For the fiscal first quarter 2014, Ciena reported revenue of $533.7 million as compared to $453.1 million for the fiscal first quarter 2013.
On the basis of generally accepted accounting principles (GAAP), Ciena’s net loss for the fiscal first quarter 2014 was $(15.9) million, or $(0.15) per common share, which compares to a GAAP net loss of $(47.3) million, or $(0.47) per common share, for the fiscal first quarter 2013.
Ciena’s adjusted (non-GAAP) net income for the fiscal first quarter 2014 was $13.7 million, or $0.13 per diluted common share, which compares to an adjusted (non-GAAP) net income of $12.3 million, or $0.12 per diluted common share, for the fiscal first quarter 2013.
“Solid execution in our fiscal first quarter, including 18% year-on-year revenue growth and 6% adjusted operating margin, demonstrates our continued momentum, reinforces our market leadership, and positions us well for the long-term opportunity ahead,” said Gary B. Smith, president and CEO, Ciena. “We continue to benefit from the strategic decisions we’ve made to expand our role and reach in the market, driving more consistent performance and progress toward achieving our long-term operating targets.”
Fiscal First Quarter 2014 Performance Summary
The tables below (in millions, except percentage data) provide comparisons of certain quarterly results to prior periods, including sequential quarter and year-over-year changes. A reconciliation between the GAAP and adjusted (non-GAAP) measures contained in this release is included in Appendix A.
| | | | | GAAP Results | | | Q1 | | Q4 | | Q1 | | Period Change | | | FY 2014 | | FY 2013 | | FY 2013 | | Q-T-Q* | | Y-T-Y* | | Revenue | | $ | 533.7 | | | $ | 583.4 | | | $ | 453.1 | | | (8.5 | )% | | 17.8 | % | | Gross margin | | 42.3 | % | | 39.7 | % | | 43.2 | % | | 2.6 | % | | (0.9 | )% | | Operating expense | | $ | 222.5 | | | $ | 232.1 | | | $ | 201.4 | | | (4.1 | )% | | 10.5 | % | | Operating margin | | 0.6 | % | | (0.1 | )% | | (1.2 | )% | | 0.7 | % | | 1.8 | % | | | | | | | | | | | | | | | | |
| | | | | Non-GAAP Results | | | Q1 | | Q4 | | Q1 | | Period Change | | | FY 2014 | | FY 2013 | | FY 2013 | | Q-T-Q* | | Y-T-Y* | | Revenue | | $ | 533.7 | | | $ | 583.4 | | | $ | 453.1 | | | (8.5 | )% | | 17.8 | % | | Adj. gross margin | | 43.4 | % | | 40.8 | % | | 44.6 | % | | 2.6 | % | | (1.2 | )% | | Adj. operating expense | | $ | 199.8 | | | $ | 210.5 | | | $ | 176.6 | | | (5.1 | )% | | 13.1 | % | | Adj. operating margin | | 5.9 | % | | 4.7 | % | | 5.6 | % | | 1.2 | % | | 0.3 | % | | | | | | | | | | | | | | | | |
| | | | | Revenue by Segment | | | Q1 FY 2014 | | Q4 FY 2013 | | Q1 FY 2013 | | | Revenue | | % | | Revenue | | % | | Revenue | | % | | Converged Packet Optical | | $ | 333.4 | | | 62.5 | | | $ | 350.9 | | | 60.1 | | | $ | 240.0 | | | 53.0 | | Packet Networking | | 51.7 | | | 9.7 | | | 61.2 | | | 10.5 | | | 45.8 | | | 10.1 | | Optical Transport | | 40.1 | | | 7.5 | | | 52.6 | | | 9.0 | | | 57.6 | | | 12.7 | | Software and Services | | 108.5 | | | 20.3 | | | 118.7 | | | 20.3 | | | 109.7 | | | 24.2 | | Total | | $ | 533.7 | | | 100.0 | | | $ | 583.4 | | | 100.0 | | | $ | 453.1 | | | 100.0 | | | | | | | | | | | | | | | | | | | | | |
| | * Denotes % change, or in the case of margin, absolute change
| | |
Additional Performance Metrics for Fiscal First Quarter 2014
Non-U.S. customers contributed 41% of total revenue
One customer accounted for greater than 10% of revenue and represented 18.8% of total revenue
Cash and investments totaled $440.1 million
Cash flow used in operations totaled $(37.2) million
Free cash flow totaled $(52.9) million
Average days’ sales outstanding (DSOs) were 88
Accounts receivable balance was $518.9 millionInventories totaled $284.1 million, including:Raw materials: $56.7 millionWork in process: $7.3 million
Finished goods: $178.0 millionDeferred cost of sales: $84.5 million
Reserve for excess and obsolescence: $(42.4) million
Product inventory turns were 3.5
Headcount totaled 4,865
Business Outlook for Fiscal Second Quarter 2014
Statements relating to business outlook are forward-looking in nature and actual results may differ materially. These statements should be read in the context of the Notes to Investors below.
Ciena expects fiscal second quarter 2014 financial performance to include:
Revenue in the range of $540 to $570 million
Adjusted (non-GAAP) gross margin in the low 40s percent range
Adjusted (non-GAAP) operating expense in the $210 million range |
