Calix Files for an IPO

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bollocks187 12/5/2012 | 3:52:10 PM

re: Calix Files for an IPO

Tellabs has been out of the market for some time - thanks in part to the idiots in Chicago and Texas.

Adtran(2), Occam(3) and Pannaway(4), Zhone(5) as well as Calix(1) of course have filled that gap nicely.  Max IOC market is $200M so it is pretty much saturated 

What is interesting in the S1 is  they don't mention that several of the Calix products are "rebranded" Chinese products.

 

 

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OSXman 12/5/2012 | 3:52:10 PM

re: Calix Files for an IPO

The most interesting market share aspect is the big hole being left by Tellabs. 

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bollocks187 12/5/2012 | 3:52:10 PM

re: Calix Files for an IPO I like the S1 reference to the competition: Other established suppliers with which we compete include ADTRAN, Inc., LM Ericsson Telephone Company, Motorola, Inc. and Tellabs, Inc. There are also a number of smaller companies with which we compete in various geographic or vertical markets, including Enablence Technologies Inc., Occam Networks, Inc. and Zhone Technologies, Inc. While most of these smaller competitors lack broad national scale and product portfolios, they can offer strong competition on a deal-by-deal basis.

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bollocks187 12/5/2012 | 3:52:10 PM

re: Calix Files for an IPO

Here is the web site link to the S1 filing for Calix:

 

http://www.secinfo.com/d14D5a.s79yj.htm#1stPage

 

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OSXman 12/5/2012 | 3:52:10 PM

re: Calix Files for an IPO

Yes, in my mind for each of OCNW and Calix it is about execution more than competition.  They should both do well. 

Calix's financials, while not pretty, are not as ugly as they seem.  They aren't that far from breakeven and a big chunk of the loss is non-cash stock option expense.

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bollocks187 12/5/2012 | 3:52:09 PM

re: Calix Files for an IPO

While most industries  charge for service & support etc. Calix has made "no significant revenue" with service contracts according to the S1 filings.

This implies that they provide "service and support" for FREE to customers.

A novel approach I wonder if they also provide "free lifetime product warranty as well" and how that is accounted for in the financial fillings - normally you need to have some cash reserves set aside for this type of deal. 

 

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OSXman 12/5/2012 | 3:52:08 PM

re: Calix Files for an IPO

Tellabs may be "out of the market" but my data shows them to have a 20% share based on legacy run rate stuff.  That 20% is up for grabs in my opinion. 

 

As for Adtran, they don't even make a separate line item in the numbers that I have seen, but I am sure that will change shortly.

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bollocks187 12/5/2012 | 3:52:07 PM

re: Calix Files for an IPO

Tellabs-AFC has a legacy base that will be replaced with Adtran, Occam, Pannaway, Calix etc. in the future this will primarily due to new fiber builds and potentially upgrades to VDSL technology. However the 20% you speak of is imo spread over a very large number of small line count IOC's and they are less motivated to upgrade with out govt. money. The major and progressive IOC accounts have already switched out AFC-Tellabs in favor of the new players. 

With Calix and others sitting at margins below 30% then these accounts will be even lower margins going forward for anyone to win the remaining 20%. 

The net for Calix and others is they have no where to go with 3GDLC technology in NA they lack an international market presence so they are a function of the IOC growth which is flat, they lack product innovation hence the massive brain drain to Cyan and others.

Not sure what Adtran is going to do.....they are cheap tho while they don't have the product line items shown by Calix, I am sure they can compete effectively.

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paolo.franzoi 12/5/2012 | 3:52:07 PM

re: Calix Files for an IPO

 

OSX,

2 Things:

1 - Grants.  As I said, the grants are new money for the Tier 3 Telcos NOT the loans.

2 - Non-Telcos.  Many of the companies applying are not wireline (note some of Dan Jones' stories about Wireless submissions).  Those companies won't buy from Calix, Adtran, or Occam.

Again, the Tier 3 Telcos are not upping their budgets by BILLIONS of dollars to buy more access gear.  They are trying to get more equipment bought for the SAME budget dollars.  RUS Loans do not do that.  They already use this vehicle.  Only the grants do that.

seven

 

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