Infinera nails first quarter 2014, expects even better second quarter
Optical transport systems vendor Infinera Corp. (NASDAQ: INFN) reported revenues of $142.8 million for the first quarter of 2014 ended March 29, at the upper end of its guidance. And they expect the current quarter to be significantly better.
Optical transport systems vendor Infinera Corp. (NASDAQ: INFN) reported revenues of $142.8 million for the first quarter of 2014 ended March 29, at the upper end of its guidance. And company executives expect the current quarter to be significantly better.
The $142.8 million showed improvement sequentially over the $139.1 million of 4Q13 and the $124.6 million earned in the first quarter of 2013. It narrowly missed exceeding Infinera’s guidance for the quarter of $137 million and $143 million (see "Infinera expects a strong start to 2014").
Strong North American traction with telcos, cable MSOs, and Internet content providers drove revenues during the quarter, Infinera executives said. They revealed that Level 3 was one of those customers.
GAAP gross margin also showed improvement. The recently completed quarter saw a GAAP gross margin of 40.9%, slightly ahead of the previous quarter's 40.2% and well ahead of the year-ago quarter's 34.2%.
However, the performance was not robust enough to achieve profitability on a GAAP basis. GAAP net loss was $4.4 million ($0.04 per share). However, that mark also bested 4Q13, when GAAP net loss came in at $10.2 million ($0.08 per share), as well as 1Q13, when GAAP net loss was $15.3 million ($0.13 per share).
On a non-GAAP basis, things looked rosier. Gross margins of 41.8% exceeded guidance as well as the 41.4% of the previous quarter and the 35.9% of the first quarter of 2013. Non-GAAP net income was $4.2 million ($0.03 per share), versus a net loss of $0.2 million ($0.00 per share) sequentially and $7.3 million ($0.06 per share) in the first quarter of 2013.
"Our first quarter performance was exceptionally strong in what is typically a soft quarter for our industry. We are benefitting from the continued investment cycle in 100G and network convergence. The favorable economics of our PIC-based architectures and the operational benefits of superchannels position us as the industry recognized leader in the optical market," said Tom Fallon, Infinera’s CEO. "I remain optimistic about our short-, intermediate-, and long-term opportunity."
Fallon's optimism shone in the company's guidance for the current quarter. Infinera forecasts revenues will fall between $160 million and $170 million. The midpoint would be a sequential increase of 16% and a 19% increase versus the year-ago quarter. Non-GAAP earnings per share should be $0.04 per diluted share, the company added.
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