Ciena Reports Surprise 2Q Profit, Shares Rally

By Features FOXBusiness

Ciena (CIEN) revealed a better-than-expected second-quarter profit, excluding items, as sales improved across its business segments and expressed optimism for the second half of the year. 

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Shares of the provider of communications network equipment and services soared more than 6% on the news to $12.60 Thursday morning.

Ciena chief executive Gary Smith said strong revenue helped boost operating earnings and demonstrated the company’s ability to “deliver operating leverage.”

“We remain confident that we are well positioned for future growth and continue to expect our second half operating results to be stronger than the first half,” he said.

The Linthicum, Md.-based company reported a narrowed loss of $27.8 million in the latest period, or 28 cents a share, compared with a year-earlier loss of $62.7 million, or 66 cents.

Excluding one-time items, Ciena earned $3.7 million, or 4 cents a share, better than the 3-cent loss forecast by analysts in a Thomson Reuters poll.

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Revenue for the three-month period was up 14.3% to $477.6 million, compared with $417.9 million a year ago, and beat the Street’s view of $447 million.

The gains were led by a 65.2% year-over-year sales improvement in its packet-optical transport segment -- by far Ciena’s largest division -- as revenue jumped to $318 million from $272.6 million a year ago.

The company forecast third-quarter revenues in the range of $455 million to $485 million, with non-GAAP gross margin of 40%. Analysts on average are expecting Ciena to report sales in the current period of $471.1 million.