Delivers 12% adjusted operating margin and generates $117 million in cash from operations
Ciena, the network specialist, has announced financial results for its fiscal third quarter ended July 31, 2015. For the fiscal third quarter 2015, the company reported revenue of $602.9 million as compared to $603.6 million for the fiscal third quarter 2014.
Ciena’s adjusted (non-GAAP) net income for the fiscal third quarter 2015 was $50.7 million, or $0.37 per diluted common share, which compares to an adjusted (non-GAAP) net income of $40.9 million, or $0.32 per diluted common share, for the fiscal third quarter 2014.
“We delivered strong financial performance in our fiscal third quarter, including increased profitability and cash generation, demonstrating our ability to deliver on our business model and drive continued operating leverage,” said Gary B. Smith, president and CEO of Ciena.
“Despite short-term revenue headwinds related to the timing of network implementations at certain large service provider customers, fundamental demand drivers for our business remain strong. In fact, we now expect to exceed 10% adjusted operating margin for the full fiscal year.”
Q3 performance summary
Key business observations and achievements detailed in the latest financial report are as follow:
- S. customers contributed 59.8% of total revenue, with one customer accounted for greater than 10% of revenue and represented 20% of total revenue
- Cash and investments totaled $927.3 million and cash flow from operations totaled $117.5 million
- Average days’ sales outstanding (DSOs) were 79 and the accounts receivable balance was $530.3 million
- Inventories totaled $194.0 million, including: raw materials: $54.1 million; work in process: $8.9 million; finished goods: $119.7 million; deferred cost of sales: $59.6 million; and reserve for excess and obsolescence: $(48.3) million.
Ciena said that it expects fiscal fourth quarter 2015 financial performance, inclusive of a full quarter of results from the acquired Cyan business, to include: revenue in the range of $665 to $700 million, adjusted (non-GAAP) gross margin of approximately 44 percent, and adjusted (non-GAAP) operating expense of approximately $225 million.
Ciena has also announced that François Locoh-Donou has been appointed senior vice president and chief operating officer, effective November 1, 2015, reporting directly to Gary B. Smith, president and CEO. In this new position, Locoh-Donou will assume responsibility for Ciena’s Global Field Organization, including the global sales and services functions, while retaining his existing responsibility for Ciena’s research and development, product line management, supply chain and quality functions.
By Matthew Peach