Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The information required by this item is set forth in our Consolidated Financial Statements contained in this Annual Report on Form 10-K. Specific financial statements can be found at the pages listed below:

			Page
Management’s Report on Internal Control Over Financial Reporting			49
Reports of Independent Registered Public Accounting Firm (PCAOB ID: 42)			50
Consolidated Balance Sheets			53
Consolidated Statements of Earnings (Loss)			54
Consolidated Statements of Comprehensive Income (Loss)			55
Consolidated Statements of Shareholders’ Equity and Mezzanine Equity			56
Consolidated Statements of Cash Flows			57
Notes to Consolidated Financial Statements			59

MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

Management’s Responsibility for Preparation of the Financial Statements

Management is responsible for the preparation of the Consolidated Financial Statements included in this Annual Report on Form 10-K. The Consolidated Financial Statements were prepared in accordance with the accounting principles generally accepted in the United States of America and include amounts that are based on the best estimates and judgments of management. The other financial information contained in this Annual Report on Form 10-K is consistent with the Consolidated Financial Statements.

Management’s Report on Internal Control Over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting as such term is defined in Exchange Act Rules 13a-159f) and 15(d)-15(f). The Company’s internal control system is designed to provide reasonable assurance concerning the reliability of the financial data used in the preparation of the Company’s Consolidated Financial Statements, as well as reasonable assurance with respect to safeguarding the Company’s assets from unauthorized use or disposition.

All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement presentation and other results of such systems.

Management conducted an evaluation of the effectiveness of the Company’s internal control over financial reporting as of June 30, 2025. In making this evaluation, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control – Integrated Framework (2013). Management’s evaluation included reviewing the documentation of its controls, evaluating the design effectiveness of controls and testing their operating effectiveness. Based on the evaluation, management concluded that as of June 30, 2025, the Company’s internal controls over financial reporting were effective.

Ernst & Young LLP, an independent registered public accounting firm, has issued its report on the effectiveness of our internal control over financial reporting as of June 30, 2025, which report is included herein.

Report of Independent Registered Public Accounting Firm

To the Shareholders and the Board of Directors of Coherent Corp.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Coherent Corp. and subsidiaries (the Company) as of June 30, 2025 and 2024, the related consolidated statements of earnings (loss), comprehensive income (loss), shareholders’ equity and mezzanine equity and cash flows for each of the three years in the period ended June 30, 2025, and the related notes and financial statement schedule listed in the Index at Item 15(a)(2) (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at June 30, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended June 30, 2025, in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of June 30, 2025, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated August 14, 2025 expressed an unqualified opinion thereon.

Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Goodwill Impairment Assessment - Lasers Reporting Unit
Description of the Matter			At June 30, 2025, the balance of the Company’s goodwill related to the Lasers reporting unit was $3.2 billion. As discussed in Note 1 to the consolidated financial statements, goodwill is reviewed annually for impairment, or more frequently if impairment indicators arise. The assessment of goodwill for impairment requires a comparison of the fair value of each reporting unit that has goodwill associated with its operations to its carrying amount, including goodwill. If the Company’s carrying amount of a reporting unit exceeds its fair value, an impairment loss would be measured as the excess of the carrying value over the calculated fair value. Auditing the Company’s annual goodwill impairment test for the Lasers reporting unit is complex because it involves making assumptions about the timing and amount of the forecasted future net cash flows of the reporting unit. The fair value estimate can be sensitive to significant assumptions such as revenue and the selected discount rate, which is based on a risk-adjusted weighted average cost of capital. These significant assumptions are forward looking and could be impacted by future economic conditions.
How We Addressed the Matter in Our Audit			We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Company’s goodwill impairment evaluation process, including controls over management’s review of the assumptions described above. Our audit procedures to test management’s impairment evaluation of the Lasers reporting unit included, among others, assessing the valuation methodology and assumptions discussed above, and the underlying data used to develop such assumptions. For example, we compared certain assumptions to current industry, market and economic trends. Where appropriate, we evaluated whether changes to the Company’s business and other factors would affect the assumptions. We also assessed the historical accuracy of management’s estimates and performed independent sensitivity analyses. We involved our valuation specialists to assist us in evaluating the methodologies and auditing the assumptions used to calculate the estimated fair value of the Lasers reporting unit.

/s/ Ernst & Young LLP

We have served as the Company’s auditor since 2008.

Pittsburgh, Pennsylvania

August 14, 2025

Report of Independent Registered Public Accounting Firm

To the Shareholders and the Board of Directors of Coherent Corp.

Opinion on Internal Control Over Financial Reporting

We have audited Coherent Corp. and subsidiaries’ internal control over financial reporting as of June 30, 2025, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, Coherent Corp. and subsidiaries (the Company) maintained, in all material respects, effective internal control over financial reporting as of June 30, 2025, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of June 30, 2025 and 2024, the related consolidated statements of earnings (loss), comprehensive income (loss), shareholders’ equity and mezzanine equity and cash flows for each of the three years in the period ended June 30, 2025, and the related notes and schedule listed in the Index at Item 15(a)(2) and our report dated August 14, 2025 expressed an unqualified opinion thereon.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.

Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control Over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ Ernst & Young LLP

Pittsburgh, Pennsylvania

August 14, 2025

Coherent Corp. and Subsidiaries

Consolidated Balance Sheets

($000)

June 30,						2025						2024
Assets
Current Assets
Cash and cash equivalents						$	909,200					$	926,033
Restricted cash, current						8,897						174,008
Accounts receivable - less allowance for doubtful accounts of $12,189 and $9,511 at June 30, 2025 and June 30, 2024, respectively						964,051						848,542
Inventories						1,437,636						1,286,404
Prepaid and refundable income taxes						55,773						26,909
Prepaid and other current assets						551,597						398,203
Total Current Assets						3,927,154						3,660,099
Property, plant & equipment, net						1,877,507						1,817,259
Goodwill						4,471,084						4,464,329
Other intangible assets, net						3,204,747						3,503,247
Deferred income taxes						53,407						40,966
Restricted cash, non-current						714,816						689,645
Other assets						662,221						313,089
Total Assets						$	14,910,936					$	14,488,634
Liabilities, Mezzanine Equity and Equity
Current Liabilities
Current portion of long-term debt						$	188,306					$	73,770
Accounts payable						846,984						631,548
Accrued compensation and benefits						258,650						212,458
Operating lease current liabilities						41,575						40,580
Accrued income taxes payable						123,762						90,705
Other accrued liabilities						335,564						294,706
Total Current Liabilities						1,794,841						1,343,767
Long-term debt						3,498,615						4,026,448
Deferred income taxes						711,717						784,374
Operating lease liabilities						165,162						162,355
Other liabilities						259,318						225,411
Total Liabilities						6,429,653						6,542,355
Mezzanine Equity
Series B redeemable convertible preferred stock, no par value, 5% cumulative; issued - 215,000 shares at June 30, 2025 and June 30, 2024; redemption value - $2,540,110 and $2,427,860 as of June 30, 2025 and June 30, 2024, respectively						2,483,261						2,364,772
Shareholders’ Equity
Common stock, no par value; authorized - 300,000,000 shares; issued - 171,849,325 shares at June 30, 2025; issued - 168,406,323 shares at June 30, 2024						5,056,168						4,857,657
Accumulated other comprehensive income (AOCI)						372,037						2,640
Retained earnings						584,374						664,940
						6,012,579						5,525,237
Treasury stock, at cost - 16,294,119 shares at June 30, 2025 and 15,626,740 shares at June 30, 2024						(368,065)						(315,122)
Total Coherent Corp. Shareholders’ Equity						5,644,514						5,210,115
Noncontrolling interests (NCI)						353,508						371,392
Total Equity						5,998,022						5,581,507
Total Liabilities, Mezzanine Equity and Equity						$	14,910,936					$	14,488,634

See Notes to Consolidated Financial Statements

Coherent Corp. and Subsidiaries

Consolidated Statements of Earnings (Loss)

Year Ended June 30,						2025						2024						2023
($000, except per share data)
Revenues						$	5,810,115					$	4,707,688					$	5,160,100
Costs, Expenses and Other Expense (Income)
Cost of goods sold						3,766,793						3,251,724						3,541,817
Research and development						581,924						478,788						499,603
Selling, general and administrative						926,451						854,001						1,036,699
Restructuring charges						160,081						27,054						119,101
Impairment of assets held-for-sale						84,988						—						—
Interest expense						243,251						288,475						286,872
Other (income) expense, net						(47,554)						(44,707)						31,566
Total Costs, Expenses and Other Expense						5,715,934						4,855,335						5,515,658
Earnings (Loss) Before Income Taxes						94,181						(147,647)						(355,558)
Income Tax Expense (Benefit)						64,124						11,117						(96,100)
Net Earnings (Loss)						30,057						(158,764)						(259,458)
Net Loss Attributable to Noncontrolling Interests						(19,307)						(2,610)						—
Net Earnings (Loss) Attributable to Coherent Corp.						49,364						(156,154)						(259,458)
Less: Dividends on Preferred Stock						129,926						123,357						144,212
Net Loss Available to the Common Shareholders						$	(80,562)					$	(279,511)					$	(403,670)
Basic Loss Per Share						$	(0.52)					$	(1.84)					$	(2.93)
Diluted Loss Per Share						$	(0.52)					$	(1.84)					$	(2.93)

See Notes to Consolidated Financial Statements

Coherent Corp. and Subsidiaries

Consolidated Statements of Comprehensive Income (Loss)

Year Ended June 30,						2025						2024						2023
($000)
Net Earnings (Loss)						$	30,057					$	(158,764)					$	(259,458)
Other Comprehensive Income (Loss):
Foreign currency translation adjustments						409,069						(81,889)						87,927
Change in fair value of interest rate instruments, net of taxes of $(5,406), $(5,468) and $8,056 for the years ended June 30, 2025, 2024 and 2023, respectively						(31,898)						(20,196)						30,071
Pension adjustment, net of taxes of ($1,543), ($1,718) and ($1,682) for the years ended June 30, 2025, 2024, and 2023, respectively						(6,351)						(7,443)						(6,105)
Other comprehensive income (loss)						370,820						(109,528)						111,893
Comprehensive Income (Loss)						400,877						(268,292)						(147,565)
Comprehensive Loss Attributable to Noncontrolling Interests						(19,307)						(2,610)						—
Foreign Currency Translation Adjustments Attributable to Noncontrolling Interests						1,423						429						—
Comprehensive Income (Loss) Attributable to Coherent Corp.						$	418,761					$	(266,111)					$	(147,565)

See Notes to Consolidated Financial Statements

Coherent Corp. and Subsidiaries

Consolidated Statements of Shareholders’ Equity and Mezzanine Equity

						Common Stock												Preferred Stock																								Treasury Stock																								Mezzanine Equity
						Shares						Amount						Shares						Amount						AOCI						Retained Earnings						Shares						Amount						NCI						Total						Preferred Shares						Amount
(000, including share amounts)
Balance - June 30, 2022						120,923						$	2,064,552					2,300						$	445,319					$	(2,167)					$	1,348,125					(13,973)						$	(239,354)					$	—					$	3,616,475					75						$	766,803
Share-based and deferred compensation activities						4,029						171,128						—						—						—						—						(1,164)						(53,767)						—						117,361						—						—
Coherent acquisition						22,588						1,207,591						—						—						—						—						—						—						—						1,207,591						—						—
Convertible debt conversions						7,181						337,940						—						—						—						—						—						—						—						337,940						—						—
Net loss						—						—						—						—						—						(259,458)						—						—						—						(259,458)						—						—
Foreign currency translation adjustments						—						—						—						—						87,927						—						—						—						—						87,927						—						—
Change in fair value of interest rate instruments, net of taxes of $8,056						—						—						—						—						30,071						—						—						—						—						30,071						—						—
Issuance of Series B shares						—						—						—						—						—						—						—						—						—						—						140						1,358,000
Pension adjustment, net of taxes of $(1,682)						—						—						—						—						(6,105)						—						—						—						—						(6,105)						—						—
Dividends						—						—						—						—						—						(144,251)						—						—						—						(144,251)						—						116,612
Balance - June 30, 2023						154,721						$	3,781,211					2,300						$	445,319					$	109,726					$	944,416					(15,137)						$	(293,121)					$	—					$	4,987,551					215						$	2,241,415
Share-based and deferred compensation activities						3,447						166,800						—						—						—						—						(492)						(22,001)						—						144,799						—						—
Conversion of Series A preferred stock						10,240						445,319						(2,300)						(445,319)						—						—						—						—						—						—						—						—
Net loss						—						—						—						—						—						(156,154)						—						—						(2,610)						(158,764)						—						—
Foreign currency translation adjustments						—						—						—						—						(82,318)						—						—						—						429						(81,889)						—						—
Change in fair value of interest rate instruments, net of taxes of $(5,468)						—						—						—						—						(20,196)						—						—						—						—						(20,196)						—						—
Pension adjustment, net of taxes of $(1,718)						—						—						—						—						(7,443)						—						—						—						—						(7,443)						—						—
Dividends						—						—						—						—						—						(123,322)						—						—						—						(123,322)						—						123,357
Sale of shares of noncontrolling interests, net of issuance costs of $31,840 and taxes of $127,389						—						464,327						—						—						2,871						—						—						—						373,573						840,771						—						—
Balance - June 30, 2024						168,408						$	4,857,657					—						$	—					$	2,640					$	664,940					(15,629)						$	(315,122)					$	371,392					$	5,581,507					215						$	2,364,772
Share-based and deferred compensation activities						3,441						199,204						—						—						—						—						(665)						(52,943)						—						146,261						—						—
Net earnings						—						—						—						—						—						49,364						—						—						(19,307)						30,057						—						—
Foreign currency translation adjustments						—						—						—						—						407,646						—						—						—						1,423						409,069						—						—
Change in fair value of interest rate instruments, net of taxes of $(5,406)						—						—						—						—						(31,898)						—						—						—						—						(31,898)						—						—
Pension adjustment, net of taxes of $(1,543)						—						—						—						—						(6,351)						—						—						—						—						(6,351)						—						—
Dividends						—						—						—						—						—						(129,930)						—						—						—						(129,930)						—						118,489
Change in deferred tax basis for noncontrolling interests						—						(693)						—						—						—						—						—						—						—						(693)						—						—
Balance - June 30, 2025						171,849						$	5,056,168					—						$	—					$	372,037					$	584,374					(16,294)						$	(368,065)					$	353,508					$	5,998,022					215						$	2,483,261

See Notes to Consolidated Financial Statements

Coherent Corp. and Subsidiaries

Consolidated Statements of Cash Flows

Year Ended June 30,						2025						2024						2023
($000)
Cash Flows from Operating Activities
Net earnings (loss)						$	30,057					$	(158,764)					$	(259,458)
Adjustments to reconcile net earnings (loss) to net cash provided by operating activities:
Depreciation						250,810						271,601						267,562
Amortization						302,788						288,160						414,125
Share-based compensation expense						160,239						126,049						148,872
Non-cash restructuring and impairment charges						140,912						16,557						119,456
Amortization of discount on convertible debt and debt issuance costs						19,774						17,652						19,850
Losses on disposals of property, plant & equipment						782						758						2,440
Unrealized losses (gains) on foreign currency remeasurements and transactions						33,122						(10,556)						(3,549)
Loss (earnings) from equity investments						(1,316)						51						66
Deferred income taxes						(95,434)						(112,096)						(206,822)
Loss on debt extinguishment						—						1,978						6,855
Increase (decrease) in cash from changes in (net of effects of acquisitions):
Accounts receivable						(170,444)						60,581						68,315
Inventories						(202,728)						(23,196)						174,136
Accounts payable						217,357						205,044						(83,330)
Contract liabilities						3,182						(72,818)						(18,957)
Income taxes						(22,118)						12,251						28,651
Accrued compensation and benefits						62,960						36,894						(60,595)
Other operating net assets (liabilities)						(96,343)						(114,415)						16,408
Net cash provided by operating activities						633,600						545,731						634,025
Cash Flows from Investing Activities
Additions to property, plant & equipment						(440,836)						(346,816)						(436,060)
Purchases of businesses, net of cash acquired						—						—						(5,488,556)
Proceeds from the sale of business						27,000						—						—
Other investing activities						(379)						(3,897)						(4,010)
Net cash used in investing activities						(414,215)						(350,713)						(5,928,626)
Cash Flows from Financing Activities
Sale of shares to noncontrolling interests						—						1,000,000						—
Proceeds from borrowings of Term B Facility						—						—						2,800,000
Proceeds from issuance of Series B preferred shares						—						—						1,400,000
Proceeds from borrowings of Term A Facility						—						—						850,000
Proceeds from borrowings of revolving credit facilities						53,729						18,966						65,000
Payments on existing debt						(436,986)						(228,802)						(1,265,175)
Payments on borrowings under Revolving Credit Facilities						(51,661)						(19,027)						(65,000)
Payments on convertible notes						—						—						(3,561)
Debt issuance costs						—						—						(126,516)
Equity issuance costs						—						(31,840)						(42,000)
Proceeds from exercises of stock options and purchases of stock under employee stock purchase plan						49,570						42,297						24,167
Payments in satisfaction of employees’ minimum tax obligations						(53,992)						(22,315)						(54,172)
Cash dividends paid						(11,438)						—						(27,600)
Other financing activities						(948)						(1,007)						(1,124)
Net cash provided by (used in) financing activities						(451,726)						758,272						3,554,019
Effect of exchange rate changes on cash, cash equivalents, and restricted cash						75,568						(1,170)						(4,223)
Net increase (decrease) in cash and cash equivalents, and restricted cash						(156,773)						952,120						(1,744,805)
Cash, Cash Equivalents, and Restricted Cash at Beginning of Period						1,789,686						837,566						2,582,371
Cash, Cash Equivalents, and Restricted Cash at End of Period						$	1,632,913					$	1,789,686					$	837,566
Supplemental Information

Cash paid for interest						$	256,704					$	312,879					$	282,835
Cash paid for income taxes						$	166,849					$	97,295					$	89,567
Non-Cash Investing and Financing Activities:
Additions to property, plant & equipment included in accounts payable						$	67,146					$	63,286					$	36,777
Conversion of Series A preferred stock to common stock						$	—					$	445,319					$	—

See Notes to Consolidated Financial Statements

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the Consolidated Balance Sheets that sum to the total of the same amounts shown in the Consolidated Statements of Cash Flows.

Year Ended June 30,						2025						2024						2023
($000)
Cash and cash equivalents						$	909,200					$	926,033					$	821,310
Restricted cash, current						8,897						174,008						12,023
Restricted cash, non-current						714,816						689,645						4,233
Total cash, cash equivalents, and restricted cash shown in the Consolidated Statements of Cash Flows						$	1,632,913					$	1,789,686					$	837,566

See Notes to Consolidated Financial Statements

Coherent Corp. and Subsidiaries

Notes to Consolidated Financial Statements

Note 1. Nature of Business and Summary of Significant Accounting Policies

Nature of Business. Coherent Corp. (“Coherent,” the “Company,” “we,” “us” or “our”), a global leader in materials, networking, and lasers, is a vertically-integrated manufacturing company that develops, manufactures, and markets engineered materials, optoelectronic components and devices, and lasers for use in the industrial, communications, electronics and instrumentation markets. The Company markets its products through its direct sales force and through distributors and agents.

The Company uses certain uncommon materials and compounds to manufacture its products. Some of these materials are available from only one proven outside source. The continued high quality of these materials is critical to the stability of our manufacturing yields.

Consolidation. The Consolidated Financial Statements include the accounts of the Company and all of its subsidiaries. All significant intercompany accounts and transactions have been eliminated in consolidation. Certain prior year amounts have been reclassified for consistency with the current year presentation.

Use of Estimates. The preparation of financial statements in conformity with generally accepted accounting principles in the United States (“U.S. GAAP”) requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Although these estimates are based on management’s best knowledge of current events and actions Coherent may undertake in the future, actual results may ultimately differ from the estimates.

Foreign Currency Translation. For all foreign subsidiaries whose functional currency is not the U.S. dollar, the functional currency is the local currency. Assets and liabilities of those operations are translated into U.S. dollars using period-end exchange rates while income and expenses are translated using the average exchange rates for the reporting period. Translation adjustments are recorded as Accumulated other comprehensive income (loss) within Shareholders’ equity in the accompanying Consolidated Balance Sheets.

Cash, Cash Equivalents, and Restricted Cash. We consider highly liquid investment instruments with an original maturity of three months or less to be cash equivalents. As of June 30, 2025, we had restricted cash of $724 million that is restricted for a specific purpose, with $9 million and $715 million recorded in Restricted cash, current and Restricted cash, non-current, respectively, on our Consolidated Balance Sheet.

Allowance for Expected Credit Losses. We recognize expected credit losses resulting from the inability of our customers to make required payments through an allowance account that is measured each reporting date. We estimate credit losses over the life of our trade accounts receivable using a combination of historical loss data, current credit conditions, specific customer circumstances, and reasonable and supportable forecasts of future economic conditions.

Inventories. Inventories are valued at the lower of cost or net realizable value, with cost determined on the first-in, first-out basis. Inventory costs include material, labor and manufacturing overhead. In evaluating the net realizable value of inventory, management also considers other factors, including known trends and market conditions. We generally record a reduction to the carrying value of inventory as a charge against earnings for all products on hand more than 12 to 24 months, depending on the nature of the products, that have not been sold to customers or cannot be further manufactured for sale to alternative customers. An additional charge may be recorded for product on hand that is in excess of product sold to customers over the same periods noted above.

Property, Plant and Equipment. Property, plant and equipment are carried at cost or fair value upon acquisition. Major improvements are capitalized, while maintenance and repairs are generally expensed as incurred. We review our property, plant and equipment and other long-lived assets for impairment whenever events or circumstances indicate that the carrying amounts may not be recoverable. Depreciation on property, plant and equipment and amortization on finance lease right-of-use assets for financial reporting purposes is computed primarily by the straight-line method over the estimated useful lives for building, building improvements and land improvements of 10 to 30 years and 3 to 20 years for machinery and equipment.

Investment Credit. The Creating Helpful Incentives to Produce Semiconductors and Science Act of 2022 (the “CHIPS Act”) was signed into law on August 9, 2022. The CHIPS Act provides for various incentives and tax credits, among other items, including the Advanced Manufacturing Investment Credit (“AMIC”), which equals 25% of qualified investments in an advanced manufacturing facility that is placed in service after December 31, 2022. The Company expects to receive refundable federal investment tax credits through the CHIPS Act in connection with ongoing expansion projects. At least a portion of our capital expenditures qualify for this credit, which benefits us by allowing us to net the credit received against our costs. The AMIC credit is accounted as a reduction to the depreciable basis of the assets used in operations. The Company has offset the cost of property, plant, and equipment by the amount of the estimated credit of $41 million for fiscal June 30, 2025. The receivable recorded is an estimate based on the Company's interpretation of the Section 48D Advanced Manufacturing Investment Credit under the CHIPS Act, which may be refunded to us in cash to the extent it exceeds our outstanding income tax liabilities.

Leases. Leases are recognized under Accounting Standards Codification 842, Leases. The Company determines whether a contract contains a lease at contract inception. A contract contains a lease if there is an identified asset and the Company has the right to control the asset. Operating lease right-of-use (“ROU”) assets represent our right to use an underlying asset for the lease term, and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and lease liabilities are recognized at commencement date based on the present value of lease payments over the lease term. We use the incremental borrowing rate in determining the present value of lease payments, unless the implicit rate is readily determinable. If lease terms include options to extend or terminate the lease, the ROU asset and lease liability are measured based on the reasonably certain decision. We have lease agreements with lease and non-lease components, which are accounted for as a single lease component for all classes of leased assets for which the Company is the lessee. Additionally, for certain equipment leases, the portfolio approach is applied to account for the operating lease ROU assets and lease liabilities. In the Consolidated Statements of Earnings (Loss), lease expense for operating lease payments is recognized on a straight-line basis over the lease term. For finance leases, interest expense is recognized on the lease liability and the ROU asset is amortized over the lease term. Some leasing arrangements require variable payments that are dependent upon usage or output, or may vary for other reasons, such as insurance or tax payments. Variable lease payments are recognized as incurred, and are not presented as part of the ROU asset or lease liability. See Note 12. Leases for further information.

Business Combinations. The Company accounts for business combinations by establishing the acquisition-date fair value as the measurement for all assets acquired and liabilities assumed. Certain provisions of U.S. GAAP prescribe, among other things, the determination of acquisition-date fair value of consideration paid in a business combination (including contingent consideration) and the exclusion of transaction and acquisition-related restructuring costs from acquisition accounting.

Goodwill. The excess purchase price over the fair value allocated to identifiable tangible and intangible net assets of businesses acquired is reported as goodwill in the accompanying Consolidated Balance Sheets. We test goodwill for impairment at least annually as of April 1, or when events or changes in circumstances indicate that goodwill might be impaired. The evaluation of impairment involves comparing the current fair value of our reporting units to the recorded value (including goodwill). We use a discounted cash flow (“DCF”) model and/or a market analysis to determine the fair value of our reporting units. A number of assumptions and estimates are involved in estimating the forecasted cash flows used in the DCF model, including markets and market shares, sales volume and pricing, costs to produce, working capital changes and income tax rates. Management considers historical experience and all available information at the time the fair values of the reporting units are estimated. Goodwill impairment is measured as the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill.

As of April 1 of fiscal years 2025 and 2024, we completed our annual impairment tests of our reporting units using the quantitative assessment. For fiscal year 2025, the fair values of the reporting units were determined using a discounted cash flow analysis with projected financial information based on our most recently completed long-term strategic planning processes and also considered the current financial performance compared to our prior projections of the reporting units, as well as a market analysis. As of April 1, 2025 and 2024, the fair value of each of our reporting units exceeded their carrying values.

Due to the cyclical nature of our business, and the other factors described in the section on Risk Factors set forth in Item 1A of this Annual Report on Form 10-K, the profitability of our individual reporting units may periodically be affected by downturns in customer demand, operational challenges and other factors. If material adverse conditions occur that impact one or more of our reporting units, our determination of future fair value might not support the carrying amount of one or more of our reporting units, and the related goodwill would need to be impaired.

Intangibles. Intangible assets are initially recorded at their cost or fair value upon acquisition. Finite-lived intangible assets are amortized using the straight-line method over the estimated useful lives of the assets ranging from 1 to 20 years. Indefinite-lived intangible assets are not amortized but tested annually for impairment at April 1, or when events or changes in circumstances indicate that indefinite-lived intangible assets might be impaired. As of April 1 of fiscal 2025, the Company completed a quantitative impairment test of the Coherent trade name acquired in the Merger using the relief from royalty method and determined that its fair value is well in excess of its carrying value.

Series A Mandatory Convertible Preferred Stock. The Mandatory Convertible Preferred Stock was initially measured at fair value, less underwriting discounts and commissions and offering expenses paid by the Company. The Preferred Stock’s dividends were cumulative, at 6% per annum. All outstanding shares of Mandatory Convertible Preferred Stock were converted to 10,240,290 shares of Company Common Stock on July 3, 2023, at a conversion ratio of 4.4523, and no shares of Mandatory Convertible Preferred Stock are currently issued and outstanding. See Note 9. Equity and Redeemable Preferred Stock for further information.

Series B Convertible Preferred Stock. The Series B-1 Convertible Preferred Stock was initially measured at fair value less issuance costs, accreted to its redemption value over a ten-year period (using the effective interest method) with such accretion accounted for as deemed dividends and reductions to Net Earnings (Loss) Available to the Common Shareholders. The Series B-2 Convertible Preferred Stock was initially measured at fair value less issuance costs, accreted to its redemption value over a ten-year period (using the effective interest method) with such accretion accounted for as deemed dividends and reductions to Net Earnings (Loss) Available to the Common Shareholders. See Note 9. Equity and Redeemable Preferred Stock for further information.

Noncontrolling Interests. The Company accounts for noncontrolling interests in accordance with ASC Topic 810-10-45, which requires the Company to present noncontrolling interests as a separate component of total shareholders’ equity on the Consolidated Balance Sheets and the consolidated net earnings (loss) attributable to its noncontrolling interests be clearly identified and presented on the face of the Consolidated Statements of Earnings (Loss) and Consolidated Statements of Comprehensive Income (Loss). See Note 11. Noncontrolling Interests for further information on the noncontrolling interests in our Silicon Carbide LLC subsidiary.

Commitments and Contingencies. Liabilities for loss contingencies arising from claims, assessments, litigation, fines, and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount of the assessment and/or remediation can be reasonably estimated. If a loss is not both probable and reasonably estimable, or if an exposure to a loss exists in excess of the amount accrued, the Company assesses whether there is at least a reasonable possibility that a loss, or additional loss, may have been incurred. If there is a reasonable possibility that a loss, or additional loss, may have been incurred, the Company discloses the estimate of the possible loss or range of loss if it is material and an estimate can be made, or discloses that such an estimate cannot be made. The determination as to whether a loss can reasonably be considered to be possible or probable is based on management's assessment, together with legal counsel, regarding the ultimate outcome of the matter. Legal costs incurred in connection with loss contingencies are expensed as incurred. Such liabilities are adjusted as further information develops or circumstances change. Our customers may discover defects in our products after the products have been fully deployed and operated under peak stress conditions. If we are unable to correct defects or other problems, we could experience, among other things, loss of customers, increased costs of product returns and warranty expenses, damage to our brand reputation, failure to attract new customers or achieve market acceptance, diversion of development and engineering resources, or legal action by our customers. We had no material loss contingency liabilities at June 30, 2025 or 2024 related to commitments and contingencies.

Supply chain financing arrangements. The Company has entered into supply chain financing arrangements with third-party financial institutions to provide its vendors with enhanced payment options while providing the Company with added working capital flexibility. The Company does not provide any guarantees under these arrangements, does not have an economic interest in its supplier's voluntary participation, does not receive an economic benefit from the financial institutions, and no assets are pledged under the arrangements. The arrangements do not change the payable terms negotiated by the Company and our vendors and does not result in a change in the classification of amounts due as accounts payable in the Consolidated Balance Sheets. Suppliers utilized the program to accelerate receipt of payment from these financial institutions for $18 million and $10 million of the Company's outstanding Accounts payable as of June 30, 2025 and 2024, respectively. Total supplier invoices paid by the financial institutions amounted to $76 million and $38 million for the years ended June 30, 2025 and 2024, respectively. The supplier invoices included under the program require payment in full to the financial institutions consistent with the Company’s normal terms and conditions as agreed upon with the vendor.

Income Taxes. Deferred income tax assets and liabilities are determined based on the differences between the Consolidated Financial Statements and tax basis of assets and liabilities using enacted tax rates in effect in the years in which the differences are expected to reverse. Valuation allowances are established when necessary to reduce deferred income tax assets to the amount more likely than not to be realized. The Company’s accounting policy is to apply acquired deferred tax liabilities to pre-existing deferred tax assets before evaluating the need for a valuation allowance for acquired deferred tax assets.

The Company recognizes the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from such a position are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate resolution. The amount of unrecognized tax benefits is adjusted for changes in facts and circumstances. For example, adjustments could result from significant amendments to existing tax law and the issuance of regulations or interpretations by the taxing authorities, new information obtained during a tax examination, or resolution of an examination. The Company believes that its estimates for uncertain tax positions are appropriate and sufficient to pay assessments that may result from examinations of its tax returns. The Company recognizes both accrued interest and penalties related to unrecognized tax benefits in income tax expense.

The Company uses a portfolio approach to release the income tax effects in AOCI related to interest rate instruments and pension and postretirement benefits. Under this approach, the income tax effects are released from AOCI based on the pre-tax adjustments to interest rate instruments and pension liabilities or assets recognized within other comprehensive income (loss). Any tax effects remaining in AOCI are released only when the entire portfolio of the interest rate instruments or pension and postretirement benefits is liquidated, sold or extinguished.

Revenue Recognition. Revenue is recognized under Accounting Standards Codification 606, Revenue from Contracts with Customers (ASC 606), when or as obligations under the terms of a contract with our customer have been satisfied and control has transferred to the customer.

We have elected the practical expedient to exclude all sales and use taxes from the measurement of the transaction price. In certain customer arrangements, we are contractually entitled to reimbursement for import tariffs incurred on product shipments, the increase in consideration received due to tariff surcharges would not meet the sales and use tax practical expedient. As such, revenue including the tariff surcharge, and related tariff expense, would be recorded gross in the income statement. These reimbursements are considered part of the transaction price under ASC 606 and are recognized as revenue on a gross basis. The corresponding tariff costs are recorded in cost of goods sold.

For contracts with commercial customers, which comprise the majority of our performance obligations, ownership of the goods and associated revenue are generally transferred to customers at a point in time, generally upon shipment of a product to the customer or delivery of the product to the customer and without significant judgments. The majority of contracts typically require payment within 30 to 90 days after transfer of ownership to the customer.

We periodically enter into contracts in which a customer may purchase a combination of goods and/or services, such as products with maintenance contracts or extended warranty. Maintenance contracts and extended warranties are typically sold separately from products, and represent a distinct performance obligation. Revenue related to the performance obligation for maintenance contracts and extended warranties is recognized over time as the customer simultaneously receives and consumes the benefits provided by us.

Service revenue includes repairs, tolling arrangements and installation. Repairs, tolling and installation activities are usually completed in a short period of time (normally less than one month) and therefore recorded at a point in time when the services are completed. The majority of contracts typically require payment within 30 to 90 days after performance of the service.

Non-recurring engineering arrangements are typically recognized as product revenue over time under either the time and material practical expedient, as the entity has a right to consideration from a customer, in an amount that corresponds directly with the value to the customer of the entity’s performance completed to date, or under the output and input method. The majority of contracts typically require payment within 30 to 90 days.

Our revenue recognition policy is consistently applied across our segments, product lines, services, and geographical locations. For the periods covered herein, we measure revenue based on the amount of consideration the Company expects to be entitled to in exchange for products or services, reduced by the amount of variable consideration related to products expected to be returned. We determine variable consideration, which primarily consists of product returns and distributor sales price reductions resulting from price protection agreements, by estimating the impact of such reductions based on historical analysis of such activity.

Under ASC 606, we expense sales commissions when incurred because the amortization period would have been one year or less. These costs are recorded within selling, general and administrative expenses (“SG&A”). Costs for freight and shipping are generally recorded in cost of goods sold when control of the products has transferred to the customer.

We offer an assurance-type limited warranty that products will be free from defects in materials and workmanship. We establish an accrual for estimated warranty expenses at the time revenue is recognized. The warranty is typically one year, although it can be longer periods for certain products, and is typically limited to either (1) the replacement or repair of the product or (2) a credit against future purchases.

We believe that disaggregating revenue by end market provides the most relevant information regarding the nature, amount, timing, and uncertainty of revenues and cash flows. See Note 3. Revenue from Contracts with Customers for further information.

Research and Development. R&D expenses include salaries, contractor and consultant fees, supplies and materials, as well as costs related to other overhead such as depreciation, facilities, utilities and other departmental expenses. The costs we incur with respect to internally developed technology, including allocations of our wafer fabrication and other manufacturing facilities and resources utilized to support R&D programs, are included in R&D expenses as incurred.

Restructuring. The Company records charges associated with approved restructuring plans to reorganize operations, to remove redundant headcount and infrastructure associated with site consolidations, facilities moves and closures, as well as the relocation and requalification of certain manufacturing facilities. Restructuring charges can include severance costs to eliminate a specific number of positions, infrastructure charges to vacate facilities and consolidate operations and contract cancellation costs. The Company records restructuring charges when they are probable and estimable. The Company evaluates restructuring charges in accordance with ASC 420, Exit or Disposal Cost Obligations, and ASC 712, Compensation-Nonretirement Post-Employment Benefits (ASC 712). See Note 20. Restructuring Plans for further information.

Assets Held-for-Sale. Assets and liabilities are classified as held-for-sale when management approves and commits to a formal plan to actively market the assets for sale at a price reasonable in relation to their estimated fair value, the assets are available for immediate sale in their present condition, an active program to locate a buyer and other actions required to complete the sale have been initiated, the sale of the assets is probable and expected to be completed within one year, and it is unlikely that significant changes will be made to the plan. These conditions are usually met from the date on which a letter of intent or agreement to sell is ready for signing. Assets held-for-sale are reported at the lower of carrying amount or fair value less costs to sell. Long-lived assets classified as held-for-sale are not subject to depreciation or amortization. The held-for-sale designation and carrying value of assets held-for-sale are periodically reviewed and adjusted as facts and circumstances indicate that a change may be necessary. See Note 21. Assets Held-for-Sale for further information.

Share-Based Compensation. Share-based compensation arrangements require the recognition in net earnings (loss) of the grant date fair value of share-based compensation (for equity-classified awards). We recognize the share-based compensation expense over the requisite service period of the individual grantees, which generally equals the vesting period, net of forfeitures. The estimated annualized forfeitures are based on our historical experience of pre-vesting cancellations. We will record additional expense in future periods if the actual forfeiture rate is lower than estimated, and will adjust expense in future periods if the actual forfeitures are higher than estimated. See Note 13. Share-Based Compensation for a description of our share-based compensation plans and the assumptions we use to calculate the fair value of share-based compensation.

Earnings per Share. Basic earnings (loss) per share is computed by dividing net earnings (loss) available to the common shareholders by the weighted-average number of shares of common stock outstanding during the period. Diluted earnings (loss) per share is computed by dividing the diluted earnings (loss) available to the common shareholders by the weighted-average number of shares of common stock and potentially dilutive shares of common stock outstanding during the period. If there is a net loss for the period, diluted earnings per share is the same as basic earnings per share. See Note 10. Earnings Per Share for further information.

Accumulated Other Comprehensive Income (Loss) (“AOCI”). AOCI is a measure of all changes in shareholders’ equity that result from transactions and other economic events in the period other than transactions with owners. AOCI is a component of shareholders’ equity and consists of accumulated foreign currency translation adjustments, changes in the fair value of interest rate derivative instruments, and pension adjustments.

Fair Value Measurements. We apply fair value accounting for all financial assets and liabilities that are required to be recognized or disclosed at fair value in the Consolidated Financial Statements. Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities, we consider the principal or most advantageous market in which we would transact, and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as inherent risk, transfer restrictions and credit risk.

Note 2. Recently Issued and Adopted Financial Accounting Standards

Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures

In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-07 - Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. This ASU improves reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. This ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. The Company adopted the standard during fiscal 2025. See Note 14. Segment and Geographic Reporting for further information.

Income Taxes (Topic 740): Improvements to Income Tax Disclosures

In December 2023, the FASB issued ASU 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures” (“ASU 2023-09”). ASU 2023-09 includes amendments that further enhance income tax disclosures, primarily through standardization and disaggregation of rate reconciliation categories and income taxes paid by jurisdiction. ASU 2023-09 is effective for annual periods beginning after December 15, 2024, on either a prospective or retrospective basis. Early adoption is permitted. The Company is currently evaluating the impact of ASU 2023-09 on its consolidated financial statements and related disclosures.

Income Statement Reporting: Disaggregation of Income Statement Expenses

In November 2024, the FASB issued ASU 2024-03, “Income Statement-Reporting Comprehensive Income-Expense Disaggregation Disclosures (Subtopic 220-40), Disaggregation of Income Statement Expenses.” This ASU requires disclosure about specific types of expenses included in expense captions including purchases of inventory, employee compensation, depreciation, amortization, and depletion. This ASU is effective for our annual disclosures starting in fiscal year 2028 and interim periods starting in fiscal year 2029. Early adoption is permitted. A public entity should apply the amendments in this ASU on a prospective basis with the option to apply the standard retrospectively. The Company is currently evaluating this ASU to determine its impact on the Company’s disclosures.

Note 3. Revenue from Contracts with Customers

The following table summarizes disaggregated revenue by market ($000):

			Year Ended June 30, 2025
			Networking						Materials						Lasers						Total
Industrial			$	61,971					$	516,768					$	1,129,046					$	1,707,785
Communications			3,320,780						115,260						—						3,436,040
Electronics			8,185						278,181						20						286,386
Instrumentation			30,340						43,634						305,930						379,904
Total Revenues			$	3,421,276					$	953,843					$	1,434,996					$	5,810,115

			Year Ended June 30, 2024
			Networking						Materials						Lasers						Total
Industrial			$	63,905					$	546,003					$	1,070,268					$	1,680,176
Communications			2,192,286						81,475						—						2,273,761
Electronics			6,655						349,250						—						355,905
Instrumentation			32,883						39,845						325,118						397,846
Total Revenues			$	2,295,729					$	1,016,573					$	1,395,386					$	4,707,688

			Year Ended June 30, 2023
			Networking						Materials						Lasers						Total
Industrial			$	70,076					$	603,664					$	1,087,881					$	1,761,621
Communications			2,219,677						73,703						—						2,293,380
Electronics			11,488						614,151						—						625,639
Instrumentation			39,689						58,240						381,531						479,460
Total Revenues			$	2,340,930					$	1,349,758					$	1,469,412					$	5,160,100

Contract Liabilities

Payments received from customers are based on invoices or billing schedules as established in contracts with customers. Contract liabilities generally relate to payments received in advance of performance under a contract. Contract liabilities are recognized as revenue when performance obligations have been satisfied. During the year ended June 30, 2025, we recognized revenue of $55 million related to customer payments that were included in the Consolidated Balance Sheet as of June 30, 2024. As of June 30, 2025 and June 30, 2024, we had $72 million and $76 million, respectively, of contract liabilities recorded in the Consolidated Balance Sheets. As of June 30, 2025, $63 million of contract liabilities is included in other accrued liabilities, and $9 million is included within other liabilities on the Consolidated Balance Sheet. As of June 30, 2024, $62 million of contract liabilities is included other accrued liabilities, and $13 million is included within other liabilities on the Consolidated Balance Sheet.

Note 4. Inventories

The components of inventories were as follows ($000):

June 30,						2025						2024
Raw materials						$	394,682					$	429,888
Work in progress						824,360						620,575
Finished goods						218,594						235,941
Total Inventories						$	1,437,636					$	1,286,404

Note 5. Property, Plant & Equipment

Property, plant & equipment consists of the following ($000):

June 30,						2025						2024
Land and land improvements						$	59,543					$	66,156
Buildings and improvements						881,578						774,991
Machinery and equipment						2,188,509						2,034,310
Construction in progress						363,129						398,884
Finance lease right-of-use asset						—						25,000
						3,492,759						3,299,341
Less accumulated depreciation						(1,615,252)						(1,482,082)
Property, plant, and equipment, net						$	1,877,507					$	1,817,259

Note 6. Goodwill and Other Intangible Assets

Changes in the carrying amount of goodwill were as follows ($000):

						Year Ended June 30, 2025
						Networking						Materials						Lasers						Total
Balance at beginning of period						$	1,036,592					$	245,983					$	3,181,754					$	4,464,329
Other reclassifications (See Note 21)						—						(8,577)						(165,796)						(174,373)
Foreign currency translation and other						1,847						4,061						175,220						181,128
Balance-end of period						$	1,038,439					$	241,467					$	3,191,178					$	4,471,084

			Year Ended June 30, 2024
			Networking						Materials						Lasers						Total
Balance-beginning of period			$	1,036,204					$	247,695					$	3,228,801					$	4,512,700
Foreign currency translation and other			388						(1,712)						(47,047)						(48,371)
Balance-end of period			$	1,036,592					$	245,983					$	3,181,754					$	4,464,329

The gross carrying amount and accumulated amortization of our intangible assets other than goodwill as of June 30, 2025 and 2024 were as follows ($000):

						June 30, 2025																		June 30, 2024
						Gross Carrying Amount						Accumulated Amortization						Net Book Value						Gross Carrying Amount						Accumulated Amortization						Net Book Value
Technology						$	1,534,066					$	(513,181)					$	1,020,885					$	1,653,289					$	(394,040)					$	1,259,249
Trade Names						438,471						(8,471)						430,000						438,470						(8,470)						430,000
Customer Lists						2,440,834						(686,972)						1,753,862						2,310,550						(498,252)						1,812,298
Backlog and Other						90,121						(90,121)						—						88,792						(87,092)						1,700
Total						$	4,503,492					$	(1,298,745)					$	3,204,747					$	4,491,101					$	(987,854)					$	3,503,247

Amortization expense recorded on the intangible assets for the fiscal years ended June 30, 2025, 2024 and 2023 was $303 million, $288 million, and $414 million, respectively. The technology intangible assets are being amortized over a range of 60 to 240 months with a weighted-average remaining life of approximately 116 months, and the amortization is recorded in Cost of goods sold in our Consolidated Statements of Earnings (Loss). The customer lists are being amortized over 60 to 192 months with a weighted-average remaining life of approximately 138 months, and the amortization is recorded in SG&A in our Consolidated Statements of Earnings (Loss).

Amortization expense in the fiscal year ended June 30, 2025 includes a total of $17 million of impairment charges in the Materials segment related to the abandonment of certain purchased technology and licenses, with $14 million recorded in cost of goods sold and $3 million recorded in R&D in our Consolidated Statements of Earnings (Loss). There were no impairment charges included in amortization expense in the fiscal year ended June 30, 2024.

Amortization expense in the fiscal year ended June 30, 2023 includes a total of $39 million of impairment charges, with $33 million in the Materials segment and $7 million in the Networking segment. $25 million of the impairment charges related to the abandonment of certain purchased technology and customer lists, with $8 million recorded in Cost of goods sold and $18 million recorded in SG&A in our Consolidated Statement of Earnings (Loss). $14 million of impairment charges, recorded in SG&A, related to the abandonment of indefinite-lived trade names primarily due to the fiscal 2023 rebranding of the Company as Coherent Corp.

In the fourth quarter of fiscal year 2025, we completed our impairment test of our $430 million indefinite-lived Coherent trade name acquired in the Merger, concluding it was not impaired.

The estimated amortization expense for existing intangible assets for each of the five succeeding years is as follows ($000):

Year Ending June 30,
2026			$	282,869
2027			281,618
2028			279,930
2029			273,718
2030			251,603

Note 7. Debt

The components of debt as of the dates indicated were as follows ($000):

			June 30, 2025						June 30, 2024
Term A Facility, interest at adjusted SOFR, as defined, plus 1.850%			$	624,375					$	775,625
Debt issuance costs, Term A Facility and Revolving Credit Facility			(8,141)						(13,586)
Term B Facility, interest at adjusted SOFR, as defined, plus 2.00%			2,102,358						2,384,536
Debt issuance costs, Term B Facility			(36,478)						(49,835)
5.00% Senior Notes			990,000						990,000
Debt Issuance costs, Senior Notes			(4,966)						(5,939)
1.3% Term loan			—						335
Facility construction loan in Germany			17,682						19,082
Borrowings on local lines of credit			2,091						—
Total debt			3,686,921						4,100,218
Current portion of long-term debt			(188,306)						(73,770)
Long-term debt, less current portion			$	3,498,615					$	4,026,448

The required annual principal repayments for all indebtedness for the next five years and thereafter, as of June 30, 2025, is set forth in the following table ($000):

						Year Ending
						June 30,
2026						$	188,306
2027						16,652
2028						614,152
2029						3,215
2030						2,912,573
Thereafter						1,608
Total						$	3,736,506

Senior Credit Facilities

On July 1, 2022 (the “Closing Date”), Coherent entered into a Credit Agreement (the “Credit Agreement”) by and among the Company, as borrower (in such capacity, the “Borrower”), the lenders, and other parties thereto, and JP Morgan Chase Bank, N.A., as administrative agent and collateral agent, which provides for senior secured financing of $4.0 billion, consisting of a term loan A credit facility (the “Term A Facility”) maturing July 1, 2027, with an aggregate principal amount of $850 million, a term loan B credit facility (the “Term B Facility” and, together with the Term A Facility, the “Term Facilities”) maturing July 1, 2029, with an aggregate principal amount of $2,800 million, and a revolving credit facility (the “Revolving Credit Facility” and together with the Term Facilities, the “Senior Credit Facilities”) maturing July 1, 2027, in an aggregate available amount of $350 million, including a letter of credit sub-facility of up to $50 million. On March 31, 2023, Coherent entered into Amendment No. 1 to the Credit Agreement, which replaced the adjusted LIBOR-based rate of interest therein with an adjusted SOFR-based rate of interest. As amended, the Term A Facility and the Revolving Credit Facility each bear interest at an adjusted SOFR rate subject to a 0.10% floor plus a range of 1.75% to 2.50%, based on the Company’s total net leverage ratio. The Term A Facility and the Revolving Credit Facility bear interest at adjusted SOFR plus 1.85% as of June 30, 2025. On April 2, 2024, Coherent entered into Amendment No. 2 to the Credit Agreement, under which the principal amount of term B loans outstanding under the Credit Agreement (the “Existing Term B Loans”) were replaced with an equal amount of new term loans (the “New Term B Loans”) having substantially similar terms as the Existing Term B Loans, except with respect to the interest rate applicable to the New Term B Loans and certain other provisions. Debt extinguishment costs related to the replacement of the Existing Term B Loans of $2 million were expensed in Other expense (income), net in the Consolidated Statement of Earnings (Loss) during the year ended June 30, 2024. On January 2, 2025, Coherent entered into Amendment No. 3 to the Credit Agreement, under which the principal amount of New Term B Loans outstanding under the Credit Agreement were replaced with an equal amount of new term loans (the “New Term B-2 Loans”) having substantially similar terms as the New Term B Loans, except with respect to the interest rate applicable to the New Term B-2 Loans and certain other provisions. As

further amended, the New Term B-2 Loans bear interest at a SOFR rate (subject to a 0.50% floor) plus 2.00% as of June 30, 2025. The maturity of the New Term B-2 Loans and Revolving Credit Facility remains unchanged.

In relation to the Term Facilities, the Company incurred interest expense, including amortization of debt issuance costs and the benefit of the interest rate cap and swap, of $192 million and $237 million in the years ended June 30, 2025 and June 30, 2024, respectively, which is included in Interest expense in the Consolidated Statements of Earnings (Loss). On July 1, 2023, our interest rate cap became effective, which together with our interest rate swap (through September 30, 2024), reduced interest expense by $32 million and $45 million in the years ended June 30, 2025 and June 30, 2024, respectively. Amortization of debt issuance costs related to the Term Facilities for the year ended June 30, 2025 and June 30, 2024 totaled $17 million and $15 million, respectively, and are included in Interest expense in the Consolidated Statements of Earnings (Loss). Debt issuance costs are presented as a reduction to debt within the Long-term debt caption in the Consolidated Balance Sheets.

On the Closing Date, the Borrower and certain of its direct and indirect subsidiaries, provided a guaranty of all obligations of the Borrower and the other loan parties under the Credit Agreement and the other loan documents, secured cash management agreements and secured hedge agreements with the lenders and/or their affiliates (subject to certain exceptions). The Borrower and the other guarantors have also granted a security interest in substantially of their assets to secure such obligations.

As of June 30, 2025, the Company was in compliance with all covenants under the Term Facilities.

Debt Assumed through Acquisition

We assumed the remaining balances of three term loans with the closing of the Merger, two of which were repaid prior to June 30, 2024. The aggregate principal amount outstanding is $18 million as of June 30, 2025 and is for a Facility construction loan in Germany due in 2030 that bears interest at 1.55% per annum. Payments are made quarterly.

5.000% Senior Notes due 2029

On December 10, 2021, the Company issued $990 million aggregate principal amount of Senior Notes pursuant to the indenture, dated as of December 10, 2021 (the “Indenture”), between the Company and U.S. Bank National Association, as trustee. The Senior Notes are guaranteed by each of the Company’s domestic subsidiaries that guarantee its obligations under the Senior Credit Facilities. Interest on the Senior Notes is payable on December 15 and June 15 of each year, commencing on June 15, 2022, at a rate of 5.000% per annum. The Senior Notes will mature on December 15, 2029*.*

On or after December 15, 2024, the Company may redeem the Senior Notes, in whole at any time or in part from time to time, at the redemption prices set forth in the Indenture, plus accrued and unpaid interest, if any, to, but excluding, the applicable redemption date. In addition, at any time prior to December 15, 2024, the Company had the ability to (but did not) redeem the Senior Notes, at its option, in whole at any time or in part from time to time, at a redemption price equal to 100% of the principal amount of the Senior Notes redeemed, plus a “make-whole” premium set forth in the Indenture, plus accrued and unpaid interest, if any, to, but excluding, the applicable redemption date. Notwithstanding the foregoing, at any time and from time to time prior to December 15, 2024, the Company had the ability to (but did not) redeem up to 40% of the aggregate principal amount of the Senior Notes using the proceeds of certain equity offerings as set forth in the Indenture, at a redemption price equal to 105.000% of the principal amount thereof, plus accrued and unpaid interest, if any, to, but excluding, the applicable redemption date.

In relation to the Senior Notes, we incurred interest expense of $50 million for both the years ended June 30, 2025 and June 30, 2024, which is included in Interest expense in the Consolidated Statements of Earnings (Loss).

The Indenture contains customary covenants and events of default, including default relating to among other things, payment default, failure to comply with covenants or agreements contained in the Indenture or the Senior Notes and certain provisions related to bankruptcy events. As of June 30, 2025, the Company was in compliance with all covenants under the Indenture.

Aggregate Availability

The Company had aggregate availability of $315 million under its Revolving Credit Facility as of June 30, 2025.

Weighted Average Interest Rate

The weighted average interest rate of total borrowings was 6% and 7% for the years ended June 30, 2025 and 2024, respectively.

Note 8. Income Taxes

The components of earnings (loss) before income taxes by jurisdiction were as follows ($000):

Year Ended June 30,						2025						2024						2023
U.S. loss						$	(445,586)					$	(540,048)					$	(450,370)
Non-U.S. income						539,767						392,401						94,812
Earnings (loss) before income taxes						$	94,181					$	(147,647)					$	(355,558)

The components of the income tax expense (benefit) were as follows ($000):

Year Ended June 30,						2025						2024						2023
Current:
Federal						$	3,010					$	10,119					$	5
State						1,733						181						3,867
Foreign						154,815						103,640						106,850
Total Current						159,558						113,940						110,722
Deferred:
Federal						(50,454)						(68,955)						(106,044)
State						(7,217)						(186)						(7,151)
Foreign						(37,763)						(33,682)						(93,627)
Total Deferred						(95,434)						(102,823)						(206,822)
Total Income Tax Expense (Benefit)						$	64,124					$	11,117					$	(96,100)

Principal items comprising deferred tax assets and liabilities were as follows ($000):

June 30,						2025						2024
Deferred income tax assets
Inventory capitalization						$	74,886					$	62,242
Non-deductible accruals						18,222						16,770
Accrued employee benefits						36,331						38,460
Net-operating loss and credit carryforwards						256,794						268,735
Share-based compensation expense						15,852						15,947
Other						9,564						1,346
Research and development capitalization						168,998						128,291
Deferred revenue						15,376						14,839
Right of use asset						37,785						47,712
Valuation allowances						(163,678)						(154,830)
Total deferred income tax assets						470,130						439,512
Deferred income tax liabilities
Tax over book accumulated depreciation						(14,038)						(29,065)
Intangible assets						(863,484)						(905,435)
Interest rate swap						—						(4,104)
Interest rate cap						(4,000)						(11,465)
Tax on unremitted earnings						(63,383)						(61,719)
Outside basis differences						(142,781)						(122,423)
Lease liability						(31,239)						(46,198)
Other						(9,515)						(2,511)
Total deferred income tax liabilities						(1,128,440)						(1,182,920)
Net deferred income taxes						$	(658,310)					$	(743,408)

The reconciliation of income tax expense at the statutory U.S. federal rate to the reported income tax expense (benefit) is as follows ($000):

Year Ended June 30,						2025						%						2024						%						2023						%
Taxes at statutory rate						$	19,778					21						$	(31,006)					21						$	(74,667)					21
Increase (decrease) in taxes resulting from:
State income taxes-net of federal benefit						(4,265)						(5)						(22)						—						(2,548)						1
Taxes on non U.S. earnings						3,632						4						16,601						(11)						191						—
Valuation allowance						20,295						22						43,866						(30)						3,836						(1)
U.S. Branch Income						(1,216)						(1)						3,226						(2)						2,037						(1)
Noncontrolling interest						4,284						4						1,002						(1)						—						—
Research and manufacturing incentive deductions and credits						(26,396)						(28)						(41,387)						28						(29,416)						8
Stock compensation						2,153						2						13,294						(9)						18,661						(5)
GILTI and FDII						13,631						15						(629)						—						(7,195)						2
Uncertain Tax Positions						6,814						7						3,301						(2)						(3,450)						1
Notional Interest						(10,174)						(11)						(2,521)						2						(7,896)						2
Assets held-for-sale						36,895						39						—						—						—						—
Other						(1,307)						(1)						5,392						(4)						4,347						(1)
						$	64,124					68						$	11,117					(8)						$	(96,100)					27

On July 4, 2025, the U.S. government enacted The One Big Beautiful Bill Act of 2025 which includes, among other provisions, changes to the U.S. corporate income tax system including the allowance of immediate expensing of qualifying research and development expenses and permanent extensions of certain provisions within the Tax Cuts and Jobs Act. Certain provisions are effective for the Company beginning fiscal 2026. The Company is evaluating the future impact of these tax law changes on its financial statements.

The Company is partially permanently reinvested and will repatriate earnings for all non-U.S. subsidiaries with cash in excess of working capital needs. Such distributions could potentially be subject to U.S. state tax in certain states and foreign withholding taxes. Foreign currency gains (losses) related to the translation of previously taxed earnings from functional currency to U.S. dollars could also be subject to U.S. tax when distributed. The Company has estimated the associated withholding tax to be $63 million.

Additionally, the Company made a final accounting policy election to treat taxes due from future inclusions in U.S. taxable income related to global intangible low tax income (“GILTI”) as a current period expense when incurred.

During the fiscal years ended June 30, 2025, 2024, and 2023, cash paid by the Company for income taxes was $167 million, $97 million, and $90 million, respectively.

Our foreign subsidiaries in various tax jurisdictions operate under tax holiday arrangements. The impact of the tax holidays on our effective rate is a reduction in the rate of 11.6%, 5.6% and 2.3% for the fiscal years ended June 30, 2025, 2024 and 2023, respectively, and the impact of the tax holidays on diluted earnings per share is $0.06, $0.05, and $0.05 for the fiscal years ended June 30, 2025, 2024, and 2023, respectively. The tax holiday related to Coherent Malaysia Sdn. Bhd will end during the fiscal year ended June 30, 2026 for certain business lines, the tax holiday related to certain II-VI Laser Enterprise Philippines, Inc.’s business lines will end during the fiscal year ended June 30, 2026, the tax holiday related to Silicon Carbide Vietnam Limited Liability Company will end during the fiscal year ended June 30, 2026, the tax holiday related to certain Coherent Vietnam (Dong Nai) Company Limited business lines will end during the fiscal year ended June 30, 2026, and the tax holiday related to certain Coherent Singapore PTE Ltd business lines will end during the fiscal year ended June 30, 2027.

The Company has the following gross operating loss carryforwards and tax credit carryforwards as of June 30, 2025 ($000):

Type						Amount						Expiration Date
Tax credit carryforwards:
Federal research and development credits						$	121,286					June 2032-June 2045
Foreign tax credits						12,964						June 2030-June 2035
State tax credits						15,976						June 2026-June 2040
State tax credits (indefinite)						79,179						Indefinite
Operating loss carryforwards:
Loss carryforwards - federal						$	31,278					June 2026-June 2036
Loss carryforwards - federal (indefinite)						1,754						Indefinite
Loss carryforwards - state						330,313						June 2026-June 2045
Loss carryforwards - state (indefinite)						42,674						Indefinite
Loss carryforwards - foreign						85,218						June 2026-June 2033
Loss carryforwards - foreign (indefinite)						48,711						Indefinite

The Company has recorded a valuation allowance against the majority of the foreign and state loss and credit carryforwards, certain U.S. credit carryforwards and the majority of state credit carryforwards. The Company’s U.S. federal loss carryforwards, federal research and development credit carryforwards, foreign tax credits, and certain state tax credits resulting from the Company’s acquisitions are subject to various annual limitations under Section 382 of the U.S. Internal Revenue Code.

Changes in the liability for unrecognized tax benefits for the fiscal years ended June 30, 2025, 2024 and 2023 were as follows ($000):

Year Ended June 30,						2025						2024						2023
Beginning balance						$	116,697					$	115,180					$	37,411
Increases in current year tax positions						9,660						5,168						110
Acquired business						—						—						86,077
Settlements						—						(2,970)						—
Expiration of statute of limitations						(2,349)						(681)						(8,418)
Ending balance						$	124,008					$	116,697					$	115,180

The Company classifies all estimated and actual interest and penalties as income tax expense. During fiscal years 2025, 2024 and 2023, there was $2.0 million, $2.3 million and $0.3 million of interest and penalties within income tax expense, respectively. The Company had $9 million, $7 million and $6 million of interest and penalties accrued at June 30, 2025, 2024 and 2023, respectively. The Company has classified the uncertain tax positions as non-current income tax liabilities, as the amounts are not expected to be paid within one year. The majority of the liability can be offset by credit carryforwards and would not impact cash taxes. Including tax positions for which the Company determined that the tax position would not meet the more likely than not recognition threshold upon examination by the tax authorities based upon the technical merits of the position, the total estimated unrecognized tax benefit that, if recognized, would affect our effective tax rate, was approximately $20 million, $19 million and $92 million at June 30, 2025, 2024 and 2023, respectively. For the years ended June 30, 2025 and June 30, 2024, due to the U.S. valuation allowance, a large portion of our unrecognized tax benefit will no longer impact the tax rate if recognized. The Company expects a decrease of $67 million of unrecognized tax benefits during the next 12 months due to the expiration of statutes of limitation.

Fiscal years 2018 and 2022 to 2025 remain open to examination by the Internal Revenue Service, fiscal years 2021 to 2025 remain open to examination by certain state jurisdictions, and fiscal years 2012 to 2025 remain open to examination by certain foreign taxing jurisdictions. The Company is currently under examination for certain subsidiary companies in Vietnam for the years ended June 30, 2017 through September 30, 2021; Malaysia for the years ended June 30, 2021 through June 30, 2023; Singapore for the year ended June 30, 2023; United Kingdom for the year ended June 30, 2023; and Germany for the years ended June 30, 2012 through June 30, 2021. The Company believes its income tax reserves for these tax matters are adequate.

Note 9. Equity and Redeemable Preferred Stock

As of June 30, 2025, the Company’s amended and restated articles of incorporation authorize our board of directors, without the approval of our shareholders, to issue 5 million shares of our preferred stock. As of June 30, 2025, 2.3 million shares of mandatory preferred convertible shares have been authorized, none are outstanding; 75,000 shares of Series B-1 convertible preferred stock, no par value, have been issued and are outstanding; and 140,000 shares of Series B-2 convertible preferred stock, no par value, have been issued and are outstanding.

Mandatory Convertible Preferred Stock

In July 2020, we issued 2.3 million shares of Mandatory Convertible Preferred Stock.

All outstanding shares of Mandatory Convertible Preferred Stock were converted to 10,240,290 shares of Company Common Stock on July 3, 2023, at a conversion ratio of 4.4523, and no shares of Mandatory Convertible Preferred Stock are currently issued and outstanding.

Series B Convertible Preferred Stock

In March 2021, the Company issued 75,000 shares of Series B-1 Convertible Preferred Stock, no par value per share (“Series B-1 Preferred Stock”), for $10,000 per share, resulting in an aggregate purchase price of $750 million. On July 1, 2022, the Company issued 140,000 shares of Series B-2 Convertible Preferred Stock, no par value per share (“Series B-2 Preferred Stock” and, together with the Series B-1 Preferred Stock, the “Series B Preferred Stock”), for $10,000 per share and an aggregate purchase price of $1.4 billion.

The shares of Series B Preferred Stock are convertible into shares of Coherent Common Stock as follows:

• at the election of the holder, each share of Series B Preferred Stock may be converted into shares of Coherent Common Stock at a conversion price of $85 per share (as it may be adjusted from time to time, the “Conversion Price”); and

• at the election of the Company at the then-applicable Conversion Price if the volume-weighted average price of Coherent Common Stock exceeds 150% of the then-applicable Conversion Price for 20 trading days out of any 30 consecutive trading days.

The issued shares of Series B Preferred Stock currently have voting rights, voting as one class with the Coherent Common Stock, on an as-converted basis, subject to limited exceptions.

On or at any time after March 31, 2031 and July 1, 2032 for the Series B-1 and B-2 Preferred Stock, respectively:

• each holder has the right to require the Company to redeem all of their Series B Preferred Stock, for cash, at a redemption price per share equal to the sum of the Stated Value (as defined in the Statement with Respect to Shares establishing the Series B Preferred Stock) for such shares plus an amount equal to all accrued or declared and unpaid dividends on such shares that had not previously been added to the Stated Value (such price the “Redemption Price,” and such right the “Put Right”), and

• the Company has the right to redeem, in whole or in part, on a pro rata basis from all holders based on the aggregate number of shares of Series B Preferred Stock outstanding, for cash, at the Redemption Price.

In connection with any Fundamental Change (as defined in the Statement with Respect to Shares establishing the Series B Preferred Stock), and subject to the procedures set forth in the Statement with Respect to Shares establishing the Series B Preferred Stock, the Company must, or will cause the survivor of a Fundamental Change to, make an offer to repurchase, at the option and election of the holder thereof, each share of Series B-1 Preferred Stock then outstanding at a purchase price per share in cash equal to (i) the Stated Value for such shares plus an amount equal to all accrued or declared and unpaid dividends on such shares that had not previously been added to the Stated Value as of the date of repurchase plus (ii) if prior to March 31, 2026 and July 1, 2027, for the Series B-1 and B-2 Preferred Stock, respectively, the aggregate amount of all dividends that would have been paid (subject to certain exceptions), from the date of repurchase through March 31, 2026 and July 1, 2027, for the Series B-1 and B-2 Preferred Stock, respectively.

If the Company defaults on a payment obligation with respect to the Series B Preferred Stock, and such default is not cured within 30 days, the dividend rate will increase to 8% per annum and will be increased by an additional 2% per annum each quarter the Company remains in default, not to exceed 14% per annum.

The Series B Preferred Stock is redeemable for cash outside of the control of the Company upon the exercise of the Put Right, and upon a Fundamental Change, and is therefore classified as mezzanine equity.

The Series B Preferred Stock is initially measured at fair value less issuance costs, accreted to its redemption value over a 10-year period (using the effective interest method) with such accretion accounted for as deemed dividends and reductions to Net Earnings (Loss) available to Common Shareholders.

Preferred stock dividends are presented as a reduction to Retained earnings on the Consolidated Balance Sheets.

The following table presents dividends per share and dividends recognized for the years ended June 30, 2025, and June 30, 2024:

						Year Ended June 30, 2025						Year Ended June 30, 2024
Dividends per share						$	604					$	574
Dividends ($000)						123,688						117,894
Deemed dividends ($000)						6,238						5,463

Note 10. Earnings Per Share

Basic earnings (loss) per common share is computed by dividing net earnings (loss) available to the common shareholders by the weighted-average number of shares of common stock outstanding during the period.

Diluted earnings (loss) per common share is computed by dividing the diluted earnings (loss) available to the common shareholders by the weighted-average number of shares of common stock and potentially dilutive shares of common stock outstanding during the period. The dilutive effect of equity awards is calculated based on the average stock price for each fiscal period, using the treasury stock method. The shares of Coherent Common Stock issuable upon conversion of the Series B Convertible Preferred Stock are calculated under the If-Converted method. For the years ended June 30, 2025, June 30, 2024 and June 30, 2023, as the Company was in a net loss position, there were no dilutive shares. For the years ended June 30, 2025, June 30, 2024 and June 30, 2023, diluted earnings (loss) per share excluded the potentially dilutive effect of the performance and restricted shares, as well as the shares of Coherent Common Stock issuable upon conversion of the Series B Convertible Preferred Stock as their effects were anti-dilutive.

The following is a reconciliation of the numerators and denominators of the basic and diluted earnings (loss) per share computations for the periods presented ($000, except per share):

Year Ended June 30,						2025						2024						2023
Numerator
Net earnings (loss) attributable to Coherent Corp.						$	49,364					$	(156,154)					$	(259,458)
Deduct Series A preferred stock dividends						—						—						(27,600)
Deduct Series B dividends and deemed dividends						(129,926)						(123,357)						(116,612)
Basic loss available to the common shareholders						$	(80,562)					$	(279,511)					$	(403,670)
Diluted loss available to the common shareholders						$	(80,562)					$	(279,511)					$	(403,670)
Denominator
Diluted weighted average common shares						154,755						151,642						137,578
Basic loss per common share						$	(0.52)					$	(1.84)					$	(2.93)
Diluted loss per common share						$	(0.52)					$	(1.84)					$	(2.93)

The following table presents potential shares of common stock excluded from the calculation of diluted net earnings (loss) per share, as their effect would have been antidilutive (in thousands of shares):

Year Ended June 30,						2025						2024						2023
Series A Mandatory Convertible Preferred Stock						—						—						10,423
Series B Convertible Preferred Stock						29,103						27,691						26,349
Common stock equivalents						4,548						2,940						2,271
Total anti-dilutive shares						33,651						30,631						39,043

Note 11. Noncontrolling Interests

On December 4, 2023, Silicon Carbide LLC (“Silicon Carbide”), one of the Company’s subsidiaries, completed (i) the sale of 16,666,667 Class A Common Units to Denso Corporation (“Denso”) for $500,000,000 pursuant to an Investment Agreement, dated as of October 10, 2023, by and between Silicon Carbide and Denso and (ii) the sale of 16,666,667 Class A Common Units to Mitsubishi Electric Corporation (“MELCO”) for $500,000,000 pursuant to an Investment Agreement, dated as of October 10, 2023, by and between Silicon Carbide and MELCO (collectively, the “Equity Investments”).

As a consequence of the Equity Investments, the Company’s ownership interest in the Class A Common Units of Silicon Carbide LLC was reduced to approximately 75%. Denso and MELCO each, individually, own approximately 12.5% of the Class A Common Units of Silicon Carbide LLC.

The Equity Investments in Silicon Carbide enables Coherent to increase its available free cash flow to provide greater financial and operational flexibility to execute its capital allocation priorities, as the aggregate $1 billion investment, net of transaction costs, is being and will continue to be used to fund future capital expansion of Silicon Carbide.

The following table presents the activity in noncontrolling interests in Silicon Carbide ($000):

Year Ended June 30,			2025						2024
Beginning balance			$	371,392					$	—
Sale of shares to noncontrolling interests			—						373,573
Share of foreign currency translation adjustments			1,423						429
Net loss			(19,307)						(2,610)
Ending balance			$	353,508					$	371,392

Note 12. Leases

The determination of whether an arrangement is, or contains, a lease is performed at the inception of the arrangement. Classification and initial measurement of the right-of-use asset and lease liability are determined at the lease commencement

date. The Company elected the short-term lease measurement and recognition exemption; therefore, leases with an initial term of 12 months or less are not recorded on the balance sheet.

Finance leases are generally those that allow us to substantially utilize or pay for the entire asset over its estimated useful life. Finance lease assets are recorded in Property, plant and equipment, net, and finance lease liabilities within Other accrued liabilities and Other liabilities on our Consolidated Balance Sheets. Finance lease assets are amortized in operating expenses on a straight-line basis over the shorter of the estimated useful lives of the assets or the lease term, with the interest component for lease liabilities included in interest expense and recognized using the effective interest method over the lease term.

Operating leases are recorded in Other assets and Operating lease liabilities, current and non-current on our Consolidated Balance Sheets. Operating lease assets are amortized on a straight-line basis in operating expenses over the lease term.

Our lease liabilities are recognized based on the present value of the remaining fixed lease payments, over the lease term, using a discount rate of similarly secured borrowings available to the Company. For the purpose of lease liability measurement, we consider only payments that are fixed and determinable at the time of commencement. Any variable payments that depend on an index or rate are expensed as incurred. We account for non-lease components, such as common area maintenance, as a component of the lease, and include it in the initial measurement of our lease assets and corresponding liabilities. Our lease terms and conditions may include options to extend or terminate. An option is recognized when it is reasonably certain that we will exercise that option.

Our lease assets also include any lease payments made, and exclude any lease incentives received prior to commencement. Our lease assets are tested for impairment in the same manner as long-lived assets used in operations.

The following table presents lease costs, which include leases for arrangements with an initial term of more than 12 months, lease term, and discount rates ($000):

Year Ended June 30,						2025						2024						2023
Finance lease cost
Amortization of right-of-use assets						$	1,528					$	1,667					$	1,667
Interest on lease liabilities						947						1,040						1,124
Total finance lease cost						2,475						2,707						2,791
Operating lease cost						59,213						52,909						53,127
Total lease cost						$	61,688					$	55,616					$	55,918
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from finance leases						$	947					$	1,040					$	1,124
Operating cash flows from operating leases						58,117						50,672						50,503
Financing cash flows from finance leases						1,749						1,584						1,430
Assets obtained in exchange for lease liabilities
Right-of-use assets obtained in acquisitions						$	—					$	—					$	56,315
Right-of-use assets obtained in exchange for new operating lease liabilities						51,357						64,385						27,720
Total assets obtained in exchange for new operating lease liabilities						$	51,357					$	64,385					$	84,035
Weighted-average remaining lease term (in years)
Finance leases						6.5						7.5						8.5
Operating leases						6.2						6.6						6.9
Weighted-average discount rate
Finance leases						5.6		%				5.6		%				5.6		%
Operating leases						6.9		%				6.8		%				5.5		%

The following table presents future minimum lease payments, which includes leases for arrangements with an initial term of more than 12 months ($000):

Future Years			Operating Leases						Finance Leases						Total
Year 1			$	57,830					$	2,771					$	60,601
Year 2			47,261						2,847						50,108
Year 3			34,712						2,925						37,637
Year 4			32,103						3,006						35,109
Year 5			21,712						3,088						24,800
Thereafter			69,092						4,669						73,761
Total minimum lease payments			$	262,710					$	19,306					$	282,016
Less: amounts representing interest			55,973						3,172						59,145
Present value of total lease liabilities			$	206,737					$	16,134					$	222,871

Note 13. Share-Based Compensation

The Company grants equity awards pursuant to the Coherent Corp. Omnibus Incentive Plan (as amended and restated, the “Plan”). The Plan was originally approved by the Company's shareholders at the Annual Meeting in November 2018, and was subsequently amended, restated and approved by the Company’s shareholders at the Annual Meetings held in November 2020, November 2023 and November 2024. The Plan provides for the grant of stock options, stock appreciation rights, restricted shares, restricted share units, deferred shares, performance shares and performance units to employees (including officers), consultants and directors of the Company. The maximum number of shares of Coherent Common Stock authorized for issuance under the Plan is limited to 13,450,000 shares of Coherent Common Stock, not including any remaining shares forfeited under the predecessor plans that may be rolled into the Plan. Certain awards under the Plan have certain vesting provisions predicated upon the death, retirement or disability of the grantee.

As of June 30, 2025, there were approximately 8 million shares available to be issued under the Plan, including forfeited shares from predecessor plans.

On June 3, 2024, the Board of Directors granted 147,214 restricted stock units vesting over three years from date of grant and 694,007 performance stock units vesting over the approximate three-year period ending June 30, 2027, to the new CEO. The grants were non-Plan “employment inducement awards” as contemplated by the New York Stock Exchange Listing Rule 303A.08 and therefore were not made pursuant to the Plan.

On October 11, 2024, the Board of Directors granted 15,902 and 63,154 restricted stock units vesting over three years and two years, respectively, from date of grant and 118,853 performance stock units vesting over the approximate three-year period ending June 30, 2027, to the new CFO. The grants were “employment inducement awards” as contemplated by the New York Stock Exchange Listing Rule 303A.08 and therefore were not made pursuant to the Plan.

The Company has an Employee Stock Purchase Plan whereby eligible employees may authorize payroll deductions (subject to certain limitations) of up to 15% (or such lessor amount as may be determined by the plan administrator) of their wages and base salary to purchase shares at an amount which will not be less than 85% of lower of (i) the fair market value of the common stock on the first trading day of the offering period and (ii) the fair market value of the common stock on the last trading day of the approximately six-month offering period.

We record share-based compensation expense for these awards, which requires the recognition of the grant-date fair value of share-based compensation in net earnings. We recognize the share-based compensation expense over the requisite service period of the individual grantees, which generally equals the vesting period. We account for cash-based stock appreciation rights, cash-based restricted share units and cash-based performance share units as liability awards.

Share-based compensation expense for the fiscal years ended June 30, 2025, 2024 and 2023 is as follows ($000):

Year Ended June 30,						2025						2024						2023
Stock Options and Cash-Based Stock Appreciation Rights						$	334					$	1,149					$	2,602
Restricted Share Awards and Cash-Based Restricted Share Unit Awards						93,223						92,634						124,212
Performance Share Awards and Cash-Based Performance Share Unit Awards						57,767						21,912						14,998
Employee Stock Purchase Plan						9,648						11,200						7,819
						$	160,972					$	126,895					$	149,631

Stock Options and Cash-Based Stock Appreciation Rights

We utilize the Black-Scholes valuation model for estimating the fair value of stock options and cash-based stock appreciation rights. During the fiscal years ended June 30, 2025, June 30, 2024 and June 30, 2023, no stock options were issued.

Stock option and cash-based stock appreciation rights activity during the fiscal year ended June 30, 2025 was as follows:

						Stock Options												Cash-Based Stock Appreciation Rights
						Number of Shares						Weighted Average Exercise Price						Number of Rights						Weighted Average Exercise Price
Outstanding - June 30, 2024						1,490,645						$	32.62					46,871						$	35.48
Exercised						(575,097)						$	28.16					(21,198)						$	34.26
Forfeited and Expired						(18,452)						$	34.89					(540)						$	16.29
Outstanding - June 30, 2025						897,096						$	35.43					25,133						$	36.93
Exercisable - June 30, 2025						897,096						$	35.43					25,133						$	36.93

As of June 30, 2025, 2024 and 2023, the aggregate intrinsic value of stock options and cash-based stock appreciation rights outstanding and exercisable was $50 million, $61 million and $44 million, respectively. Aggregate intrinsic value represents the total pretax intrinsic value (the difference between our closing stock price on the last trading day of the year ended June 30, and the option’s exercise price, multiplied by the number of in-the-money options) that would have been received by the option holders had all option holders exercised their options on June 30, 2025. This amount varies based on the fair market value of the Company’s stock. The total intrinsic value of stock options and cash-based stock appreciation rights exercised during the fiscal years ended June 30, 2025, 2024, and 2023 was $36 million, $25 million, and $5 million, respectively. As of June 30, 2025, there was no unrecognized compensation cost related to non-vested stock options and cash-based stock appreciation rights.

Outstanding and exercisable stock options at June 30, 2025 were as follows:

						Stock Options and Cash-Based Stock Appreciation Rights Outstanding																		Stock Options and Cash-Based Stock Appreciation Rights Exercisable
						Number of						Weighted Average Remaining						Weighted Average						Number of						Weighted Average Remaining						Weighted Average
Range of						Shares or						Contractual Term						Exercise						Shares or						Contractual Term						Exercise
Exercise Prices						Rights						(Years)						Price						Rights						(Years)						Price
$13.34 - $18.06						15,584						0.13						$	17.84					15,584						0.13						$	17.84
$18.07 - $24.34						188,290						1.08						$	21.50					188,290						1.08						$	21.50
$24.35 - $35.38						190,302						2.39						$	34.59					190,302						2.39						$	34.59
$35.39 - $36.89						322,676						4.24						$	36.41					322,676						4.24						$	36.41
$36.90 - $49.90						205,377						3.09						$	48.94					205,377						3.09						$	48.94
						922,229						2.89						$	35.47					922,229						2.89						$	35.47

Restricted Share Awards, Restricted Share Units, and Cash-Based Restricted Share Units

Restricted share awards, restricted share units, and cash-based restricted share units compensation expense was calculated based on the number of shares or units expected to be earned by the grantee multiplied by the stock price at the date of grant (for restricted share awards and restricted share units) or the stock price at the period end date (for cash-based restricted share units), and is being recognized over the vesting period. Generally, the restricted share awards, restricted share units, and cash-based restricted share units have a three-year tranche vesting provision. There were no restricted share awards issued in the fiscal years ending June 30, 2025 and June 30, 2024, and all previous restricted share awards have been amortized in full.

Restricted share unit and cash-based restricted share unit activity during the fiscal year ended June 30, 2025, was as follows:

						Restricted Share Units												Cash-Based Restricted Share Units
						Number of Units						Weighted Average Grant Date Fair Value						Number of Units						Weighted Average Grant Date Fair Value
Nonvested - June 30, 2024						4,067,885						$	45.84					8,984						$	43.00
Granted						1,554,412						$	81.70					5,031						$	77.59
Vested						(2,237,173)						$	47.82					(3,968)						$	46.93
Forfeited						(199,172)						$	56.25					(348)						$	55.98
Nonvested - June 30, 2025						3,185,952						$	61.13					9,699						$	59.49

As of June 30, 2025, total unrecognized compensation cost related to non-vested, restricted share units and cash-based restricted share units was $119 million. This cost is expected to be recognized over a weighted-average period of approximately 2 years. The restricted share unit compensation expense was calculated based on the number of shares expected to be earned, multiplied by the stock price at the date of grant, and is being recognized over the vesting period. The cash-based restricted share unit compensation expense was calculated based on the number of units expected to be earned, multiplied by the stock price at the period-end date, and is being recognized over the vesting period. The total fair value of the restricted share awards, restricted share units, and cash-based restricted share units granted during the years ended June 30, 2025, 2024 and 2023, was $127 million, $110 million and $102 million, respectively. The total fair value of restricted share awards, restricted share units and cash-based restricted share units vested was $185 million, $74 million and $131 million during fiscal years 2025, 2024 and 2023, respectively.

Performance Share Units

The Compensation Committee of the Board of Directors of the Company has granted certain executive officers and employees performance share units under the Plan. As of June 30, 2025, we had outstanding grants covering performance periods ranging from 12 to 36 months. These grants are intended to provide continuing emphasis on specified financial performance goals that the Company considers important contributors to the creation of long-term shareholder value. These grants are payable only if the Company achieves specified levels of financial performance during the performance periods.

For our relative Total Shareholder Return (“TSR”) performance-based units, which are based on market performance of our stock as compared to the S&P Composite 1500 – Electronic Equipment, Instruments & Components Index, the compensation cost is recognized over the performance period on a straight-line basis, because the grants vest only at the end of the measurement period, and the probability of actual shares expected to be earned is considered in the grant date valuation. As a result, the expense is not adjusted to reflect the actual shares earned. We estimate the fair value of the TSR performance-based units using the Monte-Carlo simulation model.

The performance share unit compensation expense was calculated based on the number of shares expected to be earned, multiplied by the stock price at the date of grant, and is being recognized over the vesting period.

Performance share unit activity relating to the Plan during the year ended June 30, 2025, was as follows:

						Performance Share Units
						Number of Units						Weighted Average Grant Date Fair Value
Nonvested - June 30, 2024						1,702,741						$	73.86
Granted						644,174						$	136.38
Vested						(131,239)						$	81.32
Forfeited						(77,542)						$	77.91
Nonvested - June 30, 2025						2,138,134						$	92.11

As of June 30, 2025, total unrecognized compensation cost related to non-vested performance share units was $125 million. This cost is expected to be recognized over a weighted-average period of approximately 1.70 years. The total fair value of the performance share units granted during the fiscal years ended June 30, 2025, 2024 and 2023 was $88 million, $113 million and $27 million, respectively. The total fair value of performance share units and cash-based performance share units vested during the fiscal years ended June 30, 2025, 2024 and 2023 was $17 million, $14 million and $24 million, respectively.

Note 14. Segment and Geographic Reporting

Our Chief Executive Officer has been identified as the chief operating decision maker (“CODM”) as he utilizes financial information to make decisions about allocating resources and assessing performance for the entire Company, which is used in the decision-making process to assess performance. We determine our reportable business segments based on the way the CODM organizes business segments within the Company for making operating decisions and assessing performance. Effective July 1, 2022, we report our financial results in the following three segments: (i) Networking, (ii) Materials, and (iii) Lasers.

The Networking segment has locations in the United States, Australia, China, Germany, Malaysia, South Korea, Thailand, the Philippines, the United Kingdom, and Vietnam. This segment address all of Coherent’s four end markets, namely: communications, industrial, electronics, and instrumentation, with a concentration in the communications market. This segment leverages Coherent’s compound semiconductor technology platforms and deep knowledge of end-user applications for our key end markets to deliver differentiated components, modules and subsystems.

The Materials segment has locations in the United States, China, Germany, Italy, Japan, Singapore, South Korea, Sweden, Switzerland, Taiwan, the Philippines, the United Kingdom, and Vietnam. This segment address all of Coherent’s four end markets, namely: communications, industrial, electronics, and instrumentation, with concentrations in the industrial and electronics markets. The Materials segment is a market leader in engineered materials and optoelectronic devices, such as those based on ZnSe, ZnS, GaAs, InP, GaSb, and SiC.

The Lasers segment has locations in the United States, Finland, Germany, Malaysia, Singapore, South Korea, Spain, Sweden, Switzerland, and the United Kingdom. The Lasers segment’s lasers and optics products serve industrial customers in both semiconductor and display capital equipment, precision manufacturing, and instrumentation customers in life sciences and scientific instrumentation.

During the first quarter of fiscal 2025 as a result of a new CEO joining the Company in the fourth quarter of fiscal 2024, our CODM implemented changes in the measure he uses to allocate resources and assess performance. Our CODM now evaluates each segment’s performance and allocates resources based on segment revenue and segment profit, instead of operating income, as our CODM believes segment profit is a more comprehensive profitability measure for each operating segment. Segment profit includes operating expenses directly managed by operating segments, including research and development, direct sales, marketing and administrative expenses. Segment profit does not include share-based compensation, acquisition or integration related costs, amortization and impairment of acquisition-related intangible assets, restructuring charges, and certain other charges. Additionally, effective in fiscal 2025, we no longer allocate Corporate strategic research and development, strategic marketing and sales expenses and shared general and administrative expenses, as these expenses are not directly attributable to our operating segments. The segments are managed separately due to the market, production requirements and facilities unique to each segment. The Company derives its segment results directly from the manner in which results are reported in its management reporting system and the CODM uses segment profit to drive decisions in the forecasting process when making decisions about allocation capital and other resources to the segments. The accounting policies are consistent across each segment. Effective in fiscal 2025, we no longer allocate corporate assets to the segments.

Comparative prior period segment information has been recast to conform to the new segment profitability measure. The change in our operating segment measure had no impact on our previously reported consolidated results of operations, financial condition, or cash flows.

The following tables set forth the details of revenues and segment profit and reconciles segment profit to consolidated earnings (loss) before income taxes for the periods presented ($000):

2025						Networking						Materials						Lasers						Unallocated						Total
Revenues						$	3,421,276					$	953,843					$	1,434,996					$	—					$	5,810,115
Inter-segment revenues						58,465						547,601						8,310						(614,376)						—
Less:
Cost of goods sold (1)						2,507,154						856,668						836,592						(614,376)						3,586,038
Research and development (1)						247,072						177,822						120,045						—						544,939
Selling, general and administrative (1)						81,993						112,240						170,190						—						364,423
Segment profit						$	643,522					$	354,714					$	316,479					$	—					1,314,715
Unallocated Corporate expenses
Corporate and centralized function costs (2)																														(277,771)
Share-based compensation																														(160,972)
Restructuring costs (3)																														(160,081)
Impairment of assets held-for-sale																														(84,988)
Integration, site consolidation and other costs (4)																														(38,237)
Amortization of intangibles																														(302,788)
Interest expense																														(243,251)
Other (income) expense, net																														47,554
Earnings before income taxes																														$	94,181

2024						Networking						Materials						Lasers						Unallocated						Total
Revenues						$	2,295,729					$	1,016,573					$	1,395,386					$	—					$	4,707,688
Inter-segment revenues						45,767						457,623						5,212						(508,602)						—
Less:
Cost of goods sold (1)						1,747,317						914,691						873,367						(508,602)						3,026,773
Research and development (1)						174,530						161,402						110,515						—						446,447
Selling, general and administrative (1)						65,997						101,229						209,933						—						377,159
Segment profit						$	353,652					$	296,874					$	206,783					$	—					857,309
Unallocated Corporate expenses
Corporate and centralized function costs (2)																														(239,259)
Share-based compensation																														(126,895)
Restructuring costs (3)																														(27,054)
Integration, site consolidation and other costs (4)																														(79,820)
Amortization of intangibles																														(288,160)
Interest expense																														(288,475)
Other (income) expense, net																														44,707
Earnings (loss) before income taxes																														(147,647)

2023						Networking						Materials						Lasers						Unallocated						Total
Revenues						$	2,340,930					$	1,349,758					$	1,469,412					$	—					$	5,160,100
Inter-segment revenues						70,120						362,179						1,517						(433,816)						—
Less:
Cost of goods sold (1)						1,701,681						1,061,062						866,195						(433,816)						3,195,122
Research and development (1)						180,350						168,209						123,568						—						472,127
Selling, general and administrative (1)						64,093						91,164						210,611						—						365,868
Segment profit						464,926						391,502						270,555						—						1,126,983
Unallocated Corporate expenses
Corporate and centralized function costs (2.)																														(199,811)
Share-based compensation																														(149,631)
Restructuring costs and other (3)																														(119,101)
Integration, site consolidation and other costs (4)																														(81,503)
Amortization of intangibles																														(414,125)
Interest expense																														(286,872)
Purchase accounting adjustments																														(157,500)
Transaction costs																														(38,652)
Other (income) expense, net																														(31,566)
Other																														(3,780)
Earnings (loss) before income taxes																														$	(355,558)

(1)The significant expense category amount aligns with the segment-level information that is regularly provided to the CODM and excludes unallocated corporate expenses (corporate and centralized function costs, share-based compensation, restructuring costs, integration, site consolidation and other costs as well as amortization of intangibles).

(2)We do not allocate corporate and centralized function costs that are not directly attributable to our operating segments.

(3)See Note 20. Restructuring Plans for further information.

(4)Integration and site consolidation costs in the year ended June 30, 2025 includes $35 million in consulting and legal costs related to projects to integrate recent acquisitions into common technology systems and simplify legal entity structure, $2 million of employee severance and retention costs related to sites being shut down as part of our Synergy and Site Consolidation Plan, and $1 million of executive transition costs. Integration and site consolidation costs in the year ended June 30, 2024 primarily include $40 million in consulting costs related to projects to integrate recent acquisitions into common technology systems and simplify legal entity structure, and $40 million of employee severance and retention and other costs related to sites being shut down as part of our 2023 Restructuring Plan or Synergy and Site Consolidation Plan. Integration and site consolidation costs in the year ended June 30, 2023 primarily include $46 million in consulting costs related to projects to integrate recent acquisitions into common technology systems and simplify legal entity structure, and $36 million of employee severance and retention and other costs related to sites being shut down as part of our 2023 Restructuring Plan or Synergy and Site Consolidation Plan.

The following tables summarizes capital expenditures by segment ($000):

			Year Ended June 30,
Expenditures for property, plant, and equipment			2025						2024						2023
Networking			$	263,425					$	90,950					$	98,192
Materials			137,444						224,482						274,434
Lasers			39,967						31,384						63,434
Total expenditures for property, plant, and equipment			$	440,836					$	346,816					$	436,060

The following tables summarizes depreciation and amortization by segment ($000):

						Year Ended June 30,
Depreciation and amortization						2025						2024						2023
Networking						$	162,225					$	158,833					$	169,573
Materials						119,118						107,798						141,648
Lasers						267,328						287,662						364,370
Corporate and shared services						4,927						5,468						6,096
Total depreciation and amortization						$	553,598					$	559,761					$	681,687

The following tables summarizes segment assets ($000):

						Year Ended June 30,
Segment assets and reconciliation to total assets						2025						2024						2023
Networking						$	4,027,777					$	3,472,866					$	3,188,873
Materials						2,779,093						3,017,858						2,043,241
Lasers						7,541,129						7,361,731						7,751,937
Corporate and shared services						562,937						636,179						727,082
Total assets						$	14,910,936					$	14,488,634					$	13,711,133

Geographic information for revenues by location of the customer’s headquarters, were as follows ($000):

						Revenues
Year Ended June 30,						2025						2024						2023
North America						$	3,564,846					$	2,622,569					$	2,745,891
Europe						698,800						714,282						979,911
China						680,110						621,918						577,180
Japan						390,610						340,863						392,479
Rest of World						475,749						408,056						464,639
Total						$	5,810,115					$	4,707,688					$	5,160,100

Major Customers

We had two major customers who accounted for 12% and 10% of consolidated revenue during fiscal 2025. We had a different major customer who accounted for 10% of consolidated revenue during fiscal 2024. We had a major customer who accounted for 10% of consolidated revenue during fiscal 2023. These customers purchased primarily from our Networking segment.

Geographic information for long-lived assets by country, which include property, plant and equipment, net of related depreciation, and certain other long-term assets, were as follows ($000):

						Long-Lived Assets
June 30,						2025						2024
United States						$	1,092,389					$	1,226,359
Non-United States
China						402,960						349,195
Malaysia						196,543						87,783
Germany						189,281						209,593
Vietnam						65,565						20,707
Sweden						51,032						44,733
Switzerland						49,602						44,256
Philippines						25,406						11,217
United Kingdom						20,594						19,153
Korea						16,037						17,862
Australia						9,014						8,611
Taiwan						6,063						6,705
Other						23,044						23,166
Total Non-United States						1,055,141						842,981
						$	2,147,530					$	2,069,340

Change in Reportable Segments in Fiscal 2026

Effective July 1, 2025 for our fiscal year 2026, the Company realigned its organizational structure into two reporting segments: (i) Datacenter and Communications, and (ii) Industrial. The Company will report financial information for these new reporting segments in fiscal 2026. This change in reporting is to occur beginning with periods commencing July 1, 2025.

Note 15. Fair Value of Financial Instruments

The FASB defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous markets for the asset and liability in an orderly transaction between market participants at the measurement date. We estimate fair value of our financial instruments utilizing an established three-level hierarchy in accordance with U.S. GAAP. The hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date as follows:

• Level 1 – Valuation is based upon unadjusted quoted prices for identical assets or liabilities in active markets.

• Level 2 – Valuation is based upon quoted prices for similar assets and liabilities in active markets, or other inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instruments.

• Level 3 – Valuation is based upon other unobservable inputs that are significant to the fair value measurements.

The classification of fair value measurements within the hierarchy is based upon the lowest level of input that is significant to the measurement.

We had entered into an interest rate swap with a notional amount of $1,075 million to limit the exposure to our variable interest rate debt by effectively converting it to a fixed interest rate. Through February 28, 2023, we received payments based on the one-month LIBOR and made payments based on a fixed rate of 1.52%. We received payments with a floor of 0.00%. The initial notional amount of the interest rate swap decreased to $825 million in June 2022, and remained at that amount through its expiration on September 24, 2024. On March 20, 2023, we amended our $825 million interest rate swap (“Amended Swap”), effective as of February 28, 2023, to replace the current reference rate (LIBOR) with SOFR, to be consistent with Amendment no. 1 to the Credit Agreement. See Note 7. Debt for further information. Under the Amended Swap, we received payments based on the one-month SOFR and made payments based on a fixed rate of 1.42%. Through its expiration on September 24, 2024, we received payments with a floor of 0.10%. We designated this instrument as a cash flow hedge, and deemed the hedge relationship effective at inception of the contract and the amended contract. The interest rate swap expired on September 30,

2024. The fair value of the interest rate swap of $8 million is recognized in the Consolidated Balance Sheet within Prepaid and other current assets and Other assets as of June 30, 2024.

On February 23, 2022, we entered into an interest rate cap (“the Cap”) with an effective date of July 1, 2023. On March 20, 2023, we amended the Cap to replace the current reference rate (LIBOR) with SOFR, to be consistent with Amendment No. 1 to the Credit Agreement. See Note 7. Debt for further information. The Cap manages our exposure to interest rate movements on a portion of our floating rate debt. The Cap provides us with the right to receive payment if one-month SOFR exceeds 1.92%. Beginning in July 2023, we began to pay a fixed monthly premium based on an annual rate of 0.853% for the Cap. The Cap will carry a notional amount ranging from $500 million to $1,500 million. On September 1, 2024, we increased the notional amount from $500 million to $1,500 million. The fair value of the interest rate cap of $17 million and $50 million is recognized in the Consolidated Balance Sheets within prepaid and other current and other assets as of June 30, 2025 and June 30, 2024, respectively.

The Cap, as amended, is designed to mirror the terms of the Company’s Credit Agreement as amended on March 31, 2023. We designated the Cap as a cash flow hedge of the variability of the SOFR based interest payments on the Term Facilities. Every period over the life of the hedging relationship, the entire change in fair value related to the hedging instrument will first be recorded within AOCI. Amounts accumulated in AOCI will be reclassified into interest expense in the same period or periods in which interest expense is recognized on the Credit Agreement, or its direct replacement. The fair value of the Cap is determined using widely accepted valuation techniques and reflects the contractual terms of the Cap including the period to maturity, and while there are no quoted prices in active markets, it uses observable market-based inputs, including interest rate curves. The fair value analysis also considers a credit valuation adjustment to reflect nonperformance risk of both the Company and the single counterparty. The Cap is classified as a Level 2 item within the fair value hierarchy.

We estimated the fair value of the Senior Notes, Term A Facility and Term B Facility (“Debt Facilities”) based on quoted market prices as of the last trading day prior to June 30, 2025; however, the Debt Facilities have only a limited trading volume and as such this fair value estimate is not necessarily the value at which the Debt Facilities could be retired or transferred. We concluded that this fair value measurement should be categorized within Level 2. The carrying values of the Debt Facilities are net of unamortized discount and issuance costs. See Note 7. Debt for further information on the Company’s debt facilities.

The fair value and carrying value of the Debt Facilities were as follows ($000):

						June 30, 2025												June 30, 2024
						Fair Value						Carrying Value						Fair Value						Carrying Value
Senior Notes						$	973,190					$	985,034					$	938,193					$	984,061
Term A Facility						632,960						616,234						777,564						762,039
Term B Facility						2,108,938						2,065,880						2,390,497						2,334,701

Our borrowings, including our lease obligations and the Debt Facilities, are considered Level 2 among the fair value hierarchy.

Cash and cash equivalents are considered Level 1 among the fair value hierarchy and approximate fair value because of the short-term maturity of those instruments.

At June 30, 2025, total restricted cash of $724 million includes $720 million of cash in Silicon Carbide LLC that is restricted for use only by that subsidiary and $4 million of cash restricted for other purposes in other entities. At June 30, 2024, total restricted cash of $864 million included $858 million of cash in Silicon Carbide LLC that is restricted for use only by that subsidiary and $5 million of cash restricted for other purposes in other entities. The restricted cash is invested in money market accounts and time deposits, with maturities of one year or less, that are held-to-maturity, are considered Level 1 among the fair value hierarchy and approximate fair value. Restricted cash that is expected to be spent and released from restriction after 12 months is classified as non-current on the Consolidated Balance Sheets.

We, from time to time, purchase foreign currency forward exchange contracts, that permit us to sell specified amounts of these foreign currencies for pre-established U.S. dollar amounts at specified dates that represent assets or liabilities on the balance sheets of certain subsidiaries. These contracts are entered into for the purposes of limiting translational exposure to changes in currency exchange rates and which otherwise would expose our earnings, on the revaluation of our aggregate net assets or liabilities in respective currencies, to foreign currency risk. At June 30, 2025, we had no foreign currency forward contracts. The fair values of these instruments, when outstanding, are measured using valuations based upon quoted prices for similar assets and liabilities in active markets (Level 2) and are valued by reference to similar financial instruments, adjusted for credit risk and restrictions and other terms specific to the contracts. Realized gains related to these contracts for the year ended June 30, 2025 were $16 million and for June 30, 2024 and June 30, 2023 were losses of $15 million and gains of $0.2 million, respectively, and were included in Other expense (income), net in the Consolidated Statements of Earnings (Loss).

Our non-financial assets, such as goodwill, intangible assets, and property, plant and equipment, are assessed for impairment when an event or circumstance indicates that a decline in value may have occurred. See Note 1. Nature of Business and Summary of Significant Accounting Policies for further information.

Note 16. Employee Benefit Plans

Eligible employees of the Company participate in an employee retirement plan. Under the Coherent Corp 401(k) Profit Sharing Plan (“Plan”), we match employee contributions to the plan equal to an amount of 50% of employee contributions up to a maximum of 8% of the employee’s individual earnings subject to IRS limitations. Employees become eligible for participation and Company matching contributions on their first day of employment. The Company’s matching contributions (net of forfeitures) during fiscal 2025, 2024 and 2023 were $15 million, $18 million, and $11 million, respectively. In addition, the Plan has a profit sharing retirement plan contribution for eligible U.S. employees of the Company. These contributions are made at the discretion of the Company’s Board of Directors and were $1 million for the year ended June 30, 2025 and $2 million in each of 2024 and 2023.

Switzerland Defined Benefit Plan

The Company maintains a pension plan covering employees of our Swiss subsidiary (the “Swiss Plan”). Employer and employee contributions are made to the Swiss Plan based on various percentages of salary and wages that vary according to employee age and other factors. Employer contributions to the Swiss Plan were $5 million and $4 million for the years ended June 30, 2025 and 2024, respectively. Net periodic pension cost is not material for any year presented.

The underfunded pension liability was $25 million and $17 million as of June 30, 2025 and 2024, respectively. The pension adjustment amount recognized in accumulated other comprehensive income (loss) was a $7 million decrease for both fiscal years ended June 30, 2025 and 2024. The accumulated benefit obligation was $141 million as of June 30, 2025, compared to $106 million as of June 30, 2024.

Other Defined Benefit Plans

As a result of the Coherent, Inc. acquisition on July 1, 2022, we assumed all assets and liabilities of defined benefit plans in the U.S., Germany, South Korea, Japan, Spain, and Italy (“other plans”). As is the customary practice with European and Asian companies, the plans are unfunded, with the exception of the Spanish plan which is partially funded. The U.S. qualified plan is also partially funded. Any new employees hired after January 1, 2007, are not eligible for the U.S. qualified and nonqualified plans. Effective August 31, 2018, both of the U.S. plans were amended to freeze all future compensation benefit accruals. Any new employees hired after 2000 are not eligible for the primary German pension plans. For two of the German plans and the U.S. qualified plan, unrealized gains and losses are recognized as a component of other comprehensive income (loss) within shareholders’ equity. For the other plans, we have elected to recognize all actuarial gains and losses on these plans immediately, as incurred.

Liabilities and expense for pension benefits are determined using actuarial methodologies and incorporate significant assumptions, including the interest rate used to discount the future estimated cash flows, the expected long-term rate of return on plan assets, and several assumptions relating to the employee workforce (salary increases, retirement age, and mortality). All of these assumptions were based upon management’s judgment, considering all known trends and uncertainties. Actual results that differ from these assumptions would impact future expense recognition and the cash funding requirements of our defined benefit plans.

For the other plans, employer contributions in the years ended June 30, 2025 and June 30, 2024 were $3 million and $2 million, respectively, and net periodic pension cost was not material in either year. The underfunded pension liability was $37 million and $34 million as of June 30, 2025 and June 30, 2024, respectively. The pension adjustment amount recognized in accumulated other comprehensive income (loss) was a $1 million increase and a $1 million decrease for the fiscal years ended June 30, 2025 and June 30, 2024, respectively. The accumulated benefit obligation was $47 million and $44 million as of June 30, 2025 and June 30, 2024, respectively.

Estimated future benefit payments under all plans are estimated to be as follows ($000):

Year Ending June 30,
2026			$	10,400
2027			9,400
2028			10,100
2029			11,500
2030			12,100
Next five years			66,800

Note 17. Other Accrued Liabilities

The components of other accrued liabilities were as follows ($000):

June 30,						2025						2024
Contract liabilities						$	62,967					$	62,123
Warranty reserves						32,754						44,193
Current liabilities held-for-sale						57,394						—
Other accrued liabilities						182,449						188,390
						$	335,564					$	294,706

Note 18. Commitments and Contingencies

We have purchase commitments for materials and supplies as part of the ordinary conduct of business. A portion of the commitments are long-term and are based on minimum purchase requirements. Certain short-term raw material purchase commitments have a variable price component which is based on market pricing at the time of purchase. Due to the proprietary nature of some of our materials and processes, certain contracts may contain liquidated damage provisions for early termination. We do not believe that a significant amount of liquidated damages are reasonably likely to be incurred under these commitments, based upon historical experience and current expectations. Total future purchase commitments held by Coherent as of June 30, 2025 were $945 million in fiscal 2025 and $147 million thereafter.

Regulatory Matters

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 to EAR and consequently restricted for export, reexport, and transfer when Huawei is a party to the transaction. We have stopped shipping products to Huawei. We are in discussions with BIS regarding past product sales and cannot predict the outcome of those discussions. While we have received requests for additional information in this matter, we have not yet received any determination from BIS. In the event that we are found to have violated the EAR, we may be required to incur significant penalties and/or costs or expense as a result of the inquiry and to comply with, or remedy any violations of these regulations, but at this time, we are unable to determine an estimate or range of loss.

Note 19. Accumulated Other Comprehensive Income (Loss)

The changes in AOCI by component, net of tax, for the years ended June 30, 2025, 2024, and 2023 were as follows ($000):

						Foreign Currency Translation Adjustment						Interest Rate Instruments						Defined Benefit Pension Plan						Total Accumulated Other Comprehensive Income (Loss)
AOCI - June 30, 2022						$	(34,572)					$	26,041					$	6,364					$	(2,167)
Other comprehensive income (loss) before reclassifications						87,927						49,372						(5,326)						131,973
Amounts reclassified from AOCI						—						(19,301)						(779)						(20,080)
Net current-period other comprehensive income (loss)						87,927						30,071						(6,105)						111,893
AOCI - June 30, 2023						$	53,355					$	56,112					$	259					$	109,726
Other comprehensive income (loss) before reclassifications						(82,318)						24,948						(6,708)						(64,077)
Amounts reclassified from AOCI						—						(45,144)						(735)						(45,880)
Net current-period other comprehensive income (loss)						(82,318)						(20,196)						(7,443)						(109,957)
AOCI - Reclass related to noncontrolling interests						2,871						—						—						2,871
AOCI - June 30, 2024						$	(26,092)					$	35,916					$	(7,184)					$	2,640
Other comprehensive income (loss) before reclassifications						409,069						499						(6,064)						403,505
Amounts reclassified from AOCI						—						(32,397)						(287)						(32,685)
Net current-period other comprehensive income (loss)						409,069						(31,898)						(6,351)						370,820
AOCI - Reclass related to noncontrolling interests						(1,423)						—						—						(1,423)
AOCI - June 30, 2025						$	381,554					$	4,018					$	(13,535)					$	372,037

The Company uses a portfolio approach to release the income tax effects in AOCI related to interest rate instruments and pension and postretirement benefits. Under this approach, the income tax effects are released from AOCI based on the pre-tax adjustments to interest rate instruments and pension liabilities or assets recognized within AOCI. Any tax effects remaining in AOCI are released only when the entire portfolio of the interest rate instruments or pension and postretirement benefits is liquidated, sold or extinguished.

Note 20. Restructuring Plans

2023 Restructuring Plan

On May 23, 2023, the Board of Directors approved the 2023 Plan which includes site consolidations, facilities moves and closures, as well as the relocation and requalification of certain manufacturing facilities. These restructuring actions were intended to realign our cost structure as part of a transformation to a simpler, more streamlined, resilient and sustainable business model. We evaluate restructuring charges in accordance with ASC 420, Exit or Disposal Cost Obligations, and ASC 712, Compensation-Nonretirement Post-Employment Benefits (ASC 712).

In fiscal 2025, these activities resulted in $53 million of charges primarily for impairment losses associated with the sale of our Newton Aycliffe business, impairment of ROU assets, employee termination costs, site move cost and accelerated depreciation. In fiscal 2024, these activities resulted in $27 million of charges primarily for acceleration of depreciation, write-off of property and equipment, and site move costs. In fiscal 2023, these activities resulted in $119 million of charges primarily for employee termination and the write-off of property and equipment, net of $65 million from reimbursement arrangements.

Activity and accrual balances for the 2023 Plan were as follows ($000):

			Severance						Asset Write-Offs						Other						Total Accrual
Balance - June 30, 2023			$	64,379					$	—					$	—					$	64,379
Restructuring charges (recoveries)			(129)						11,658						15,527						27,056
Payments			(13,189)						—						—						(13,189)
Asset write-offs and other			—						(11,658)						(15,527)						(27,185)
Balance - June 30, 2024			51,061						—						—						51,061
Restructuring charges			6,123						24,010						22,864						52,997
Payments			(12,954)						—						—						(12,954)
Asset write-offs and other			—						(24,010)						(22,864)						(46,874)
Balance - June 30, 2025			$	44,230					$	—					$	—					$	44,230

At June 30, 2025, $11 million and $34 million of accrued severance related costs were included in other accrued liabilities and other liabilities on our Consolidated Balance Sheet, respectively, and are expected to result in cash expenditures through fiscal 2028. The current year severance related net charges are primarily comprised of accruals and adjustments for severance pay for employees being terminated due to the consolidation of certain manufacturing sites, with severance recorded in accordance with ASC 712. The fiscal 2024 severance related recoveries are primarily comprised of adjustments to accruals for severance pay for employees being terminated due to the consolidation of certain manufacturing sites, with severance recorded in accordance with ASC 712.

By segment in fiscal 2025, $12 million, $38 million and $3 million of restructuring costs were incurred in the Networking, Materials and Lasers segments, respectively. By segment in fiscal 2024, $(4) million, $28 million and $4 million of restructuring costs (recoveries) were incurred in the Networking, Materials and Lasers segments, respectively. Restructuring charges and recoveries are recorded in Restructuring charges in our Consolidated Statements of Earnings (Loss).

2025 Restructuring Plan

Commencing in the quarter ended March 31, 2025, and as part of the ongoing strategic review of the Company’s business, the Company’s management approved the 2025 Plan. In connection therewith, the Company expects to incur charges for related severance and benefits, lease and contract termination costs, asset write-offs, facilities move and other restructuring costs. We evaluate restructuring charges in accordance with ASC 420 and ASC 712.

In fiscal 2025, these activities resulted in $107 million of charges primarily for the write-off of property and equipment and ROU assets, employee and contract termination costs. We expect the restructuring actions to be substantially completed by the end of fiscal 2026. However, the actual timing and costs associated with these restructuring actions may differ from our current expectations and estimates and such differences may be material.

Activity and accrual balances for the 2025 Plan were as follows for fiscal 2025 ($000):

			Severance						Asset Write-Offs						Other						Total Accrual
Balance - June 30, 2024			$	—					$	—					$	—					$	—
Restructuring charges			23,983						59,068						24,033						107,084
Payments			(7,261)						(48,574)						(4,136)						(59,971)
Balance - June 30, 2025			$	16,722					$	10,494					$	19,897					$	47,113

At June 30, 2025, $17 million of accrued severance related costs were included in other accrued liabilities and are expected to result in cash expenditures primarily through fiscal 2026. The current year severance related net charges are primarily comprised of accruals for severance and pay for employees being terminated due to the consolidation of certain manufacturing sites as well as workforce reductions, with severance recorded in accordance with ASC 712. At June 30, 2025, total liabilities for asset write-offs and other contract costs of $19 million and $12 million were included in other accrued liabilities and other liabilities on our Consolidated Balance Sheet, respectively.

By segment, in fiscal 2025, $65 million of restructuring costs were incurred in the Materials segment, $23 million were incurred in the Networking segment, $12 million were incurred in the Lasers segment, and $7 million were incurred in the Corporate segment. Restructuring charges and recoveries are recorded in Restructuring charges in our Consolidated Statements of Earnings (Loss).

Note 21. Assets Held-for-Sale

In the fourth quarter of fiscal 2025, management entered into non-binding agreements to sell several entities. As a result of classifying these entities as held-for-sale, we recorded non-cash impairment charges of $85 million in our Lasers segment to Impairment of assets held-for-sale in our Consolidated Statements of Earnings (Loss) in the fourth quarter of fiscal 2025 to reduce our carrying value in these entities to fair value. Current assets and current liabilities held for sale are recorded in Prepaid and other current assets and Other accrued liabilities, respectively, in our Consolidated Balance Sheet. Noncurrent assets and noncurrent liabilities held for sale are recorded in Other assets and Other liabilities, respectively, in our Consolidated Balance Sheet. Assets and liabilities held-for-sale are in our Lasers and Materials segments.

On August 2, 2025, we entered into an agreement to sell our aerospace and defense business for $400 million. We expect to close this transaction in the first quarter of fiscal 2026. Although the assets of this business were classified as held-for-sale at June 30, 2025, we did not record an impairment loss on this business as we expect to recognize a gain in the first quarter of fiscal 2026 when the sale of the business closes.

Current and noncurrent assets and liabilities classified as held for sale as of June 30, 2025 related to these entities are as follows ($000):

						June 30, 2025
Accounts receivable						$	43,353
Inventories						97,236
Prepaid and refundable income taxes						9,023
Prepaid and other current assets						3,067
Total current assets held-for-sale						$	152,679
Property, plant & equipment, net						$	103,863
Goodwill						174,373
Intangible assets						141,647
Other assets						32
Less: Impairment of assets held-for-sale						(84,988)
Total noncurrent assets held-for-sale						$	334,927
Accounts payable						$	19,209
Accrued compensation and benefits						16,768
Operating lease current liabilities						2,441
Accrued income taxes payable						(226)

Other accrued liabilities						19,202
Total current liabilities held-for-sale						$	57,394
Deferred income taxes						$	14,785
Operating lease liabilities						5,980
Other liabilities						7,870
Total noncurrent liabilities held-for-sale						$	28,635

SCHEDULE II

COHERENT CORP. AND SUBSIDIARIES

VALUATION AND QUALIFYING ACCOUNTS

YEARS ENDED JUNE 30, 2025, 2024, AND 2023

(IN THOUSANDS OF DOLLARS)

			Balance at Beginning of Year			Charged to Expense			Charged to Other Accounts						Assets Held-For-Sale			Deduction from Reserves						Balance at End of Year
YEAR ENDED JUNE 30, 2025:
Allowance for doubtful accounts			$	9,511		$	8,181		$	—					$	(117)		$	(5,386)		(3)			$	12,189
Warranty reserves			$	44,193		$	26,352		$	—					$	(4,299)		$	(33,492)					$	32,754
Deferred tax asset valuation allowance			$	154,830		$	15,413		$	3,577		(2)			$	(10,142)		$	—					$	163,678
YEAR ENDED JUNE 30, 2024:
Allowance for doubtful accounts			$	8,005		$	5,161		$	—					$	—		$	(3,655)		(3)			$	9,511
Warranty reserves			$	47,563		$	34,362		$	—					$	—		$	(37,732)					$	44,193
Deferred tax asset valuation allowance			$	97,180		$	57,968		$	(318)		(2)			$	—		$	—					$	154,830
YEAR ENDED JUNE 30, 2023:
Allowance for doubtful accounts			$	4,206		$	1,793		$	3,112		(1)			$	—		$	(1,106)		(3)			$	8,005
Warranty reserves			$	17,738		$	40,475		$	29,196		(1)			$	—		$	(39,846)					$	47,563
Deferred tax asset valuation allowance			$	55,420		$	4,035		$	37,725		(1,2)			$	—		$	—					$	97,180

(1) Related to amounts assumed from the Coherent, Inc. acquisition.

(2) Primarily related to currency translation adjustments.

(3) Primarily relates to write-offs of accounts receivable.