Coherent Corp (COHR) Stock Forecast & Price Target

Coherent Corp reported a revenue of $1,529 million for 4Q25, reflecting a 16% year-over-year increase and a 2% quarter-over-quarter increase, driven by robust demand from AI data centers and growing telecom revenue. The company's Networking segment led the growth, achieving a remarkable 39% increase year-over-year, underscoring strong market interest, particularly in transceivers below the 1.6T data rate, while the overall demand for digital connectivity and capacity expansion initiatives position Coherent favorably in the industry. As the firm anticipates continued growth in 1.6T transceiver shipments and increased traction in the transition to higher data rate solutions, these factors are set to contribute to positive long-term revenue expansion and enhance gross margins.

Coherent Corp has reported a decline in revenue across its industrial segments, with both the Materials and Lasers segments experiencing year-over-year and sequential decreases, contributing to a negative outlook for the company's financial performance. Despite an increase in gross margins year-over-year, the company's guidance for F1Q26 indicates expected revenue and adjusted EPS below consensus estimates, signaling potential difficulties in maintaining growth amidst product innovation challenges and declining average selling prices (ASPs). Furthermore, the significant drop in demand for silicon carbide products, particularly related to the automotive sector, adds to the challenges faced by Coherent, increasing concerns about its overall market position and financial stability.