Greetings and welcome to Coherent's fourth quarter and full fiscal year 2025 earnings webcast. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Paul Silverstein, Senior Vice President of Investor Relations for Coherent. Please go ahead. Thank you, operator, and good afternoon, everyone. With me today are Jim Anderson, Coherent CEO, and Sherri Luther, Coherent's CFO. During today's call, we will provide a financial and business review of the fourth quarter fiscal 2025 and full year fiscal 2025, and a business outlook for the first quarter of fiscal 2026. Our earnings press release can be found in the Investor Relations section of our company website at coherent.com. I would like to remind everyone that during our conference call today, we may make projections or other forward-looking statements regarding future events or the future financial performance of the company. We wish to caution you that such statements are predictions based on information that is currently available and that actual results may differ materially. We refer you to the documents that the company files with the SEC, including our 10-Ks, 10-Qs, and 8-Ks. These documents contain and identify important risk factors that could cause the actual results to differ materially from those contained in our projections or forward-looking statements. This call includes and constitutes the company's official guidance for the first quarter of fiscal 2026. If, at any time after this call, we communicate any material changes to this guidance, we intend that such updates will be done using a public forum, such as a press release or publicly announced conference call. Additionally, we will refer to both GAAP and non-GAAP financial measures during this call. By disclosing certain non-GAAP information, management intends to provide investors with additional information to permit further analysis of the company's performance and underlying trends. For historical periods, we provided reconciliations of these non-GAAP financial measures to GAAP financial measures in our earnings release and investor presentation that can be found on the Investor Relations section of our website at coherent.com. Let me now turn the call over to our CEO, Jim Anderson. Thank you, Paul, and thank you, everyone, for joining today's call. Our fiscal 2025 was an outstanding year for Coherent, as full-year revenue increased by approximately 23% year-over-year to a record $5.81 billion, driven by strong growth in our data center and communications business. Our revenue growth, combined with gross margin expansion of 358 basis points, led to an approximately 3x increase in our non-GAAP EPS over the prior year. In addition, Q4 marked a strong end to the year, with revenue increase seeing 16% year-over-year to a new record, and non-GAAP EPS approximately doubling year-over-year to $1 per share. Having completed my first year with Coherent, I'd like to take the opportunity to thank my Coherent teammates for their outstanding focus and execution over the last year and their help in positioning the company for continued long-term growth. At Coherent, almost everything we do touches a photon in some way. We believe there is no other company with a broader and deeper portfolio of photonic technology, expertise, and innovation. Photonics is becoming increasingly critical to many applications, including AI data centers, communications, and a wide range of industrial applications. Coherent is well-positioned to take full advantage of this opportunity. We're excited about the future, and I couldn't be more proud to be part of such an incredible team. Let me provide some market and product updates from the past quarter. In our data center and communications market, revenue grew by 51% in fiscal 2025. In Q4, revenue grew 5% sequentially and 39% year-over-year. For fiscal Q4 and full year, we saw strong growth in both AI data centers and communications. In the data center market, full-year revenue increased by 61%. For Q4, we again achieved record quarterly revenue with data center revenue growth of 3% sequentially and 38% year-over-year. We continue to see strong bookings and demand forecasts across our data center customers as they continue to invest in AI data center capacity expansion. In fiscal Q4, we were pleased to see initial revenue shipments of our new 1.6T transceivers, and we continue to expect 1.6T volumes to ramp throughout the balance of this calendar year with more meaningful revenue contribution in calendar 2026. In the meantime, demand continued to grow in Q4 for our transceivers with data rates below 1.6T. Beyond 1.6T, we continue to make solid progress on the development of our 3.2T transceiver products and technologies, which will support a range of optical data transmission form factors. Our 400 gig per lane differential EML, which we demonstrated earlier this year and is the foundation of 3.2T transceivers, is recognized by our customers as a key advantage of Coherent's technology roadmap. We also continue to make progress on CPO-related products and technologies with strong engagements across a wide range of customers. For example, one of the key technologies behind CPO applications is CW lasers. We have a long history of producing CW lasers, and we drove a significant increase both sequentially and year-over-year in our CW laser production in Q4. We expect to continue to rapidly ramp CW laser volume over the coming quarters. To meet the rising demand for our optical networking solutions that use EML or CW lasers, we continue to ramp internal production of indium phosphide, which is the key technology behind EML and CW lasers used in both pluggable transceivers and CPO applications. As a reminder, we've had indium phosphide capability in-house for over 20 years, and indium phosphide-based transceivers account for a majority of our datacom transceiver revenue, with the majority of our EML-based transceivers utilizing our internally manufactured EMLs. We've tripled indium phosphide capacity year-over-year and expect to continue to expand capacity over the coming quarters to support the strong demand signals from our customers. For example, I'm pleased to announce that we will begin production this month of our new 6-inch indium phosphide line in Coherent's Sherman, Texas facility. This is the world's first 6-inch indium phosphide production platform and is expected to provide us significant advantages in terms of both lower cost and higher volume production, and it will further enhance our industry-leading supply chain resiliency. In addition to indium phosphide, our Sherman, Texas facility is also a site for VCSEL production on gallium arsenide technology. As mentioned in a recent Apple announcement regarding their American manufacturing program, we've entered into a new multi-year agreement with Apple for a new generation of VCSEL products that support Apple's iPhone and iPad products. We expect revenue from this expanded partnership with Apple to begin in the second half of calendar 2026. The VCSELs for Apple are manufactured in our Sherman, Texas facility and will help support the long-term growth and utilization of the site. I want to thank Apple, which has been a longstanding customer for this important multi-year agreement. This agreement highlights the importance of our supply chain resiliency and flexibility, including our significant U.S. manufacturing footprint. In fiscal Q4, we also began initial revenue shipments of our new optical circuit switch. As a reminder, this new product represents a $2 billion expansion of our addressable market opportunity. The underlying technology in our OCS has tremendous benefits versus mechanical MEMS-based solutions offered by others, as our solution is non-mechanical and is based on field-proven digital liquid crystal technology that's been deployed for many years in demanding telecom applications. Customer engagements on this new product continue to grow, and we expect revenue to ramp through the remainder of this calendar year and to contribute more meaningfully in calendar 2026. We also delivered strong growth for both full-year fiscal 2025 and Q4 in our communications business. This business is comprised of both traditional telecom as well as data center interconnect. Communications revenue increased 23% for fiscal 2025. For Q4, we saw accelerated growth in this segment, as communications grew 11% sequentially and 42% year-over-year. Growth was driven by robust demand for our ZR/ZR+ DCI-focused new product introductions and ongoing recovery in end demand in the traditional transport market. We saw continued growth in the ramp of our new products, including our 100 gig, 400 gig, and 800 gig ZR/ZR+ Coherent transceivers, and expect these products to increase their revenue contribution throughout fiscal 2026 and beyond. In particular, our 100 gig ZR product family is ramping rapidly. Driven by strong customer traction for this uniquely differentiated solution, we productized multiple variants and have several more in development across multiple applications. We believe both AI data centers as well as communications will be strong long-term growth drivers for the company, given the exceptional breadth and depth of our photonic technology. Turning to our industrial-related end markets, revenue decreased 2% for the year. For our fiscal Q4, revenue decreased 2% sequentially and 8% year-over-year. For the full year, we delivered above market growth in our industrial laser products and services, which was offset by a decline in our silicon carbide business, which was consistent with softer end market demand in the automotive segment. In our industrial laser products, where we lead the industry with the widest and deepest portfolio of industrial lasers, fiscal 2025 growth was driven by growth in both product sales as well as growth in our recurring services revenue stream. Year-over-year growth was driven primarily by display capital equipment and semi-cap equipment markets. In particular, display capital equipment growth was driven by growing demand for our laser systems and services that are used to support the capacity expansion of OLED fabs, as OLED screen adoption continues to grow and total OLED surface area is expected to double over the coming years. Across our industrial laser products, our recurring services revenue stream grew faster than product sales. As we discussed at our Investor Day, we continue to expand the installed base of our industrial lasers, and we expect the recurring service revenue stream to continue to become a larger component of our overall industrial revenue over time, which is a tailwind for our gross margin. For our materials products, fiscal 2025 revenue, excluding silicon carbide, was flat year-over-year as demand remained stable. During fiscal 2025, we experienced a drop in silicon carbide demand, which was a headwind to our overall industrial revenue. However, over the past months, silicon carbide demand has stabilized, and we do not expect this to be a headwind for us in fiscal 2026. We continue to see our industrial products and end markets as a strong long-term revenue growth and gross margin expansion opportunity for the company, given our leadership portfolio of hardware and software products and services. On the topic of our investment strategy and our portfolio optimization initiative, as discussed over the past quarters and at our recent Investor Day, we've been driving a series of actions to streamline our portfolio and concentrate our investments in the areas of greatest long-term growth and profitability. As part of our portfolio optimization, today we announced an agreement to sell our aerospace and defense business for $400 million. We expect to close this transaction this quarter. Upon closing, we plan to use the proceeds of the sale to pay down additional debt, and we expect the sale to be accretive to our EPS. We made the decision to sell our A&D business because it was not aligned with our long-term strategic focus areas, and it did not support our long-term financial targets. I'd like to thank all of the A&D employees for their tremendous contributions to Coherent over the past years and wish them all the best moving forward. We will continue to look for ways to streamline and strengthen our portfolio moving forward and ensure that our investments are concentrated in the area of greatest shareholder value creation. Regarding the current tariff policy environment, unchanged from last quarter, we do not expect significant impact from tariffs this quarter. Though we do not have full details yet, we believe President Trump's recent announcement regarding semiconductor tariffs may present a competitive advantage for our business. Many of our products, such as transceivers, are today covered by the semiconductor exemption. As a company with significant U.S. manufacturing operations today and new investments planned for our Sherman, Texas, Easton, Pennsylvania, and other U.S. facilities, we believe we would avoid the semiconductor tariff. Our extensive U.S. manufacturing footprint is a key part of our overall supply chain resiliency, and we believe this is an important competitive advantage for us. Over the past months, you've heard me stress the importance of Coherent's dynamic, flexible, global manufacturing footprint as a competitive advantage and a hedge against geopolitical risk. Our U.S. footprint is a key part of that strategy. Coherent has a long and proud history of advanced manufacturing in the United States, leading U.S. manufacturing innovation since our founding more than 50 years ago, beginning with the company's first manufacturing site in Saxonburg, Pennsylvania, which remains our company headquarters. Today, our U.S. manufacturing footprint extends across more than 20 U.S. manufacturing locations in 13 states. Across those U.S. manufacturing locations, we employ thousands of people. These sites lead the industry in technical innovation and manufacturing, and we continue to invest in our U.S. manufacturing footprint. In summary, I'm very pleased with the progress we made during our fiscal 2025. We expect fiscal 2026 to be another growth year for the company and believe we are well-positioned for continued long-term growth as we drive market-leading photonic innovation across our core markets and continue to progress toward the financial targets we provided at our Investor Day. Once again, I want to thank the Coherent team for all their hard work and dedication. I couldn't be more proud of my teammates and their laser focus on unlocking the full potential of the company. I'll now turn the call over to our CFO, Sherri Luther. Thank you, Jim. We are pleased with our full-year 2025 results. We drove strong double-digit revenue growth, significant gross margin expansion, and improved profitability. We increased our cash from operations, enabling us to significantly pay down our outstanding debt and further strengthen our balance sheet. Let me now provide a summary of our results. Fourth quarter revenue was a record $1.53 billion, up 2% sequentially from the third quarter and up 16% year-over-year, driven by growth in AI data center demand coupled with a continuing recovery in telecom. Full-year 2025 revenue was a record $5.81 billion, up 23% from 2024. Revenue growth for the full-year 2025 was driven by growth in both AI data center demand as well as telecom. Our Q4 non-GAAP gross margin was 38.1%, down 43 basis points compared to the prior quarter, and was up 220 basis points compared to the year-ago quarter. The sequential decline in gross margin was primarily driven by unfavorable foreign exchange in Q4, which was partially offset by benefits from our gross margin expansion strategy, with improvements in both pricing optimization as well as cost reductions. Our non-GAAP gross margin for the full-year 2025 was 37.9%, up 358 basis points from 2024. The improvements in non-GAAP gross margin for the full-year 2025 were driven by our gross margin expansion strategy, where we saw improvements in both pricing optimization as well as cost reductions, offset somewhat by unfavorable mix and foreign exchange. Cost reductions included lower manufacturing costs as well as yield improvements. Fourth quarter non-GAAP operating expenses were $307 million compared to $297 million in the prior quarter and $269 million in the year-ago quarter. The increases were primarily in R&D, driven by increased investments in our product portfolio, in particular in data center and communications. We continue to focus on investing our R&D in those projects with the highest ROI while driving efficiency and greater leverage in SG&A. Non-GAAP operating expenses for the full-year 2025 increased to $1.17 billion from $998 million in 2024, primarily driven by increased investments in our product portfolio as well as variable compensation. Our fourth quarter non-GAAP operating margin was 18% compared to 18.6% in the prior quarter and 15.4% in the year-ago quarter. Our non-GAAP operating margin for the full-year 2025 was 17.8%, up 472 basis points from 2024. Fourth quarter non-GAAP earnings per diluted share was $1.00 compared to $0.91 in the prior quarter and $0.51 in the year-ago quarter. Non-GAAP diluted earnings per share for the full-year 2025 was $3.53 compared to $1.21 for the full-year 2024. This represents a 191% year-over-year growth. We paid down $51 million in debt during the quarter using cash from operations. This brings our fiscal 2025 total debt payments to $437 million, nearly two times the amount of debt payments made in fiscal 2024. This significant increase in debt payments has reduced our debt leverage ratio to 2x, down from 2.5x, as defined in the credit agreement at the end of 2024. As Jim noted, we plan to use the proceeds from the sale of the aerospace and defense business to further reduce our interest expense by paying down additional debt, which will be immediately accretive to our EPS. For reference, this sale will result in Coherent's exit from 10 sites and will reduce our employee count by approximately 550 employees that will remain with the A&D business. Over the past four quarters, this business contributed average quarterly revenue of approximately $50 million, with a gross margin below Coherent's average gross margin. We view this sale as a very positive outcome for shareholders, as exiting this business will meaningfully streamline our portfolio, allow us to accelerate the paydown of our debt, increase our profitability, and focus our investments in the areas that enhance shareholder value. I will now turn to our guidance for the first quarter of fiscal 2026. We expect the sale of our aerospace and defense business to close this quarter. As a result, our outlook excludes approximately $20 million in aerospace and defense revenue that we expect will occur after we close the sale. We expect revenue to be between $1.46 billion and $1.6 billion. We expect non-GAAP gross margin to be between 37.5% and 39.5%. We expect total operating expenses of between $290 million and $310 million on a non-GAAP basis. We expect the tax rate for the quarter to be between 18% and 22% on a non-GAAP basis. We expect EPS of between $0.93 and $1.13 on a non-GAAP basis. In summary, I'm very pleased with the progress we have made in Q4 and throughout fiscal 2025. We are excited about the year ahead and remain focused on executing to our financial target model that we laid out at our Investor Day earlier this year. That concludes my formal comments. Operator, please open the call for Q&A. Thank you. Ladies and gentlemen, we will now begin the question- and- answer session. If you would like to ask a question, please press Star and one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press Star and two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the Star keys. Ladies and gentlemen, we will wait for a moment while we poll for questions. Our first question comes from Samik Chatterjee with JPMorgan. Please go ahead. Hi. Thanks for taking my questions. Jim, maybe I can start on the data center side, and if I'm doing based on your new segmentation, you had pretty strong results in this fourth quarter with 40% year-over-year growth in revenue. How should we think about the growth outlook for the next fiscal year? I mean, we've seen all the hyperscalers increase their capital spending plans as well. Any color you can provide in terms of sort of the growth rates or how you think about the outlook for the data center business in fiscal 2026, and then I will follow up, please. Yeah, thanks, Samik, for the question. Looking back at fiscal 2025, really pleased with the growth that we saw in data center and communications. That's a combination of data center and communications, which is our traditional telecom business plus DCI. If you look at the prior year, we saw over 50% growth full year, and in the most recent quarter, in the June quarter, we saw 5% sequential growth and almost 40% growth year-over-year. Very pleased with that growth. The data center portion of that was the fastest growing in full year, over 60%. Really strong growth, and I want to thank the team for the great execution over the prior year. Looking forward, we continue to see really strong demand signals. The combination of the backlog that we have, the ordering that we're seeing, and the longer-term forecasts from the customers, I would say the demand outlook is very strong. We're expecting data center and communications to be up sequentially again this quarter. We really only guide the current quarter, but we're expecting it to be up sequentially. Beyond that, as I said, a number of different things are propelling our growth, a number of different drivers of the growth. I would flag number one, 800 gig transceivers are continuing to ramp. We believe the 800 gig transceiver will grow this calendar year and next calendar year as well. We're really pleased to see the start of 1.6T revenue. We had initial revenue shipments of our 1.6T transceivers in the prior quarter, and we expect that to ramp through the rest of this calendar year and into next calendar year. On top of that, really pleased to see OCS initial revenue for our optical circuit switch. Initial revenue began last quarter. We expect that to continue to ramp through the rest of this calendar year into next. We did see an acceleration of growth in the communications part of our business in the most recent quarter, where it grew double digits sequentially, and we are seeing very strong demand in the DCI portion of the market, the Data Center Interconnect, and that's specifically around our ZR/ZR+ products. We have a very nice lineup of products there. A number of different growth areas that we see ahead of us. We're really quite excited about the year and the growth ahead of us, and certainly also driving capacity expansion to meet those demand signals, including not just the capacity of assembly and test, but also the key ingredients like indium phosphide. I would say we're really excited about the growth ahead of us in data center and comms. Got it, got it. Maybe for my follow-up, I did want to ask about your progress or ramp on the 6-inch indium phosphide platform in Sherman, Texas. If you can give us an update on how the ramp is going on that front and what you are seeing from customers in relation to interest in the U.S. manufacturing that you have. Particularly, what does the announcement with Apple mean in terms of incremental revenue or revenue opportunities? Any color on that front as well? Thank you. Yeah, thanks, Samik. I'll start with the six-inch indium phosphide in Sherman. We view this as a really big milestone. This month in August is when we began production of that new six-inch indium phosphide line in Sherman. We believe this is the world's first -inch indium phosphide production, and it'll start this quarter, but obviously ramp over the coming quarters. This is a big benefit to us in two ways, both capacity, obviously on a larger wafer size. We get a significant increase in capacity, but also we expect a significant cost structure advantage. As we fully ramp that capacity, both the ability to just drive higher volume, but lower cost structure is a big advantage for that. We're really excited about that and looking forward to that ramp. More generally, as you asked about the U.S. manufacturing footprint, I would characterize this as certainly part of a broader strategy to invest in U.S.-based manufacturing. If you step back, the company, looking over the last few years, has done a really great job of building a tremendous amount of resiliency and flexibility into our supply chain, both in terms of our geographic diversity of supply, but also the strategic vertical integration of strategic components. On the geographic diversity of supply, one of the main pillars of that has been a strong U.S. manufacturing presence. We have over 20 sites across the U.S., across 13 different states, and that employs thousands of employees. We're continuing to invest in U.S. manufacturing. We view this as a competitive advantage. We hear that all the time from our top strategic customers. They view our supply chain resiliency, the U.S. manufacturing footprint as a key competitive advantage. A great proof point was, Samik, you asked about the recent Apple partnership that we announced. This is a great proof point. This is one of, I would say, many large strategic customers that view that U.S. manufacturing footprint for the specific plant in Sherman as a strategic advantage. We're really pleased with that expansion of our partnership with Apple. You asked about revenue. The revenue from that expanded partnership, we expect that to kick in in the second half of next calendar year. It is a proof point of our strong presence in U.S. manufacturing and our commitment to continuing to build our supply chain resiliency and U.S. manufacturing presence. Okay, got it. Thank you. Thanks for taking my questions. Thank you. Our next question comes from Simon Leopold with Raymond James. Please go ahead. Thank you very much for taking the question. First thing, I wanted to see if I could get an understanding of what product categories or segments might be down sequentially at the midpoint of your guidance. I appreciate you've highlighted the $20 million for the aerospace sale. Apart from that, it sounds like there's a number of things going well. I'm trying to make sure I capture what might be down sequentially from the June quarter. I've got a quick follow-up I'll ask now. You talked about generating some revenue from the OCS. Could you tell us a little bit about your pipeline and the thoughts on the trajectory for that product line? Thank you. Yeah, thanks, Simon. On the first part of the question, as I mentioned, we expect data center and communications up sequentially. We expect our industrial-related markets to be down sequentially. Part of that is the $20 million that Sherri mentioned, that we took $20 million in revenue out of the guidance, assuming the transaction closes sometime during this quarter. If you set that aside sort of on a pro forma basis, I would say we expect industrial to be flat to down sequentially. We're taking a bit of a cautious view on the broad-based industrial market. Given the macroeconomy uncertainty around tariffs, we're just taking a little bit more of a cautious view of that business and that end market. That said, that's a very near-term comment. Over the long term, we still believe that the industrial segments represent a really good growth opportunity for the company. I would highlight that if you look at last year, fiscal 2025, our industrial segment, if you set aside the silicon carbide headwind that we had last year, we saw some nice growth in our industrial segment, especially in our industrial lasers. Over the long term, we expect industrial to continue to be a good growth area for the company across things like semi-cap equipment, display capital equipment. Near term, more of a cautious view on that market. The second part of the question, I think, was on OCS pipeline. I would say the OCS pipeline is very healthy. We were really pleased with the initial revenue generation in the prior quarter. The customer engagement, I would call, very strong across multiple customers. We're very excited about the ramp of this product. We are adding capacity to support the ramp of this product as fast as we can based on the demand outlook that we're getting and the orders that we're getting from our customers. Thank you. Thanks, Simon. Thank you. Thank you. The next question comes from George Notter with Wolfe Research. Please go ahead. Hi guys, thanks very much. I guess I wanted to come back to the Apple relationship. I'm just curious how much incremental revenue is in the offing from that relationship. If I look back, obviously, there was a step down in the Apple business going back a couple of years ago. It was pretty significant for the company. I'm wondering if you've been able to build in anything contractually that gives you more certainty of that run rate on a go-forward basis. Yeah, thanks, George. Yeah, we feel really good about that expansion. I would describe it as an expansion of the partnership. It's a new generation of VCSELs that go into Apple iPad and iPhones, and we do see that as an increase in revenue. That'll start to have impact to our revenue in the second half of next calendar year, so second half of 2026. Yeah, we see it, and this is a multi-year partnership, and I think a really good, healthy partnership between the two companies. We do have a long history of working with Apple and really pleased, you know, really pleased to see that partnership expand. The other thing that I would note is, again, these VCSELs are being manufactured at our Sherman, Texas plant. That's also a great way to continue to grow that plant and to make sure that plant is fully utilized. It provides a great sort of underlying foundation of business for that plant as we ramp other products in that plant as well, like the indium phosphide capacity that I talked about earlier. As I mentioned earlier as well, again, I think this is just a great proof point of the importance of our U.S. manufacturing footprint. Just a quick follow-up. Is there any sense for what your market share would look like in Apple on a 3% basis? Also, do you have to make capital investments in Sherman? Is that something that Apple would help you with, or is that fully on Coherent? Thanks a lot. Yeah, on the first, we do have a sense of the share. We'll probably share more details about that as we get closer to the ramp. I would say stay tuned on that. We'll provide more thoughts on the size and the rate and the pace of that ramp as we get closer to the second half of 2026. On capital, I think it's, yeah, there's a little bit of incremental capital that we would be providing to support that business. Thank you. Thank you. The next question comes from Blayne Curtis with Jefferies. Please go ahead. Hi Ezra Weener on for Blayne. Thanks for taking my question. I guess the first one would be on the OCS competitive landscape. I know you guys talk about the liquid crystal versus mechanical. Can you talk a little bit about what that is from a performance benefit and what that means for cost for your customer? Yeah, thanks, Ezra. First of all, let me just describe the technology difference. If you look at what's been deployed historically around optical circuit switching, it's been based on MEMS technology, which is an inherently mechanical technology. Our technology is digital liquid crystal, and this is a technology that we've used for years in our telecom business. We've taken that technology and repurposed it for optical circuit switch. Because it's a non-mechanical technology, it has a much, much higher reliability. As you can imagine, in a data center, an AI data center, reliability is an incredibly important attribute to our customers. It has much higher reliability, and the performance is very good. Performance is meeting the specs of our customers, which is why we're seeing, I would say, again, very strong engagement across multiple customers, and we're really excited about the ramp of this product. Got it. Thank you. The second one would be, you talked about initial 1.6T shipments, and that 800 gig is going to ramp this year and next year. Can you talk a little bit more about what you're seeing, A, from a supply-demand perspective on that as your capacity ramps, and also a little bit more about what you're internally sourcing from a laser perspective versus externally sourcing? Okay, on the first part of the discussion, the way to, I think the way to think about it is if you start with the 800 gig ramp, the 800 gig is obviously growing this calendar year versus prior. We expect 800 gig to grow again next calendar year, and that's ramping very quickly. Then on top of that, 1.6T, we believe, starts to ramp on top of that 800 gig ramp. We saw initial revenue in the prior quarter. We expect that revenue to grow over the coming quarters. The model for how to think about how the transitions or how the ramp happens over time, I'd refer you back to our Investor Day in May. We shared a multi-year model of how we view the transitions and the layering of the different speeds and how that applies to the overall growth. We shared that at our Investor Day in May. I'd take a look at that. The short version is to think about 800 gig continuing to ramp into next year and 1.6T ramping on top of that. On the second part of your question around capacity and laser, we're certainly ramping our capacity to meet the demand signals that we're seeing for both 800 gig as well as 1.6T. That's a combination of us ramping our assembly and test, but also ramping the internal, the ingredients that go into that transceiver, things like laser capacity, which is indium phosphide. That's why I mentioned on the prepared remarks why it's an important milestone that we hit production of indium phosphide 6-inch in this August month, and we're ramping it from here. In terms of the mix of internal versus external laser, I think that was the last part of your question. We use a mix today, and I would anticipate continuing to use a mix of internal and external. Today, over half of our transceivers ship with EML lasers, and over half of those EML-based transceivers are internally sourced EMLs. That gives you a rough sense of the breakdown. We believe we'll continue to use a mix of both internal and externally sourced lasers. Got it. Thank you. Thank you. The next question comes from Vivek Arya with Bank of America Securities. Please go ahead. Thank you for taking my question. For the first one, Jim, I realize this is a little bit more short-term oriented, but when I look at your data center and communication segment, sequential growth rate has gone from 9% in March to 5% in June. I think your September implied is probably at or somewhat below this number, even though you're starting to ramp 1.6T and OCS. What is the right way to interpret this kind of somewhat slowdown? When I look at the deployment of AI clusters, they seem to be accelerating in the back half. One of your closest peers got it to double-digit sequential growth. How would you address that pushback? Do you think the sequential growth rates can start to re-accelerate at some point? Yeah, thanks, Vivek. On a quarter-to-quarter basis, the sequential growth rates can fluctuate quarter to quarter based on lumpiness of demand from our customers or our supply or capacity-related things. If you look over the full year of fiscal 2025, I'm quite pleased with our growth in data center for the full year. We saw over 60% growth and even faster growth in the higher speed data rates. We believe over that fiscal 2025, we gained share over that fiscal 2025. We feel good about the fiscal 2025 results. As I said, looking forward into the current fiscal year, again, we see very strong demand ahead of us and a number of different growth vectors: 800G gig 1.6T. We talked about OCS as well, as well as seeing very strong demand in our DCI segment. We feel good about the growth ahead of us and certainly making sure that we've got all the capacity in place to meet those demand signals. Got it. For my follow-up, maybe one on gross margins. I think, Sherri, you mentioned there was some FX headwind in Q4. If you could, perhaps quantify how much that impacted gross margin. Are you assuming any headwind in Q1? As we look out into fiscal 2026 and you look at the ramp you might have with Apple and just obviously the continued growth in transceivers, do you think that there is a chance that Coherent gets towards that 40% gross margin that many have been expecting for a while? Is there a different mix that we should keep in mind as we model gross margins for the fiscal year? Yeah, Vivek, I'll take that question. The sequential decline in gross margin was due to FX, unfavorable FX during the quarter that was somewhat offset by pretty good contributions, benefits from our gross margin expansion strategy. Cost reductions as well as pricing optimization. In fact, I'm really pleased with the progress that we've made on cost reductions and pricing optimization. If not for the headwinds from FX, our gross margin would have exceeded the high end of our guide for the quarter. I'm really, really pleased with the progress that we've made to date on our gross margin expansion initiatives. A little bit more color in terms of where those came from. On cost reductions, we had improvements in yield. We had improvements in manufacturing processes that generated benefits. On pricing optimization, we saw improvements in our lasers business as well as our datacom business. Really good results there. In terms of, you had mentioned about our Q1 guide in terms of FX, and that's really, the guide is based upon the best information that we have right now. I'm not expecting it to be material, but it's based on the best information that we have right now. I think, frankly, the FX impacts that we saw during the quarter are all-time weaknesses of the USD versus a few different currencies that haven't occurred in a number of years. I don't expect that to be a material impact in the next quarter in Q1. You also asked about Apple and the impacts to gross margin there. I would expect that to certainly benefit our gross margin. The arrangement, I'm really pleased with the arrangement that we have with Apple, and that will certainly benefit our gross margin going forward. I think the other last part of your question was on our, you know, will we be able to get to our long-term target model, which we put out earlier this year in May of greater than 42%. I'm very confident that we'll be able to achieve the long-term target model. Again, the improvements that we've made during Q4 and, frankly, for the full fiscal year of 2025, where our gross margin improved 360 basis points, that's pretty good. I'm really pleased with that. There's certainly more to come. I consider us to still be in the early stages of this initiative, and it will be ongoing. The timing of these, when the impacts or in terms of the benefits, when they will kick in, that can vary on a quarterly basis, but I feel very confident in our long-term target model. Thank you. Thank you. The next question comes from Meta Marshall with Morgan Stanley. Please go ahead. Great, thanks. I appreciate the question. Maybe a couple for me. Just on the industrial lasers business, is there any geographic concentration to where the customers are that perhaps make you a little bit more cautious or just general caution in industrial production? Maybe just the second question on datacom. Is there any lumpiness, and maybe you mentioned lumpiness as a factor there, but just any design changes or things to be mindful of, even if they're kind of staying with you overall as a customer, just to be mindful of that could cause some of that lumpiness? Thanks. Thanks, Meta. On the first part of the question on industrial lasers, I wouldn't say anything unexpected in terms of customer concentration. We have a wide range of customers, and those customers would be in typical industrial bases that you would expect, right? Certainly a large number of customers in Europe, a big number of customers in Asia, and some in North America as well. It's not so much around customer concentration. Our caution around that business is just with high cost of capital, with still quite a bit of tariff uncertainty, overall macroeconomic, we're just taking a more cautious view on the near-term outlook of that market. We could be wrong, and it could be better than that, but we're taking just a more cautionary stance on that. That said, if I look at fiscal 2025 and our overall industrial business, if I set aside, you know, we saw a significant headwind in silicon carbide, but if I set that aside, the rest of the business, I was actually quite pleased with the performance. Our industrial lasers grew year over year. In fact, our service, the service component, the recurring revenue component of our revenue actually grew faster than underlying product sales, which was great to see. That's a key strategic focus area for us and a gross margin tailwind. Good performance last year. We're taking a little bit more cautious view in the near term, but we still believe over the long term, it's a very good growth area for the company. I think the second question around data center and we've on the, you know, the fluctuation of growth rates, sequential growth rates quarter- to- quarter. We've historically seen growth rates fluctuate quarter to quarter. We don't view that as out of the ordinary for this business. There certainly is with the 800 gig ramp. I think you were asking about transitions going on. Certainly with the 800 gig ramp, there is a transition that some customers are going through from 400 gig to primarily 800 gig. There are underlying transitions that are happening, which those transitions were expected, and I would call those nothing out of the ordinary. Great. Thank you. Thank you. The next question comes from Papa Sylla with Citibank. Please go ahead. Thank you for taking my question. I guess for my first question is on DCI. You seem to be kind of seeing a very strong growth there. Can you maybe touch a little bit on the nature of your customers or any visibility on the underlying factor there? Is the growth primarily coming from multi-data center training or is it more inference? Maybe part of that question is any color at this point on how we should think about DCI sale versus traditional telco? Thanks, Papa. On the first, I think that was a four-part question there. On the first part of the question, I'll do my best to answer. Yeah, we are seeing very strong demand in DCI. If I look at the communications part of our business, which is a combination of traditional telecom and DCI, we saw overall that communications up sequentially by, I think, about 11% in the most recent quarter. Underneath that, the DCI even grew faster. That's a combination of our, for instance, our products, our ZR/ZR+ products, 100 gig, 400 gig, 800 gig Coherent transceivers. We're seeing a really good ramp of those products. We've got a really good lineup of products, very, very competitive. Yeah, we're pleased with the growth there. We're continuing to see very strong demand signals moving forward as well. I think you asked the second part was you asked about the customer. In DCI, we actually have two routes to market. We sell, for instance, Coherent ZR/ZR+ transceivers, and we also sell some related systems. We also sell components into other vendors as well. We have both a sale of components and then a sale of things like transceivers. It's kind of a dual path to market. We're seeing strong demand, I would say, in both of those paths to market. In terms of the type of, I think you asked about multi-data center versus inference. I think it's a combination of both, but probably more of the demand being driven by kind of this multi-data center workloads that are spanning multiple data centers and the interconnect that's required between those data centers. I think, Papa, I think I hit each part of your question. Yeah, absolutely. You get them all. I'll make sure that my follow-up is a little bit shorter. I guess I was hoping on the datacom sequential growth, you can pass through a little bit. Obviously, 800 gig plus AI was very strong, but just any sense of the sub-400 gig kind of demand this quarter and then moving forward? Yeah, I think, you know, we expect 800 gig demand to continue to grow sequentially this quarter. We're still seeing, I would say, it is relatively strong demand on 400 gig and below. There are still a number of customers that are using significant quantities of 400 gig and below. We think the demand there will continue to be strong here in the near term. Clearly, we're transitioning, the market is transitioning towards 800 gig. As I mentioned earlier, we're just starting to see revenue related to 1.6T. If, as I mentioned a little bit earlier, at our Investor Day in May, we gave a breakdown of the market growth over the coming years and how we view the transition in terms of the data rates, how the market will transition from 400 gig to 800 gig to 1.6T. We even had 3.2T on there. Our view is the same as it was back in May. I'd refer you back to the Investor Day for that kind of picture of the transitions we expect. Got it. Very helpful. Thank you. Thank you. The next question comes from Christopher Rolland with Susquehanna. Please go ahead. Susquehanna, thank you very much. My questions are really around transceiver. Outstanding growth in transceiver, but I did have some questions about the Chinese dynamic. You have guys like InnoLight and OptoLink that are growing like 60% and 150% this year. How do you view Coherent's market share as we progress to 800 gig and eventually 1.6? Pricing pressure from this Chinese dynamic, and what are your specific plans to put on transceiver capacity in 2026 and beyond? Yeah. Thanks, Chris. On the first part of the question around market share, when we look at our fiscal 2025 and we look at kind of third-party independent data, we believe we gained share in our fiscal 2025, right? I think it's important not to look at just one single quarter, but to look over a multi-quarter period. We believe we gained share in the market overall, but specifically in the higher data rate transceivers. We're certainly focused on continuing to gain share moving forward. We feel like we're very well positioned competitively. That's really based on two things. Number one, the technology roadmap that we have, but also number two, the supply chain resiliency and strategy that we have. On the first one, on the technology roadmap, we feel like we've got a great lineup of 800 gig transceivers. We demonstrated at OFC earlier this year three different versions of 1.6T transceivers based on three different types of lasers, VCSELs, EMLs, and silicon photonics. We feel really well positioned on the technology from a technology standpoint. I think on the supply chain, just hands down, we have a much more resilient supply chain. The combination of geographic diversity, the U.S. manufacturing footprint, the vertical integration, and internal supply of key components like indium phosphide, like EMLs, I think makes our supply chain incredibly resilient and the most resilient supply chain out there. I think customers recognize that, they see that, and I think that definitely favors us, you know, continuing to gain share as we move forward. I would say on the second part of your question on the pricing pressure, I would say the pricing has been very much as we expected. I don't think we've seen anything unusual in pricing. On the last part of your question around capacity, we are certainly ramping capacity as quickly as we can. That's a combination of assembly and test capacity, but also the capacity of the key ingredients. For instance, again, on the indium phosphide capacity, ramping the ability to manufacture more EMLs, more CW lasers. We tripled our indium phosphide capacity on a year-over-year basis last quarter. We also increased CW laser production both sequentially and year-over-year. Certainly we're very focused on continuing to expand capacity given the strong demand signals, orders, and forecasts that we're seeing from our big data center customers. Very helpful, Jim. I also read an article suggesting that you guys inaugurated a new facility in Vietnam. This article suggested there were multiple products there, including expanding capacity for silicon carbide. I don't know if all the facts in this article were correct or not, but could you talk about that Vietnam facility and your plans for silicon carbide as well moving forward? Yeah, thanks. We did inaugurate a new facility in Vietnam. This is part of our strategy around geographic diversity. This facility is focused on a number of our materials-related businesses and silicon carbide being one of them. We're really pleased with the opening of that facility that will help us drive some additional flexibility, capacity, and cost structure advantages on the silicon carbide business in general. If you remember, we recently stopped the investment in the devices and modules portion of the silicon carbide business. That was pre-revenue investment. We shut down that and concentrated the investment on the wafers and the epi that we supply. Silicon carbide last year in fiscal year, that was a headwind for us. We did see a significant drop in silicon carbide demand. More recently, that has now stabilized, and we've started to see demand pick back up. We don't expect that silicon carbide business to be a headwind for us in fiscal 2026. Certainly expecting a bit of growth from silicon carbide this fiscal year. Thanks, Jim. Thank you. The next question comes from Karl Ackerman with BNP Paribas. Please go ahead. Yes, thank you. Hi, Jim and Sherri. I have two questions, if I may. First, do you believe you can be in a position to service all or nearly all of your EML laser needs internally by the end of this calendar year as 6-inch comes online? I have a follow-up. Yeah, on the first part of the question, we're certainly ramping 6-inch capacity as quickly as we can. It's not, Karl, just to make sure I correct, it's not just about EMLs. Indium phosphide is used in a lot of different products. EMLs is one. Also, CW lasers. CW lasers are used in both silicon photonics as well as CPO applications. We're also ramping that indium phosphide to support those applications. They're also used for photodiodes and other products. There's actually quite a number of products. In terms of our in-source versus outsource strategy, I believe we'll continue to use a mix for EMLs in particular. We'll continue to use a mix of both internal supply and external as well. I think that gives us really good supply chain resiliency and optionality. I would see that we continue to have a mix in the foreseeable future. Thank you. You certainly gave comments around datacom around, you know, in the September quarter. Just, given rising CapEx forecasts by several key data center customers, do you believe that you can outgrow or at least grow in line with your datacom growth rates that you've outlaid, that you laid out during your most recent analyst day? Thank you. Yeah, that's certainly our target is to grow within that range that we provided in the main Investor Day. We can grow, we'll target growing faster if we can. We're certainly adding capacity, as I mentioned a couple of times during the call, to support that growth. We see strong demand signals from our customers, and we're certainly adding the capacity to meet that demand. Does that answer your question, Karl? Yes, thank you. Thank you. Ladies and gentlemen, this concludes the question and answer session. I would now like to hand the conference over to the CEO, Jim Anderson, for any closing comments. Yeah, thanks everybody for joining the call today. I just want to take the opportunity to once again thank my Coherent teammates for the great results in fiscal 2025 and also for helping position Coherent for another strong growth year ahead of us as we kick off our fiscal 2026. Thanks again for the support. Operator, that concludes our call. Thank you. Ladies and gentlemen, the conference of Coherent Corp. has now concluded. Thank you for your participation. You may now disconnect your lines.