COHERENT CORP.

Note 1. Basis of Presentation

Basis of Presentation

The condensed consolidated financial statements of Coherent Corp. (“Coherent”, the “Company”, “we”, “us” or “our”) for the three months ended September 30, 2026 and 2025 are unaudited. In the opinion of management, all adjustments considered necessary for a fair presentation for the periods presented have been included. All adjustments are of a normal recurring nature unless disclosed otherwise. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted. These condensed consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended June 30, 2026 filed with the Securities and Exchange Commission (the “SEC”) on August 14, 2026. The condensed consolidated results of operations for the three months ended September 30, 2026 are not necessarily indicative of the results to be expected for the full fiscal year. The Condensed Consolidated Balance Sheet information as of June 30, 2026 was derived from the Company’s audited consolidated financial statements.

Note 2. Recently Issued Financial Accounting Standards

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

We disaggregate revenue by market and geography. We believe that disaggregating revenue by market and geography provides the most relevant information regarding the nature, amount, timing, and uncertainty of revenues and cash flows. We do not present other levels of disaggregation, such as by type of products, customer, contracts, duration of contracts, timing of transfer of control and sales channels, as this information is not used by our chief operating decision maker (“CODM”) to manage the business.

Effective July 1, 2025, the Company aligned its reporting of revenues intotwo markets: (i) Datacenter & Communications, and (ii) Industrial. All prior period market and segment disclosure information has been reclassified to conform to the current reporting structure.

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

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 the contract. Contract liabilities are recognized as revenue when the performance obligations have been satisfied. During the three months ended September 30, 2026, we recognized revenue of $15 million related to customer payments that were included as contract liabilities in the Consolidated Balance Sheet as of June 30, 2026. We had $333 million of contract liabilities recorded in the Condensed Consolidated Balance Sheet as of September 30, 2026. As of September 30, 2026, $172 million of contract liabilities is included within Other accrued liabilities, and $161 million is included within Other liabilities on the Condensed Consolidated Balance Sheet. As of June 30, 2026, $48 million of contract liabilities is included in Other accrued liabilities, and $15 million is included within Other liabilities on the Condensed Consolidated Balance Sheet.

Note 4. Inventories

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

Note 5. Property, Plant and Equipment

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

Note 6. Goodwill and Other Intangible Assets

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

(1)Other reclassifications include the transfer of $141 million of goodwill from the Industrial segment to the Datacenter & Communications segment related to the movement of certain business units effective as of the first day of fiscal 2027. Goodwill was reallocated using a relative fair value approach. As a result of the transfer between reportable segments, the Company performed an impairment assessment immediately before and immediately after the transfer became effective, and no impairment of goodwill was identified. See Note 18. Segment Reporting for further information.

We test goodwill for impairment annually during the fourth quarter of our fiscal year, or more frequently when events or changes in circumstances indicate that fair value is below carrying value.

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

Note 7. Assets Held-for-Sale and Sale of Businesses

On September 2, 2025, the Company completed the sale of its aerospace and defense business, which was part of the Industrial segment, for approximately $400 million, subject to customary post-closing adjustments. In connection with the sale, the Company recorded a gain of $115 million and incurred approximately $9 million in transaction related costs, which were recorded in Gain on sale of business and SG&A expenses, respectively, in the Condensed Consolidated Statements of Earnings in the first quarter of fiscal 2026.

On January 30, 2026, the Company completed the sale of its product division based in Munich, Germany that makes tools for materials processing, which was part of the Industrial segment. The transaction resulted in a loss of $96 million. The loss was primarily attributable to impairment charges of $105 million recognized within Impairment of assets held-for-sale in the Condensed Consolidated Statements of Earnings (Loss), including $81 million in the fourth quarter of fiscal 2025, $13 million in the first quarter of fiscal 2026 and $11 million in the second quarter of fiscal 2026. These impairment charges were partially offset by a gain of $115 million recorded within Gain on sale of business in the Condensed Consolidated Statements of Earnings (Loss) in the third quarter of fiscal 2026.

In fiscal 2026, the Company recorded additional non-cash impairment charges of $64 million related to three entities within the Industrial segment. Two of these entities had already been classified as held-for-sale as of June 30, 2025 and remained classified as held-for-sale during the first and second quarters of fiscal 2026, while the third entity was classified as held-for-sale during the fourth quarter of fiscal 2026 and remains classified as held-for-sale at September 30, 2026. A plan to dispose of this entity was approved by management during the fourth quarter of fiscal 2026 as part of the Company’s strategic realignment and the Company expects to complete the disposal through a sale to a third party within one year of the held-for-sale classification date.

Current assets and current liabilities held-for-sale are recorded in Prepaid and other current assets and Other accrued liabilities, respectively, in our Condensed Consolidated Balance Sheets. Noncurrent assets and noncurrent liabilities held-for-sale are recorded in Other assets and Other liabilities, respectively, in our Condensed Consolidated Balance Sheets. Assets and liabilities held-for-sale are in the Industrial segment at both September 30, 2026 and June 30, 2026.

Current and noncurrent assets and liabilities classified as held-for-sale as of September 30, 2026 and June 30, 2026 are as follows ($000):

Note 8. Debt

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

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 provided 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 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 all of their assets to secure such obligations. 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. 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. 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. The maturity of the New Term B-2 Loans and Revolving Credit Facility was unchanged.

On September 26, 2025, the Company entered into Amendment No. 4 (“Amendment No. 4”) and Amendment No. 5 (“Amendment No. 5”) to the Credit Agreement. Under Amendment No. 4, (i) the existing revolving credit commitments were refinanced and replaced with new senior secured revolving credit commitments, (ii) $350 million of senior secured incremental revolving credit commitments were added, increasing the total availability under the Revolving Credit Facility to $700 million (the “2025 Revolving Loans”), including a letter of credit sub-facility of up to $100 million, and (iii) a $1,250 million new tranche of senior secured incremental term A loans was added (the “2025 Incremental Term A Loans”), the proceeds of which were used, in part, to repay all outstanding principal, interest and fees of term A loans outstanding under the Credit Agreement (the “Existing Term A Loans”). As amended, the 2025 Revolving Loans and the 2025 Incremental Term A Loans each bear interest at an adjusted SOFR rate subject to a 0.00% floor plus a range of 1.25% to 2.25% based on the Company’s total net leverage ratio. The interest rate applicable to the 2025 Revolving Loans and the 2025 Incremental Term A Loans is initially a SOFR-based rate plus 1.25% as of September 30, 2026. The 2025 Revolving Loans and the 2025 Incremental Term A Loans mature on the earlier of September 26, 2030 or a “Springing Maturity Date,” which is a date that is 91 days prior to the stated maturity of either (i) the Company’s unsecured senior notes or (ii) the term B loans then outstanding if, on such 91st day, the applicable senior notes or term B loans remain outstanding and liquidity is less than (x) $250 million plus (y) the aggregate outstanding principal amount of such notes or term B loans, as applicable. Under Amendment No. 5, the outstanding New Term B-2 Loans were replaced with an equal amount of new term loans (the “New Term B-3 Loans”) having substantially similar terms as the New Term B-2 Loans, except with respect to the interest rate applicable to the New Term B-3 Loans and certain other provisions. As further amended, the New Term B-3 Loans bear interest at a SOFR-based rate (subject to a 0.50% floor) plus 1.75% as of September 30, 2026. The New Term B-3 Loans will mature on July 1, 2029.

Debt extinguishment costs related to the termination of the Existing Term Loans of $3 million were expensed in Other expense, net in the Condensed Consolidated Statement of Earnings during the three months ended September 30, 2025.

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, of $30 million and $41 million in the three months ended September 30, 2026 and September 30, 2025, respectively, which is included in Interest expense in the Condensed Consolidated Statements of Earnings.

On July 1, 2023, our interest rate cap became effective, which reduced interest expense by $1 million during the three months ended September 30, 2026, and $6 million in the three months ended September 30, 2025. The amortization of debt issuance costs included in interest expense was $2 million in the three months ended September 30, 2026, and $10 million in the three months ended September 30, 2025. Debt issuance costs are presented as a reduction to debt within Long-term debt in the Condensed Consolidated Balance Sheets.

As of September 30, 2026, the Company was in compliance with all covenants under the Senior Credit Facilities.

The Company had aggregate availability of $669 million under its Revolving Credit Facility as of September 30, 2026.

Debt Assumed through Acquisition

The aggregate principal amount outstanding under a term loan assumed with the closing of the acquisition of Coherent, Inc., is $13 million as of September 30, 2026 and in connection with 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.

Beginning 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, prior to December 15, 2024, the Company had the ability to 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. The Company did not exercise this option.

In relation to the Senior Notes, the Company incurred interest expense of $13 million in each of the three months ended September 30, 2026 and September 30, 2025, which is included in Interest expense in the Condensed Consolidated Statements of Earnings.

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 September 30, 2026, the Company was in compliance with all covenants under the Indenture.

Other Credit Facilities

In June, July, and August 2026, two wholly-owned foreign subsidiaries of the Company entered into unsecured credit facility agreements with two local lenders providing for aggregate lines of credit of up to $475 million, which is denominated in local currency (the “2026 Credit Lines”). The 2026 Credit Lines mature in 2029 and had $205 million outstanding as of September 30, 2026. Borrowings bear interest at the one-year local currency lending benchmark less 61 basis points, and the interest is payable quarterly. Neither the Company, nor any other of its subsidiaries, is a party to, or a guarantor of, the 2026 Credit Lines.

On August 12, 2026, a wholly-owned foreign subsidiary of the Company entered into an unsecured credit facility with local lenders providing for aggregate commitments of approximately $950 million. The facility consists of a local currency tranche with a sublimit equivalent to 475 million U.S. Dollars and a U.S. Dollar tranche with sublimit of $475 million (the “August 2026 Facility”). The August 2026 Facility matures 36 months from the date of first utilization, August 17, 2026, and had $598 million outstanding as of September 30, 2026. Borrowings may be used to fund working capital and other permitted operating requirements of the borrower, including the repayment of existing intercompany working capital loans. Borrowings bear interest at variable rates based on the applicable benchmark rate for the borrowed currency, including three-month Term SOFR plus 20 basis points for U.S. Dollar denominated loans and the one-year local currency lending benchmark less 71 basis points for local currency denominated loans, in each case subject to customary adjustments. Interest is payable quarterly. Neither the Company, nor any other of its subsidiaries, is a party to, or a guarantor of, the August 2026 Facility.

Note 9. Leases

We determine if an arrangement is a lease at inception for arrangements with an initial term of more than 12 months, and classify it as either finance or operating.

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 Condensed 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 leases that do not qualify as finance leases and are recorded in Other assets and Operating lease current liabilities and Operating lease liabilities on our Condensed 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 leased 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, remaining lease terms, and discount rates ($000):

Note 10. 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 (“ASC 420”), and ASC 712, Compensation-Nonretirement Post-Employment Benefits (“ASC 712”).

In the three months ended September 30, 2026, these activities resulted in net charges of $4 million, primarily for asset write-offs, site closure and employee termination costs. In the three months ended September 30, 2025, these activities resulted in $7 million of net charges primarily for site closure and employee termination costs.

Activity and accrual balances for the 2023 Plan were as follows for the first quarter of fiscal 2027 and 2026 ($000):

At September 30, 2026, $5 million and $23 million of accrued severance related costs were included in other accrued liabilities and other liabilities on our Condensed Consolidated Balance Sheet, respectively, and are expected to result in cash expenditures through fiscal 2028. The current and prior year severance related net charges are primarily comprised of accruals and adjustments for severance and pay for employees being terminated due to the consolidation of certain manufacturing sites, with severance recorded in accordance with ASC 712.

For the three months ended September 30, 2026 restructuring costs were not material in any segment. For the three months ended September 30, 2025, restructuring costs were primarily incurred in the Datacenter & Communications segment. Restructuring charges (recoveries) are recorded in Restructuring charges in our Condensed Consolidated Statements of Earnings.

2025 Restructuring Plan

Commencing in the quarter ended March 31, 2025, and as part of the Company’s ongoing strategic review of its business, management approved the 2025 Plan. In connection therewith, the Company has incurred restructuring charges, including employee severance and benefits, lease and contract termination costs, asset write-offs, facilities relocation costs and other restructuring-related expenses. We account for restructuring charges in accordance with ASC 420 and ASC 712.

For the three months ended September 30, 2026, these activities resulted in net restructuring charges of $4 million primarily related to employee termination and site closure costs. For the three months ended September 30, 2025, these activities resulted in restructuring charges of $13 million primarily related to employee termination and site closure costs. 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 the first quarter of fiscal 2027 and 2026 ($000):

At September 30, 2026, $22 million of accrued severance related costs were included in other accrued liabilities and are expected to result in cash expenditures primarily through fiscal 2027. 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 and distribution sites as well as workforce reductions, with severance recorded in accordance with ASC 712. At September 30, 2026, total liabilities for asset write-offs and other contract costs of $11 million and $10 million were included in other accrued liabilities and other liabilities, respectively, on our Condensed Consolidated Balance Sheet.

For the three months ended September 30, 2026, restructuring charges were incurred primarily in the Industrial segment and Corporate. For the three months ended September 30, 2025, restructuring charges were primarily incurred in Corporate.

Note 11. Contingencies

Regulatory Matters

In January 2025, the Company received an inquiry from the Bureau of Industry and Security (“BIS”) concerning past product sales to Huawei; the Company is cooperating with BIS’s inquiry and conducting an internal review of those sales to determine what products are subject to Export Administration Regulations (“EAR”) and consequently restricted for export, reexport, and transfer when Huawei is a party to the transaction. The Company has stopped shipping products to Huawei. The Company is currently in discussions with BIS regarding past product sales and cannot predict the outcome of those discussions. While the Company has received requests for additional information in this matter, the Company has not yet received any determination from BIS. In the event that the Company is found to have violated the EAR, the Company 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, the Company is unable to determine an estimate or range of loss.

Note 12. Equity and Redeemable Preferred Stock

Common shares issued

On March 2, 2026, the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) with NVIDIA Corporation (“NVIDIA”), pursuant to which the Company issued and sold 7,788,161 shares of Common Stock at a price of $256.80 per share, for aggregate gross proceeds of $2 billion. The transaction was completed as a private placement in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended. NVIDIA’s investment will support research and development initiatives, future capacity expansion, and operational capabilities, as Coherent expands its manufacturing footprint.

The shares issued to NVIDIA were subject to a contractual lock-up for a period ofsix months following the closing date, during which NVIDIA could not, without the Company’s prior written consent, directly or indirectly transfer or otherwise dispose of the shares or enter into transactions that transfer the economic risks or benefits of ownership.

The Purchase Agreement included a price protection provision that was effective for a period ofsix months following execution of the Purchase Agreement. The Company evaluated the price protection provision under applicable U.S. GAAP, including ASC 815, Derivatives and Hedging, and ASC 480, Distinguishing Liabilities from Equity, and determined that the provision was indexed to the Company’s own stock and met the criteria for equity classification. Accordingly, the price protection provision was not accounted for as a derivative liability and no separate fair value measurement was required subsequent to issuance. Any potential issuance of additional shares or cash settlement pursuant to the price protection provision, if triggered, would have been accounted for as an adjustment to equity. The price protection provision expired in September 2026 without being triggered. Accordingly, no additional shares were issued and no cash settlement was required.

Preferred stock

As of September 30, 2026, the Company’s amended and restated articles of incorporation authorize the Board of Directors, without shareholder approvals, to issue up to 5 million shares of preferred stock. As of that date,2.3 million shares of mandatory convertible preferred shares had been previously issued and subsequently converted into shares of the Company’s Common Stock. During the quarter ended December 31, 2025,75,000 shares and 140,000 shares of previously issued Series

B-1 (“Series B-1 Preferred Stock”) and B-2 convertible preferred stock (“Series B-2 Preferred Stock” and, together with the Series B-1 Preferred Stock, the “Series B Preferred Stock”), no par value per share, respectively, were converted into an aggregate of 30.1 million shares of Common Stock. The majority of the Series B Preferred Stock was converted by the holder and the remainder was converted by the Company. No Series B Preferred Stock was outstanding at June 30, 2026 or September 30, 2026. As a result of the conversion, $2.5 billion was reclassified from Mezzanine Equity to Common Stock during the year ended June 30, 2026.

Series B Convertible Preferred Stock - Prior to Conversion in the quarter ended December 31, 2025

In March 2021, the Company issued 75,000 shares of 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 Preferred Stock for $10,000 per share and an aggregate purchase price of $1.4 billion.

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

•at the election of the holder, each share of Series B Preferred Stock could have been converted into shares of 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 Common Stock exceeded 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 had voting rights, voting as one class with the Common Stock, on an as-converted basis, subject to limited exceptions.

The Series B Preferred Stock was 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 were presented as a reduction to Retained earnings on the Condensed Consolidated Balance Sheets. The Company entered into an agreement with the holder of the Series B Preferred Stock to waive dividends effective November 20, 2025. Due to the conversion of the Series B Preferred Stock to Common Stock in the quarter ended December 31, 2025, no dividends were declared or paid for quarters after September 30, 2025.

The following table presents dividends per share and dividends recognized:

Note 13. 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 result 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 own approximately 12.5% of the Class A Common Units of Silicon Carbide.

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):

Note 14. Accumulated Other Comprehensive Income

The changes in Accumulated Other Comprehensive Income (“AOCI”) by component, net of tax, for the three months ended September 30, 2026 were as follows ($000):

Note 15. Share-Based Compensation

Stock Award Plans

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 Company has an Employee Stock Purchase Plan whereby eligible employees may authorize payroll deductions (subject to certain limitations) of up to 15% (or such lesser 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 the 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 approximatelysix-month offering period.

Share-based compensation expense for the periods indicated was as follows ($000):

Note 16. Income Taxes

The Company’s fiscal year-to-date effective income tax rate was a benefit of 6% at September 30, 2026 compared to a benefit of 4% for the same period in the prior fiscal year. The variance from the U.S. statutory federal income tax rate of 21% was primarily driven by differences between U.S. and foreign tax rates and discrete tax benefits related to return to provision adjustments, excess tax benefits associated with stock-based compensation, and a change to the permanent reinvestment assertion in China.

U.S. GAAP prescribes the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements which includes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. As of September 30, 2026 and June 30, 2026, the Company’s gross unrecognized tax benefit, excluding interest and penalties, was $64 million and $64 million, 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. As of September 30, 2026, $32 million of the gross unrecognized tax benefit would impact the effective tax rate if recognized. The Company recognizes interest and penalties related to uncertain tax positions in the income tax provision in the Condensed Consolidated Statements of Earnings. The amount of accrued interest and penalties included in the gross unrecognized income tax benefit was $6 million and $5 million at September 30, 2026 and June 30, 2026, respectively.

Fiscal years 2023 to 2026 remain open to examination by the Internal Revenue Service, fiscal years 2022 to 2026 remain open to examination by certain state jurisdictions, and fiscal years 2012 to 2026 remain open to examination by certain foreign taxing jurisdictions. The Company is currently under examination by the Internal Revenue Service for the fiscal year ended June 30, 2024; New York City for the years ended June 30, 2023 through June 30, 2024; New York for the years ended June 30, 2023 through June 30, 2024; Massachusetts for the year ended June 30, 2023; for certain subsidiary companies in Vietnam for the years ended June 30, 2018 through June 30, 2021; Singapore for the years ended June 30, 2021 through June 30, 2024; United Kingdom for the years ended June 30, 2022 through June 30, 2024; Germany for the years ended September 30, 2012 through June 30, 2024; and Netherlands for the years ended June 30, 2018 through June 30, 2020. The Company believes its income tax reserves for these tax matters are adequate.

Note 17. Earnings Per Share

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

Diluted earnings per common share is computed by dividing the diluted earnings 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. Potentially dilutive shares whose effect would have been anti-dilutive are excluded from the computation of diluted earnings per common share.

The dilutive effect of equity awards is calculated based on the average stock price for each fiscal period, using the treasury stock method. For the three months ended September 30, 2026 and September 30, 2025, diluted shares outstanding include the dilutive effect of the potential shares of Common Stock issuable from performance and restricted shares.

For the three months ended September 30, 2025, diluted earnings per share also included the potentially dilutive effect of the shares of Common Stock issuable upon conversion of the Series B Preferred Stock (under the If-Converted method), as their effects were dilutive.

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

Note 18. Segment Reporting

The Company’s businesses are organized and managed into segments based on similarities in products and services. Segment determination reflects how the CODM evaluates the Company’s operations for decision-making operating decisions and performance assessment. The Company identifies multiple operating segments, which are aggregated intotwo reportable segments: (i) Datacenter & Communications, and (ii) Industrial. In accordance with ASC 280, Segment Reporting, the aggregation of the Company’s segments is based on similarities in economic characteristics, product and service types, production processes, type or class of customers, and distribution methods.

The Datacenter & Communications segment has locations in the United States, Australia, China, Germany, Malaysia, South Korea, Sweden, Switzerland, Thailand, the Philippines and Vietnam. This segment sells primarily into the datacenter and communications market, including transceivers, co-packaged optics, optical circuit switches, systems, subsystems, modules, components, optics, and semiconductor devices.

The Industrial segment has locations in the United States, China, Finland, Germany, Italy, Japan, Malaysia, Singapore, South Korea, Spain, Sweden, Taiwan, the Philippines, the United Kingdom and Vietnam. This segment sells primarily into the industrial market, which includes lasers, systems, optics, components and materials for semiconductor and display capital equipment, precision manufacturing, life sciences, consumer electronics, scientific research and automotive and market applications.

Our CODM, who has been identified as our Chief Executive Officer, receives and reviews financial information based on the operating segments that are aggregated into thetwo reportable segments. Our CODM evaluates each segment’s performance and allocates resources based on segment revenue and segment profit, as our CODM believes segment profit is a more comprehensive profitability measure for each operating segment. Our CODM is regularly provided with segment revenue and segment profit information to assess performance of each 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, impairment charges on assets held-for-sale, gain on sale of businesses and certain other charges or gains. Additionally, we do not 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 unique products and markets that each serves. The Company derives its reportable segment results based on how financial information is reported and aggregated within its management reporting system. The CODM uses segment profit as a key metric in the forecasting process and in making decisions related to capital allocation and resource deployment across segments. The accounting policies are consistent across each segment. Assets by segment are not a measure used to assess the performance of the company by the CODM and thus are not reported in our disclosures.

As part of the Company’s annual business planning, the CODM reviews our reportable segment composition and financial performance. As a result of this review, effective July 1, 2026, we moved certain business units across reportable segments. Prior period segment information has not been recast, as the changes to our segment composition did not have a material impact on the operating results of our reportable segments.

The following table summarizes selected financial information of our operations by segment and reconciles segment profit to consolidated earnings before income taxes for the periods presented ($000):

(1)The significant expense category amount aligns with the segment-level information that is regularly provided to the CODM. Segment cost of goods sold and operating expenses primarily include manufacturing costs, labor and research and development costs, and exclude expenses and credits that are included in the Unallocated corporate expenses category.

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

(3)See Note 10. Restructuring Plans for further information.

(4)Integration, site consolidation and other costs are $21 million and $22 million in the three months ended September 30, 2026 and 2025, respectively, primarily consisting of consulting and legal costs related to initiatives to integrate recent acquisitions into common technology systems, to divest businesses and simplify legal entity structure.

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

Note 19. 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.

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 reference rate (“LIBOR”) with SOFR, to be consistent with Amendment No. 1 to the Credit Agreement. See Note 8. 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. 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 $2 million and $3 million is recognized in the Condensed Consolidated Balance Sheet within Prepaid and other current assets as of September 30, 2026 and June 30, 2026, respectively. Cash flows from hedging activities are reported in the Condensed Consolidated Statements of Cash Flows in the same classification as the hedged item, generally as a component of cash flows from operations.

The Cap, as amended, is designed to mirror the terms of the 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 are 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 and the Term Facilities (“Debt Facilities”) based on quoted market prices as of the last trading day prior to September 30, 2026; 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 8. Debt for details on the Company’s Debt Facilities.

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

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 investments. At September 30, 2026 and June 30, 2026, time deposits of $200 million and $825 million, respectively, with maturities of one year or less, are recorded in Short-term investments on the Condensed Consolidated Balance Sheet are considered Level 1 among the fair value hierarchy and approximate fair value because of the short-term maturity of those investments.

At September 30, 2026, total restricted cash was $583 million, which includes $581 million held by Silicon Carbide LLC and restricted for use only by that subsidiary, and $2 million of cash restricted for other purposes in other entities. At June 30, 2026, total restricted cash was $606 million, which includes $604 million of cash held by Silicon Carbide LLC and restricted for use only by that subsidiary, and $2 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 Condensed 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 purpose 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, 2026, we had one foreign currency forward contract recorded at fair value and no contracts at September 30, 2026. 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 three months ended September 30, 2026 and September 30, 2025 were $0.2 million andzero, respectively, and were included in Other income, net in the Condensed Consolidated Statements of Earnings.