Ciena Swings to Profit
Boosted by strong sales and gross margins, Ciena Corp. (NYSE: CIEN) realized a profit and beat analysts' expectations in its fiscal third quarter. (See Ciena Reports Q3.)
For the quarter ended July 31, 2007, the optical vendor reported earnings of $28.3 million, or 29 cents a share, on revenues of $205 million. That compares with a loss of $4.3 million, or 5 cents per share, on sales of $137.8 million in the year-ago quarter.
Ciena's revenues grew 5.9 percent sequentially and 34.4 percent year over year, beating Wall Street expectations. Analysts expected quarterly sales of $203.25 million, according to Thomson Financial .
The company also posted strong margins for the quarter, with overall gross margins at 47.7 percent and product gross margins of 53.7 percent. That compares with Wall Street estimates of 44.5 percent.
Excluding certain one-time and non-cash items, the company reported third-quarter earnings of $40 million, or 41 cents per share. That beat analyst expectations for profits of 31 cents per share.
Ciena's third-quarter 2006 results included a restructuring charge of $11 million. Excluding one-time charges, earnings were $20.6 million, or 23 cents per share, in the previous year's third quarter.
Ciena's earnings come in the wake of a number of customer wins in the quarter and continued strong business from existing customers. Earlier in the quarter, the company touted customer wins at JANET ("the UK's education and research network") and AboveNet Inc. (NYSE: ABVT), and talked up business that it had won at BT Group plc (NYSE: BT; London: BTA) as part of that company's 21CN project. (See Janet Deploys Ciena 40G, AboveNet Deploys Ciena, and Ciena Touts BT Deployment.)
Ciena's fiscal third quarter marks continued momentum for the company, which has posted 14 quarters of sequential revenue growth. The company's stock has responded to that growth, rising nearly 40 percent year-to-date.
— Ryan Lawler, Reporter, Light Reading