The document describes a two-step finite element simulation of diamond-coated cutting tools. In the first step, a cohesive zone model is used to analyze residual stresses deposited during the coating process. In the second step, a 2D cutting simulation is performed using the residual stresses as initial conditions. The effects of fracture energy, interface strength, deposition temperature, and cutting parameters on coating delamination are investigated. The simulations demonstrate that residual stresses significantly impact coating failure during cutting, and failure is more likely with higher stresses, lower interface strength, or increased uncut chip thickness.