Vecima Networks saw a sharp rise in sales and deployments of distributed access architecture (DAA) gear by cable operators in its fiscal Q1. But execs also warned that the company is starting to feel the effects of supply chain constraints.
Sales of the company's "Entra"-branded DAA products reached a record C$18.1 million (US$14.46 million) in the period, up 246% year-over-year, and up 9% from the prior quarter. Entra sales accounted for about 75% of total sales in Vecima's video and broadband solutions (VBS) segment, Vecima President and CEO Sumit Kumar said on last week's quarterly earnings call. Total Vecima revenues climbed 19%, to C$32.4 million (US$25.89 million).
Vecima has seen DAA sales activity accelerate in 2021 after cable operators put certain DAA projects and other next-gen network activity on the backburner in 2020. Last year, operators were more focused on adding capacity to their existing networks to stay ahead of usage spikes fueled by the pandemic.
Cable operators appear to be pursuing DAA with more vigor now as they look to beef up the capabilities of their existing DOCSIS 3.1 networks and begin to lay the groundwork for DOCSIS 4.0 – an architecture for hybrid fiber/coax (HFC) networks that requires DAA and will put MSOs in position to offer symmetrical multi-gigabit speeds.
Vecima said total customer "engagements" for Entra products rose to 77 cable operators worldwide in the quarter, up from 71 at the end of the prior period. Thirty-nine of those customers have ordered Entra products that now span nearly 7,200 cable and fiber access nodes and cover some 18,000 service groups.
Kumar said orders are shifting to scaled deployments among some customers. But sales in fiscal Q1 would have been even higher without external freight logistics issues linked to supply chain constraints that are impacting multiple industries. Delays in schedules and delivery times impacted Entra sales by more than C$2 million (US$1.59 million) in the period, he said.
Those issues aside, Vecima's DAA activity is ramping up following its 2020 acquisition of Nokia's cable access assets.
Vecima is also looking to broaden its piece of the cable access market following the recent commercial launch of a fiber-optic node based on the SCTE's Generic Access Platform (GAP) standards. Vecima acquired ATX Networks' intellectual property, including drawings and schematics, for a GAP node earlier this year. Charter Communications is considered the primary champion of standardized GAP nodes that can house various types of service modules for HFC, fiber-to-the-premises and mobile/wireless access networks.
Kumar said Vecima has left the door open to other M&A opportunities that might provide incremental technology and product advancements. "We're in a great position to be a consolidator, if other vendors are changing focus," he said.
- Vecima scooped up Nokia's cable access assets for just $4.87M
- Vecima leaps into cable's 'GAP'
- Vecima touts 'breakout year' as DAA deployments start to flourish
- Vecima scoops up ATX's 'GAP' node tech
— Jeff Baumgartner, Senior Editor, Light Reading