Powering Innovation with Photons: A Q&A with Coherent’s CMO on AI, Datacenters & Laser Leadership

As industries worldwide undergo rapid transformation-driven by AI, data demands, and advanced manufacturing-photons are playing a critical, enabling role.

During the recent Laser World of Photonics event in Munich, Laser Photonics Professional interviewed Dr. Sanjai Parthasarathi, Chief Marketing Officer of Coherent Corp., to explore how the company is adapting and leading across key market segments.

From enabling scale-up and scale-out connectivity in hyperscale datacenters to developing vertically integrated fiber lasers, Sanjai explains how Coherent is uniquely positioned to deliver innovation across datacenter & communications, semiconductor and display manufacturing, industrial applications, smart sensing, and more.

^{Photons are powering the future}

Below is the full Q&A, translated and edited for clarity.

Q&A with Dr. Sanjai Parthasarathi, CMO, Coherent Corp.

Q1: Coherent is more than lasers. What are the current business pillars of Coherent?

A: Thanks for this question that allows me to highlight the diversity of our business and the wide range of markets we serve. As you said, there is much more than lasers: almost everything we do can be tied back to the photon.  At a very fundamental level – we generate photons in our laser devices, we modulate photons for optical networking, we amplify photons for networking and materials processing, we direct photons for optical switching and finally we detect photons in networking and sensing.  At the application level, we can broadly classify almost everything we do into 3 main areas – we transmit data, we modify materials, and we sense and measure. From a market segmentation standpoint, we have started thinking about our markets as a Datacenter & Communications market and an Industrial market. We further segment our markets by defining verticals within each market. 

Our Datacenter business is driven by the growth of AI.  Our Communications business is driven by the never-ending demand for bandwidth.  Within Industrial, we have many diverse market verticals.  Our Precision Manufacturing vertical enables laser materials processing.   Our Semiconductor Capital Equipment vertical serves the wafer fabrication equipment market. Our Display Capital Equipment market is centered around enabling display manufacturing processes. Sensing is a big focus of our Automotive and Consumer Electronics applications. Within Life Sciences we serve the biotechnology equipment market as well as the medical laser market. And, finally, Scientific Research includes microscopy and other research tools. Within all of our markets we sell at all levels of the value chain, from material up to subsystems and systems. Our vertical integration is a key differentiator.

Q2: Did any of the business branches become significantly more important in recent years?

A: We have been so excited about the rapid growth of AI especially generative AI and the tailwind it represents for our various businesses enabled by our compound semiconductors, materials and lasers. First, as datacenters continue to retool their architecture and integrate AI clusters, it represents an immediate and direct growth opportunity for our Datacenter business.  And at the heart of all of this AI connectivity, is our optical transceivers.   

^{For nearly four decades, Coherent has provided a comprehensive range of data and communications transceivers, enabling customers to experience the speed and performance of optical communications.}

Most of the growth we have seen in the last two years has been in what we call the scale out network which is essentially connecting clusters of GPUs together you can also think of it connectivity between racks. The market growth comes from increasing deployment of GPUs, increasing bandwidth per GPU and the increasing number of transceivers per GPU. Now let’s move to the scale up network.  If we look at the GPUs within the rack, or the scale up network, they are all connected electrically today.  But these electrical links are starting to run out of bandwidth and will have to go optical, representing an exciting emerging market opportunity for all of us in the optical connectivity business: this means CoPackaged Optics, with all its enabling products and technologies, like lasers, optics, thermoelectrics, fibers and so on. But our AI opportunity extends well beyond datacom.  AI chips require the most advanced node which in turn drives the most advanced semicap manufacturing tools.  Next gen semi cap tools are driving the increased use of lasers and advanced materials representing great opportunities for us.  AI drives demand for advanced sensing: advanced sensors are the eyes and ears of AI.  Thermal management is critical for AI systems, and we are also excited by the opportunities for our advanced laser manufacturing platforms.

Related resource: Speech by Vipul Bhatt, VP of Strategic Marketing at Coherent on CPO

^{Scale up and scale out architecture in datacenter}

Q3: Could you explain about synergies in other market segments for the laser business?

A: Thanks to the acquisitions we have made over the years, we were able to build a broad and deep portfolio of vertically integrated optical solutions across the different markets described above. We were able to complete our offering up and down the value chain. For instance, we strengthen our presence in the Precision Manufacturing market, where we offer from the enabling materials, components to lasers and to complete systems. Our new innovative EDGE Fiber Laser platform is a great example of synergies of industry leading technologies from various entities. EDGE FL brought together our long-standing leadership in laser technology with our expanded portfolio of high-performance laser components to deliver best-in-class fiber lasers with unmatched value. The EDGE FL platform leverages our decades of experience in designing and building fiber lasers. As a combined company we started from a blank page with no assumptions about what a fiber laser “should” be but more of what does the market need. Our privileged customer insights throughout the eco-system was of great value.

^{12 kW EDGE fiber laser for the most demanding cutting jobs that offer an unrivaled combination of performance and value}

With the exacting market requirements of high-power cutting applications and customer target cost points as our guide, we developed our EDGE FL utilizing the best-in-class technology and value needed to satisfy those requirements. And since we manufacture all the necessary components in house, we can achieve a level of supply chain resilience that ensures customers can always receive the high-quality laser they expect. There are many other examples, including in Life Sciences, where our portfolio allows us to offer from materials and optics up to complete systems.

Related resource: EDGE-FL

^{Supply chain resilience in Coherent}

Q4: What role do strategic partnerships play in certain segments?

A: Strategic partnerships play a crucial role in various segments by driving growth, enhancing innovation, and expanding market reach. We are so proud of our privileged customer partnerships that we have built over the decades. Our customers engage in deep discussions to enable multi-generational roadmap alignment.  And often this enables us to launch pioneering technology platforms and associated products for the broader market.

Related resource: Supplier Resilience in a Dynamic Environment

Q5: Artificial intelligence is undoubtedly a major trend topic and Coherent is also known as an innovation leader. In which way does Coherent play an active role in AI developments? Will AI enter the laser business or laser manufacturing?

A: As mentioned, the most direct impact we are seeing is in our Datacenter & Communications business, where we are designing, developing and manufacturing products to be used in the heart of the GPUs, between GPUs and within the Datacenters and across Datacenters. That said, at Coherent we use AI in various places in our daily work activities. We have already recorded improvements in our operational productivity and efficiency through AI driven interfaces and software in design and manufacturing processes.  Some of our industrial laser systems use AI/ML in the process itself – for example intelligent seam tracking in a laser welding tool.

Q6: Can you tell us a little bit about the growth strategy for Coherent's diverse businesses over the next few years?

A: As our CEO disclosed recently, we are optimizing our portfolio over the coming quarters to streamline for best business outcomes both in the short and the long term.  We have been increasing our R&D investment in the last quarters for the long-term growth of our company. We invest where we believe we're either generating a significant technological advantage for our customers or we're creating a significant cost structure advantage.  We will be divesting non-core assets and focusing on key technologies which are important from an innovation perspective or from a capacity perspective. We provided more details at our Investor Day in May.

Related resources: Coherent Analyst & Investor Day Presentation

Featured at Laser World of Photonics Munich
As published in Laser Photonics Professional – May/June 2025

Want to learn more about Coherent’s role in AI, optics, and laser innovation?

Explore:

• Coherent EDGE Fiber Lasers
• Optical Transceivers for Datacenters
• AI & Photonics Portfolio Highlights

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