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Is Laser Sensing Emerging as a Key Revenue Driver for nLIGHT?
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Key Takeaways
nLIGHT's laser sensing business is growing with applications in missile guidance and defense systems.
LASR secured a $50M missile program contract and began production on a classified sensing program.
Existing programs drive near-term revenues, while new programs are set to scale over time.
nLIGHT’s (LASR - Free Report) laser sensing end market is becoming one of the key growth drivers. Management stated that both directed energy and laser sensing delivered accelerated growth in 2025. nLIGHT’s laser sensing products are used in missile guidance, proximity detection, range finding and countermeasures. These products are already part of several long-running defense programs, and are expected to continue growing. This makes laser sensing an important contributor to the company’s defense business.
nLIGHT also pointed to solid program execution. In the third quarter of 2025, nLIGHT signed a new $50 million contract for an existing long-running missile program that uses one of its laser sensing products. The long-running missile program remains a key priority for the customer as part of the nation's munitions restocking efforts. In the fourth quarter of 2025, nLIGHT began low-rate initial production on a new classified sensing program.
Currently, nLIGHT's existing sensing programs are in full-rate production and will drive most of the near-term revenues. Further, new programs that are now in low-rate production are expected to scale over the next one to two years and become a larger part of the business. This provides both near-term visibility and a path for future growth.
nLIGHT’s strong performance on existing sensing programs and early success on classified work have increased both the number of opportunities and the size of its laser sensing pipeline. The above-mentioned factors demonstrate laser sensing becoming a major revenue growth driver for nLIGHT. The Zacks Consensus Estimate for 2026 and 2027 revenues indicates a year-over-year increase of 7% and 15%, respectively.
How Competitors Fare Against nLIGHT
nLIGHT’s push for laser sensing growth puts it against players like Coherent (COHR - Free Report) and IPG Photonics (IPGP - Free Report) .
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 rallied 67.3% year to date compared with the Electronics - Semiconductors industry’s growth of 11.5%.
nLIGHT YTD Price Return Performance
Image Source: Zacks Investment Research
From a valuation standpoint, nLIGHT trades at a forward price-to-sales ratio of 12.02X, higher than the industry’s average of 7.82X. The Zacks Value Score of F also suggests that LASR stock is overvalued.
nLIGHT Forward 12-Month P/S Ratio
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for nLIGHT’s 2026 and 2027 earnings implies year-over-year growth of 45.8% and 58.7%, respectively. The estimates for 2026 and 2027 earnings have both been revised downward over the past 30 days.
View the Zacks #1 Rank List
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Is Laser Sensing Emerging as a Key Revenue Driver for nLIGHT?
Key Takeaways
nLIGHT’s (LASR - Free Report) laser sensing end market is becoming one of the key growth drivers. Management stated that both directed energy and laser sensing delivered accelerated growth in 2025. nLIGHT’s laser sensing products are used in missile guidance, proximity detection, range finding and countermeasures. These products are already part of several long-running defense programs, and are expected to continue growing. This makes laser sensing an important contributor to the company’s defense business.
nLIGHT also pointed to solid program execution. In the third quarter of 2025, nLIGHT signed a new $50 million contract for an existing long-running missile program that uses one of its laser sensing products. The long-running missile program remains a key priority for the customer as part of the nation's munitions restocking efforts. In the fourth quarter of 2025, nLIGHT began low-rate initial production on a new classified sensing program.
Currently, nLIGHT's existing sensing programs are in full-rate production and will drive most of the near-term revenues. Further, new programs that are now in low-rate production are expected to scale over the next one to two years and become a larger part of the business. This provides both near-term visibility and a path for future growth.
nLIGHT’s strong performance on existing sensing programs and early success on classified work have increased both the number of opportunities and the size of its laser sensing pipeline. The above-mentioned factors demonstrate laser sensing becoming a major revenue growth driver for nLIGHT. The Zacks Consensus Estimate for 2026 and 2027 revenues indicates a year-over-year increase of 7% and 15%, respectively.
How Competitors Fare Against nLIGHT
nLIGHT’s push for laser sensing growth puts it against players like Coherent (COHR - Free Report) and IPG Photonics (IPGP - Free Report) .
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 rallied 67.3% year to date compared with the Electronics - Semiconductors industry’s growth of 11.5%.
nLIGHT YTD Price Return Performance
Image Source: Zacks Investment Research
From a valuation standpoint, nLIGHT trades at a forward price-to-sales ratio of 12.02X, higher than the industry’s average of 7.82X. The Zacks Value Score of F also suggests that LASR stock is overvalued.
nLIGHT Forward 12-Month P/S Ratio
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for nLIGHT’s 2026 and 2027 earnings implies year-over-year growth of 45.8% and 58.7%, respectively. The estimates for 2026 and 2027 earnings have both been revised downward over the past 30 days.
Image Source: Zacks Investment Research
nLIGHT currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.