EX-99.1 2 cohr_form8kxexhibitxq2x2022.htm EX-99.1 Document
Exhibit 99.1

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May 11, 2022
Press Release No. 1493
For Immediate Release:

Coherent, Inc. Reports Second Fiscal Quarter Results

SANTA CLARA, CA, May 11, 2022 -- Coherent, Inc. (NASDAQ, COHR), one of the world’s leading providers of lasers, laser-based technologies and laser-based system solutions in a broad range of scientific, commercial and industrial applications, today announced financial results for its second fiscal quarter ended April 2, 2022.

FINANCIAL HIGHLIGHTS
Three Months EndedSix Months Ended
Apr. 2, 2022Jan. 1, 2022Apr. 3, 2021Apr. 2, 2022Apr. 3, 2021
GAAP Results
(in millions, except per share data)
Net sales $370.2 $384.5 $374.0 $754.7 $700.0 
Net income (loss)$33.7 $30.3 $(158.2)$63.9 $(158.1)
Diluted EPS$1.35 $1.21 $(6.49)$2.57 $(6.50)
Non-GAAP Results
(in millions, except per share data)
Net income $42.5 $57.7 $35.2 $100.2 $61.9 
Diluted EPS $1.70 $2.32 $1.42 $4.02 $2.52 

SECOND FISCAL QUARTER DETAILS

For the second quarter of fiscal 2022, Coherent announced net sales of $370.2 million and net income, on a U.S. generally accepted accounting principles (GAAP) basis, of $33.7 million, or $1.35 per diluted share.

These results compare to net sales of $374.0 million and net loss of $158.2 million, or $6.49 per diluted share, for the second quarter of fiscal 2021 and net sales of $384.5 million and net income of $30.3 million, or $1.21 per diluted share, for the first quarter of fiscal 2022. The net loss in the second quarter of fiscal 2021 includes $179.2 million, net of tax, in merger and acquisition costs, primarily due to a merger agreement termination fee paid to Lumentum Holdings Inc.

Non-GAAP net income for the second quarter of fiscal 2022 was $42.5 million, or $1.70 per diluted share. Non-GAAP net income for the second quarter of fiscal 2021 was $35.2 million, or $1.42 per diluted share. Non-GAAP net income for the first quarter of fiscal 2022 was $57.7 million, or $2.32 per diluted share. Reconciliations of GAAP to non-GAAP financial measures for the three months ended April 2, 2022, January 1, 2022 and April 3, 2021 and six months ended April 2, 2022 and

Exhibit 99.1

April 3, 2021 appear in the financial statements portion of this release under the heading “Reconciliation of GAAP to Non-GAAP net income.”


Summarized statement of operations information is as follows (unaudited, in thousands, except per share data):
Three Months EndedSix Months Ended
Apr. 2, 2022Jan. 1, 2022Apr. 3, 2021Apr. 2, 2022Apr. 3, 2021
Net sales $370,204 $384,507 $373,982 $754,711 $700,035 
Cost of sales(A)(B)(C)(D)
215,670 216,943 232,957 432,613 439,014 
Gross profit 154,534 167,564 141,025 322,098 261,021 
Operating expenses:
Research & development(A)(B)(D)
31,679 29,769 32,007 61,448 60,228 
Selling, general & administrative(A)(B)(D)
66,517 93,774 72,662 160,291 146,890 
Merger and acquisition costs(E)
1,044 977 231,996 2,021 231,996 
  Amortization of intangible assets(C)
563 565 596 1,128 1,193 
Total operating expenses 99,803 125,085 337,261 224,888 440,307 
Income (loss) from operations 54,731 42,479 (196,236)97,210 (179,286)
Other expense, net(B)
(5,729)(6,185)(2,526)(11,914)(4,815)
Income (loss) before income taxes 49,002 36,294 (198,762)85,296 (184,101)
Provision (benefit) for income taxes (F)
15,326 6,029 (40,547)21,355 (26,030)
Net income (loss)$33,676 $30,265 $(158,215)$63,941 $(158,071)
Net income (loss) per share:
Basic$1.36 $1.23 $(6.49)$2.60 $(6.50)
Diluted $1.35 $1.21 $(6.49)$2.57 $(6.50)
Shares used in computations:  
Basic 24,708 24,542 24,389 24,625 24,326 
Diluted 24,935 24,919 24,389 24,927 24,326 

(A)Stock-based compensation expense included in operating results is summarized below (all footnote amounts are unaudited, in thousands, except per share data):
Stock-based compensation expenseThree Months EndedSix Months Ended
Apr. 2, 2022Jan. 1, 2022Apr. 3, 2021Apr. 2, 2022Apr. 3, 2021
Cost of sales $1,971 $1,731 $1,989 $3,702 $4,261 
Research & development 1,158 1,236 1,030 2,394 2,229 
Selling, general & administrative(1)
5,914 28,940 6,073 34,854 14,787 
Impact on income (loss) from operations $9,043 $31,907 $9,092 $40,950 $21,277 

For the fiscal quarters ended April 2, 2022, January 1, 2022 and April 3, 2021, the impact on net income (loss), net of tax was $7,655 ($0.31 per diluted share), $29,613 ($1.20 per diluted share) and $7,746 ($0.31 per diluted share), respectively. For the six months ended April 2, 2022 and April 3, 2021, the impact on net income (loss), net of tax was $37,268 ($1.48 per diluted share) and $18,359 ($0.75 per diluted share), respectively.

(1) The fiscal quarter ended January 1, 2022 includes a $19.7 million stock-based compensation expense resulting from the acceleration of vesting of restricted stock units for certain executives.

Exhibit 99.1


(B)Changes in deferred compensation plan liabilities are included in cost of sales and operating expenses while gains and losses on deferred compensation plan assets are included in other income (expense), net. Deferred compensation expense (benefit) included in operating results is summarized below:
Deferred compensation expense (benefit)Three Months EndedSix Months Ended
Apr. 2, 2022Jan. 1, 2022Apr. 3, 2021Apr. 2, 2022Apr. 3, 2021
Cost of sales $(28)$(6)$11 $(34)$22 
Research & development (306)(71)293 (377)588 
Selling, general & administrative (1,405)(415)1,818 (1,820)3,624 
Impact on income (loss) from operations $(1,739)$(492)$2,122 $(2,231)$4,234 

For the fiscal quarters ended April 2, 2022, January 1, 2022 and April 3, 2021, the impact on other income (expense), net from gains or losses on deferred compensation plan assets was expense of $1,604, expense of $300 and income of $2,692, respectively. For the six months ended April 2, 2022 and April 3, 2021, the impact on other income (expense), net from gains or losses on deferred compensation plan assets was expense of $1,904 and income of $4,988, respectively.

(C)Amortization of intangibles is included in cost of sales and operating expenses as summarized below:
Amortization of intangiblesThree Months EndedSix Months Ended
Apr. 2, 2022Jan. 1, 2022Apr. 3, 2021Apr. 2, 2022Apr. 3, 2021
Cost of sales $267 $818 $1,855 $1,085 $3,872 
Amortization of intangible assets563 565 596 1,128 1,193 
Impact on income (loss) from operations $830 $1,383 $2,451 $2,213 $5,065 

For the fiscal quarters ended April 2, 2022, January 1, 2022 and April 3, 2021, the impact on net income (loss), net of tax was $699 ($0.03 per diluted share), $1,190 ($0.05 per diluted share) and $2,159 ($0.09 per diluted share), respectively. For the six months ended April 2, 2022 and April 3, 2021, the impact on net income (loss), net of tax was $1,889 ($0.08 per diluted share) and $4,429 ($0.18 per diluted share), respectively.

(D)For the fiscal quarters ended April 2, 2022, January 1, 2022 and April 3, 2021, the impact of restructuring charges (gains) was a gain of $2,284 ($1,768 net of tax ($0.07 per diluted share)), gain of $10 ($7 net of tax ($0.00 per diluted share)) and charge of $3,659 ($3,059 net of tax ($0.12 per diluted share)), respectively. For the six months ended April 2, 2022 and April 3, 2021, the impact of restructuring charges (gains) was a gain of $2,294 ($1,775 net of tax ($0.07 per diluted share)) and charge of $9,042 ($7,532 net of tax ($0.31 per diluted share)), respectively.

(E)For the fiscal quarters ended April 2, 2022, January 1, 2022 and April 3, 2021, we incurred merger and acquisition costs of $1,044 ($806 net of tax ($0.03 per diluted share)), $977 ($755 net of tax ($0.03 per diluted share)) and $231,996 ($179,217 net of tax ($7.34 per diluted share)), respectively. For the six months ended April 2, 2022 and April 3, 2021, we incurred merger and acquisition costs of $2,021 ($1,561 net of tax ($0.06 per diluted share)) and $231,996 ($179,217 net of tax ($7.34 per diluted share)), respectively. The merger and acquisition costs for the three and six months ended April 3, 2021 were primarily due to a termination fee paid to Lumentum Holdings Inc. of $217,600.

(F)The fiscal quarters ended April 2, 2022, January 1, 2022 and April 3, 2021 included non-recurring income tax charges of $1,613 ($0.06 per diluted share), $514 ($0.02 per diluted share) and $1,854 ($0.07 per diluted share), respectively. The fiscal quarters ended April 2, 2022, January 1, 2022 and April 3, 2021 included $184 ($0.01 per diluted share), $4,630 ($0.19 per diluted share) and $598 ($0.02 per diluted share), of excess tax benefits for employee stock-based compensation, respectively. The six months ended April 2, 2022 and April 3, 2021 included non-recurring income tax charges of $2,127 ($0.09 per diluted share) and $10,468 ($0.43 per diluted share), respectively. The six months ended

Exhibit 99.1

April 2, 2022 and April 3, 2021 included a benefit of $4,814 ($0.19 per diluted share) and a charge of $13 ($0.00 per diluted share) of excess tax charges (benefits) for employee stock-based compensation, respectively.

Summarized balance sheet information is as follows (unaudited, in thousands):
Apr. 2, 2022Oct. 2, 2021
ASSETS
Current assets:
Cash, cash equivalents, restricted cash and short-term investments$403,477 $458,061 
Accounts receivable, net262,956 249,389 
Inventories417,275 392,241 
Prepaid expenses and other assets91,884 79,594 
Total current assets1,175,592 1,179,285 
Property and equipment, net305,916 302,613 
Other assets388,887 407,032 
Total assets$1,870,395 $1,888,930 
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Short-term borrowings$9,571 $18,395 
Accounts payable106,071 104,539 
Other current liabilities238,321 259,281 
Total current liabilities353,963 382,215 
Long-term liabilities582,238 638,530 
Total stockholders’ equity934,194 868,185 
Total liabilities and stockholders’ equity$1,870,395 $1,888,930 


Reconciliation of GAAP to Non-GAAP net income, net of tax (unaudited, in thousands, other than per share data):

Three Months EndedSix Months Ended
Apr. 2, 2022Jan. 1, 2022Apr. 3, 2021Apr. 2, 2022Apr. 3, 2021
GAAP net income (loss)$33,676 $30,265 $(158,215)$63,941 $(158,071)
Stock-based compensation expense 7,655 29,613 7,746 37,268 18,359 
Amortization of intangible assets699 1,190 2,159 1,889 4,429 
Restructuring charges (gains) and other(1,768)(7)3,059 (1,775)7,532 
Non-recurring tax expense1,613 514 1,854 2,127 10,468 
Tax charge (benefit) from stock-based compensation expense(184)(4,630)(598)(4,814)13 
Merger and acquisition costs806 755 179,217 1,561 179,217 
Non-GAAP net income$42,497 $57,700 $35,222 $100,197 $61,947 
Non-GAAP net income per diluted share $1.70 $2.32 $1.42 $4.02 $2.52 


Founded in 1966, Coherent, Inc. is one of the world’s leading providers of lasers, laser-based technologies and laser-based system solutions in a broad range of scientific, commercial and industrial customers. Our common stock is listed on the Nasdaq Global Select Market and is part of the Russell 1000 and Standard & Poor’s MidCap 400 Index. For more information about Coherent, visit the company's website at www.coherent.com for product and financial updates.

5100 Patrick Henry Dr. P. O. Box 54980, Santa Clara, California 95056–0980 . Telephone (408) 764-4000