Ciena Q2 Conference Call Highlights; Shares Skyrocket
Shares of Ciena (NYSE: CIEN) traded up 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; 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.
• We also remain committed to driving down OpEx as a percentage of revenue going forward toward our target of the low- to mid-30s as a percentage of revenue.
• In the second half of this year, we expect it to be in the mid-30s 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 seven percent to 10 percent 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.
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