Optics Industry Splits as Coherent and Cisco Struggle, Ciena and Nokia Shine
The optics industry is experiencing a split this morning as Coherent and Cisco report mixed earnings results. Coherent (NYSE:COHR) shares are down 4.94% after the company reported revenue of $2.05 billion, up 33.74% year over year, but also disclosed an operating cash flow of just $79.5 million in fiscal 2026, a significant decline from last year's figure.
Cisco (NASDAQ:CSCO) shares are down 8.48%, despite the company reporting revenue of $17.25 billion, up 17.6% year over year. The issue is margin mix, with non-GAAP gross margin dropping to 66.3% from 68.4% due to heavier AI hardware volume and memory cost inflation.
However, the pure-play optical vendors that sell into the same demand story are seeing significant gains. Ciena (NYSE:CIEN) is up 6.04% and Nokia (NYSE:NOK) is up 3.29%, with both companies benefiting from increasing demand for data center interconnect and coherent optical transport solutions.
Ciena's most recent quarter showed 39.51% revenue growth, while Nokia's Q2 AI and Cloud revenue more than doubled year over year. The strong results are a positive read-through for Ciena itself, as well as other companies in the space.