CIENA Corporation (NASDAQ: CIEN) reported revenue of $458.1 million for its third fiscal quarter ended July 31, 2001, including revenue from six new customers. CIENA's third quarter sales represent sequential revenue growth of more than seven percent over the Company's fiscal second quarter revenue of $425.4 million, and an increase of more than 96 percent as compared to the same period a year ago when the Company reported revenue of $233.3 million.
Adjusted net income for the third quarter, which excludes deferred stock compensation charges, payroll taxes on stock option exercises, a benefit from receipt of a previously written down receivable, and amortization of intangibles and goodwill, was $58.0 million or, $0.17, earnings per diluted share. This represents an increase of approximately 100 percent and 70 percent respectively, when compared with adjusted net income for the same period a year ago of $28.8 million or, $0.10, earnings per diluted share, exclusive of payroll tax on stock option exercises, provision for a doubtful account, gain on settlement of an accrued contract obligation and amortization of intangibles and goodwill. Consensus of First Call estimates for CIENA's third quarter fiscal 2001 was $0.16, earnings per diluted share.
Quarterly Highlights
CIENA continues to diversify its growing customer base, adding revenue from six new customers in the third quarter. The Company's total revenue-generating optical networking equipment customer base now totals 55, of which, a record-high 45 contributed to CIENA's revenues during the most recent quarter. In addition, sales of CoreDirector, CIENA's next-generation, intelligent optical core switching platform, surpassed ten percent of total revenue for the third sequential quarter and increased 20 percent over the previous quarter.
Market Outlook
Recent market studies by industry analyst firms, including The Aberdeen Group, have confirmed that service provider spending is shifting from legacy systems to next generation systems. Based on a survey of 74 carriers and service providers, Aberdeen published a report entitled "Shining the Light on Intelligent Optical Networking, Redefining the Market Yields New Results: A Demand Side Study." In this report, Aberdeen indicates that CIENA, with its focus on next-generation intelligent optical networking systems, is the best-positioned optical equipment vendor in the marketplace.
Aberdeen's research also found the following:
* Money historically spent on circuit switching and SONET/SDH transport gear will be increasingly used on next-generation "intelligent" optical systems.
* Long-haul DWDM transport is the primary market for next-generation systems, but metro optical transport and core optical switching will be the fastest growing segments over the next five years.
* CIENA has a 25 percent market share in intelligent optical networking.
* CIENA has a 30 percent and 52 percent market share, respectively, in long-haul transport and the core switch markets.
Organizational Update
In addition, the Company announced that, effective immediately, Jesùs Leòn, CIENA's senior vice president, metro transport division, also will assume leadership of the CIENA's Metro Switching Division, replacing Alnoor Shivji.
About CIENA:
CIENA Corporation's intelligent optical networking systems form the core for networks and services worldwide. For more information, visit www.CIENA.com.