What happened

Shares of Coherent, Inc. (NASDAQ:COHR) are getting crushed today, down by 23% as of 12:15 p.m. EDT, after the company reported fiscal third-quarter earnings.

So what

The company, which specializes in lasers and laser technologies, generated revenue of $464.1 million in the third quarter, which translated into non-GAAP net income of $83.4 million, or $3.36 per share. On a GAAP basis, the company posted net income of $61.1 million, or $2.46 per share.

CNC machine using lasers

Image source: Getty Images.

This was the second full quarter after Coherent closed its acquisition of Rofin-Sinar late last year.

Now what

In a statement, CEO John Ambroseo said demand "remains buoyant" and Coherent booked a "significant" number of large format deals for tools used in OLED manufacturing. Utilization rates at OLED manufacturing facilities are high, and more installations are coming online, according to Ambroseo. That business will start showing up in fiscal year 2019. The company voluntarily prepaid 45 million euros in debt, and plans on continuing to actively pay down debt to strengthen the balance sheet going forward.

Shares had nearly doubled year to date before today's earnings release, clearly pricing in lofty expectations. That could help explain today's pullback.

Evan Niu, CFA has no position in any stocks mentioned. The Motley Fool owns shares of Coherent. The Motley Fool has a disclosure policy.