What Happened?

Shares of fiber laser manufacturer IPG Photonics (NASDAQ: IPGP) fell 8% in the afternoon session after the company announced an unfavorable ruling in a patent infringement case in Germany. 

The Unified Patent Court ruled that certain designs of IPG's adjustable mode beam (AMB) lasers, used in welding and cutting, infringed on a patent held by Trumpf SE & Co. KG. The decision affected certain AMB laser products sold in seven European countries, including Germany and France. While the company stated that this impacted less than 1% of its total sales, the news created uncertainty. IPG Photonics noted that it disagreed with the decision and planned to file an appeal. Compounding investor concerns, the company also disclosed heightened regulatory and export control risks for its CROSSBOW counter-UAS activities, which could constrain the system's development and commercialization.

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What Is The Market Telling Us

IPG Photonics’s shares are quite volatile and have had 19 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The biggest move we wrote about over the last year was 10 months ago when the stock dropped 12.1% on the news that the company reported weak first quarter 2025 results with revenue and EPS guidance for the next quarter missing expectations. 

Revenue fell 10%, hurt by a drop in demand for materials processing products, especially in North America and Europe. Looking ahead, management expects delays from tariffs to slow shipments and weigh on profit margins. On the other hand, IPG Photonics beat analysts' adjusted operating income and EPS expectations this quarter. Overall, this print was on the weaker side.

IPG Photonics is up 70.5% since the beginning of the year, but at $127.63 per share, it is still trading 17.1% below its 52-week high of $153.91 from February 2026. Investors who bought $1,000 worth of IPG Photonics’s shares 5 years ago would now be looking at an investment worth $561.36.

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