Next Generation Networking Industry
Paul Johnson, Communications/Networking
Paul Silverstein , Communications/Networking
Ara Mizrakjian, Communications/Networking
“The companies that we cover under the Optical Networking category have all reported their December quarters, and we are taking this opportunity to review their overall quarterly performance, as well as the positive momentum observed for profitability and growth throughout the Optical Networking industry,” said Johnson, Silverstein and Mizrakjian. “We believe it is this momentum that underscores the opportunity for upside surprise in revenues and earnings as the market for optical subsystems and systems continue to accelerate over the next few years. Revenue for next generation Optics, as we define it, was up roughly 35% sequentially and 272% year-over-year in the December quarter. Our original projections for the overall market growth for Optics in the December quarter were roughly 17% sequentially and 222% year-over-year. Overall revenues for the December quarter totaled $653 million, or roughly 16% higher than our original forecasts. Optical networking is one of the critical pieces of next generation networks. Optics companies create products which represent the new physical and logical transport layers that increase, by orders of magnitude, the available bandwidth and flexibility of Metro and Long-haul carrier networks. With the telecom carriers’ continued focus on increasing data capacity at both the edge and core of the network, the opportunity for the Optical companies, as a group, remains a large one. As a direct consequence, we believe that Optics will continue to be a huge growth opportunity in the networking sector.”
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