Coherent’s first quarter results reflected robust year-over-year growth, driven by continued strength in AI data center and telecom demand. Management attributed the quarter’s performance to strong execution on new product introductions and expansion in advanced optical technologies. CEO Jim Anderson emphasized the company’s progress in launching multiple high-speed transceivers and noted that recent product launches at the Optical Fiber Communications Conference captured customer interest. Anderson explained, “We achieved record Q3 revenue which grew 11% sequentially and 54% year-over-year due to ongoing strong AI data center demand.”

Is now the time to buy COHR? Find out in our full research report (it’s free).

While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.

Our Top 5 Analyst Questions Coherent’s Q1 Earnings Call

• Samik Chatterjee (JPMorgan): Asked about the timing and impact of new product launches; CEO Jim Anderson stated 1.6T transceivers are expected to ramp this year, with broader adoption following early customer qualifications.
• Simon Leopold (Raymond James): Inquired about inventory levels and technology mix for transceivers; Anderson clarified there is no apparent inventory buildup and over half of transceiver revenue now comes from EML-based products.
• Thomas O’Malley (Barclays): Sought details on the financial impact of exiting the silicon carbide device business; Anderson noted this segment was pre-revenue, so its closure had minimal direct revenue impact.
• Papa Sylla (Citigroup): Questioned telecom segment growth drivers; CFO Sherri Luther identified data center interconnect as the main source of growth, with traditional telecom sentiment remaining cautiously positive.
• Meta Marshall (Morgan Stanley): Asked about industrial end market outlook; Anderson confirmed the cautious stance is due to macro uncertainty, not customer order pull-forwards.

Catalysts in Upcoming Quarters

In the coming quarters, our analysts will monitor (1) the pace of adoption and revenue contributions from new transceiver generations, especially 1.6T and 3.2T products, (2) the effectiveness of cost reduction and yield improvement initiatives in driving continued margin expansion, and (3) signs of stabilization or growth in industrial and traditional telecom markets. Execution on portfolio optimization and capacity expansion will remain important markers for sustained performance.

Coherent currently trades at $88.50, up from $69.62 just before the earnings. Is the company at an inflection point that warrants a buy or sell? See for yourself in our full research report (it’s free).

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