Ciena (CIEN) said Wednesday it narrowed its first quarter net loss as the company booked lower expenses and saw improved margins, though revenues for the period declined. For the three months that ended January 31, the network specialist posted a net loss of $47.7 million, or $0.49 loss per share, compared to a net loss of $79.1 million, or $0.84 loss per share, a year ago.
Adjusted for certain one-time items such as amortization and share-based compensation, Ciena posted a wider loss of $0.17 per share, compared with $0.14 a year earlier. Analysts polled by Thomson Reuters had anticipated a five-cent loss per share. Revenues for the period declined four percent to $416.7 million, from $433.3 million in the same period last year.
"Our first quarter revenue reflects the combined effects of seasonality and longer customer deployment and revenue recognition cycles as a result of our greater mix of international and solutions-oriented sales," said president and CEO, Gary Smith. "However, our first quarter revenue does not reflect the underlying strength of the business and ongoing customer demand.
Last month, the company lowered its revenue forecast for the first quarter to $415 million - sharply below analyst estimates at that time. In the latest quarter, total product revenues fell five percent to $333.7 million, partially offset by a three percent increase in service revenues, to $83.0 million.
Under Ciena's packet-optical transport business, revenues declined seven percent to $266.3 million, offset by a 21 percent increase in packet-optical switching revenues, to $43.4 million.
Carrier-ethernet solutions sales fell 21 percent to $21.9 million, while software and services revenues rose one percent to $85.1 million. Total operating expenses fell 18 percent to $198.9 million, reflecting lower amortization, acquisition costs, and research and development expenses, among others. The company posted a ten basis point improvement in gross profit margins, to 41.9 percent, from 41.8 percent a year ago.
Looking forward, Smith said: "We expect sequential revenue growth in the fiscal second quarter, and we anticipate that our operating results for the second half of fiscal 2012 will be stronger than the first half."
Ciena said it expects revenues between $435 and $460 million for the second quarter, in line with analysts' $449.10 million estimate. Gross margins are expected in the low 40s, while operating expenses are expected in the low $180 million range.
The Linthicum, Maryland-based company makes products and services used to deliver voice, video and data communications. Shares of Ciena rose 8.56 percent in premarket trading Wednesday, to $14.59 as of 8:20 am EDT.