P=IV is the standard equation for power in general, not just diodes. That does not mean, however, that all of that power is going into the material being lased. In fact, that laser diode is only a few percent efficient, so you probably only have 5-10% of your power being turned into light. I can't see what kind of optics you have set up, but obviously it's enough to focus the spot small enough to burn (it's all about power density, not just power).
You're probably in the 800-900nm range as far as the wavelength goes, right in the area of YAG lasers.