Ciena’s second quarter 2011 results disappoint

Management at Ciena Corp. (NASDAQ:CIEN) cited “momentum” and “a strong foundation to optimize the business” as outcomes of its fiscal second quarter, quarter which ended April 30, 2011. The Street wasn’t as impressed with the optical equipment maker’s 2Q11 performance, thrashing Ciena’s stock based on revenues and loss that missed analyst’s expectations, guidance for the third quarter that similarly disappointed, and a round of musical chairs within the leadership team.

Ciena reported revenue in 2Q11 of $417.9 million, at the low end of its previous guidance, and a GAAP net loss of $62.7 million, or $0.66 per common share. GAAP gross margin came in at 39.7%.

While the revenue and loss figures compared favorably to the year ago quarter (which saw a GAAP net loss of $90 million, or $0.97 per common share), they were worse than analysts’ estimations, which Reuters put at $428.2 million in revenue and an adjusted loss of $0.11 per share. (Reuters put Ciena’s loss, “excluding items,” at $0.24 per share.)

Nevertheless, Ciena CEO Gary Smith did his best to cast the quarter in a positive light. “Having successfully completed all of our critical integration milestones, we now have a strong foundation to optimize the business and gain additional operating leverage as we drive toward sustained profitability.”

To help this drive, Smith shuffled a few of his reports. Mike Aquino, previously senior vice president, global field operations, was shuttled to the role of general manager, global government solutions. Philippe Morin, who joined Ciena as senior vice president, global products group when Ciena acquired Nortel, will take Aquino’s place as senior vice president, global field operations. François Locoh-Donou, formerly vice president and g manager, EMEA, will fill Morin’s former role.

Smith added that he expects fiscal third quarter 2011 revenue to be in the range of $435 million to $455 million, with an adjusted gross margin in the low 40 percent range.

The markets were unimpressed. Ciena stock dropped $3.92, or 16%, in trading yesterday, Bloomberg reports.