Sep. 4, 2013, 3:01 PM
- Equipment vendors Adtran (ADTN +10.1%), Ruckus (RKUS +4.5%), Aruba (ARUN +2.5%), Ericsson (ERIC +2.2%), Procera (PKT +2.1%) and Calix (CALX +2.3%), and component/chip suppliers Oplink (OPLK +4.1%), NeoPhotonics (NPTN +2.3%), Alliance Fiber (AFOP +3.1%), AppliedMicro (AMCC +5%), and PMC-Sierra (PMCS +1.9%) have joined the ranks of names outperforming following Ciena's (CIEN +13.6%) strong numbers (fueled by strong demand for metro/edge networking hardware) and Juniper's upbeat conference comments about Q3 bookings and router demand.
- Ciena mentioned on its FQ3 CC U.S. orders were relatively strong (likely a sign of strong AT&T/Verizon spending), as North American carriers lead the way in adopting newer technology platforms (100G optical, integrated Ethernet/optical hardware, etc.), However, the company also claimed Europe is stabilizing, and that it's seeing new customer wins in Latin America/Asia.
- Ciena also touted its share gains, noting Heavy Reading calls it the leader in the fiber-based Ethernet access switch space, and that Dell'Oro ranks its first in the integrated Ethernet/optical market. However, it does look as if Ciena has lost some share in optical transport (revenue +15% Q/Q but -26% Y/Y). The company says new customer wins will lead transport growth to pick up.
Sep. 4, 2013, 9:29 AM
- Ciena (CIEN) expects FQ4 revenue of $550M-$580M, mostly above a $551.4M consensus.
- Sales of integrated Ethernet switching/optical networking gear (Converged Packet Optical) rose 3% Q/Q and 23% Y/Y in FQ3, and made up 56% of revenue. That could be a positive for Cyan (CYNI - previous).
- Ethernet switch sales (packet networking) +14% Q/Q and +104% Y/Y, and now 11% of revenue. Optical transport hardware +15% Q/Q but -26% Y/Y, and 12% of revenue. Software/services +7% Q/Q and +1% Y/Y, and 20% of revenue.
- As Cisco and Juniper can vouch, demand for metro/edge networking hardware (such as Ciena's converged packet optical gear and Ethernet switches) has been strong lately.
- Gross margin was 43.6%, +110 bps Q/Q and +400 bps Y/Y, and reversing FQ2's Q/Q decline. It's expected to be in the low-40s in FQ4. Opex -3.5% Q/Q and only +8% Y/Y, op. margin jumped to 8.2% from 3.7% in FQ2.
- International customers made up 37% of revenue vs. 43% in FQ2. Two customers (possibly AT&T/Verizon) accounted for 31.8% of revenue, nearly even with FQ2.
- Infinera (INFN) +6.9%, JDS Uniphase (JDSU) +2.5% and Finisar (FNSR) +2.8% in sympathy.
- Ciena also jumped following its FQ2 results. Needham's July call was on the mark.
- FQ3 results, PR
Sep. 4, 2013, 9:10 AM
Sep. 4, 2013, 7:03 AM
Sep. 4, 2013, 12:05 AM
Sep. 3, 2013, 5:30 PM
Sep. 3, 2013, 10:30 AM
- BlackBerry (BBRY +2.1%) is rallying on hopes the Microsoft/Nokia blockbuster will increase its chances of being acquired as it continues evaluating "strategic alternatives," and reportedly seeks out a "Google-like" white knight.
- Deal optimism is overshadowing a bearish note from Raymond James: the firm has cut estimates through 2015, and (backing up a recent WSJ column) says checks indicate sell-through has been weak.
- Meanwhile, several smaller networking/telecom equipment makers have joined Alcatel-Lucent and Ericsson (previous) in outperforming, as investors speculate Nokia will use some of its Microsoft cash to strengthen NSN via M&A. Infinera (INFN +5.6%), Ciena (CIEN +3.5%), DragonWave (DRWI +4.8%), and Ruckus (RKUS +2.6%) are among the winners.
- Craig-Hallum thinks Nokia is now likely to buy Ruckus, a leading player in carrier Wi-Fi and an existing NSN partner.
Aug. 14, 2013, 7:07 PM
- Nasdaq-100 futures (QQQ, XLK) -0.5% AH after Cisco provides relatively light FQ1 guidance to go with an FQ4 beat, and also reports Asia-Pac/Japan orders were down 3% Y/Y (macro is blamed).
- Networking/telecom hardware vendors and some of their suppliers are naturally the biggest decliners. Many of them have run up strongly this year on hopes of gradually improving carrier capex and enterprise IT spending. ALU -3.3% AH. JNPR -2.4%. ARUN -1.4%. FFIV -2%. ARRS -2.4%. RVBD -3.2%. JDSU -1.6%. FNSR -2.8%. CIEN -2.2%. CAVM -2%.
Aug. 6, 2013, 5:20 PM
- Finisar (FNSR) expects FQ1 (July quarter) revenue of $266M and EPS of $0.30-$0.31, above guidance of $245M-$260M and $0.22-$0.26, and a consensus of $253.6M and $0.24.
- The optical component vendor mostly attributes its performance to "increased sales of 10G, 40G and 100G Ethernet transceivers for datacom applications." Demand for 10G data center hardware and 100G carrier optical networking gear has been growing rapidly. Telecom sales rose by $2M Q/Q.
- Though Finisar is halted, other industry names are up in AH trading. JDSU +4.4%. CIEN +2.8%. Other names that might rally in sympathy: INFN, NPTN, AFOP, OPLK, OCLR.
Jul. 29, 2013, 2:14 PM
- Analyst Alex Henderson says "numerous indications from the component supply chain " point to a pickup in orders for components used in coherent optical transmission systems, which can lower the need for optical amplifiers and are proving popular for 100G deployments.
- Ciena (CIEN +1.8%), whose PT is raised to $28 from $22, is "unanimously noted" in the checks as having pulled in component orders.Though coherent demand is seen as the main factor, Henderson also reports hearing of strong demand OTN switching and carrier Ethernet gear.
- Henderson is also reiterating Buys on rival Infinera (INFN -0.8%) and component vendor NeoPhotonics (NPTN -2.9%) for the aforementioned reasons. Infinera tumbled last week in spite of beating Q2 estimates and providing above-consensus Q3 guidance, as investors decided they wanted more following huge YTD gains.
- Ciena has been rallying strongly since its June 6 FQ2 report (I, II).
- Other optical component vendors: JDSU, FNSR, OPLK, OCLR, AFOP
Jul. 18, 2013, 11:23 AMSeveral telecom equipment/component/chip names are ticking higher after Verizon raises its 2013 capex budget to $16.4B-$16.6B from $16.2B (a figure that disappointed investors when announced in January). CIEN +2.7%. JDSU +2%. JNPR +1.7%. SONS +2.3%. ALLT +2.5%. CAVM +1.8%. CALX +2.2%. The group sold off 3 months ago after AT&T lowered its 2014/2015 capex forecasts. It rallied last Thursday thanks to positive analyst commentary. | Comment!
Jul. 17, 2013, 10:47 AMOptical networking hardware vendors Infinera (INFN +2.7%) and Ciena (CIEN +1.6%) rally after William Blair starts coverage with an Outperform. Shares of both companies have soared over the last 3 months, fueled by strong earnings reports (I, II) and expectations of a surge in 100G transmission system deployments. Infinera's Q2 report arrives on July 24. | 1 Comment
Jul. 11, 2013, 4:03 PMTelecom equipment, chip, and component makers finish up strongly after Needham upgrades Finisar (FNSR +6%), Goldman upgrades Alcatel-Lucent (ALU +6.3%) and Adtran (ADTN +2.3%), and William Blair reports of positive F5 checks. Ciena (CIEN +10.1%), Riverbed (RVBD +4%), Calix (CALX +6.9%), Aruba (ARUN +5%), and JDS Uniphase (JDSU +3.6%), are among the top gainers. Needham says meetings with Finisar's chairman and CEO leave it impressed with the company's positioning and visibility. "Finisar seems more confident in its outlook than it’s been in a number of years." Goldman responds to Adtran's strong top-line results and guidance by declaring it "uniquely positioned to benefit" from a multi-year cable/DSL broadband infrastructure upgrade cycle. (previous) | 1 Comment
Jun. 19, 2013, 4:28 PMFinisar (FNSR) +8.9% AH following its FQ4 beat. FQ1 guidance is for revenue of revenue of $245M-$260M and EPS of $0.22-$0.26, mostly above a consensus of $248.9M and $0.20. A 150 bps Q/Q increase in gross margin to 32.2%, caused by a favorable mix, contributed to the EPS beat. Finisar says it's seeing strong demand for 10G/100G Ethernet components for datacom gear - 10G is being rapidly adopted in data centers, and some firms are starting to embrace 100G. Opex +4% Y/Y. a little above rev. growth of 2%. JDSU +3%, NPTN +4.3%, and CIEN +1% in sympathy. FN, OCLR, and OPLK could also rally. CC at 5PM ET (webcast). (PR) | Comment!
Jun. 10, 2013, 4:06 PMNeoPhotonics (NPTN +5.2%) and Alliance Fiber (AFOP +4.2%) close up strongly after SA contributor Inflection Point Investing argues the optical component vendors are plays on the 100G optical networking boom, while making a fresh bull case for Infinera (INFN +1.6%). IPI points out NeoPhotonics mentioned in May it's seeing strong 100G component sales, and that it "supplies to seemingly every big vendor in the optical space." Regarding Infinera, the firm is encouraged by Ciena's (CIEN +2.2%) earnings call remarks about "seeing a strong uptick" in 100G optical demand, with U.S. carriers leading the way. (previous) | Comment!
Jun. 6, 2013, 12:45 PM
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