Doink! JDSU Hits Capacity Ceiling

The company will see $10M of revenues delayed by a quarter because its manufacturing can't keep up

Craig Matsumoto, Editor-in-Chief, Light Reading

August 21, 2008

1 Min Read
Doink! JDSU Hits Capacity Ceiling

JDSU (Nasdaq: JDSU; Toronto: JDU) says demand for certain optical products is exceeding its production capacity, echoing a similar complaint from Bookham Inc. (Nasdaq: BKHM; London: BHM).

JDSU's news came out during last night's quarterly earnings call, where the company missed its fourth quarter earnings expectations by four cents per share. (See JDSU Reports Q4 and JDSU's Down.)

"There are certain product lines such as ROADMs [reconfigurable optical add-drop multiplexers] and tunables where the forecast had been rising faster than the increased capacity that we'd been building," CEO Kevin Kennedy said on last night's earnings call. Hence, $10 million in revenues have been "scheduled into fiscal Q2 despite the fact that customers have asked for it earlier."

JDSU said first-quarter revenues would be between $378 million and $394 million, short of analyst predictions of $400.1 million as tallied by Reuters Research . Add that missing $10 million, though, and JDSU's range would have fallen on target.

Just a few weeks ago, Bookham noted it ran short of capacity for assembly and test of its tunable lasers -- a product segment that nonetheless grew 17 percent between Bookham's third and fourth quarters. (Bookham's fiscal year ends in June; see Bookham Reports Q4.)

That's leading Bookham to boost its capital spending during the second half of this year. That move, though, will push Bookham's cash-flow breakeven point into next year, CEO Alain Couder said on the company's July 24 earnings call.

— Craig Matsumoto, West Coast Editor, Light Reading

About the Author(s)

Craig Matsumoto

Editor-in-Chief, Light Reading

Yes, THAT Craig Matsumoto – who used to be at Light Reading from 2002 until 2013 and then went away and did other stuff and now HE'S BACK! As Editor-in-Chief. Go Craig!!

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