Core Insights - Ciena Corporation reported adjusted EPS of 64 cents for Q1 fiscal 2025, exceeding the Zacks Consensus Estimate of 39 cents, but reflecting a 3% decline year over year [1] - Total revenues increased by 3.3% year over year to $1,072.3 million, surpassing the Zacks Consensus Estimate by 2%, driven by strong orders from cloud and service providers [2] - Service provider revenues surged 14% year over year, constituting approximately 51% of total revenues [3] Financial Performance - Networking Platforms revenues, which account for 76.6% of total revenues, rose 1.7% year over year to $821.2 million, while Platform Software and Services revenues increased by 6% to $95.1 million [5] - Global Services revenues were $130 million, up 2.5% year over year, with regional performance showing a 10.8% increase in the Americas, a 23.9% decline in Europe, the Middle East, and Africa, and a 5.9% increase in Asia Pacific [6] - Non-GAAP adjusted gross margin decreased to 44.7% from 45.7% a year ago, and adjusted operating margin fell to 12.3% from 13.2% [9] Cash Flow and Liquidity - Net cash flow from operating activities was $103.7 million, down from $266 million in the prior year, with $1.3 billion in cash and investments and $1,531 million in net long-term debt as of February 1, 2025 [10] - The company repurchased about 1 million shares worth $79 million, with plans to buy back approximately $330 million in total during fiscal 2025 [10] Guidance - For Q2 fiscal 2025, Ciena expects revenues between $1.05 billion and $1.13 billion, with adjusted gross margin in the low-40% range and adjusted operating expenses around $355 million [11] - For the full fiscal 2025, revenue growth is anticipated at the upper end of 8-11%, with adjusted gross margin projected between 42-44% and average adjusted operating expenses of $350-$360 million per quarter [12] Market Performance - Despite strong financial results, Ciena's shares fell 2.4% on March 11, 2025, but rebounded with a 2% increase in pre-market trading on March 12, 2025 [3][4] - Over the past year, Ciena's shares have increased by 24.2%, outperforming the Zacks Fiber Optics industry's growth of 23.8% [4]

One group of stocks that has been punished during this current market downturn is telecoms. On Tuesday, they got little respite, on news of remarks from a top executive at one of their incumbent companies.Many telecoms sank into the gloom that trading session, including big dogs AT&T (T -4.66%) and T-Mobile US (TMUS -3.74%); the pair closed the day down nearly 5% and 4% in price, respectively. Even associated businesses felt the pain, with networking specialist Ciena (CIEN -2.41%) losing more than 2% of its ...

Financial Data and Key Metrics Changes - Total revenue for Q1 2025 was $1.07 billion, with an adjusted gross margin of 44.7% and adjusted EPS of $0.64 per share [9][26]. - Adjusted operating margin was 12.3%, with adjusted net income of $94 million and adjusted EBITDA of $156 million [27][34]. - Cash from operations generated was $104 million, ending the quarter with approximately $1.3 billion in cash and investments [27][34]. Business Line Data and Key Metrics Changes - Service provider revenue increased by 14% year-over-year, comprising approximately 51% of total revenue [14]. - Cloud revenue accounted for 32% of total revenue, with five cloud providers in the top 10 customers for the quarter [16]. - Routing and switching revenue was $93 million, up 17% sequentially [29]. Market Data and Key Metrics Changes - North America led service provider revenue growth, with international markets also showing positive progress [14]. - The demand for high-speed networks driven by AI and cloud traffic is expected to continue growing, with significant CapEx plans from cloud providers [11][17]. - The company added 20 new customers for WaveLogic 6E in Q1, confirming strong demand for its optical technologies [18][28]. Company Strategy and Development Direction - The company aims to extend its leadership and grow market share in core businesses, including subsea, long-haul, Metro DCI, and MOFN opportunities [12]. - Investments are aligned with market dynamics and customer priorities, focusing on high-speed connectivity and AI-driven infrastructure [24]. - The company is on track for general availability of its 800 gig WaveLogic 6 nano pluggable solution in the first half of the calendar year [23]. Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in continued demand growth despite potential economic disruptions and tariff uncertainties [31][34]. - The company expects revenue growth toward the high end of its 8% to 11% guidance range for fiscal 2025 [34]. - Positive demand dynamics are anticipated to persist across all segments, with a strong order flow indicating improved market position [35]. Other Important Information - The company repurchased approximately 1 million shares for $79 million during the first quarter, targeting a total repurchase of approximately $330 million for fiscal year 2025 [27][34]. - The company remains the only vendor in the market with a 1.6 terabit WAN solution, expecting to maintain this lead for at least two years [28]. Q&A Session Summary Question: Dynamics in the cloud service provider segment - Management noted solid order growth with no signs of a pause, indicating an acceleration in demand from cloud providers [38][42]. Question: Seasonality of cloud customers - Management stated that the cloud segment is not significantly affected by seasonality, with increasing demand expected to continue [47][49]. Question: Gross margins and one-time benefits - Management acknowledged that the strong gross margin performance was driven by non-recurring events and does not expect those effects to recur in Q2 [56][57]. Question: Composition of customer verticals for revenue outlook - Management indicated that the increase in revenue guidance is largely driven by cloud demand, with service provider recovery also contributing [70][72]. Question: Pluggable opportunity and revenue expectations - Management confirmed strong momentum in pluggables, expecting revenue to double for the year, with WaveLogic 5 being the dominant contributor through 2025 [74][78]. Question: Huawei replacement opportunities - Management highlighted that the greatest opportunity for Huawei replacement remains in Europe, with a multi-year opportunity ahead [123][125]. Question: CPO and data center opportunities - Management sees opportunities in coherent technologies as they become relevant inside data centers, with ongoing discussions about the impact of CPO [130][132].

Financial Data and Key Metrics Changes - The company reported total revenue of $1.07 billion for Q1, with an adjusted gross margin of 44.7% and adjusted EPS of $0.64 per share, indicating strong financial performance [9][26]. - Adjusted operating margin was 12.3%, with adjusted net income of $94 million and adjusted EBITDA of $156 million [27][34]. - Cash from operations was $104 million, and the company ended the quarter with approximately $1.3 billion in cash and investments [27][34]. Business Line Data and Key Metrics Changes - Service provider revenue increased by 14% year-over-year, accounting for approximately 51% of total revenue [14]. - Cloud revenue comprised 32% of total revenue, with five cloud providers among the top 10 customers for the quarter [16]. - Revenue from routing and switching was $93 million, up 17% sequentially, while platform software and services revenue increased by 6% year-over-year [29][31]. Market Data and Key Metrics Changes - North America led service provider revenue growth, with international markets also showing positive progress [14]. - The company noted strong order flow from cloud providers, with direct orders from them making up half of overall orders in Q1 [10][42]. - The demand for high-speed connectivity is driven by the rapid expansion of AI and cloud traffic, leading to significant investments in scalable networks [11][12]. Company Strategy and Development Direction - The company aims to extend its leadership and grow market share in core businesses, including subsea, long-haul, and Metro DCI, while expanding into adjacent markets [12]. - The strategy focuses on capitalizing on the growth of cloud and AI traffic, with a strong emphasis on partnerships with service and cloud providers [10][12]. - The company is on track to double its revenue from pluggables in fiscal 2025, driven by strong demand for high-speed solutions [29][75]. Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in continued demand growth, particularly from service providers and cloud customers, despite potential economic disruptions [31][33]. - The company anticipates revenue growth toward the high end of the 8% to 11% guidance range for fiscal 2025, supported by strong order flows and a growing backlog [34][41]. - Management highlighted the importance of addressing bandwidth demands driven by cloud connectivity and AI, positioning the company well for long-term growth [24][34]. Other Important Information - The company repurchased approximately 1 million shares for $79 million during the first quarter, with a target of $330 million in total repurchases for fiscal 2025 [27][34]. - The company remains the only vendor with a 1.6 terabit WAN solution and expects to maintain this lead for at least two years [28]. Q&A Session Summary Question: Dynamics in the cloud service provider segment - Management noted solid order growth with no signs of a pause, indicating an acceleration in demand from cloud providers [38][40]. Question: Seasonality of cloud customers - Management stated that the cloud segment is not significantly affected by seasonality, with increasing demand expected to continue [47][49]. Question: Gross margins and one-time benefits - Management explained that the strong gross margin performance was due to several one-time events and does not expect these effects to recur in Q2 [56][57]. Question: Composition of customer verticals - Management indicated that the increase in revenue guidance is largely driven by cloud, with service provider recovery also contributing positively [70][72]. Question: Pluggable opportunity - Management confirmed record order flows for pluggables and expects to double revenue in this segment for the year [74][75]. Question: Huawei replacement opportunities - Management highlighted that the greatest opportunity for Huawei replacement remains in Europe, with a multi-year outlook for this opportunity [123][125]. Question: CPO and data center opportunities - Management sees opportunities in coherent technologies as they become more relevant inside data centers, with ongoing discussions about these innovations [130][132].

Ciena (CIEN) came out with quarterly earnings of $0.64 per share, beating the Zacks Consensus Estimate of $0.39 per share. This compares to earnings of $0.66 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 64.10%. A quarter ago, it was expected that this developer of high-speed networking technology would post earnings of $0.66 per share when it actually produced earnings of $0.54, delivering a surprise of -18.18%.Over the las ...

March 11, 2025 © Ciena Corporation 2025. All rights reserved. Proprietary Information. Forward-looking statements and non-GAAP measures You are encouraged to review the Investors section of our website, where we routinely post press releases, Securities and Exchange Commission (SEC) filings, recent news, financial results, supplemental financial information, and other announcements. From time to time, we exclusively post material information to this website along with other disclosure channels that we use. ...

FOR IMMEDIATE RELEASE Ciena Reports Fiscal First Quarter 2025 Financial Results HANOVER, Md. - March 11, 2025 - Ciena Corporation (NYSE: CIEN), a networking systems, services and software company, today announced unaudited financial results for its fiscal first quarter ended February 1, 2025. ® "We delivered strong fiscal first quarter results that reflect balanced growth and strong momentum across our customer segments and reinforce the continuation of positive demand dynamics," said Gary Smith, president ...

Ciena Corporation (CIEN) is scheduled to report first-quarter fiscal 2025 results on March 11, before market open.Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar. The Zacks Consensus Estimate for earnings is pegged at 39 cents per share, implying a 40.9% decrease from the year-ago level.The consensus estimate for revenues is pegged at $1.05 billion, indicating a growth of 0.7% from the prior-year level. For the fiscal first quarter, management expects revenues in the range of $1.01- ...

Analysts on Wall Street project that Ciena (CIEN) will announce quarterly earnings of $0.39 per share in its forthcoming report, representing a decline of 40.9% year over year. Revenues are projected to reach $1.05 billion, increasing 0.7% from the same quarter last year.The consensus EPS estimate for the quarter has been revised 4.8% lower over the last 30 days to the current level. This reflects how the analysts covering the stock have collectively reevaluated their initial estimates during this timeframe ...

Core Viewpoint - Nvidia has been a leading player in the AI sector, significantly impacting the market with its graphics cards and server systems, resulting in substantial revenue and stock price growth [1] - However, Nvidia's stock has recently declined by 8% over the past three months due to various challenges, including proposed sales restrictions and concerns over AI spending [2] - Ciena is emerging as a strong alternative investment opportunity in the AI space, having outperformed Nvidia with a 15% stock increase in the same period [3][4] Company Performance - Ciena is positioned to benefit from the increasing demand for high-speed networking driven by AI, with sales of networking equipment expected to grow at an annual rate of 34% through 2028 [5] - The company has seen a surge in orders for its optical networking equipment, with cloud providers becoming significant customers, indicating a shift in demand dynamics [6][7] - Ciena's addressable market is projected to expand by $12 billion to $26 billion by 2028, solidifying its competitive position in the optical networking sector [8] Financial Outlook - Ciena's management anticipates revenue growth of 8% to 11% annually over the next three years, with adjusted operating margins expected to reach 15% to 16% by fiscal 2027 [9] - The company's earnings are forecasted to grow significantly, with estimates suggesting an increase from $1.82 per share in fiscal 2024 to $4.17 per share in three years [10][11] - If Ciena achieves these earnings and trades at a multiple of 34 times earnings, its stock price could potentially rise to $142, representing a 77% increase from current levels [12]