Ciena Q2 Conference Call Highlights; Shares Skyrocket

Shares of Ciena CIEN traded up a whopping 18 percent following its second quarter earnings release on Thursday.

Below are some highlights and key takeaways from its conference call:

• Over the past several years, we've consistently executed well; and as a result, our financial performance has steadily improved.

• All of this gives us confidence with respect to the second half of our fiscal year.

• With our market momentum, we expect a significantly stronger second half performance with better operating leverage.

• Our customers' businesses depend on enabling that experience, making network performance more critical than ever.

• This shift to an on-demand world is a fundamental market changer. And as we've said before, there will be new winners and losers in this environment.

• We have deliberately built our approach, our organization and our portfolio as the network specialist for this opportunity.

• We are capitalizing on segments that are growing faster than the traditional telco market, and we're taking share in those segments.

• All of these factors help drive another strong quarter and first half for Ciena, and we view them as critical underpinnings for our continued differentiated performance going forward.

• We have built a broad and balanced business for the significant multi-year opportunity in front of us.

• Ciena is in a position to not just win in the new environment, but to drive increased operating leverage in our business in 2014 and beyond.

Fundamentals:

• We also remain committed to driving down OpEx as a percentage of revenue going forward toward our target of the low to mid 30%s as a percentage of revenue.

• In the second half of this year, we expect it to be in the mid-30%s as our revenue grows.

• We've built a balanced, diversified business that is aligned with high-growth segments of the market, and we continue to execute very well.

• We're delivering steady improvement in operating leverage.

• And we remain confident that we will achieve the low end of our current target range of 7% to 10% for adjusted operating margin for the full 2014 fiscal year.

• We estimate Q3's basic share count at approximately 106 million total shares.

• Diluted share count will vary depending upon your assumptions about our profitability.