Canada-based Vecima turned in a record fiscal year, thanks in large part to an acceleration of deployments of distributed access architecture (DAA) products by cable operators in multiple regions around the globe.
"Fiscal 2021 was the breakout year we've long envisioned for Vecima," Sumit Kumar, Vecima's CEO, said Thursday on the company's fiscal Q4 2021 earnings call.
That breakout showed up in the numbers, as Vecima generated full-year revenues of C$124.2 million (US$98.10 million), up 31%, and the highest in the company's 33-year history.
But the underlying story at Vecima was the progress made with DAA, whereby cable operators are deploying electronics and functions toward the edges of the network. In addition to boosting the capacity and performance of the hybrid fiber/coax (HFC) network, DAA is also a requirement for DOCSIS 4.0, a new set of CableLabs specs that support multi-gigabit symmetrical speeds paired with enhanced security and lower latencies.
Sales for Vecima's next-gen "Entra" family of DAA products surged seven-fold, to C$42.6 million (US$33.65 million) for the full fiscal year, and reached C$16.6 million (US$13.11 million) in Q4, up 31% from the previous quarter. Entra represented 57% of sales in Vecima's video and broadband solutions segment in fiscal 2021, up from just 15% in fiscal 2020.
Kumar believes Vecima has "reached an inflection point," noting that the company now counts 71 total "customer engagements" with DAA. Of that total, 38 across six continents have placed product orders, with some transitioning to scaled deployments, and 33 are in earlier stages of DAA development. He estimates that Vecima's current set of DAA deployments covers almost 14 million cable homes.
"I want to emphasize that this is just the beginning of the growth potential we see for our Entra family of solutions," he said. "DAA is a once-in-a-lifetime technology transition for the global cable industry … This is a true technology wave, and its momentum will continue to build."
Vecima has secured a foothold in this first significant wave of DAA deployments, establishing that position despite competition from a group of rivals that includes CommScope, Cisco, Teleste, Casa Systems, Technetix and Harmonic, among others.
"We know that the companies that capture the first wave are uniquely positioned to benefit from not just the initial network buildouts but the years of augmentation and upgrades that follow," Kumar said.
Nokia deal spurring DAA momentum
Kumar credited Vecima's acquisiton last year of Nokia's cable and PON access network products as an important growth driver, giving the company the ability to dramatically accelerate elements of its broader DAA product strategy. Entra sales in the quarter included about C$9.2 million (US$7.26 million) from DAA products that Vecima acquired last year from Nokia for just US$4.87 million, and roughly C$19.7 (US$15.56) million for fiscal 2021.
In addition to adding 10-Gig-capable fiber-to-the-premises (FTTP) technology, the acquisition also provided Vecima with new remote MACPHY technologies for cable DAA deployments that complemented its internally developed remote PHY product set.
Vecima had those products on its roadmap, but the Nokia deal "sped up our timelines, saving us several years and many millions of dollars in product development," Kumar said.
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— Jeff Baumgartner, Senior Editor, Light Reading