

Under the new ownership structure, the Zhenjiang facility will continue supplying LightPath with products for its commercial customers in the U.S. and Europe as a third-party vendor.

Sam Rubin, President and Chief Executive Officer, said the sale completes LightPath's multi-year transformation of its manufacturing infrastructure. The company now operates as a Western-aligned, vertically integrated provider of optics and infrared imaging solutions.

"Defense primes and public safety agencies increasingly want to know where their optics are made and who owns the facilities that make them," Rubin said. "We believe our footprint positions LightPath well for programs where non-China sourcing is required."

The company said it structured the transaction to minimize disruption to commercial customers and does not expect material impact to supply, quality or service. LightPath stated it remains focused on adding manufacturing capacity to meet growing demand from defense customers.