Coherent Q1 Revenue Jumps 50% to $2.37 Billion; Non-GAAP EPS Hits $2.09
Coherent opened fiscal 2027 with a blowout photonics quarter as AI datacenter optical demand accelerated and margins widened.
Saxonburg, Pennsylvania-based Coherent reported revenue of $2.37 billion for the first quarter ended Sept. 30, 2026, up 50% year over year and 56% on a pro forma basis, according to its earnings release filed with an 8-K Wednesday. GAAP gross margin was 39.1%, up 254 basis points. Non-GAAP gross margin was 40.6%, up 184 basis points. GAAP diluted EPS was $1.90, up $0.71. Non-GAAP diluted EPS was $2.09, up $0.93.
CEO Jim Anderson said established businesses grew strongly while new growth areas began to ramp, and that AI datacenters’ shift from copper to optical connectivity plays to Coherent’s platform and manufacturing scale. He said the company expects fiscal 2027 pro forma revenue growth to exceed 60%.
Margin path
CFO Sherri Luther pointed to pricing optimization and cost improvements driving operating leverage and said the company is raising its longer-term gross-margin target, expecting its first quarter with non-GAAP gross margin above 45% before the end of calendar 2028.
GAAP net income of $1.90 per diluted share and non-GAAP EPS of $2.09 show the operating leverage dropping through as revenue scaled. The 254-basis-point GAAP gross-margin expansion is as important as the top line for investors who worried that rapid AI-optics growth would come with pricing pressure or yield noise.
Management’s call for fiscal 2027 pro forma revenue growth above 60% sets a high bar for the next three quarters. The longer-term non-GAAP gross-margin target above 45% before the end of calendar 2028 is the second checkpoint: if Coherent can grow that fast and still expand margins, the AI optical thesis compounds; if margins stall, the multiple usually compresses first.
Why it matters
COHR has become a direct AI-infrastructure proxy through optical connectivity. A 50% revenue jump, nearly doubled non-GAAP EPS growth and an FY27 pro forma growth call above 60% keep the stock in the high-beta photonics bucket—where retail investors need the margin expansion story to stick as volumes scale.
By the numbers
- Q1 revenue: $2.37 billion, up 50% (56% pro forma)
- GAAP gross margin: 39.1%
- Non-GAAP gross margin: 40.6%
- GAAP EPS: $1.90
- Non-GAAP EPS: $2.09
- FY2027 pro forma revenue growth outlook: above 60%
Sources
- Coherent Form 8-K with fiscal 2027 first-quarter results, filed Nov. 4, 2026 (accession 0001193125-26-447200)
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