Is nLIGHT's Record A&D Revenues Enough to Hit 40% Growth Target?

nLIGHT LASR delivered strong results in the second quarter of 2025, where it posted revenues of $61.7 million, representing an increase of 22% year over year. The company also delivered net non-GAAP profit of 6 cents per share against a net loss of 10 cents during the same quarter last year. The main driver was aerospace and defense (A&D), which delivered record revenues of $40.7 million, accounting for two-thirds of total sales.

Defense products were especially strong, growing 74.5% year over year, supported by shipments into the HELSI-2 program. This $171 million U.S. Department of Defense (DoD) contract aims to build a 1-megawatt high-energy laser by 2026. nLIGHT is also advancing work on the Army’s DE M-SHORAD short-range air defense system, with field testing expected to progress as per schedule. In addition, management highlighted growing opportunities under the Golden Dome missile defense initiative and new international wins in directed energy.

Laser sensing is another area gaining traction, with products used in missile guidance, range finding, and countermeasures. Several classified programs are moving into the next phase and could add revenues later this year and beyond. Together, these efforts have given management confidence to raise its full-year A&D growth outlook to at least 40%, up from 25% earlier.

The commercial segment showed some sequential recovery, but management remains cautious on broader industrial demand. Still, nLIGHT’s focus on defense, its manufacturing execution, and strong pipeline suggest that the company’s growth path in 2025 will be shaped largely by its ability to deliver on A&D programs. The Zacks Consensus Estimate for 2025 revenues is pegged at 234.3 million, suggesting an increase of around 18% year over year.

How Competitors Fare Against nLIGHT

nLIGHT’s push for 40% A&D growth puts it against players like Coherent COHR and IPG Photonics IPGP.

IPG Photonics is known as a global leader in fiber lasers. Moreover, IPG Photonics has been actively expanding into defense applications, such as high-energy lasers for counter-drone and missile defense. 

Meanwhile, Coherent remains focused on photonics, optics, and laser systems. Coherent is also actively engaged in defense laser opportunities through U.S. DoD collaborations and systems development.

nLIGHT’s Price Performance, Valuation and Estimates

Shares of nLIGHT have skyrocketed 175.2% year to date compared with the Electronics - Semiconductors industry’s growth of 27%.

nLIGHT YTD Price Return Performance

From a valuation standpoint, nLIGHT trades at a forward price-to-sales ratio of 5.96X, lower than the industry’s average of 9.37X.

nLIGHT Forward 12-Month P/S Ratio

The Zacks Consensus Estimate for nLIGHT’s 2025 and 2026 earnings implies year-over-year growth of 106.2% and 8.3%, respectively. The estimates for 2025 and 2026 earnings have both been revised upward over the past 30 days.

nLIGHT currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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