Coherent delivered a robust third quarter, with revenue of $1.498B, marking a 4% sequential rise and a 24% year-over-year increase, driven by ongoing AI data-center demand and telecom strength. Non-GAAP gross margin expanded to 38.5%, up 30 basis points QoQ and 490 basis points YoY, contributing to a non-GAAP operating margin of 18.6% and a non-GAAP EPS of $0.91. The quarter featured meaningful product and portfolio progress, including advances in 1.6T transceivers (EML, VCSEL, and silicon photonics) and a pathway to ramping within the current calendar year, the 400G EML milestone underpinning 3.2T capabilities, and early OCS adoption for data-center expansion. Management signaled fiscal 2025 as a strong growth year despite macro uncertainty and outlined a strategic portfolio realignment to exit non-core lines (e.g., silicon carbide devices) and optimize assets, with debt reduction totaling $136M in the quarter.
Management reiterated a cautiously constructive near-term view for industrial end-markets while maintaining a longer-term growth thesis anchored in data-center photonics, DCI, and next-generation data-rate technologies. The company provided Q4 guidance of $1.425B–$1.575B revenue, 37%–39% non-GAAP gross margin, $290M–$310M non-GAAP OpEx, 21%–24% tax rate, and $0.81–$1.01 non-GAAP EPS, factoring tariffs as a non-significant headwind. Investor Day is scheduled for May 28, where the company will outline long-term strategy, end-market growth, and financial model.