---
title: "Nvidia invested $2 billion in Coherent; insiders sold $1.1 billion in a year and bought none"
description: "Coherent's proxy pairs a multibillion-dollar Nvidia purchase commitment with a $2 billion Nvidia stake in the transceiver maker. Three days later the optics complex led the market down, and the filings show Coherent's own insiders sold $1.1 billion of stock while buying none."
publisher: "The Inference"
section: "Money"
published: 2026-10-13T17:12:40.865Z
modified: 2026-10-13T17:12:40.865Z
canonical: https://theinference.org/article/nvidia-invested-2-billion-in-coherent-insiders-sold-1-1-billion-in-a-year-and-bought-none
language: en
keywords: "Nvidia, Coherent, Insider Selling, Photonics, AI Hardware, Valuation"
---

# Nvidia invested $2 billion in Coherent; insiders sold $1.1 billion in a year and bought none

> Coherent's proxy pairs a multibillion-dollar Nvidia purchase commitment with a $2 billion Nvidia stake in the transceiver maker. Three days later the optics complex led the market down, and the filings show Coherent's own insiders sold $1.1 billion of stock while buying none.

On October 9 Lumentum's chief executive, Michael Hurlston, [told Bloomberg in Tokyo](https://qz.com/lumentum-ai-data-center-optical-parts-sold-out-2029-100926) that his company's AI optical components are "completely sold out, so there's no end in sight," with about 70% of demand for some products unmet into next year [1]. Three trading days later the market sold the news anyway: Ciena closed down 10%, Lumentum down 9.8%, and [Coherent](https://theinference.org/markets/companies/coherent), which makes the lasers and transceivers that move data inside AI data centers, down 7.9% at $288.02 [2]. The Roundhill Photonics & Optics ETF, the fund that holds the group, dropped 7% while the S&P 500 was flat [3].

## Nvidia is buying supply security in both American optical makers

Coherent's [definitive proxy statement, filed October 9](https://www.stocktitan.net/sec-filings/COHR/def-14a-coherent-corp-definitive-proxy-statement-748517463067.html), discloses a multiyear strategic agreement with [Nvidia](https://theinference.org/markets/companies/nvidia): a multibillion-dollar purchase commitment plus a $2 billion equity investment to fund research and development, capacity and US manufacturing [4]. Nvidia made the same-sized investment in rival [Lumentum](https://theinference.org/markets/companies/lumentum) earlier this year [1]. Coherent's fiscal 2026 revenue rose 22.5% to $7.12 billion, and datacenter and communications revenue grew 40% to $5.27 billion [4].

## Coherent's own insiders sold $1.1 billion and bought none

Morningstar analyst Martin Szumski said commentary from [Broadcom](https://theinference.org/markets/companies/broadcom) chief executive [Hock Tan](https://theinference.org/markets/people/hock-tan), who [told a panel in Singapore](https://www.msn.com/en-us/news/other/why-ciena-lumentum-and-other-optical-stocks-were-among-the-market-s-biggest-losers-on-monday/ar-AA2e5HQP) that capital is the biggest bottleneck in the AI buildout, "may have also sparked" Monday's moves; photonics revenue rides on committed spending from hyperscalers, the large cloud companies that provide computing power, so any hint that spending shifts can drag the group [2]. Szumski noted many of the photonics stocks had run up significantly over the last 18 months, leaving them exposed to anything but good news [2]. Meanwhile, GuruFocus's scan of Coherent's regulatory filings [counts $1,117.0 million of insider sales over the past twelve months](https://www.gurufocus.com/news/9119934/coherent-corp-cohr-shares-fall-79-what-gf-score-of-78-tells-investors) with no buying [5].

## Coherent trades at 70 times earnings while expansion outruns its cash

Coherent closed October 12 still at 70.0x trailing earnings and 30.7x forward, and the drop left the stock mid-range in a 52-week span of $108.19 to $440.00 [5]. Count the money from its own filings: [over the four quarters through June 2026](https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000820318) Coherent spent $1.10 billion on capital projects and generated $0.08 billion of operating cash flow, with negative free cash flow in each of the last three quarters [6][7]. Analysts' average target is $410.10, about 42% above the close [7]. Ciena's math is the same shape: a 90.24 P/E, and $10.9 million of insider sales in three months [8].

*Chart: **Coherent's capital spending has outgrown its operating cash flow** Line chart of Coherent's quarterly capital expenditure and operating cash flow from the quarter ended September 2023 to the quarter ended June 2026, in billions of US dollars. Capex rises from $0.062 billion to $0.556 billion while operating cash flow falls from $0.199 billion to $0.069 billion, dipping negative in early 2026.*

*Quarterly, USD billions, calendar labels for Coherent fiscal quarters. Capex is positive capital spending; operating cash flow can be negative. Free cash flow is excluded because the series breaks in 2025. Source: Coherent quarterly figures from its SEC filings, retrieved October 13, 2026 [6]. [6]*

*Chart: **The optics group led the market down on October 12** Bars chart of one-day closing percentage moves in optical stocks on October 12, 2026: Ciena down 10%, Lumentum down 9.8%, Coherent down 7.9%, Corning down 6%, Cisco down 2.6%. Coherent is highlighted.*

*One-day closing moves on October 12, 2026, percent. Coherent highlighted. Source: MarketWatch, October 12, 2026 [2]. [2]*

## The bulls' argument: the selloff reflects positioning, and the order book is intact

Giuseppe Sette, president and co-founder of Reflexivity, an AI investment analytics platform, told MarketWatch that Monday's action signaled no "crack in optical demand, which remains booked out for years"; a Monday demo at the Open Compute Project summit was already priced in and became "an exit point rather than a catalyst" [2]. Analysts mostly keep Buy ratings on Coherent [7]. Fair. But an order book does not protect a multiple: Lumentum, up 516% in a year at 43x forward earnings, led the AI-optics selloff even with the fullest order book in the group [2][3]. And Coherent's expansion is being financed with capital spending that outruns cash generation [6].

## What decides it: the next quarterly report

Coherent's next quarterly report is approaching [7]. Lumentum [guided $1.225 billion to $1.275 billion for the current quarter](https://247wallst.com/investing/2026/10/12/lumentum-falls-10-as-optics-selloff-hits-hardest-where-capacity-is-sold-out-applied-optoelectronics-drops-7-coherent-slides-7/) against $1.006 billion last quarter, which will show whether a sold-out book converts to revenue on schedule [3]. The tell for Coherent is its own cash flow statement: whether operating cash flow turns as the Nvidia-funded capacity ramps [6]. Nvidia put $2 billion into Coherent [4] and $2 billion into Lumentum [1], with purchase commitments, on one side of the ledger. Insiders put $1.1 billion of Coherent stock on the other [5].

## Takeaway

Nvidia's $2 billion equity stake and multibillion-dollar purchase commitment in Coherent arrived days before the optics complex led the market down, and Coherent's filings tell the harder half of the story: insiders sold $1.1 billion of stock in a year and bought none, while capital spending of $1.10 billion against $0.08 billion of operating cash flow leaves the 70-times-earnings expansion riding on the next quarterly report.

## Sources

1. [Quartz, Lumentum says its AI data center optical parts are sold out through early 2029, 9 October 2026](https://qz.com/lumentum-ai-data-center-optical-parts-sold-out-2029-100926)
2. [MarketWatch, Why Ciena, Lumentum and other optical stocks were among the market's biggest losers on Monday, 12 October 2026](https://www.msn.com/en-us/news/other/why-ciena-lumentum-and-other-optical-stocks-were-among-the-market-s-biggest-losers-on-monday/ar-AA2e5HQP)
3. [24/7 Wall St, Lumentum Falls 10% as Optics Selloff Hits Hardest Where Capacity Is Sold Out; Applied Optoelectronics Drops 7%, Coherent Slides 7%, 12 October 2026](https://247wallst.com/investing/2026/10/12/lumentum-falls-10-as-optics-selloff-hits-hardest-where-capacity-is-sold-out-applied-optoelectronics-drops-7-coherent-slides-7/)
4. [Stock Titan, Coherent Corp. Definitive Proxy Statement (DEF 14A), filed 9 October 2026](https://www.stocktitan.net/sec-filings/COHR/def-14a-coherent-corp-definitive-proxy-statement-748517463067.html)
5. [GuruFocus, Coherent Corp (COHR) Shares Fall 7.9% -- What GF Score of 78 Tells Investors, 12 October 2026](https://www.gurufocus.com/news/9119934/coherent-corp-cohr-shares-fall-79-what-gf-score-of-78-tells-investors)
6. [Coherent, quarterly figures from its SEC filings, retrieved 13 October 2026](https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000820318)
7. [TradingKey, Coherent Corp Stock (COHR) Moved Down by 8.65% on Oct 12: Facts Behind the Movement, 12 October 2026](https://www.tradingkey.com/news/market-movers/262212207-market-movers-cohr-20261012)
8. [MarketBeat, Ciena (NYSE:CIEN) Stock Price Down 10.1% - Time to Sell?, 12 October 2026](https://www.marketbeat.com/instant-alerts/price-ciena-nyse-cien-stock-price-down-101-time-to-sell-2026-10-12/)


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Nvidia invested $2 billion in Coherent; insiders sold $1.1 billion in a year and bought none — The Inference. Canonical: https://theinference.org/article/nvidia-invested-2-billion-in-coherent-insiders-sold-1-1-billion-in-a-year-and-bought-none