Coherent revenue growth accelerated to 33.7% in the fourth quarter of fiscal 2026, up from 20.5% in the previous quarter, as management attributed the increase to demand from AI data centers. The company’s Datacenter & Communications segment generated $5.3 billion in fiscal 2026, accounting for most of the $7.1 billion in total sales for the year.
This recent acceleration follows a period where sales momentum had previously slowed. In the report filed in August 2025, Coherent recorded revenue growth of 16.4%, down from 23.9% in the May 2025 report. During that same period, the operating margin slipped to 9.5%, though it remained above the 5.9% level reported in August 2024. Management has since focused on widening gross margins, a strategy noted on an earnings call in February 2025.
The company’s financial trajectory shifted notably after a November 6, 2024 filing, where first-quarter fiscal 2025 revenue climbed 28.0% year-over-year. This marked a sharp increase from the 9.1% growth reported in the prior quarter. By the time Coherent stock had more than doubled in the six months leading up to October 9, 2025, these improvements in sales and margins were already public knowledge.
Investors who entered the stock during that period faced a significant run-up, with Coherent returning 135.4% in the twelve months to October 12, 2026, compared to 17.3% for the S&P 500. Lumentum experienced a similar trend, returning 523.1% over the same period. Despite these gains, Coherent shares have recently lagged the broader market, falling 6.5% over the past six months while the S&P 500 rose 14.0%.
Profitability has improved alongside revenue. The operating margin over the latest twelve months reached 12.7%, up from 9.2% a year earlier. Management also reported that debt leverage had been cut to 2 times from 2.5 times on an August 13, 2025 call. A Zacks preview published on May 5, 2025, had anticipated that rising demand for transceivers would benefit Coherent’s sales.
Looking ahead, management guided to first-quarter fiscal 2027 revenue of $2.2 billion to $2.4 billion, compared to $2.05 billion in the fourth quarter of fiscal 2026. On an August 12, 2026 call, executives stated that demand drove another quarter of record bookings and that fiscal 2027 is basically booked out. The upcoming first-quarter report will test whether sales continue their upward trajectory or stall relative to the previous quarter’s figures.