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Casa Sees Cable Spending Perk Up in Q2

Jeff Baumgartner
8/1/2019

Indicating that the worst may be behind it following a disastrous Q1, Casa Systems said cable infrastructure spending showed signs of life in the second quarter.

Cable segment spending, which had stalled out as operators mull their next-gen access network strategies, picked up a bit in Q2. Cable revenues in the quarter primarily came way of capacity-related purchases, including software licenses and some chassis from Casa's lineup of converged cable access platform (CCAP) products, company CEO Jerry Guo said on Wednesday's earnings call.

Casa's Q2 revenues at $52.1 million were in line with guidance, despite being off from year-ago revenues of $68.7 million. Q2 results were also 47% better than the numbers posted in Casa's tough Q1. In addition to improved cable spending, Casa also was able to recognize some revenue from its wireless backlog, Guo said.

He said some money came in the door from Casa's newer cable access products, including remote PHY nodes that fit into emerging distributed cable architectures and future virtualized forms of the CCAP.

"However, revenue from our new cable products was not yet material," Guo pointed out. "As a result, while we do expect MSOs to increasingly redirect investment into distributed access architecture, we continue to believe that we haven't yet reached an inflection point away from the industry-wide pause in cable spending that we identified on our last call."

Guo said Casa has DAA trials underway with several MSOs around the globe (Liberty Global and Charter Communications are among its largest cable operator customers), providing a mix of DAA nodes and remote PHY nodes that work in tandem with both physical CCAP cores and newer virtualized CCAP cores.

DAA deployments are expected to grow toward late 2019, but Guo isn't ready to declare when DAA deployments will reach an inflection point. "The timing is very hard to forecast given how much delay that [the] industry has experienced," he said.

Looking ahead, Casa now expects full-year 2019 revenues of $320 million to $350 million as it has built in revenues coming way of NetComm ($70 million to $80 million), the just-acquired Australian wireless tech company that counts AT&T among its customers.

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— Jeff Baumgartner, Senior Editor, Light Reading

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