Ciena Reports Stronger-Than-Expected Q2 Results, CEO Highlights Bandwidth Demand Growth

Zinger Key Points
  • Ciena's Q2 2024 revenue fell 19.6% Y/Y to $910.8M, beating the $894.94M estimate. Adjusted EPS of $0.27 also beat the $0.15 estimate.
  • Total Networking Platforms revenue dropped 26.1% Y/Y, while Global Services revenue grew 5.4% Y/Y. Adjusted gross margin declined to 43.5%.

Ciena Corp CIEN reported a fiscal second-quarter 2024 revenue decline of 19.6% year-on-year to $910.80 million, beating the analyst consensus estimate of $894.94 million.

The American telecommunications networking equipment and software services supplier reported an adjusted EPS of $0.27, beating the analyst consensus estimate of $0.15.

Segments: Total Networking Platforms revenue declined by 26.1% Y/Y to $676.3 million, and Total Global Services increased by 5.4% Y/Y to $134.7 million.

Margins: The adjusted gross margin declined by 20 bps to 43.5%. Adjusted operating margin decreased by 700 bps to 6.8%.

One 10%-plus customer represented a total 13.8% of revenue.

CEO Gary Smith said, “With continued robust growth in bandwidth demand, we remain focused on extending our leadership in optical as a foundation for expanding our addressable market.”

Ciena held $1.42 billion in cash and equivalents and generated $58.5 million in operating cash flow.

During first-quarter print Ciena said it expects fiscal 2024 revenue of $4 billion – $4.3 billion (2024 revenue estimate $4.11 billion) and adjusted gross margin in the mid-40s%.

Price Action: CIEN shares were trading higher by 5.62% at $50.95 at the last check Thursday.

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