Summary
Ciena Corporation reported solid revenue growth in the third quarter of fiscal year 2018, with total revenue increasing by 12.4% year-over-year to $818.8 million. This growth was primarily driven by strong performance in the Networking Platforms segment, particularly within Converged Packet Optical products. The company also saw increased revenue from its Global Services segment. Despite revenue growth, the reported net income for the quarter was $50.8 million, a decrease from $60.0 million in the prior year's quarter, impacted by higher operating expenses, including increased selling and marketing costs, and a significant increase in the provision for income taxes. The company also completed the acquisition of Packet Design, LLC, adding to its software capabilities. For the nine months ended July 31, 2018, Ciena reported a net loss of $408.7 million, largely due to a substantial provisional tax expense of $503.7 million related to the Tax Cuts and Jobs Act, including a $431.3 million charge for the remeasurement of deferred tax assets and a $45.6 million transition tax on foreign earnings. Excluding this tax impact, the operational performance would have been significantly different. The company continues to diversify its customer base and expand its geographic reach, with notable revenue growth in EMEA and APAC regions. Ciena also repurchased $73.5 million of its common stock during the period.
Financial Highlights
56 data points| Revenue | $818.82M |
| Cost of Revenue | $467.27M |
| Gross Profit | $351.54M |
| R&D Expenses | $121.13M |
| Operating Expenses | $266.27M |
| Operating Income | $85.27M |
| Interest Expense | $13.61M |
| Net Income | $50.84M |
| EPS (Basic) | $0.35 |
| EPS (Diluted) | $0.34 |
| Shares Outstanding (Basic) | 143.40M |
| Shares Outstanding (Diluted) | 160.00M |
Key Highlights
- 1Total revenue for Q3 FY2018 increased 12.4% to $818.8 million, driven by strong Networking Platforms growth.
- 2Networking Platforms revenue rose 14.4% to $677.5 million, with Converged Packet Optical products showing significant gains.
- 3Gross profit increased by 7.2% to $351.5 million, though gross margin as a percentage of revenue declined from 45.0% to 42.9%.
- 4Operating expenses increased by 8.2% to $266.3 million, with notable rises in Selling and Marketing and Significant asset impairments and restructuring costs.
- 5Net income for Q3 FY2018 decreased to $50.8 million from $60.0 million in Q3 FY2017.
- 6The company recorded a significant provisional tax expense of $503.7 million for the nine months ended July 31, 2018, primarily due to the Tax Cuts and Jobs Act.
- 7Ciena completed the acquisition of Packet Design, LLC for approximately $41 million in cash to bolster its software strategy.