On August 23, Coherent Corp. addressed the concern regarding the decrease in operating cash flow during the second quarter in an institutional conference call. The company clarified that downstream demand remains robust. While fulfilling customer delivery commitments, Coherent Corp. is also proactively preparing for production and securing materials. In the first half of 2026, the bulk of operating cash flow expenditures was allocated to raw material purchases. Some of these purchases were made to adhere to the regular delivery timeline, while a substantial portion was dedicated to advance stockpiling. Expenses related to material preparation encompass advance payments and other long-term assets. Notably, these other long-term assets primarily represent prepayments secured for durations exceeding one year, reflecting a quarter-over-quarter increase of over 1 billion yuan in the second quarter.