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Technology Stocks : Ciena (CIEN) -- Ignore unavailable to you. Want to Upgrade?

To: Ibexx who wrote (11637)	11/12/2001 4:21:07 PM
From: Techplayer	Read Replies (2) \| Respond to of 12623

Ibexx, Right, but is writing it off killing the product or is it disposing of the paper deficit created by the drop in CIEN's stock price? I am unfamiliar with the accounting rules and practices in relation to acquisitions and development in process. LU finally wrote off the Chromatis deal last quarter and killed the product effort entirely. thanks. edit: this article explains it... lightreading.com tp

To: Ibexx who wrote (11637)	11/12/2001 8:09:48 PM
From: Maverick	Read Replies (1) \| Respond to of 12623

SSB is neutral on CIEN, difficult to believe 10% layoff unless they believed demand would remain weak Excerpts follow. CIENA (CIEN) CIEN: Ciena Preannounces Above-Consensus 3H (Neutral, High Risk) Fiscal 4Q Results Mkt Cap: $5,805.1 mil. November 12, 2001 SUMMARY * Ciena preannounced stronger-than-expected fiscal TELECOMMUNICATIONS 4Q results. Revenues are expected to come in at EQUIPMENT $368 million, 4% above our forecast and exceeding B. Alexander Henderson consensus expectations by 3%. * Earnings are expected to come in at $0.04-$0.06 per share, compared to consensus expectations of Timothy Anderson $0.04 per share. * Mgmt reaffirmed that they logged revs. from the Cyras product in fiscal 4Q. Daryl Armstrong * The company is trimming 10% of its workforce or around 380 people immediately. The cut is expected to lower fiscal 2002 COGS by $21-$23 million on an annualized basis. * While encouraged with the preannouncement, we question whether Ciena's momentum is sustainable. The company's decision to cut headcount suggests that demand continues to be weak. In addition, Qwest, an important Ciena customers, is expected to show a sharp Q-Q reduction to calendar 4Q capex. we still harbor concern relative to the forward outlook. First, the company's decision to cut manufacturing headcount at this point suggests that demand is not rebounding. It seems difficult to believe that the company would shed over 10% of their workforce unless they believed demand would remain weak for at least a few quarters. Secondly, the carrier capex environment remains extremely challenging. Qwest, a significant Ciena customer, is expected to show a steep sequential declines in capex in the calendar 4Q period, falling to around $700 million from $2.2 billion. Consequently, we need further confirmation before becoming constructive on the outlook.