Coherent Q2 Datacenter Revenue Hits $1.21B Up 34%, Stock Gains 7%
Coherent’s Datacenter and Communications segment generated $1.21B in Q2 FY2026, up 34% year-over-year, lifting the stock 7% on its March 6 S&P 500 inclusion. Analyst projections highlight Coherent’s expansion of its indium phosphide fab and its 50% datacom revenue exposure to hyperscale customers.
1. Strong Q2 Revenue Growth
In Q2 FY2026, Coherent’s Datacenter and Communications segment reached $1.21 billion, a 34% year-over-year increase that accounted for roughly 72% of total revenue and underscored strong demand from AI and cloud datacenter operators.
2. S&P 500 Inclusion Catalyst
Coherent was added to the S&P 500 index on March 6, triggering index fund rebalancing flows that contributed to a 7% stock price rise as institutional buyers acquired shares.
3. Hyperscale Demand and Fab Expansion
The company derives about 50% of its revenue from datacom and supplies optical transceivers to major hyperscale customers like Microsoft, Google and Amazon, while its 6-inch indium phosphide fabrication expansion aims to boost output capacity and reduce unit costs.