What happened

Shares of Lumentum Holdings (NASDAQ:LITE) rose 16.2% in October according to data provided by S&P Global Market Intelligence. The company is a maker of optical sensor technologies and a supplier for Apple's (NASDAQ:AAPL) mobile devices. Its stock climbed in relation to strong demand for the iPhone X and favorable earnings reports from related suppliers.

So what

Win Semiconductor, which supplies a component for the Lumentum chips that are used in Apple devices, released a September revenue report on Oct. 5, showing that its sales had increased roughly 24% year over year. Lumentum's shares climbed roughly 6% the day of trading following the news. The stock posted another 6% daily gain on Oct. 16 following news that AMS, a company that's also presumed to be an Apple supplier, posted a better than expected earnings forecast. Shares then climbed higher in the lead up to the company's Nov. 1 earnings report.

One of Lumentum's fabrication factories.

Image source: Lumentum.

Now what

Lumentum sales and earnings fell short of the average analyst estimates, and its shares have dipped roughly 9% following the release of its first quarter-results. On the other hand, its earnings outlook for the current fiscal year came in above expectations, and the company sees strong demand for its chips and is ramping up manufacturing. Lumentum is reportedly the sole supplier of the laser dot projector hardware that is used for facial and spacial recognition in Apple's latest mobile devices, which could turn into a sustained sales catalyst. However, investors should keep in mind that its growth prospects appear to be closely tied to maintaining that relationship.