Analysts are looking for $203M in revenue and $0.31 EPS.
Last quarter Ciena recorded $0.26 EPS on $194M in revenue (revenue was up 48% year over year). This beat estimates by $0.01 on the bottom line and $14M on the top line.
They also lifted full year guidance at the time, pushing revenue growth year over year to 36% from a previous forecast of 27-30%. Gross margins, however, did fall from 44.6% to 42.3%. (Juniper and Cisco for example have >60% gross margins)
One main drawback is the extreme concentration on just a few customers - Sprint (S), Verizon (VZ), and AT&T (T), accounted for 50% of 2006 revenue.
Ciena was on the many go go tech stocks in the late 90s/00; interesting to see some of these names come back. If Cisco (CSCO) is any bellweather, I expect more positive news about the future and strong pipeline.
Investor's Business Daily ran a report here about CIEN on June 29th
- "The underlying demand drivers for optical networking equipment have never appeared to be more robust," Piper Jaffray analyst Troy Jensen wrote in a client note.
- Ciena makes equipment used in citywide networks and long-haul data lines. It also makes switches that get data to its destination and access components that help customers deliver telephone and high-def TV over the Internet.
- Its customers are telecom giants, cable companies, large enterprises and governments.
- Telecom companies and service providers laid vast networks of fiber that were to be the backbone of the New Economy. Then came the dot-com bust. Now, much of that dark fiber is being lit, thanks to video and a slew of other information-dense applications. Service providers are updating the switches in the system. And they're stringing fiber straight into homes to deliver even more services.
- Internet video uses 1,000 times as much bandwidth as a single e-mail
- YouTube. The Google-owned video-sharing site now uses the same amount of bandwidth as the entire Internet consumed in 2000, computer pioneer Michael Dell said in January.
- Once a solely fiber pure-play, it went on a buying spree, picking up six companies since 2001. That expanded its product and customer base, turning it into a broader-based network services firm.
- Ciena typically relies on several customers for almost half of its revenues -- four customers each contributed more than 10% last quarter. But because of various project cycles, that revenue is lumpy.
