Coherent (COHR) Financial History

Our common stock is subordinate to our existing and future indebtedness, and any preferred stock we may issue in the future.

Regardless of the amount of a person’s holdings, if a shareholder or shareholder group (including affiliated persons) would be a party to certain proposed transactions with us or would be treated differently from othe…

For these reasons, investors should not rely on recent or historical trends to predict future trading prices of our common stock, financial condition, results of operations, or cash flows.

We from time to time borrow under our existing credit facility or use proceeds from sales of our securities to fund portions of our operations, including working capital investments and financing of our acquisition st…

In addition, the Term Loan A Facility and Revolving Credit Facility require that the Company maintain (i) a maximum total net leverage ratio, as defined in the Credit Agreement, of 4.25 to 1.00 through maturity and (i…

The Credit Agreement, dated as of July 1, 2022 (as amended, restated, supplemented and/or otherwise modified from time to time, the “Credit Agreement”), which provides for the Term Loan A Facility, Term Loan B Facilit…

As of June 30, 2026, we had approximately $3.2 billion of outstanding indebtedness on a consolidated basis, including under (i) our $1.1 billion senior secured incremental term A loan facility (the “Term Loan A Facili…

The manufacture of our products requires the use of facilities, equipment, chemicals, and materials that are subject to a broad array of laws and regulations in numerous jurisdictions in which we operate.

We are subject to a variety of complex and evolving laws, regulations, or industry standards, including with respect to environmental, health, safety, and product considerations and cybersecurity, data privacy, and AI…

In January 2025, we received an inquiry from BIS concerning past product sales to Huawei; we are cooperating with BIS’s inquiry and conducting an internal review of those sales to determine what products are subject t…

Additionally, failure to comply with the various regulatory requirements could subject us to significant fines, suspension of export privileges or debarment.

Our business is subject to various domestic and international laws and other legal requirements, including anti-corruption regulations, such as the Foreign Corrupt Practices Act of 1977, anti-money laundering regulati…

We are subject to complex and rapidly changing domestic and international laws and regulations, including import and export regulations of the countries in which we operate and/or sell which could limit our sales and…

Similarly, changes in U.S.

morale among our remaining employees; diversion of management attention; adverse effects to our reputation as an employer which could make it more difficult for us to hire new employees in the future; loss of the inst…

As a result of the Restructuring Plans, we have incurred approximately $370 million of pre-tax charges in fiscal years 2023 to 2026 primarily as a result of the reduction in force and facility consolidations related t…

To the extent that we complete acquisitions, the success of our acquisitions will depend in large part on our success in integrating the acquired operations, strategies, technologies, and personnel.

We may be adversely impacted by any of the multiple uncertainties and outcomes associated with the use and evolution of AI.

Our information technology and cybersecurity program also incorporate and rely on technology, products and services that are provided by service providers and other third parties (“third parties”), which means that th…

Changes in manufacturing processes are often required due to changes in product specifications, yield improvements, changing customer needs, and the introduction of new products.

We manufacture some of the components that we incorporate into our subsystem products; in other cases, we provide components to contract manufacturers to produce finished or intermediary goods.

Some of our products require designs and specifications that are at the cutting-edge of available technologies and change frequently to meet rapidly evolving market demands.

A deterioration of conditions in regional or worldwide credit markets could limit our ability to obtain external financing to fund our operations and capital expenditures.

Downturns in regional or worldwide economies, due to inflation, geopolitics, major central bank policy actions including interest rate increases, public health crises, or other factors, have harmed our business in the…

Any of the above factors could have a material adverse effect on our business, results of operations, or financial condition.

Large end-user service providers and product companies comprise a significant portion of our customer base.

Shifts in market demand could also have an adverse effect on our business, results of operations and financial condition, as we base many of our operating decisions including, but not limited to, those regarding manuf…

in the launch of new products or, if such products are introduced, that those products will achieve sufficient market acceptance or generate sales to offset the costs of development.

Our markets are characterized by extensive research and development, rapid technological change, frequent new product introductions, changes in customer requirements and evolving industry standards.

We intend to continue to make significant investments in research, development, and engineering to achieve our goals.

To meet our strategic objectives, we must develop, manufacture, and market new products and continue to update our existing products and processes to keep pace with sudden increases and decreases in market demand and…

Furthermore, we may not, unless holders of Series B Preferred Stock otherwise consent in writing (or if such action is taken with respect to a Permitted Issuance (as defined in the Investment Agreement)), so long as B…

ability to substantially influence all matters that require approval by our shareholders, including the approval of significant corporate transactions.

Our Series B Preferred Stock has voting rights, allowing holders to vote as one class with our common stock on an as-converted basis, subject to limited exceptions.

Holders of our Series B Preferred Stock can exercise significant control over us, which could limit the ability of holders of our other capital stock to influence the outcome of key transactions, including a change of…

At any time on or after the ten-year anniversary of the applicable issuance date of the shares of our Series B Preferred Stock and subject to the procedures set forth in the terms of the Series B Preferred Stock, each…

The redemption rights of the holders of Series B Preferred Stock may result in the use of our cash in such a way that could adversely affect our business, financial condition or results of operations.

In the event of a bankruptcy, liquidation, dissolution, or winding-up of our affairs, our assets will be available to pay obligations on the Series B Preferred Stock only after all of our consolidated liabilities have…

Our common stock ranks junior to our Series B Preferred Stock with respect to the payment of dividends and amounts payable in the event of our liquidation, dissolution, or winding-up of our affairs.

In addition, if any of certain fundamental changes were to occur, we or the surviving entity would be required to make an offer to repurchase, at the option and election of the holders thereof, for cash each share of…

For these reasons, investors should not rely on recent or historical trends to predict future trading prices of our common stock, financial condition, results of operations, or cash flows.

Changes to income tax laws and regulations, or the interpretation of such laws, in any of the jurisdictions in which we operate could significantly increase our effective tax rate and ultimately reduce our cash flows…

In January 2025, we received an inquiry from BIS concerning past product sales to Huawei; we are cooperating with BIS’s inquiry and conducting an internal review of those sales to determine what products are subject t…

International trade disputes, geopolitical tensions, and military conflicts have led, and continue to lead, to new and increasing export restrictions, trade barriers, tariffs, and other trade measures that can increas…

Government actions and regulations, such as export restrictions, tariffs, and trade protection measures, may limit our ability to sell our products to certain customers or markets, or could otherwise restrict our abil…

in successfully integrating any acquired operations or to otherwise realize any of the anticipated benefits of an acquisition, including any expected cost savings and synergies, our operations could be impaired.

third-party technology as we do, which means that outages, errors and other incidents impacting third parties and third party technology can impact both us, as well as our customers, vendors and service providers, whi…

Our business is subject to various domestic and international laws and other legal requirements, including ant-competition and import/export regulations, such as the U.S.

Our business is subject to various governmental regulations.

Any changes in political, trade, regulatory, and economic conditions, including U.S.

Significant political, trade, regulatory developments, and other circumstances beyond our control, including as a result of recently announced tariffs, could have a material adverse effect on our financial condition o…

We also make products of which we are one of the world’s largest suppliers.

Some of our products require designs and specifications that are at the cutting-edge of available technologies and change frequently to meet rapidly evolving market demands.

and loss of reputation.

Our dependence on large orders from a relatively small number of large customers makes our relationship with each large customer critically important to our business.

interested shareholder or affiliate group, unless the transaction is approved by independent directors or other criteria are satisfied.

debt arrangements on favorable terms or at all, which could negatively affect our ability to fund current and future expansion as well as future acquisitions and development.

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted in the United States.

Changes to income tax laws and regulations, or the interpretation of such laws, in any of the jurisdictions in which we operate could significantly increase our effective tax rate and ultimately reduce our cash flows…

As directed by Section 404 of the Sarbanes-Oxley Act of 2002, the U.S.

Failure to maintain effective internal control over financial reporting may cause a loss of investor confidence in the reliability of our financial statements or cause us to delay filing our periodic reports with the…

standards could cause us to incur additional direct costs, as well as increased indirect costs related to our relationships with our customers and suppliers, and otherwise harm our operations and financial condition.

In addition, foreign governments have taken and may take retaliatory actions in response to U.S.

The U.S.

profitability, and we may be subject to legal and regulatory consequences if we do not comply with applicable laws and regulations.

Political tensions as a result of trade policies could reduce trade volume, investment, technological exchange and other economic activities between major international economies, resulting in a material adverse effec…

The legal landscape governing these measures also remains unsettled.

We operate globally and sell or plan to sell our products in countries throughout the world.

Significant political, trade, regulatory developments, and other circumstances beyond our control, including those resulting from increased tariffs and ongoing geopolitical tensions, could have a material adverse effe…

The Restructuring Plans may result in other unintended consequences, including higher than anticipated costs in implementing planned workforce reductions, particularly in highly regulated locations outside the United…

acquired business can be a time-consuming and expensive process that, without proper planning and effective and timely implementation, could significantly disrupt our business.

Our manufacturing processes and those of our contract manufacturers rely on many materials, including precious and rare earth metals, indium phosphide (“InP”) and certain lasers and laser components that may be diffic…

We purchase a significant amount of the materials and components used in our products from a limited number of suppliers.

reasons, including changes in circumstances at our contract manufacturers or our own business strategies, we may voluntarily, or be required to, transfer the manufacturing of certain products to other manufacturing si…

less profitable than those projects we do not select.

We have a broad portfolio of products to address our customers’ needs, which span multiple market segments and are subject to rapid technological changes.

If we overestimate demand, if customers delay, reduce, or cancel anticipated orders, or if expected end markets develop more slowly than anticipated, we may be unable to optimize our manufacturing footprint and could…

From time to time, we could experience impacts from certain of the above items and, because these risks are a characteristic of our business, we expect to experience them in the future.

•insufficient customer demand to utilize our increased capacity.

•increases to our cost structure until new production is ramped to adequate scale; and

•inability to timely ramp production in a cost-effective manner;

•inability to attract, retain and motivate key talent;

•inability to complete construction as scheduled and within budget;

•potential restrictions on expanding in certain geographies;

•delays and potential restrictions related to environmental and other government regulations or permits;

•potential changes in laws or provisions of grants, investment tax credits, and other government incentives, including the CHIPS Act;

•inability to realize expected grants, investment tax credits, and other government incentives, including through the CHIPS Act and other national, international, state, and local grants;

•unavailability of necessary funding, which may include external sources;

•inability to meet capital expenditure requirements, including during periods of relatively low free cash flow generation;

In addition, these expansions involve several risks including the following:

We have made and are planning to make significant investments to satisfy increased customer demand, including expansion of our production capacity in the United States and in other regions where we operate.

We may not be able to achieve expected returns from strategic investments, including capacity expansions.

In addition, customers may require qualification or requalification of manufacturing lines before they will accept volume shipments, including when we establish new lines, relocate production, introduce new products,…

We provide components to contract manufacturers to produce finished or intermediary goods, and for some products a particular internal or external manufacturing site may be the sole qualified source.

Our reliance on contract manufacturers, and any failure to qualify or requalify our own or our subcontractors’ manufacturing lines for volume production, could adversely affect our ability to meet customer demand and…

Although we maintain insurance and self-insured retentions for reasonably estimable liabilities, such insurance coverage may not continue to be available on acceptable terms, if at all, and our reserves may be inadequ…

•we could be required to pay for costs, payments, or damages in connection with warranty and product liability claims and product recalls;

manufacturing capacity, or recover investments made in anticipation of demand.

Our dependence on large orders from a relatively small number of large customers makes our relationship with each large customer critically important to our business.

Alternatively, downturns in the industries in which we compete, or changes in technology, may cause our customers to significantly and abruptly reduce their demand, or even cancel orders.