Communications networking equipment maker Ciena Corp. (CIEN) on Thursday reported a loss for the first quarter that narrowed slightly from last year, reflecting higher revenues and margins that were mostly offset by a loss on debt extinguishment. Both revenue and adjusted earnings per share beat analysts' estimates.
Looking ahead, the company provided revenue guidance for the second quarter in line with Street view. The company's shares are up 10 percent in pre-market trades.
The Hanover, Maryland-based company's products revenue for the first quarter increased 6 percent from the year-ago period to $353.06 million, while services revenue grew 21 percent to $100.04 million.
Gary Smith, president and CEO of Ciena said, "Our strong first quarter performance reflects a solid start to our fiscal year. We have positioned Ciena to take advantage of the underlying market dynamics, which are increasingly aligned with our strategy and competitive strengths."
Ciena's first-quarter net loss was $47.32 million or $0.47 per share, narrower than loss of $47.65 million or $0.49 per share in the prior-year quarter.
The latest quarter's results include, among others, a loss on debt extinguishment of $28.63 million.
Excluding these items, adjusted net income for the quarter was $12.28 million or $0.12 per share, compared to adjusted loss of $16.48 million or $0.17 per share in the year-ago quarter. On average, 19 analysts polled by Thomson Reuters expected the company to report loss of $0.14 per share for the quarter. Analysts' estimates typically exclude special items.
Revenues for the quarter grew 9 percent to $453.09 million from $416.69 million in the same period last year. Analysts had a consensus estimate of $449.14 million.
Ciena noted that non-U.S. customers contributed 42 percent of the revenues. Two customers accounted for greater than 10 percent of revenue and represented 26.4 percent of total revenue.
Gross margin for the quarter expanded 290 basis points from the year-ago period to 43.2 percent, while adjusted gross margin expanded 270 basis points to 44.6 percent.
Looking ahead to the second quarter, Ciena forecasts revenues in a range of $465 million to $495 million and adjusted gross margin in the low 40s percent range. Analysts expect the company to report revenues of $482.13 million for the quarter.
CIEN closed Wednesday's trading at $14.94. In Thursday's pre-market, the stock is adding $1.50 or 10.04 percent to $16.44.
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