Coherent Stock Crashes 20% in a Day—Here’s What Triggered the Bloodbath

Another tech darling bites the dust. Coherent’s stock plummeted nearly 20% on Thursday—proof that even 'sure bets' aren’t immune to market tantrums.

The Drop: No Slow Bleed, Just Straight Capitulation

No gentle slide here. Shareholders got bulldozed as the stock nosedived in a single session. Blame it on weak guidance, a botched product cycle, or just Wall Street’s fickleness—pick your poison.

Why It Matters: Tech’s Fragile Illusion of Stability

Coherent isn’t some meme stock—it’s a legit player. If it can crater 20% overnight, what does that say about the rest of the sector? Hint: 'Diversify your portfolio' isn’t just boilerplate advice.

The Aftermath: Bagholders and Vultures

Short sellers are feasting. Retail investors? Not so much. Meanwhile, analysts will spin this as a 'buying opportunity'—because of course they will. (Cue the downgrades in 3…2…1…)

Lesson learned: In tech, even the 'coherent' narratives fall apart fast. Maybe stick to Bitcoin—at least its volatility comes with a side of decentralization.

A double beat wasn't good enough

For its fiscal Q4 of 2025, Coherent's revenue was $1.53 billion, notching a new record for the company. That figure was also 16% higher year over year. The company's non-GAAP (adjusted) net income grew more modestly, advancing by nearly 9% to $192 million or an even $1.00 per share.

Image source: Getty Images.

Both headline figures came in slightly higher than the consensus analyst estimates of $1.51 billion for revenue and $0.92 for adjusted earnings per share (EPS).

Coherent attributed the improvements to the liveliness of certain revenue drivers, such as artificial intelligence (AI) data centers.

However, in a new research note on the company, analyst Vivek Arya fromSecurities pointed out that the company's revenue growth in the data center space was slowing. According to reports he wrote, this was 24% in Q4, but 39%, 46%, and 58% in the three preceding frames.

This was one of the factors that inspired Arya to downgrade his recommendation on the stock to neutral from his previous buy.

Modeling a better first quarter

Coherent management proffered guidance for its current (first) quarter. It believes revenue will fall between $1.46 billion and $1.6 billion, and adjusted EPS will come in at $0.93 to $1.13. Both ranges start well above Q4 of fiscal 2024's $1.31 billion on the top line and adjusted EPS of $0.61.

The average analyst estimates of, respectively, $1.55 billion and $1.03 per share for the present quarter are within the two guidance ranges.