Brisk Web Business Boosts ADVA's Outlook

ADVA has increased its second-quarter guidance for both revenue and profitability, suggesting that the web-scale market, particularly Internet Content Providers and Web 2.0 firms, is continuing to provide ongoing robust business for optical vendors across the board.

The Germany-based vendor was vocal about its bright prospects following its first-quarter earnings report earlier this year, as ADVA Optical Networking CEO Brian Protiva described how a confluence of trends -- the rise of metro cloud and data center networking, a healthier European market environment and vendor consolidation, among other things -- were leading ADVA into a period of potentially strong growth. Now, it's apparently seeing even more interest than it had previously forecast, boosting its Q2 revenue projection from the earlier range of €105 million (US$118 million) to €110 million ($124 million) to between €109 million ($123 million) and €113 million ($127 million), and upping its operating income guidance as well. (See ADVA Eyes Advantages Amid Acquisitions and ADVA Increases Q2 Guidance.)

It's already been a busy month for ADVA, which announced its new CloudConnect platform in recent weeks, and just yesterday unveiled new NFV demarcation products at the Open Networking Summit. ADVA is scheduled to report first-half earnings results on July 22. (See ADVA Launches NFV Demarcation Products and ADVA Ups Its DCI Game.)

Other larger optical vendors, namely Infinera Corp. (Nasdaq: INFN) and Ciena Corp. (NYSE: CIEN), long have been boasting about their success rate landing business with ICPs and other web-scale companies, though ADVA has been a bit more low key -- until now.

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Meanwhile, Infinera, already enjoying strong growth thanks in part to its relationships with web-scale household names like Facebook, also this week received a reiteration of support from Michael Genovese, managing director of MKM Partners. Genovese, in a research note, cites Infinera's position in what is expected to be a $10 billion metro optical market by 2020. He also says it's looking more likely the company will announce a new metro aggregation product later this year. (See Infinera Coming Closer to Mastering the Metro.)

In addition, however, he noted that the company's planned acquisition of Sweden's Transmode Systems AB is now scheduled to close a little later than had originally been forecast -- by late August instead of mid-August -- possibly due in part to Sweden's arduous shareholder approval requirements./p>

Infinera last week won its second straight Public Company of the Year award during Light Reading's Leading Lights ceremony at the Big Telecom Event in Chicago. (See Leading Lights Awards 2015: The Winners)

— Dan O'Shea, Managing Editor, Light Reading

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