10-KPeriod: FY2022

COHERENT CORP. Annual Report, Year Ended Jun 30, 2022

Filed August 29, 2022For Securities:COHR

Summary

II-VI Incorporated (now Coherent Corp. following the acquisition of Coherent, Inc.) reported its fiscal year 2022 results, which concluded on June 30, 2022. A significant event during this period was the completion of the Coherent acquisition on July 1, 2022, which is expected to reshape the company's reporting segments and business focus for fiscal year 2023. The company experienced a revenue increase of 7% to $3.32 billion, driven by strong performance in the communications sector, particularly in datacom and transceivers, as well as growth in semiconductor capital equipment and industrial markets. This growth was partially offset by a decline in consumer electronics sales. The company's financial performance in fiscal year 2022 showed total revenues of $3.317 billion, with gross margin remaining stable at 38%. Research and development expenses increased to $377 million, reflecting continued investment in new technologies. The company ended the fiscal year with $2.58 billion in cash and cash equivalents. Looking ahead, the company has secured significant financing and is integrating the acquired Coherent business, aiming to leverage synergies and expand its market leadership across photonic solutions, compound semiconductors, and lasers.

Financial Highlights

50 data points
Beta

Revenue

$3.32B

38.2% Gross Margin

Net Income

$234.76M

7.1% Net Margin

EPS (Diluted)

$1.45

Total Assets

$7.84B

Cash & Equivalents

$2.58B

Free Cash Flow

$99.00M

Financial Statements
Beta
Revenue$3.32B
Cost of Revenue$2.05B
Gross Profit$1.27B
R&D Expenses$377.11M
SG&A Expenses$474.10M
Operating Expenses$3.03B
Operating Income$414.29M
Interest Expense$121.25M
Net Income$234.76M
EPS (Basic)$1.57
EPS (Diluted)$1.45
Shares Outstanding (Basic)106.19M
Shares Outstanding (Diluted)116.51M

Key Highlights

  • 1Total revenues increased by 7% to $3.32 billion in fiscal year 2022.
  • 2The acquisition of Coherent, Inc. was completed on July 1, 2022, marking a significant strategic move for the company, which will be rebranded as Coherent Corp. starting in fiscal year 2023.
  • 3Communications segment revenue grew by 9% to $2.23 billion, driven by strong demand in datacom and transceivers.
  • 4Compound Semiconductors segment revenue saw a modest 2% increase to $1.09 billion, supported by industrial and semiconductor capital equipment sales, but impacted by a decline in consumer electronics.
  • 5Research and Development (R&D) expenses increased by 14% to $377 million, indicating continued investment in innovation.
  • 6The company ended FY22 with $2.58 billion in cash and cash equivalents.
  • 7Bookings and backlog significantly increased, with bookings reaching approximately $4.3 billion and backlog at $2.3 billion as of June 30, 2022.

Frequently Asked Questions

The most significant strategic development was the completion of the acquisition of Coherent, Inc. on July 1, 2022. This acquisition is expected to create a leading global player in the photonics, semiconductors, and lasers industries, and the company will be rebranded as Coherent Corp. starting in fiscal year 2023.

The Photonic Solutions segment saw a 9% increase in revenue to $2.23 billion, primarily driven by growth in the transceiver business for datacom. The Compound Semiconductors segment experienced a 2% revenue increase to $1.09 billion, supported by industrial and semiconductor capital equipment, although it was offset by a decrease in consumer electronics sales.

As of June 30, 2022, the company had total debt obligations of $2.3 billion and cash, cash equivalents, and restricted cash of $2.58 billion. The company also had $450 million in available borrowing capacity under its Revolving Credit Facility. The company expressed confidence that its existing cash, cash flow from operations, and available borrowing capacity would be sufficient to fund its needs through fiscal year 2023.

The company increased its R&D expenses by 14% to $377 million in fiscal year 2022, indicating a continued commitment to innovation across its various technology platforms. These investments are focused on developing new products and manufacturing processes to support growth in key markets like communications, industrial applications, and emerging technologies.