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Shares of optical network communication equipment vendor Ciena Corp. (NYSE: CIEN) jumped on Thursday following a mixed fourth-quarter report. Guidance calling for substantial revenue growth during the first quarter, along with positive commentary from management, seems to be the driver behind the stock's rise. At 11:45 a.m. EST, the stock was up about 14.5%.
Ciena reported fourth-quarter revenue of $716.2 million, up 3.5% year over year and in line with analyst expectations. The networking platforms segment produced $488 million of revenue, up slightly from $484.3 million during the prior-year period, while the packet networking segment grew revenue by 13.7% to $72.4 million. Optical transport saw revenue tumble 65% to just $5.8 million, while the software and services segments grew revenue by 43% and 11%, respectively.
Non-GAAP earnings per share came in at $0.44, up from $0.42 during the prior-year period but $0.02 below the average analyst estimate. GAAP EPS was $0.25, up from $0.10. Non-GAAP gross margin rose by 30 basis points year over year to 45.2%, while non-GAAP operating margin slumped 20 basis points to 12.8%. Non-GAAP operating expenses jumped 5.4%, knocking down profitability.
Ciena expects to report solid revenue growth during the first quarter. The company guided for first-quarter revenue in the range of $615 million to $645 million, up from $573 million during the prior-year period. The midpoint of that range represents growth of 9.9%.
Ciena CEO Gary Smith expects market share gains and improved profitability in 2017:
While Ciena's fourth-quarter results were mixed, a positive outlook was enough to send shares higher on Thursday.
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