Ciena Corporation ( CIEN Quick Quote CIEN - Free Report) recently reaffirmed guidance for both second-quarter and full-year fiscal 2023 that it provided with its last earnings.
For second-quarter fiscal 2023, the company continues to expect revenues in the range of $1,035-$1,115 million. Adjusted gross margin is estimated to be low 40%. Adjusted operating expenses are projected to be $335 million.
For fiscal 2023, the company continues to expect revenue growth in the range of 20-22%, up from the earlier guided range of 16-18%. Adjusted gross margin is estimated to be between 42% and 44%. Adjusted operating expenses are expected to be $330 million per quarter in the remaining quarters.
The company also reiterated outlook regarding demand environment and the normalization of inventory and backlog aspects. Ciena’s performance is likely to be driven by easing supply-chain troubles.
CIEN is one of the leading providers of optical networking equipment, software and services. The company’s performance is being driven by increased network traffic, demand for bandwidth and the adoption of cloud architectures.
In addition to increasing demand for its solutions in the 5G, cloud, AI and automation space, CIEN is investing extensively to grab opportunities in fast growing markets in the next-gen metro and edge solutions.
The company’s flagship solution WaveLogic 5 Extreme continues to gain traction with 13 new customer wins in the last reported quarter.
recently unveiled WaveLogic 6, the latest generation of its WaveLogic technology, to tap the growing demand for increasing bandwidth and reducing energy usage to meet current and future network and business requirements.
Ciena has two new solutions with WaveLogic 6, WaveLogic 6 Extreme and WaveLogic 6 Nano. These new technologies are designed to cater to the high-capacity transport required by next-generation routing data paths and associated wholesale services. Frequent product launches and synergies from acquisitions, like Benu, are major tailwinds.
However, uncertainty prevailing over global macroeconomic conditions continues to be a major headwind. Rising research and development to fend off stiff competition continues to strain the company’s margins. Also, reliance on third-party contract manufacturers is a headwind.
Zacks Rank and Other Stocks to Consider
At present, Ciena carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks in the broader technology space are
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The Zacks Consensus Estimate for Perion’s 2023 earnings is pegged at $2.69 per share, rising 16% in the past 60 days. The long-term earnings growth rate is anticipated to be 25%.
Perion’s earnings beat the Zacks Consensus Estimate in all the last four quarters, the average being 31.7%. Shares of PERI have increased 58.6% in the past year.
The Zacks Consensus Estimate for Pegasystems’ 2023 earnings is pegged at $1.35 per share, rising 66.7% in the past 60 days.
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