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primarysourced Photonics sector Coherent
COHR
~6 min read · 1,382 words ·updated 2026-04-29 · confidence 85%

InP EML process and Sherman TX 6-inch fab

The electro-absorption modulated laser (EML) is the dominant transmitter device for single-mode fiber datacom and telecom links from 100 Gb/s per lane upward. Coherent and Lumentum operate the only two merchant InP EML lines at meaningful volume globally — together they hold an estimated 80%+ of merchant supply, with Innolight, Eoptolink, and other transceiver houses sourcing from this duopoly. Coherent’s InP fab footprint is anchored in Sherman, Texas (legacy Finisar, brought in via the 2019 acquisition — see 01_company) and in Järfälla, Sweden (legacy II-VI epi/laser site).

Sherman, Texas — the world’s first 6-inch (150 mm) InP production line

The Sherman fab is a 700,000 square-foot facility that Apple co-funded via the $390M Advanced Manufacturing Fund award announced December 13, 2017 ✓ (Apple Newsroom 2017-12-13). The site originally produced 3-inch (75 mm) InP wafers for VCSELs and edge-emitting lasers; through 2024–2025 Coherent re-tooled it to 6-inch (150 mm) as the world’s first production-volume InP fab on that wafer size.

Metric3-inch InP (legacy)6-inch InP (Sherman, 2025+)
Wafer diameter75 mm150 mm
Die per wafer (same chip size)1×~4× ✓
Cost per die (Coherent claim)1×<0.5× ✓
Initial yieldbaselinehigher than 3-inch ✓
Production startlegacySeptember 2025 quarter ✓

Source: Coherent Q1 FY2026 earnings call (call held November 5, 2025) ✓ — “Our 6-inch indium phosphide line in Sherman, Texas, which is the world’s first 6-inch indium phosphide production line, began production last quarter and continues to ramp well… initial yields of the 6-inch indium phosphide are actually higher than our 3-inch indium phosphide lines” (Q1 FY26 transcript).

CHIPS Act funding

On December 5, 2024 ✓, Coherent signed a non-binding preliminary memorandum of terms (PMT) with the U.S. Department of Commerce for up to $33 million in CHIPS Act funding to expand and modernize the cleanroom for the 150 mm InP line and add ~70 manufacturing jobs (Coherent press release; DOC press release). The PMT is non-binding and remains subject to definitive documentation and customary closing conditions.

NVIDIA capacity-expansion investment

On March 2, 2026 ✓, Coherent entered into a Securities Purchase Agreement with NVIDIA Corporation, issuing 7,788,161 shares of common stock at $256.80 per share for an aggregate $2 billion in cash (COHR 8-K filed via stocktitan). Critical structural distinction from the parallel Lumentum deal: the COHR investment is straight common stock — there is no preferred or convertible-preferred tranche. The parallel Lumentum (LITE) transaction announced the same day was structured as $2B in Series A Convertible Preferred plus a separate common-stock component. Both deals total $4B aggregate from NVIDIA into the merchant InP duopoly ✓ (NVIDIA press release).

The COHR–NVDA agreement also carries a multi-billion-dollar NVIDIA purchase commitment running into the late 2020s and “expanded access to five additional Coherent product families tied to co-packaged optics” ◐ — the specific product families have not been individually disclosed.

Generation roadmap — per-lane line rates

EML generations are characterized by their per-lane PAM4 modulation rate. Coherent’s status as of 2026-Q1 is:

GenerationPer-lane rateAggregate (8-lane)Coherent status (2026-Q1)Source
Gen-150 Gb/s PAM4400G-DR8 / 400G-FR4mature, mass production10-K FY2025 ✓
Gen-2100 Gb/s PAM4800G-DR8 / 800G-FR4mass productionCoherent datacom blog ✓
Gen-3200 Gb/s PAM41.6T-DR8 / 1.6T-FR8volume ramp (FY2026)Q1 FY26 transcript ✓
Gen-4 (D-EML)400 Gb/s PAM43.2T-DR8research / pre-commercialOFC 2025 PR 2025-03-27 ✓

200G EML — current ramp

Coherent first introduced the 200 Gb/s InP EML for 800G/1.6T transceivers in 2024 and confirmed in the Q1 FY2026 earnings call (Nov 2025) that “silicon photonics and EML-based 1.6T are ramping now, and 200G VCSEL-based 1.6T is slated to ramp next calendar year” ✓. This means 200G/lane EML is in volume ramp during fiscal 2026 (Coherent’s fiscal year ending June 2026), not yet mass-production maturity.

400G/lane Differential EML (D-EML)

At OFC 2025, Coherent demonstrated the industry’s first 400 Gb/s D-EML — a differential-design EML that doubles signal amplitude while lowering power consumption and minimizing crosstalk vs single-ended EMLs (2025-03-27 press release) ✓. The 200G D-EML has been recognized in the 2025 Lightwave+BTR Innovation Reviews; general availability of the 200G D-EML is expected in 2026 ✓ — Coherent has not provided a public general-availability date for the 400G D-EML, which remains research-stage.

At OFC 2026 (March 17, 2026, Los Angeles), Coherent demonstrated 400G/lane PAM4 optical links for emerging 3.2T applications, using both the 400G Differential EML and a silicon-photonics PIC implementation based on Coherent’s 400G pure-silicon PN-junction Mach-Zehnder modulator (Coherent OFC 2026 PR) ✓. See Silicon photonics for the SiPh side of the same demonstration.

Capacity — Coherent vs Lumentum head-to-head

The capacity-race framing is the load-bearing investment narrative for both Lumentum and Coherent.

SiteOwnerWafer sizeStatusSource
Sherman, TXCoherent6-inch (150 mm)Production since Q1 FY26 (Sept 2025) ✓Q1 FY26 transcript
Järfälla, SwedenCoherentmixedProducing; ramping in parallel ✓Q1 FY26 transcript
San Jose, CALumentum4-inch (100 mm)Production (legacy IQE/Lumentum)Lumentum disclosures
Greensboro, NCLumentum6-inch (150 mm)Acquired from Qorvo for $18M Mar 2026; retrofit; production scaling toward mid-2028 ✓Lumentum PR Mar 2026

The structural picture as of 2026-Q1: Coherent is roughly 2–3 years ahead of Lumentum on 6-inch InP capacity at scale. Sherman is in production now; Lumentum’s Greensboro 6-inch line is retrofit and qualification through 2026–2027 with production scaling toward mid-2028. This explains why Coherent’s near-term EML supply position has been the tighter-rope variable that the merchant transceiver market (Innolight, Eoptolink, Cloud Light/Lumentum, Hisense) reacts to. Coherent is doubling InP device output over the 12 months following Q1 FY26 — split across Sherman (the 6-inch ramp) and Järfälla ✓.

EML structure and process node

An EML monolithically integrates a distributed-feedback (DFB) continuous-wave laser with an electro-absorption modulator (EAM) on the same InP chip. The EAM section is reverse-biased; applied voltage modulates the absorption of light passing through the active region (Franz-Keldysh / quantum-confined Stark effect in the multi-quantum-well stack). The integration eliminates the coupling loss of a discrete laser-plus-modulator and enables small footprints suitable for 8-lane transceiver assembly.

Coherent’s process choices are not fully disclosed (the company treats the epi structure and metallization stack as trade secret) ⚠ — but typical 200G/lane EAM bandwidths require ≥70 GHz electro-optic 3-dB bandwidth, very low contact resistance, and tightly controlled MQW absorption-edge wavelength. The process node sits inside the Sherman MOCVD–stepper line; Coherent has indicated yields on 6-inch already exceed 3-inch yields, which is rare in a wafer-size transition and suggests the process was substantially re-engineered (not just scaled).

EML competitors

Beyond Coherent and Lumentum, smaller merchant-EML positions exist at:

  • Mitsubishi Electric (Japan) — supplier to several Japanese transceiver houses ◐
  • Sumitomo Electric (Japan) — niche telecom positions ◐
  • Source Photonics (China) — emerging position ⚠
  • Broadcom (legacy Avago) — DFB-MZ alternative path, not a primary merchant EML supplier ◐

The duopoly framing remains correct for hyperscale-volume datacom EMLs.

Cross-tenant context

  • Lumentum (LITE) — duopoly partner on InP EML; Greensboro 6-inch fab in retrofit; received $2B Series A Preferred from NVIDIA same day as COHR
  • LWLG — electro-optic polymer modulator path (Perkinamine + silicon-photonic stack); alternative to InP EML for ≥200 Gb/s/lane future generations
  • MRVL — DSP supplier into Coherent transceivers (Marvell PAM4 DSP, coherent DSP)

Sources