<<Ciena Misses in Q1
March 4, 2010 | Craig Matsumoto
Ciena Corp. (Nasdaq: CIEN) shares are down 8 percent today as the company missed its earnings target while on the verge of its big Nortel Networks Ltd. deal.
Ciena reported non-GAAP losses of $11.4 million, or 12 cents per share, on revenues of $175.9 million. Analysts had expected losses of only 7 cents per share, according to Reuters Research .
Ciena did put out $27 million in expenses related to the pending acquisition of Nortel's Metro Ethernet Networks assets. (See Ciena Beats NSN to Buy Nortel's MEN.) But its revenues still fell short of analysts' expectations of $183 million.
That's because of delays in getting revenues from certain customers, according to Ciena's release. The company said the delays were related to "initial deployments of new platforms," but didn't specify which ones.
One candidate might be the CoreDirector FS upgrade, introduced in September. A longshot possibility is the Ciena 5400, the next-generation packet-optical transport system (P-OTS). In September, Ciena had said the 5400 would reach general availability in the first half of 2010. (See Ciena Catches Packet/Optical Convergence Bug.)
In its press release, Ciena says revenues for its second quarter will be $185 million to $195 million. Ciena may fall short of analysts' expectations there as well; before today's earnings, the consensus forecast was that Ciena would report $194 million in second-quarter revenues.
We may never know whether Ciena hits that target. In a report early this morning, Soleil Securities Group Inc. analyst Michael Genovese points out that the Nortel deal should be closed within the month, adding substantially to Ciena's April-quarter results. Ciena would be under no obligation to report how much of those revenues came from the Nortel side.
Nortel MEN brought in $798 million in revenues during the past nine months, Ciena reported. That's an average of $266 million per quarter.
Ciena shares were down $1.14 (7.8%) at $13.41 at press time.
— Craig Matsumoto, West Coast Editor, Light Reading>>
ref: lightreading.com;
Hopefully, just growing pains.
Woody |
