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Ciena (CIEN) Q2 Earnings Beat Estimates, Revenues Fall Y/Y
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Ciena Corporation (CIEN - Free Report) reported healthy second-quarter fiscal 2021 (ended May 1, 2021) results, wherein the bottom line and the top line beat the Zacks Consensus Estimate.
This Hanover, MD-based company’s share price moved up 7.3% on Jun 3, closing the trading session at $58.38.
Ciena witnessed encouraging signs in the market that include improvements in customer spending.
Net Income
On a GAAP basis, net income in the quarter was $103.1 million or 66 cents per share compared with $91.7 million or 59 cents per share in the prior-year quarter. The improvement primarily resulted from higher operating income and lower provision for income tax.
It’s worth noting that net income benefited from recording $40.4 million in pre-tax amounts from the Canadian Emergency Wage Subsidy program.
Adjusted net income came in at $97.6 million or 62 cents per share compared with $117.4 million or 76 cents per share in the year-ago quarter. The bottom line beat the Zacks Consensus Estimate by 14 cents, delivering a surprise of 29.2%.
Ciena Corporation Price, Consensus and EPS Surprise
Total revenues declined 6.7% year over year to $833.9 million, primarily due to lower product sales resulting from the pandemic. The top line, however, surpassed the consensus estimate of $828 million.
Region-wise, revenues in the Americas were $587.5 million, down 9.7% year over year. Revenues in Europe, Middle East and Africa were $155 million, up from $141.4 million. Asia Pacific revenues totaled $91.4 million, down 10.7%.
Segment Results
Total revenues in Networking Platforms decreased 11.3% year over year to $637.3 million. Platform Software and Services revenues were $56.7 million compared with $45 million in the prior-year quarter. Blue Planet Automation Software and Services revenues increased from $15 million to $23.9 million. Total revenues in Global Services were $116 million, up 0.3%.
Other Details
Adjusted gross margin was 49.2% compared with 46.9% in the year-ago quarter. Adjusted operating expenses were $278.7 million, up from $258.7 million. Operating income improved to $133.6 million from $127.5 million.
Adjusted operating income decreased to $131.7 million from $160.3 million. The adjusted operating margin came in at 15.8% compared with 17.9% in the prior-year quarter. Adjusted EBITDA was $156.2 million, down from $183 million.
During the quarter, Ciena repurchased almost 0.5 million shares for a total price of $26.2 million.
Cash Flow & Liquidity
During the first six months of fiscal 2021, Ciena generated $217.7 million of cash from operating activities compared with $130.9 million in the year-ago period. As of May 1, 2021, the company had $1,203 million in cash and cash equivalents compared with $673.4 million of long-term debt.
Outlook
Ciena continues to benefit from increased network traffic, demand for bandwidth and the adoption of cloud architectures. For the fiscal third quarter, the company expects revenues in the range of $950-$980 million. Adjusted gross margin is projected between 46% and 47%. Adjusted operating expenses are estimated between $285 million and $290 million.
Cambium delivered a trailing four-quarter earnings surprise of 46.5%, on average.
Altice delivered a trailing four-quarter earnings surprise of 61.5%, on average.
Vicor delivered a trailing four-quarter earnings surprise of 80.6%, on average.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
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Ciena (CIEN) Q2 Earnings Beat Estimates, Revenues Fall Y/Y
Ciena Corporation (CIEN - Free Report) reported healthy second-quarter fiscal 2021 (ended May 1, 2021) results, wherein the bottom line and the top line beat the Zacks Consensus Estimate.
This Hanover, MD-based company’s share price moved up 7.3% on Jun 3, closing the trading session at $58.38.
Ciena witnessed encouraging signs in the market that include improvements in customer spending.
Net Income
On a GAAP basis, net income in the quarter was $103.1 million or 66 cents per share compared with $91.7 million or 59 cents per share in the prior-year quarter. The improvement primarily resulted from higher operating income and lower provision for income tax.
It’s worth noting that net income benefited from recording $40.4 million in pre-tax amounts from the Canadian Emergency Wage Subsidy program.
Adjusted net income came in at $97.6 million or 62 cents per share compared with $117.4 million or 76 cents per share in the year-ago quarter. The bottom line beat the Zacks Consensus Estimate by 14 cents, delivering a surprise of 29.2%.
Ciena Corporation Price, Consensus and EPS Surprise
Ciena Corporation price-consensus-eps-surprise-chart | Ciena Corporation Quote
Revenues
Total revenues declined 6.7% year over year to $833.9 million, primarily due to lower product sales resulting from the pandemic. The top line, however, surpassed the consensus estimate of $828 million.
Region-wise, revenues in the Americas were $587.5 million, down 9.7% year over year. Revenues in Europe, Middle East and Africa were $155 million, up from $141.4 million. Asia Pacific revenues totaled $91.4 million, down 10.7%.
Segment Results
Total revenues in Networking Platforms decreased 11.3% year over year to $637.3 million. Platform Software and Services revenues were $56.7 million compared with $45 million in the prior-year quarter. Blue Planet Automation Software and Services revenues increased from $15 million to $23.9 million. Total revenues in Global Services were $116 million, up 0.3%.
Other Details
Adjusted gross margin was 49.2% compared with 46.9% in the year-ago quarter. Adjusted operating expenses were $278.7 million, up from $258.7 million. Operating income improved to $133.6 million from $127.5 million.
Adjusted operating income decreased to $131.7 million from $160.3 million. The adjusted operating margin came in at 15.8% compared with 17.9% in the prior-year quarter. Adjusted EBITDA was $156.2 million, down from $183 million.
During the quarter, Ciena repurchased almost 0.5 million shares for a total price of $26.2 million.
Cash Flow & Liquidity
During the first six months of fiscal 2021, Ciena generated $217.7 million of cash from operating activities compared with $130.9 million in the year-ago period. As of May 1, 2021, the company had $1,203 million in cash and cash equivalents compared with $673.4 million of long-term debt.
Outlook
Ciena continues to benefit from increased network traffic, demand for bandwidth and the adoption of cloud architectures. For the fiscal third quarter, the company expects revenues in the range of $950-$980 million. Adjusted gross margin is projected between 46% and 47%. Adjusted operating expenses are estimated between $285 million and $290 million.
Zacks Rank & Stocks to Consider
Ciena currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader industry are Cambium Networks Corporation (CMBM - Free Report) , Altice USA, Inc. (ATUS - Free Report) and Vicor Corporation (VICR - Free Report) , each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Cambium delivered a trailing four-quarter earnings surprise of 46.5%, on average.
Altice delivered a trailing four-quarter earnings surprise of 61.5%, on average.
Vicor delivered a trailing four-quarter earnings surprise of 80.6%, on average.
5 Stocks Set to Double
Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.
Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.
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