One month after increasing its fourth-quarter revenue outlook on growing service provider demand, Cyan hit the new mark, reporting $30.5 million in revenue for the quarter, as well as two carrier wins for its Blue Planet SDN/NFV software. (See Cyan Posts Q4 Revenue Jump.)
Regarding the carrier deals, Cyan CEO Mark Floyd said on the vendor's earnings call Wednesday afternoon that Cyan earned "two RFP wins for NFV orchestration, one of them from a Tier 1 carrier." He said deployment on these opportunities would begin by the end of the first half of 2015. He added that Cyan received a $28 million order during the quarter, the largest order in the company's history.
Difficulty converting much-ballyhooed software trials into revenue has been a source of frustration for the company in recent months, and late last year, Cyan had to seek additional funding to support ongoing operations. The company eventually gained $46.6 million from a senior notes sale. (See Cyan to Net $46.6M in Notes Sale and Cyan Seeks Funding in SDN Squeeze.)
Even with the RFP wins, the vendor faces ongoing challenges: Its full-year revenue dropped to $100.5 million from about $116.6 million in 2013, and its net loss also grew on a quarterly and yearly basis. Cyan officials said on the call that they are continuing to pursue cost reduction measure across the organization.
Cyan last month adjusted its revenue forecast for Q4 to between $30 million and $31 million, up from the earlier estimated range of $24 million to $26 million. Much of the increase came from expanded business opportunities for Cyan at Windstream Communications, the independent telco that traditionally has been the vendor's largest customer. Windstream accounted for $15.8 million of Cyan's total revenue for the fourth quarter (See Cyan Ups Q4 Outlook, Promises SDN Wins.)
Over-reliance on its Windstream relationship has been considered a weakness at times. However, the two Blue Planet wins, including the emerging opportunity with the unnamed Tier 1 carrier, could help the company start to better diversify its revenue sources, according to Floyd. Cyan adjusted its outlook for 2015 with a forecast for between 35% and 45% revenue growth year over year, so the company is not hedging its bets.
Cyan also sought to broaden its horizons recently with the launch of a dedicated product for data center interconnection deployments. (See Cyan Targets DCI With 34 Terabit Platform.)
— Dan O'Shea, Managing Editor, Light Reading