Key Takeaways COHR shares gained 13.9% in 3 months, beating its industry and the S&P 500 Composite.Revenues soared 51% in fiscal 2025, led by a 61% surge in the data center market.COHR trades at a discount to peers with stronger ROE, ROIC and liquidity than the industry.Coherent Corp.'s (COHR) stock price has increased 13.9% in the past three months, outperforming the industry's 12% rise and the 9.3% growth of the Zacks S&P 500 Composite.COHR’s industry peers, Microvast (MVST) and Vimeo (VMEO) , have lost 2 ...

Core Insights - Coherent Corp. reported record revenues of $1.53 billion for Q4 FY25 and $5.81 billion for the full fiscal year, marking a year-over-year growth of 23% [1][2][4] - The company experienced a GAAP gross margin of 35.7% in Q4 FY25 and 35.2% for the full year, with non-GAAP gross margins at 38.1% and 37.9% respectively, indicating significant margin expansion [1][2][4] - Despite a GAAP net loss of $0.83 per diluted share in Q4 FY25, the non-GAAP EPS was $1.00, reflecting a substantial improvement in profitability metrics [1][2][4] Financial Performance - Q4 FY25 revenues reached $1,529 million, up 2.1% quarter-over-quarter and 16.4% year-over-year, while full-year revenues were $5,810 million, a 23.4% increase from FY24 [1][2][5] - GAAP gross margin improved by 284 basis points year-over-year to 35.2% for FY25, while non-GAAP gross margin increased by 358 basis points to 37.9% [4][5] - The company reported a GAAP net loss of $0.52 per diluted share for FY25, an improvement of $1.32 compared to the previous year, while non-GAAP EPS rose by $2.32 to $3.53 [4][5] Operational Highlights - The CEO highlighted strong revenue growth driven by key growth areas such as AI datacenters, and the company is optimizing its portfolio by selling its Aerospace and Defense business [3][4] - Operating cash flow improved, allowing the company to repay approximately $437 million of outstanding debt during FY25 [3] - The company commenced revenue shipments of its 1.6T datacom transceivers and achieved initial revenue from its optical circuit switch platform, expanding its addressable market by over $2 billion by 2030 [7][8] Business Outlook - For Q1 FY26, the company expects revenues between $1.46 billion and $1.60 billion, with gross margins projected between 37.5% and 39.5% on a non-GAAP basis [15] - The sale of the Aerospace and Defense business is anticipated to close in the current quarter, which will exclude approximately $20 million in revenue from future forecasts [9]

Summary of Lumentum (LITE) Conference Call Company Overview - **Company**: Lumentum Holdings Inc. (LITE) - **Industry**: Optical components and solutions Key Points and Arguments Financial Performance and Guidance - Lumentum raised its earnings guidance for June, expecting to reach $500 million in revenue a quarter earlier than previously anticipated, while maintaining a target of $600 million for future quarters [6][8] - The company is experiencing broad-based strength across its business segments, which has led to an upgrade in revenue guidance [6][8] - The CEO emphasized the importance of operational execution and streamlining projects to improve performance [13][16] Strategic Focus and Business Dynamics - The CEO highlighted a shift towards focusing on fewer projects to enhance execution and operational efficiency, reducing the number of initiatives by about 50% [14][16] - Lumentum is focusing on its module business, Optical Circuit Switching (OCS), and co-packaged optics as key growth drivers for 2026 [7][16] - The company aims to improve gross margins, targeting a return to the 40% range, with aspirations to reach the 50% margin level in the long term [20][21] Market Position and Competitive Landscape - Lumentum's primary competitors include Coherent and various Chinese suppliers, with the company currently not doing business in China due to market restrictions [24][25] - The CEO noted that the optical industry is evolving, with a shift towards more balanced relationships between suppliers and customers, allowing for better pricing power [22][23] - The company is strategically selective about which market segments to pursue, focusing on higher-margin opportunities [26][27] Optical Circuit Switching (OCS) and Co-Packaged Optics - OCS is gaining traction, with significant power and cost savings demonstrated by Google, leading to increased interest from other hyperscalers [32][33] - Lumentum is positioned to compete effectively in new deployments, leveraging technical advantages in insertion loss and cost [33][35] - The company is optimistic about the adoption of co-packaged optics, particularly as hyperscalers begin to deploy NVIDIA's turnkey solutions [47][49] Supply Chain and Capacity Challenges - Lumentum has doubled its EML laser capacity over the past year but still faces challenges in meeting demand [66][67] - The company plans to allocate more capacity to its own modules, which is expected to improve margins significantly [70] Telecom Business Recovery - The telecom segment has seen a decline from historic highs but is showing signs of recovery, particularly driven by demand from hyperscalers [60][61] - The CEO indicated that while the business may not return to previous peak levels, incremental growth is expected in the coming quarters [61] Operational Efficiency and Cost Management - The company is focused on improving operational leverage by streamlining projects and reducing overhead costs [62][63] - Lumentum aims to maintain competitive operating margins while ramping up revenue significantly [64] Additional Important Insights - The CEO's experience in the optical industry and previous roles at companies like Broadcom and Finisar is seen as beneficial for Lumentum's strategic direction [9][10] - The company is committed to leveraging its technical expertise and market position to drive growth and improve profitability [11][12] This summary encapsulates the key insights from the Lumentum conference call, highlighting the company's strategic focus, financial performance, and market dynamics.