Test technology vendor EXFO Inc. (NASDAQ: EXFO, TSX: EXF) has announced the promotion of Chief Operating Officer Philippe Morin to the position of CEO. Germain Lamonde, the company's founder, chairman of the board and, until April 1, CEO, will become executive chairman of the company, with an emphasis on leading EXFO's acquisition strategy as well as other growth initiatives, customer outreach, and corporate governance.
Morin joined EXFO in 2015 from Ciena, where he was senior vice president of worldwide sales and field operations (see "Ciena's Morin moving to EXFO as COO").
Lamonde believes the time is finally right to hand over day-to-day operations of the company for the first time in the nearly 32 years since he founded EXFO in his apartment. "It's not that much about age," he explained. "I think this is a tremendous time of transformation within the space, with data center construction, data migrations to high speeds like 100G, 200G, 400G… there's a huge amount of transformation. And EXFO has really been performing very well in that space. I believe the two of us jointly in our respective roles will just have more strength and more capacity to accelerate [EXFO's success] in the marketplace."
"I think the company is in a really good position now," added Morin. "I really believe that now is the time to make some decisions around whether [to pursue] organic or inorganic opportunities because the market is so dynamic. There are a lot of opportunities, a lot of new models emerging."
Morin said he sensed growing demand for optical communications technology at OFC 2017 last week as well as calls for virtualization of the network. These trends should provide growth opportunities for EXFO, he and Lamonde agreed. In addition to the data center and the roll out of 100 Gbps and eventually higher speeds, Lamonde pointed to support of wireless backhaul and fiber to the home (FTTH) as growth engines within optical communications, while Morin said he's encouraged by what he sees in the metro and data center interconnect.
EXFO will continue to support the test requirements of both network operators as well as technology developers, the two confirmed. "As new services get deployed, I think having the capability to start engaging the network equipment vendors in the lab as they design technology, and then heading into production and then as the technology gets deployed in the network – I really like the capability to do that," said Morin. "I think Germain and the team made a pretty important decision a couple of years ago to reinvest to go after that network equipment market." More than 12 network equipment vendors have purchased the LTB-8 platform EXFO launched last year, he added. Morin sees the platform and the modules EXFO has developed for it as applicable to technology deployment, meaning operators will find them useful as well.
Even before the transition, EXFO has proven aggressive in acquisitions (see, most recently, "EXFO buys Absolute Analysis for optical RF over CPRI test technology" and "EXFO buys Ontology Systems for real-time network topology discovery and service-chain mapping"). Lamonde said that he doesn't believe in buying market share; rather, he prefers acquisitions of smaller players that provide synergies with the company's direction as well as serve strategic goals. He pointed to the Absolute Analysis and Ontology Systems acquisitions as examples in which EXFO has brought in a capability just ahead of a demand ramp that the company is therefore in position to exploit.
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