& cplSiteName &

Cyan's SDN Customer Wins Soar to 85

Light Reading
News Analysis
Light Reading
8/7/2013
50%
50%

Cyan, Inc. says it's making progress with real, revenue-producing SDN deployments while other vendors are "simply messaging" about the SDN trend.

In announcing its second quarter results -- its first earnings report as a public company since it listed in May -- Cyan Chairman and CEO Mark Floyd said the company now has 85 customers for its Blue Planet SDN platform, which launched in late 2012. (See Cyan Spins 'Blue Planet' For SDN).

That customer tally is up from 35 at the end of the first quarter, by the count of Jeffries analyst George Notter, who issued a post-earnings research note maintaining his "buy" rating on Cyan.

Cyan President Michael Hatfield added that "the lion's share" of those customers, none of which are in trial mode, are delivering reportable revenues to Cyan. "We are making real progress with SDN, while other companies are simply messaging," Hatfield said. Cyan's customer count follows Tellabs' recent, less specific claim of having several SDN customer engagements. (See Tellabs Boasts SDN 'Engagements'.)

Separate from the SDN wins, Hatfield said Blue Planet also allowed Cyan to get its foot in the door with an array of potential Tier 1 carrier customers during the second quarter. "What's interesting in the Tier 1s is it's coming from the top down," he said. "SDN is such an impactful movement that where we usually [experience] a lot of inertia, we are seeing more urgency [among carriers' top executives] and getting asked to do things with SDN a lot quicker than we expected."

Cyan, however, did not oversell its new engagements with the Tier 1s. Floyd said, "Tier 1 [buying] cycles are likely to be long and revenues not realized for a while." He added that Cyan's goal is to be deployed in Tier 1 networks starting next year.

While there are signs the tide is turning for vendors from hardware to software sales, the migration remains a gradual one. Floyd grounded the SDN celebration by noting that the vendor's software exploits are still well over-shadowed by its packet optical hardware revenue, with about 20 percent of the company's total customer base being software-only, and software currently making up less than 10 percent of Cyan's total revenue. "It's not yet a meaningful portion of total revenue," he said. "We'll start breaking it out when it reaches 10 percent. We think that revenue will become material in 2014."

For the second quarter, Cyan reported year-over-year revenue growth of 37 percent to $31.7 million, which beat many estimates. It posted a gross margin of 43.4 percent, but a net loss of $9.1 million, compared to $1.5 million a year ago and $9.4 million in the previous quarter.

Hatfield said increasing software business, including Blue Planet platform sales and related software applications, should help Cyan reach a three-to-five-year goal of gross margins between 50 percent and 60 percent.

In the short term, Cyan is offering third quarter guidance of a net loss between $8.6 million and $10 million from revenues of between $36 million and $38 million. And, it would appear, it was that third quarter guidance that resulted in a significant share price dip Wednesday, as Cyan saw its share price tumble by $1.71, more than 15 percent, to $9.32, below its May list price of $11. (See Cyan's Not Blue Over NYSE Debut.)

— Dan O'Shea, Managing Editor, Light Reading

(1)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
DOShea
100%
0%
DOShea,
User Rank: Blogger
8/7/2013 | 8:21:52 PM
re: Cyan's SDN Customer Wins Soar to 85
Cyan also has been beating the drum over international expansion, but Floyd said those opportunities are developing more slowly than expected, with early returns on that investment not likely until Q4.
From The Founder
NFV's promises of automation and virtualization are intriguing, but what really excites service providers is the massive amount of money they could save.
Flash Poll
Live Streaming Video
Charting the CSP's Future
Six different communications service providers join to debate their visions of the future CSP, following a landmark presentation from AT&T on its massive virtualization efforts and a look back on where the telecom industry has been and where it's going from two industry veterans.
Women in Comms Introduction Videos
VMWare VP Brings Women Up With Her

8|16|17   |   6:49   |   (1) comment


It's an art and a science to make mentorship, inclusive leadership, diversity and promotion of high-potential women work, says Honore' LaBourdette, vice president of Global Market Development at VMWare.
LRTV Documentaries
5G Spectrum Wars – The Recap

8|15|17   |   2:22   |   (0) comments


Service provider 3 has filed a lawsuit against Ofcom over 5G spectrum auction in the UK.
LRTV Custom TV
Say What? Facebook Unleashes AI Anarchy – The Recap

8|7|17   |     |   (0) comments


A recap of the week's talking points on Light Reading's sister site, telecoms.com. Facebook AI programmers had a bit of a brain-fade as they allowed one of its AI applications to invent its ...
Women in Comms Introduction Videos
Fujitsu's Women Band Together to Help Girls Do STEM

8|2|17   |   9:35   |   (1) comment


Supporting women both inside and outside of Fujitsu is a top priority of the telecom vendor. Yanbing Li, Fujitsu Network Communication's director of System Software Development & Delivery, shares why it's important, but why there's still a long road ahead.
LRTV Custom TV
If You're Not First, You're Last – The Recap

7|31|17   |   08:18   |   (1) comment


In case you missed it, Amazon's 1% stock increase helped Jeff Bezos dethrone Bill Gates as the richest man in the world. Also, Taiwanese electronics manufacturer
Women in Comms Introduction Videos
AT&T's Tech President Preps Workforce for the Future

7|26|17   |   5:47   |   (10) comments


AT&T is focused on the software-defined network of the future and is reskilling its workforce to get ready too, according to AT&T's President of Technology Development Melissa Arnoldi.
Women in Comms Introduction Videos
Cisco: Mentoring Critical to Attract & Retain Women

7|19|17   |   6:40   |   (1) comment


Liz Centoni, senior vice president and general manager of Cisco's Computing System Product Group, shares why mentoring in all its forms is important for women and what Cisco is doing that's made a difference for women in tech.
LRTV Custom TV
Gigabit LTE With Snapdragon 835

7|12|17   |     |   (1) comment


At an event in Wembley stadium, EE used its live network to demonstrate gigabit LTE using a Sony Xperia XZ Premium smartphone with a Qualcomm Snapdragon 835 chip.
LRTV Custom TV
Implementing Machine Intelligence With Guavus

7|12|17   |     |   (0) comments


Guavus unites big data and machine intelligence, enabling many of the the largest service providers in the world to save money and drive measureable revenue. Learn how applying Machine Intelligence substantially reduces operational costs and in many cases can eliminate subscriber impact, meaning a better subscriber experience and higher NPS.
LRTV Custom TV
Unlocking Customer Experience Insights With Machine Intelligence

7|12|17   |     |   (0) comments


When used to analyze operational data and to drive operational decisions, machine intelligence reduces the number of tasks which require human intervention. Guavus invested in Machine Intelligence early. Learn about the difference between Machine Learning and Machine Intelligence.
Women in Comms Introduction Videos
Verizon VP Talks Network, Career Planning

7|12|17   |   4:49   |   (0) comments


Heidi Hemmer, vice president of Technology, Strategy & Planning at Verizon, shares how bold bets and the future of tech define her career.
Telecom Innovators Video Showcase
Masergy's NFV Journey

7|11|17   |     |   (0) comments


Ray Watson, vice president of global technology at Masergy, discusses the advantages and challenges in entering the still-maturing NFV market for the past three years.
Upcoming Live Events
September 28, 2017, Denver, CO
October 18, 2017, Colorado Convention Center - Denver, CO
November 1, 2017, The Royal Garden Hotel
November 1, 2017, The Montcalm Marble Arch
November 2, 2017, 8 Northumberland Avenue, London, UK
November 30, 2017, The Westin Times Square
All Upcoming Live Events
Infographics
With the mobile ecosystem becoming increasingly vulnerable to security threats, AdaptiveMobile has laid out some of the key considerations for the wireless community.
Hot Topics
Intel CEO Leaves Trump Biz Advisory Board
Dan Jones, Mobile Editor, 8/15/2017
Are Cord-Cutting's Days Numbered?
Alan Breznick, Cable/Video Practice Leader, Light Reading, 8/14/2017
Orchestration Startup UBiqube Pivots Away From NFV
Carol Wilson, Editor-at-large, 8/15/2017
Verizon Video Woes Pile On
Mari Silbey, Senior Editor, Cable/Video, 8/14/2017
WiCipedia: Dolly Babes, Manifesto Backlash & 'Brotastic' Failures
Eryn Leavens, Special Features & Copy Editor, 8/18/2017
Like Us on Facebook
Twitter Feed
Animals with Phones
We Know a Tough Day When We See One Click Here
Live Digital Audio

Understanding the full experience of women in technology requires starting at the collegiate level (or sooner) and studying the technologies women are involved with, company cultures they're part of and personal experiences of individuals.

During this WiC radio show, we will talk with Nicole Engelbert, the director of Research & Analysis for Ovum Technology and a 23-year telecom industry veteran, about her experiences and perspectives on women in tech. Engelbert covers infrastructure, applications and industries for Ovum, but she is also involved in the research firm's higher education team and has helped colleges and universities globally leverage technology as a strategy for improving recruitment, retention and graduation performance.

She will share her unique insight into the collegiate level, where women pursuing engineering and STEM-related degrees is dwindling. Engelbert will also reveal new, original Ovum research on the topics of artificial intelligence, the Internet of Things, security and augmented reality, as well as discuss what each of those technologies might mean for women in our field. As always, we'll also leave plenty of time to answer all your questions live on the air and chat board.