Phase Space AI

Financial Model Notes

Coherent [COHR]

Coherent Corp [COHR] — Financial Model Notes

No .xlsx was produced this run (time-boxed; the brief's priority order puts accounting-quality and valuation work above model artefacts). These notes carry every figure the model would contain, with its source, so the model is reproducible and every number is traceable.

Per known-silent-failures.md §1–§3, had a workbook been built: no defined name matching ^[A-Za-z]{1,3}\d{1,7}$ (rev_fy27, not rev27); open by absolute path and assert the filename matches the ticker before reading any cell; and treat the model as unverified until Excel has opened, computed and saved it.

Source hierarchy actually used

Item Source Why
Revenue, gross profit, operating income, quarterly, 81 periods AV INCOME_STATEMENT (normalized) Brief: prefer AV normalized statements. Verified against EDGAR: 0 DISAGREE of 6
D&A AV CASH_FLOW, depreciationDepletionAndAmortization The income-statement field is corrupted on this name — see defects
EBITDA computed: operating income + |cash-flow D&A| AV's own ebitda field is unusable (defect 4)
Receivables, inventory, cash, debt AV BALANCE_SHEET, cross-checked to the 10-Q AV has two errors here (defects 1–2)
Share count 10-Q cover page, 2026-05-04 AV is 20.5% wrong (defect 1)
Net debt 10-Q debt note, hand-totalled Framework fails net-cash closed by default (§9.6); resolved by hand here
Segment / customer concentration EDGAR 10-K FY2025, Major Customers note AV does not carry it
Guidance transcript, 2026-05-06 CFO prepared remarks AV EARNINGS_ESTIMATES returns zero rows
Prices, volatility Alpaca daily bars, adjustment=all, explicit start= §4: limit=N without start= returns zero bars
Options Alpaca v1beta1/options/snapshots with explicit symbol list The per-underlying path silently ignores a symbols filter

Verified inputs

Income statement, quarterly ($m)

Period Revenue Gross % Op income Op % D&A (CF)
2024-09-30 1,348.1 34.1 99.6 7.4 65.9
2024-12-31 1,434.7 35.5 144.9 10.1 134.5
2025-03-31 1,497.9 35.2 145.5 9.7 146.6
2025-06-30 1,529.4 36.6 159.0 10.4 250.4
2025-09-30 1,581.4 36.6 172.2 10.9 122.4
2025-12-31 1,686.0 37.0 199.0 11.8 108.4
2026-03-31 1,805.6 37.7 148.6 8.2 132.9

TTM (2025-06-30 → 2026-03-31): revenue $6,602.4m, gross margin 36.99%, operating income $678.8m (10.28%), D&A $614.1m, EBITDA $1,292.9m (19.58%). Prior-year TTM: revenue $5,595.1m, operating income $467.3m (8.35%). YoY: revenue +18.0%, operating margin +1.93pp.

Note Q3FY26's operating margin dip to 8.2% from 11.8%: gross margin rose to 37.7%, so the dip is below the gross line. It is not a margin reversal.

Balance sheet, 2026-03-31 ($m, from the 10-Q)
Cash and equivalents 1,592.7
Short-term investments 825.0
Restricted cash, non-current 591.0 — excluded from net debt
Accounts receivable, net 1,187.9
Inventory 2,126.8
Goodwill 4,402.4
Acquired intangibles, net 2,958.2
Total assets 17,286.7
Total debt (5.00% Senior Notes $990.0 + Term B + local lines + German construction loan) 3,193.8
Operating lease liabilities (current $52.4 + non-current $178.9) 231.3 — excluded; convention stated
Net debt 776.1
Total shareholders' equity 10,677.0
Shares outstanding (cover page, 2026-05-04) 195,639,321

Lease convention stated explicitly per §9.7: operating leases are excluded from net debt on all names in this cluster, so the comparison across COHR / FN / LITE / EMS peers is internally consistent. Including COHR's $231.3m would raise EV by 0.5% and change no verdict.

Forward, from guidance (8-K and call, 2026-05-06)
Q4FY26 revenue $1,910–2,050m, midpoint $1,980m (+29.5% YoY)
Q4FY26 non-GAAP gross margin 39–41%
Q4FY26 non-GAAP opex $360–380m
Q4FY26 non-GAAP EPS $1.52–1.72
Implied Q4FY26 non-GAAP operating margin 21.3% at midpoint
FY2026 revenue $7,053m (+21.4%) = 9M actual $5,073.0m + Q4 midpoint
FY2027 "growth rate to exceed fiscal 2026" — a floor of +21.4%, no level given
Munich divestiture ~$25m/quarter removed, below-corporate gross margin; $8m still in Q3FY26

Model structure that would be built

  1. Revenue — three end markets (Datacenter, Communications, Industrial), driven off the guided Q4FY26 base. Datacenter modelled on the 1.6T/800G mix with 1.6T ASPs above 800G (CEO-stated) and an explicit InP wafer-supply cap as a hard volume ceiling, because that is the binding constraint the company itself names. Do not model demand-limited growth on this name.
  2. Gross margin — bridge from 37.0% TTM to a 42.0% terminal in four steps: 6-inch InP conversion (die cost <50% of 3-inch), 1.6T mix accretion, Munich divestiture removal, and volume absorption.
  3. Opex — R&D held at 9.5–10.0% of revenue; SG&A declining 16% → 11.5% on volume.
  4. Amortisation run-off — the $2,958.2m intangible balance amortised on a declining schedule; this is what closes the GAAP-to-non-GAAP gap and it is the mechanical core of the terminal margin.
  5. Debt — $3,193.8m amortising; leverage 1.7x falling. Model both LongTermDebtCurrent and LongTermDebtNoncurrent; §9.6 records that dropping the current portion is deterministic on any amortising loan, and COHR has one.
  6. Shares — 195.639m flat. Do not model the Series B preferred: it fully converted in Q2FY26 and is already inside the 195.639m.

Defects to carry forward

Field Do not use Use instead
commonStockSharesOutstanding (AV) 155.5m 195,639,321, 10-Q cover
currentNetReceivables 2024-09-30 (AV) $819,712,000,000 $819.7m
depreciationAndAmortization (AV income statement) $44.6m Q3FY26 — equals interestExpense $132.9m, cash-flow statement
ebitda (AV) any value operating income + |cash-flow D&A|
EARNINGS_ESTIMATES (AV) empty array read as "no estimates exist" treat as INDETERMINATE and substitute filed guidance, declaring the substitution
Screen op_margin_pct 1.7% 10.28%
Screen ev_ebit 444.7x 65.2x
Screen terminal_margin 0.144 via max(own, sector median) 0.200 via own non-GAAP + opex bridge