Coherent Corp. is a vertically integrated manufacturing company that develops, manufactures, and markets lasers, transceivers, and other optical and optoelectronic devices, modules, and systems, as well as engineered materials, for use in the data center, communications and industrial markets. The company operates in markets characterized by extensive research and development, rapid technological change, frequent new product introductions, changes in customer requirements, and evolving industry standards. The industry is subject to cyclical market factors, and the company makes significant decisions based on estimates of customer requirements, determining levels of business, production schedules, personnel needs, and other resource requirements. The nature of these markets requires significant research and development expenses to participate, with substantial resources invested in advance of material sales.

Coherent is a global leader in many of its product families and competes on core competencies from materials to systems, differentiated products and services, and the sustainability of its competitive advantages. The company also competes by using its intellectual property, ability to scale, product quality, on-time delivery, and technical support. Coherent believes its vertical integration, manufacturing facilities and equipment, experienced technical and manufacturing employees, and worldwide marketing and distribution channels provide competitive advantages. The company had two customers who each contributed more than 10% of revenue during fiscal 2026.

Coherent generates nearly all of its revenues, earnings, and cash flows from developing, manufacturing, and marketing a wide range of products and services for its end markets. The company generates revenue through a direct sales force and through representatives and distributors around the world. Products are actively marketed through key account relationships, personal selling, authorized distributors, systems integrators, select advertising, attendance at trade shows, digital marketing, and customer partnerships. The company targets strategic, long-term, sales agreements with market leaders, which enables forward planning and production efficiencies.

The Datacenter & Communications segment leverages compound semiconductor technology platforms and deep knowledge of end-user applications to deliver differentiated components, modules, and subsystems. Products include transceivers, co-packaged optics, optical circuit switches, and other systems, subsystems, modules, and semiconductor devices for datacenter and communications applications, as well as VCSELs, EELs, pump lasers, and other components, optics and ICs for datacenter and communication applications. During fiscal 2026, the company announced the expansion of its Sherman, Texas, manufacturing facility, entered into a strategic multi-year supply agreement with NVIDIA for advanced lasers and optical networking products supporting next-generation AI infrastructure, and received a $50 million preliminary memorandum of terms under the CHIPS and Science Act to support the Sherman expansion.

The Industrial segment's lasers and optics products serve industrial customers in both semiconductor and display capital equipment and precision manufacturing, and instrumentation customers in life sciences and scientific instrumentation. It is also a market leader in engineered materials and optoelectronic devices, such as those based on ZnSe, ZnS, GaAs, InP, GaSb, and SiC. Products include excimer lasers, solid-state lasers, CO2 lasers, and laser systems for a variety of industrial applications including semiconductor capital equipment, display manufacturing, precision manufacturing, and scientific research; laser systems and subsystems including high-power lasers for materials processing; and engineered materials, laser optics, thermoelectric components, and advanced ceramic and metal-matrix composite materials and products. The company is a market leader in the technology development and large-volume manufacturing of 100 mm, 150 mm, and the industry's first 200 mm semi-insulating SiC substrates.

During fiscal 2026, the company announced the expansion of its Sherman, Texas, manufacturing facility, entered into a strategic multi-year supply agreement with NVIDIA for advanced lasers and optical networking products supporting next-generation AI infrastructure, and received a $50 million ¹ preliminary memorandum of terms under the CHIPS and Science Act to support the Sherman expansion. The company sold its Aerospace and Defense business on September 2, 2025, and sold its Munich, Germany-based product division on January 30, 2026. The company repurchased 347,064 ² shares of its common stock during fiscal 2026 for $60.0 million ³. In March 2026, the company issued 2,000,000 ⁴ shares of common stock in a private placement for net proceeds of $199.9 million ⁵. On June 8, 2026, the company entered into a new credit line for up to $100.0 million ⁶ and a new facility for up to $100.0 million ⁷. Subsequent to year-end, on August 12, 2026, the company entered into a new unsecured credit facility for up to $500.0 million ⁸ with a $300.0 million ⁹ U.S. dollar tranche and a $200.0 million ¹⁰ local currency tranche.

For the fiscal year ended June 30, 2026, total revenues were $5,387.0 million ¹¹, compared to $5,087.0 million ¹² in fiscal 2025 and $4,708.0 million ¹³ in fiscal 2024. Net loss was $1,268.0 million ¹⁴ for fiscal 2026, compared to net loss of $1,040.0 million ¹⁵ in fiscal 2025 and net loss of $1,090.0 million ¹⁶ in fiscal 2024. The Datacenter & Communications segment generated revenues of $3,175.0 million ¹⁷ in fiscal 2026, up from $2,618.0 million ¹⁸ in fiscal 2025. The Industrial segment generated revenues of $2,212.0 million ¹⁹ in fiscal 2026, down from $2,469.0 million ²⁰ in fiscal 2025. Gross profit was $1,683.0 million ²¹ in fiscal 2026, compared to $1,573.0 million ²² in fiscal 2025. Research and development expenditures were $723 million ²³ in fiscal 2026, compared to $582 million ²⁴ in fiscal 2025 and $479 million ²⁵ in fiscal 2024.

A key growth vector is the Datacenter & Communications segment, where AI and ML are driving rapid growth in datacenter infrastructure, increasing demand for high-performance optical connectivity that enables greater bandwidth, lower latency, and improved power efficiency. Coherent is a leading supplier of optical transceivers for AI datacenter and networking applications, offering a comprehensive, protocol-agnostic portfolio supporting Ethernet, InfiniBand, NVIDIA NVLink, and other AI networking architectures. The company continues to expand its global 6-inch InP manufacturing capacity in the United States and Europe to support increasing customer demand, while also operating multiple 6-inch GaAs VCSEL manufacturing facilities. During fiscal 2026, the company announced the expansion of its Sherman, Texas, manufacturing facility, entered into a strategic multi-year supply agreement with NVIDIA for advanced lasers and optical networking products supporting next-generation AI infrastructure, and received a $50 million ²⁶ preliminary memorandum of terms under the CHIPS and Science Act to support the Sherman expansion. The portfolio also includes silicon photonics, CPO, OCS, and other advanced optical technologies that support evolving AI datacenter architectures.

Another growth vector is the Industrial segment, where the company's lasers are displacing conventional technologies because they can do the job faster, yield higher quality, provide overall economic benefits, and enable next-generation applications. The company continues to develop solid-state lasers for industrial applications for materials processing, instrumentation, and scientific applications; broaden the product portfolio of CW, visible, and ultraviolet OPSLs; increase output power of GaAs- and InP-based edge-emitting semiconductor lasers for laser pumping and industrial applications including laser inertial confinement fusion; continue to support existing excimer laser-based applications in display manufacturing, instrumentation, and materials processing; continue to develop CO2 lasers used in industrial applications; and continue to develop leading Bi2Te3 materials for thermoelectric cooling/heating with a focus on thermoelectric power-generation capability. The company is a market leader in the technology development and large-volume manufacturing of 100 mm, 150 mm, and the industry's first 200 mm semi-insulating SiC substrates.The company has been executing restructuring actions, including the 2023 Restructuring Plan and the 2025 Restructuring Plan, to align its business with strategic priorities. During fiscal 2026, the company recorded restructuring charges of $35.0 million ²⁷ under the 2023 Restructuring Plan and $14.0 million ²⁸ under the 2025 Restructuring Plan. The company also recorded impairment charges of $1,139.0 million ²⁹ related to goodwill in the Lasers reporting unit during the fourth quarter of fiscal 2026.

The company's operational outlook includes continued investment in manufacturing capacity expansion, particularly the Sherman, Texas, facility for 6-inch InP manufacturing. The company utilizes contract manufacturers and strategic suppliers and believes its diverse manufacturing base sets it apart, especially at a time when supply chain resiliency is strongly valued by customers. As of June 30, 2026, the company employed approximately 51,000 ³⁰ employees worldwide, with 45,775 ³¹ in manufacturing, 3,344 ³² in research and development, and 2,359 ³³ in sales, general and administrative functions. The company continues to increase its use of renewable energy to power its operations and lower its greenhouse gas footprint, with on-site solar systems at several facilities.

Research and development expenditures were $723 million ³⁴ for fiscal 2026. Capital expenditures are not explicitly guided for the upcoming period, but the company continues to invest in capacity expansions including the Sherman, Texas, facility. During fiscal 2026, the company repurchased 347,064 ³⁵ shares of its common stock for $60.0 million ³⁶. In March 2026, the company issued 2,000,000 ³⁷ shares of common stock in a private placement for net proceeds of $199.9 million ³⁸. The company's ability to declare and pay dividends on its capital stock may be limited, including by the terms of its existing Credit Agreement. The company has a substantial amount of debt, including $500.0 million ³⁹ aggregate principal amount of 5.000% senior notes due 2029, a Term A Loan Facility, a Term B Loan Facility, and a Revolving Credit Facility.

The company faces headwinds from cyclical market factors, as a significant portion of its business is subject to cyclical market factors and the company may fail to accurately estimate the size and growth rate of its markets and customers' demands. The company also faces risks from global economic downturns that may adversely affect its business, results of operations, and financial condition. Geopolitical tensions and trade developments, including increased tariffs, could have a material adverse effect on financial condition and may limit the company's ability to sell products to certain customers or markets. The company is subject to complex and rapidly changing domestic and international laws and regulations, including import and export regulations of the countries in which it operates and/or sells, which could limit sales and decrease profitability.

The company faces constraints from its reliance on a limited number of suppliers for key components and materials, including exotic materials, crystals, and optics from sole-source or limited-source suppliers in the Industrial segment. The company uses rare-earth materials in some production processes and continuously works to strengthen and diversify its supply chain, including maintaining buffer inventory and developing multiple sources of supply. The company also faces risks from cybersecurity attacks and incidents, natural disasters or other global or regional catastrophic events, and the multiple uncertainties and outcomes associated with the use and evolution of AI.

Management's message emphasizes the company's strategy to grow businesses with world-class lasers, optics, and engineered materials to advance current customers' strategies, reach new markets through innovative technologies and platforms, and enable new applications in large and growing markets. A key strategy is to develop and manufacture high-performance materials and, in certain cases, components incorporating those materials that are differentiated from those produced by competitors. The company focuses on providing components that are critical to the heart of customers' products and continues to grow the number and size of key accounts. Management targets strategic, long-term, sales agreements with market leaders, which enables forward planning and production efficiencies. The company intends to continue capitalizing and executing on this proven model, participating effectively in the growth of the markets discussed, and continuing a focus on operational excellence as it executes its primary business strategies. The company's core values are Integrity, Collaboration, Accountability, Respect, and Enthusiasm (I CARE), which define who the company is and serve as a guide in how it engages with employees, customers, suppliers, investors, and the environment.

For the fiscal year ended June 30, 2026, total revenues were $5,387.0 million ⁴², compared to $5,087.0 million ⁴³ in fiscal 2025 and $4,708.0 million ⁴⁴ in fiscal 2024. Net loss was $1,268.0 million ⁴⁵ for fiscal 2026, compared to net loss of $1,040.0 million ⁴⁶ in fiscal 2025 and net loss of $1,090.0 million ⁴⁷ in fiscal 2024. Basic and diluted loss per share was $6.68 ⁴⁸ for fiscal 2026, compared to $5.67 ⁴⁹ in fiscal 2025 and $6.37 ⁵⁰ in fiscal 2024. Gross profit was $1,683.0 million ⁵¹ in fiscal 2026, compared to $1,573.0 million ⁵² in fiscal 2025 and $1,333.0 million ⁵³ in fiscal 2024. Operating loss was $1,237.0 million ⁵⁴ in fiscal 2026, compared to operating loss of $1,009.0 million ⁵⁵ in fiscal 2025 and operating loss of $1,087.0 million ⁵⁶ in fiscal 2024. The fiscal 2026 results include a goodwill impairment charge of $1,139.0 million ⁵⁷ related to the Lasers reporting unit, which significantly reduced reported net income. The Datacenter & Communications segment generated revenues of $3,175.0 million ⁵⁸ in fiscal 2026, up from $2,618.0 million ⁵⁹ in fiscal 2025, while the Industrial segment generated revenues of $2,212.0 million ⁶⁰ in fiscal 2026, down from $2,469.0 million ⁶¹ in fiscal 2025. Cash and cash equivalents were $1,035.0 million ⁶² as of June 30, 2026, compared to $1,031.0 million ⁶³ as of June 30, 2025. Total debt was $4,380.0 million ⁶⁴ as of June 30, 2026, compared to $4,385.0 million ⁶⁵ as of June 30, 2025.

The company faces material risk from its substantial debt load, with total debt of $4,380.0 million ⁴⁰ as of June 30, 2026, which could adversely affect its business, financial condition, or results of operations and prevent it from fulfilling debt-related obligations. The company recorded a goodwill impairment charge of $1,139.0 million ⁴¹ in fiscal 2026 related to the Lasers reporting unit, indicating significant risk of further impairment if business conditions deteriorate. The company relies on sole-source or limited-source suppliers for key components and materials in the Industrial segment, including exotic materials, crystals, and optics, and uses rare-earth materials in some production processes, creating supply chain concentration risk. The company is subject to significant political, trade, and regulatory developments, including increased tariffs and ongoing geopolitical tensions, which could have a material adverse effect on financial condition and may limit the ability to sell products to certain customers or markets. The company's business is dependent on the demand for products produced by end-users in communications, industrial, instrumentation and electronics markets, many of which have historically experienced highly cyclical demand for their products.