Networking gear maker Ciena Corp. (CIEN: Quote) reported Thursday a significantly narrower loss for the second quarter, reflecting about 14 percent growth in revenues and lower operating expenses. Excluding items, the company posted a surprise profit, as analysts were expecting a loss.
Ciena said it remains confident that it is well positioned for future growth and continues to expect second half operating results to be stronger than the first half. In pre-market trading, the shares rose more than 5 percent.
Gary Smith, president and CEO of the company said, "Our second quarter was highlighted by strong revenue growth and positive overall operating performance, which demonstrated our ability to deliver operating leverage."
The Linthicum, Maryland-based company's quarterly net loss narrowed to $27.78 million or $0.28 per share from $62.69 million or $0.66 per share reported last year.
On an adjusted basis, earnings were $0.04 per share, compared to an adjusted loss of $0.24 per share a year ago. On average, 21 analysts polled by Thomson Reuters expected the company to report a loss of $0.03 per share for the quarter. Analysts' estimates typically exclude special items.
Total revenues for the quarter grew 14.3 percent to $477.62 million, which also came in above analysts' estimate of $446.97 million. The company said its non-U.S. customers contributed 47 percent of total revenue.
Product revenues increased to $384.73 million from $336.03 million in the prior year. Services revenues were $92.89 million, higher than $81.87 million a year earlier.
Ciena, which counts AT&T Inc. (T) and Verizon Communications Inc. (VZ) among its top customers, said its gross margin declined 1.4 percent to 38.3 percent. Total operating expenses were $194.4 million, down 12.2 percent from the preceding year.
Looking ahead to the third quarter, the company said it expects revenues to be in the range of $455 million to $485 million. Analysts are looking for revenues of $471.05 million for the quarter. Adjusted gross margin is expected to be about 40 percent.
CIEN closed Wednesday's regular trading at $11.88 on the Nasdaq. In the pre-market activity, the shares are up 5.13 percent.
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by RTT Staff Writer
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