They tripled capacity for the hottest commodity in tech, yet guided next quarter's revenue flat.
Thesis: COHR is the blue-collar worker of the AI boom. They don't have NVDA's leverage, but they have the volume. Tripling Indium Phosphide capacity while expanding gross margins by 363bps validates the yield story. The flat guidance is classic sandbagging—you don't triple capacity and pay down debt to stall out. Buying the execution, not the power.
Verdict: LONG — Conviction: MEDIUM
Catalyst: 1.6T transceiver ramp beginning in calendar 2025, moving from sampling to revenue.
Key Risk: Hyperscaler digestion. With 'vast majority' of datacom revenue tied to a few players, a synchronized pause crushes the P&L.
The Tell: When asked about pricing pressure from Chinese competition, Anderson called pricing 'pretty stable' and 'as predicted.' In a supply-constrained supercycle, 'stable' pricing is a confession that you don't hold the gun.
Friction Level: MODERATE_FRICTION — Pricing power. Bulls see margin expansion as structural yield improvement; Bears see 'stable' pricing in a shortage as proof of commoditization.
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