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1. Company Snapshot

1.a. Company Description

nLIGHT, Inc.designs, manufactures, and sells semiconductor and fiber lasers for industrial, microfabrication, and aerospace and defense applications.It operates in two segments, Laser Products and Advanced Development.


The company also provides fiber amplifiers, and beam combination and control systems for use in high-energy laser systems in directed energy applications.It sells its products through direct sales force in the United States, China, South Korea, and European countries, as well as through various independent sales representatives and distributors in Asia, Europe, and South America.The company was formerly known as nLight Photonics Corporation and changed its name to nLIGHT, Inc.


in January 2016.nLIGHT, Inc.was incorporated in 2000 and is headquartered in Camas, Washington.

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1.b. Last Insights on LASR

nLIGHT's recent performance was driven by strong Q3 earnings, beating estimates due to robust Aerospace and Defense demand and higher margins. The company's record A&D revenues, particularly in defense, have been a significant growth driver. Analysts predict a 30.59% upside potential, citing an upward trend in earnings estimate revisions. The company's growing backlog and renewed growth in A&D sales have fueled optimism, with a consensus "Buy" rating from analysts. Despite substantial operating losses, nLIGHT's revenue momentum remains strong.

1.c. Company Highlights

2. nLIGHT's Q3 Results Exceed Expectations with 19% Revenue Growth

nLIGHT's Q3 results demonstrated a strong performance with total revenue reaching $67 million, a 19% year-over-year increase, driven primarily by a record aerospace and defense revenue of $45.6 million, which surged 50% year-over-year. The company's gross margin was a record 41%, and adjusted EBITDA exceeded expectations at more than $7 million. The earnings per share (EPS) came in at $0.08, significantly beating estimates of $0.02. The expansion in gross margin and adjusted EBITDA highlights the leverage in nLIGHT's operating model.

Publication Date: Nov -23

📋 Highlights

Aerospace and Defense Revenue Drives Growth

Aerospace and Defense (A&D) revenue was a key driver of growth, reaching a record $45.6 million, up 50% year-over-year and 12% sequentially. Development revenue of $19.1 million grew 28% year-over-year, driven by multiple directed energy programs, while commercial revenue was slightly ahead of expectations at $21.2 million. As Joseph Corso mentioned, "the hole from HELSI-2 being wound down is already filled, with the key being the timing of bookings and how quickly they can get to work on new programs," indicating a strong pipeline of new programs to offset the revenue loss from existing contracts.

Guidance and Outlook

nLIGHT expects revenue for Q4 to be between $72 million and $78 million, with aerospace and defense revenue growth exceeding 40% year-over-year. Gross margin is expected to be between 27% and 32%, with products gross margin between 34% and 39% and development gross margin of approximately 8%. Adjusted EBITDA for Q4 is expected to be between $6 million and $11 million. Analysts estimate next year's revenue growth at 11.3%, indicating a continued upward trajectory.

Valuation Metrics

With a P/E Ratio of -34.61 and an EV/EBITDA of -38.71, the market appears to be pricing in significant growth expectations. The P/S Ratio stands at 6.58, indicating that the stock may be trading at a premium relative to its sales. The ROE and ROIC are both negative, at -20.16% and -18.19% respectively, which may be a concern for investors. However, the company's strong revenue growth and improving margins may justify the current valuation.

Opportunities in Directed Energy and Counter-Drone Technology

nLIGHT is seeing opportunities in the counter-drone technology space as part of the directed energy application, with continued progress in US programs and international efforts, such as the UK's Dragonfire and Israel's Iron Beam. The company is working on approximately a dozen programs in the development product line, with varying sizes and time periods, indicating a diverse pipeline of potential growth opportunities.

3. NewsRoom

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Wall Street Analysts Predict a 30.59% Upside in nLight (LASR): Here's What You Should Know

Nov -17

Source: zacks.com

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nLight Shares Rise 14% on Q3 Earnings Beat, Revenues Up Y/Y

Nov -10

Source: zacks.com

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nLIGHT: I Am Not Enlightened Here

Nov -09

Source: seekingalpha.com

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nLIGHT, Inc. (LASR) Q3 2025 Earnings Call Transcript

Nov -07

Source: seekingalpha.com

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nLight (LASR) Tops Q3 Earnings and Revenue Estimates

Nov -07

Source: zacks.com

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What's in Store for These 5 Semiconductor Stocks This Earnings Season?

Nov -05

Source: zacks.com

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nLIGHT Gears Up to Report Q3 Earnings: What's in Store for the Stock?

Nov -04

Source: zacks.com

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nLight (LASR) Upgraded to Strong Buy: Here's Why

Oct -24

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (10.20%)

6. Segments

Laser Products

Expected Growth: 10.2%

Growing demand for high-powered semiconductor lasers in industrial, aerospace, and defense applications drives growth, fueled by increasing adoption of laser-based technologies and nLIGHT's reputation for high reliability and efficiency.

Advanced Development

Expected Growth: 10.2%

Growing demand for high-power semiconductor laser diodes in industrial, aerospace, and defense applications drives growth. nLIGHT's advanced development enables high-brightness and reliable laser diodes, meeting the increasing need for precision and efficiency in these industries.

7. Detailed Products

High-Power Semiconductor Lasers

nLIGHT's high-power semiconductor lasers are designed for industrial, defense, and aerospace applications, offering high reliability and efficiency.

Fiber Lasers

nLIGHT's fiber lasers provide high-power, high-reliability solutions for material processing, spectroscopy, and other applications.

Direct Diode Lasers

nLIGHT's direct diode lasers offer high-power, high-brightness solutions for industrial, defense, and aerospace applications.

Laser Modules

nLIGHT's laser modules provide compact, high-reliability solutions for industrial, defense, and aerospace applications.

Semiconductor Optical Amplifiers

nLIGHT's semiconductor optical amplifiers offer high-gain, low-noise solutions for telecommunications, datacom, and sensing applications.

8. nLIGHT, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for nLIGHT, Inc. is medium due to the availability of alternative laser technologies and the increasing adoption of fiber lasers.

Bargaining Power Of Customers

The bargaining power of customers for nLIGHT, Inc. is low due to the company's strong relationships with its customers and the customized nature of its products.

Bargaining Power Of Suppliers

The bargaining power of suppliers for nLIGHT, Inc. is medium due to the company's dependence on a few key suppliers for critical components.

Threat Of New Entrants

The threat of new entrants for nLIGHT, Inc. is high due to the increasing demand for laser technology and the relatively low barriers to entry in the industry.

Intensity Of Rivalry

The intensity of rivalry for nLIGHT, Inc. is high due to the competitive nature of the laser technology industry and the presence of several established players.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 5.27%
Debt Cost 9.70%
Equity Weight 94.73%
Equity Cost 16.03%
WACC 15.70%
Leverage 5.57%

11. Quality Control: nLIGHT, Inc. passed 4 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Amtech Systems

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Growth: 4.7

Quality: 3.8

Yield: 0.0

Momentum: 9.0

Volatility: 1.7

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nLIGHT

A-Score: 4.1/10

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Growth: 2.6

Quality: 4.3

Yield: 0.0

Momentum: 9.5

Volatility: 2.0

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Quality: 4.2

Yield: 0.0

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Volatility: 1.0

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CEVA

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Value: 6.8

Growth: 1.4

Quality: 4.5

Yield: 0.0

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Volatility: 3.0

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Mobix Labs

A-Score: 3.4/10

Value: 6.6

Growth: 6.9

Quality: 3.0

Yield: 0.0

Momentum: 3.5

Volatility: 0.3

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

35.79$

Current Price

35.79$

Potential

-0.00%

Expected Cash-Flows