Coherent Corp (COHR)
Indium phosphide lasers, optical engines, and datacom transceivers (post-II-VI/Finisar merger). $2B Nvidia strategic investment (March 2026); doubling InP capacity into 1.6T ramp.
- Ticker: COHR
- Sector: networking (optical)
- DC exposure tier: high
Coherent Corp (COHR) is a high-exposure name in the data-center supply chain in the networking sector. Data Center Index tracks Coherent Corp's capex history, project wins, and supplier exposure across the AI infrastructure buildout, refreshed daily from SEC filings and project announcements.
Coherent Corp data center thesis
Coherent makes the indium-phosphide (InP) lasers and 800G/1.6T datacom transceivers that go inside hyperscale AI back-end fabrics. The March 2026 $2B NVIDIA strategic investment is funding doubled InP wafer capacity into the 1.6T transceiver ramp. Revenue ran from $2.4B (FY20) to $5.8B (FY25) at a 37% gross margin, and the stock is -3% YoY, the laggard in the optical cohort despite the strategic re-rating catalyst.
Bull case
- NVIDIA put $2B of strategic capital into doubling Coherent's InP capacity, a hard supply commitment that pulls forward the 1.6T transceiver ramp and locks in volume against an NVIDIA-spec demand curve.
- InP epi capacity is the actual bottleneck for 800G/1.6T transceivers; you can't run a Blackwell or Rubin training cluster without optical lanes that originate from InP wafers, and Coherent owns one of three Western sources at scale.
- Each GPU generation roughly doubles transceiver attach per server and shifts to higher-data-rate optics. The H100 -> B200 -> B300 -> Rubin progression is a structural unit-and-mix tailwind that Coherent is positioned for.
Bear case
- LPO (linear pluggable optics) and CPO (co-packaged optics) threaten the standalone DSP-pluggable transceiver model that drives Coherent's mix today; if Broadcom and NVIDIA pull DSP into the switch, Coherent loses content per port.
- Stock is -3.5% YoY and at 60% of 52-week high, relative weakness vs Lumentum (+0.97%) and Ciena (+633%) suggests the market is questioning whether the NVIDIA investment translates into share gain or just supply security.
- Operating income has barely turned positive ($100M on $4.7B FY24, undisclosed FY25); valuation is paying for the 1.6T ramp on faith. Any margin slip on the InP capacity build prints worse than the bull case requires.
Data center exposure rationale
AI datacom transceivers (800G/1.6T) are the fastest-growing segment; DC is the largest disclosed end-market in the Networking platform.
Coherent Corp revenue and capex
In fiscal 2026, Coherent Corp reported revenue of $7.1B and capital spending of $1.1B.
| Fiscal year | Revenue | Capex | Operating income |
|---|---|---|---|
| 2026 | $7.1B | $1.1B | n/a |
| 2025 | $5.8B | $440.8M | n/a |
| 2024 | $4.7B | $346.8M | $96.1M |
Tracked Coherent Corp data center projects
- Meta Hyperion, 5 GW, Holly Ridge, LA · under construction
- AWS Project Rainier (New Carlisle), 2.2 GW est., New Carlisle, IN · operational
- Meta Prometheus, 1 GW, New Albany, OH · operational
- Google New Albany, 250 MW, New Albany, OH · operational
- Microsoft Fairwater Wisconsin, Mount Pleasant, WI · operational