A Farewell to Coherent

Effective yesterday, I have retired from Coherent.?

From the day I joined our team nearly 20 years ago, every moment I have spent with you has been an honor and a privilege. Our work together, along with your friendship, mean more to me than words can express. But that won’t stop me from trying.

Coherent Corp. (and before that, II-VI) gave me the opportunities of a lifetime:? to contribute the best of my God-given abilities; to live up to the values that my parents instilled in me; to apply everything I learned from my teachers and mentors; to build on the strong foundation that was left by those who came before us; to work with the most talented innovators alive; and to be part of an incredible team of 26,000 people across more than a dozen time zones.?

Bold ambition has always defined our company, and it is astonishing to realize how far we’ve come. In 1970, II-VI was a startup underwritten by an initial $125,000 investment—along with assets that no amount of money can buy: courage, vision, and technological brilliance. Our founders faced deep uncertainties from the outset, but their faith in our future was even deeper. They had conviction that imagination and materials innovation would sustain our competitive advantage for decades to come. They committed to growing by “evolution, not revolution,” and ever since, we’ve reinvented our company just about every five years. Today, Coherent continues to feel both new and timeless.

I admit that after spending roughly the first half of my post-graduate career at AT&T Bell Laboratories and Lucent Technologies, I had some reservations about leaving a global tech giant for a small domestic manufacturing company. In 2000, just before I joined the Board, II-VI’s revenues were less than $75 million. I am so grateful to my wife Paola for encouraging me to take the leap. After she experienced the culture here, she thought it was a no-brainer for me to join as an employee. She felt that my skills and experiences would be valued—and she believed that if I gave it my all, I could help transform II-VI into a global company. Most of all, she knew that I would relish collaborating with II-VI’s team of really smart, hard-working, respectful, and incredibly kind people. And she was right.

When I first joined II-VI as a Board Member, I was mentored (patiently, I should add) by our Founding CEO, Carl Johnson, and our second CEO, Fran Kramer. The three of us served on the Board together, along with Tom Mistler, and the late Pete Sognefest and Duncan Morrison. In my first 12 months here, I watched our deep bench of extraordinary colleagues grow revenues to $123 million—a nearly 40% jump.

To be clear: What impressed me even more than the growth, itself, were the people who made it happen. They were patient, pragmatic, and persistent. They were strategic. They were rooted in our company’s history, even as they fixed their sights on the future. Here, I thought, are people who can and will disrupt our industry’s core technology. I could practically hear the clock ticking.

So, we got busy. We laid out an audacious multi-year strategy to extend the lifetime of our CO2 laser business, and set the foundation for us to participate in the adoption of the Fiber Laser. Along the way, we planned to diversify, globalize, vertically integrate, outshine our competitors, and ultimately become the best performing public company industrywide.

Sharing in something so much bigger than ourselves formed a powerful bond among our global leadership team. We worked hard and learned to embrace the challenges with enthusiasm. In circumstances that would try anyone’s patience, we chose to take the long view. Professionally and personally, we dedicated ourselves to our company and our mission. Above all, no matter what, we respected each other.

These strengths didn’t just help us win—they helped us change the game. We transformed from a materials technology-driven pioneer into a market-driven subsystem and systems leader. Our team expanded and so did our reputation, prompting more and more industry leaders to leave their companies and join us. Remarkably, as we’ve grown larger, we’ve also grown faster, becoming more flexible and more adaptable than ever.

Einstein was right when he said, “Not everything that counts can be counted.” Nonetheless, our evolution created tremendous material upside. As a measure of our progress, consider that the S&P 500 grew shareholder returns 5x over the past 20 years—and we doubled that. Since April 2004, our stock price has increased nearly 1,000 percent.

Our breakthroughs have become indispensable to customers and every one of our end markets: industrial, communications, electronics, and instrumentation. Across these sectors, the best minds of our generation trust us to do things right—and to do the right things. When we say we will do something, they know that we will overcome every obstacle to not only deliver, but also live up to our enduring commitments to safety and compliance.

As proud as I am of everything we’ve achieved together, I believe this is just the beginning. The next few years will bring opportunities that we have only imagined—and certainly more challenges, too. On your watch—and with your full support for our new CEO, Jim Anderson —the best is yet to come.

If there’s one thing I’ll miss most about working at Coherent, it’s the vital diversity of our team. With most of our employees living and working outside the U.S., I’ve benefitted from an illuminating range of perspectives. By looking at the same problems from different angles, our team is capable of seeing unique and altogether new solutions.

I am and always will be profoundly grateful to my Coherent family. Again and again, you have opened my mind and touched my heart. I thank God for the privilege of knowing you and leading you. I pray that in the days ahead, you will continue inspiring each other to build a better future.

Going forward, there won’t be a day that passes that I don’t think about and pray for all of you. If I can leave you with the most important thing I’ve learned these past 20 years, it’s this: Whatever it takes, your work here will give far more back to you—and to the world.

And with that, I’m signing off. God bless and good-bye.

Chuck