nLIGHT (LASR) Q4 FY25 earnings call: guidance and Q&A

Clarification on the nature of expected directed energy orders (development, continuation, or production).

Management confirmed that expected orders would encompass all three types: continuation of existing programs, new development programs building on prior work, and production orders for low-rate production programs.

“It's actually all of the above. There are certainly examples of continuation. There's examples of new programs that certainly build on things we've done. And there are orders for the low rate production program. So really all 3.”

asked by Jonathan Siegmann · answered by Scott Keeney

Which laser sensing opportunities (new programs vs. existing missile programs) are greater for near-term revenue.

Existing laser sensing programs in full-rate production will drive more near-term revenue, while new programs will contribute more as they move into LRIP over the next year or two. Both are growing nicely.

“Near term, the existing laser sensing programs that we're working on are in full rate production, John. So those will tend to drive more revenue in the near term.”

asked by Jonathan Siegmann · answered by Joseph Corso

Why the decision to exit cutting and welding now, given it was a positive contribution margin business, and the long-term P&L impact.

The decision was driven by a focus on higher-growth A&D and advanced manufacturing opportunities. While there might be a slight near-term margin headwind, the overhead and talented engineers are being repurposed, so no material long-term impact on margin or cash flow is expected.

“The short answer to your question is focus... we are transitioning people to focus on those core growth opportunities as opposed to some legacy opportunities that have -- that are far less attractive.”

asked by Greg Palm · answered by Scott Keeney

Clarification on the $25 million to $30 million revenue headwind from exiting cutting and welding, specifically its timing and impact on overall 2026 growth.

The $25 million to $30 million headwind is an absolute reduction from FY25 industrial revenue. Some contribution will continue in H1 2026, but revenue streams will be effectively zero by H2. Despite this, the company still expects overall revenue growth in FY26, driven by A&D and advanced manufacturing.

“If you think about the industrial end market in full year 2025, a good way to think about the modeling is just take $25 million off of that as a starting point for where we would be in industrial as we're moving into 2026.”

asked by Greg Palm · answered by Joseph Corso

How microfabrication is expected to perform (flat to down) and if A&D growth will be strong double-digits to offset the cutting & welding exit and potential microfab softness, similar to last year's outperformance.

Microfabrication is the least visible market, typically $8M-$12M quarterly, with China's contribution significantly reduced. A&D is expected to grow double-digits in 2026, with the current growth largely covered by existing backlog. Additional growth depends on new contract wins, which could accelerate growth further if secured in H1.

“Jim, I think your interpretation is spot on. Let me touch on microfabrication first. Microfabrication is the market in which we have the least amount of visibility. But also if you just go back over the recent past, that business tends to be somewhere between $8 million and $12 million a quarter.”

asked by James Ricchiuti · answered by Joseph Corso

How the doubling of manufacturing capacity in Longmont translates to revenue potential and its timing.

The expansion is driven by anticipation of strong market demand over the next couple of years, positioning the company to build multiple high-energy lasers simultaneously. It's difficult to quantify direct revenue translation, but it's a strategic move to be ahead of demand. Work has started, including clean rooms and staffing.

“That is a decision that is really driven by our anticipation that this is a market that is going to be quite strong over the next couple of years... we wanted to be out in front, and we wanted to be able to put that capacity in place.”

asked by James Ricchiuti · answered by Joseph Corso

Specific plans for the $190M+ raised from the equity offering, beyond the Longmont facility.

The capital will accelerate growth by investing ahead of demand in A&D and laser sensing, funding the Colorado facility, strengthening supply chain partnerships, investing in people and new product development, and providing flexibility for opportunistic M&A.

“We raise the capital because we want to be in a position to accelerate growth. And having this capital will give us the flexibility to pursue multiple opportunities simultaneously.”

asked by Keith Housum · answered by Joseph Corso

What keeps the CEO up at night or what could go wrong in 2026-2027.

The CEO emphasizes vigilance and avoiding arrogance, focusing intensely on execution, market dynamics, and specific requirements from the Department of War and global allies. He acknowledges that lasers are complex and implementation requires meticulous attention to detail.

“Well, internally, my team calls me EOR frequently. So I have no trouble worrying about things... I think arrogance is what kills companies.”

asked by Keith Housum · answered by Scott Keeney

Expected diluted share count for Q1 2026 after the equity raise.

Diluted share count for Q1 2026 is estimated to be in the 55 million range.

“Yes, Q1 share count probably be in the 55-ish million range from a diluted -- for purposes of diluted EPS is probably a decent number to use.”

asked by Troy Jensen · answered by Joseph Corso