Aug. 21, 2014, 3:59 PM
- Optical component vendors JDS Uniphase (JDSU +4.3%), Finisar (FNSR +3.4%), Oplink (OPLK +3.2%), Oclaro (OCLR +3.6%), and Alliance Fiber (AFOP +2.5%) have all rallied on a quiet day of trading, and so has client Ciena (CIEN +2.7%). No news has hit the wires to explain the gains.
- JDS, Oclaro, and Alliance Fiber all sold off in recent weeks (I, II, III) after providing disappointing guidance in their calendar Q2 reports. JDS (like Juniper following its Q2 report) observed soft North American wireline capex is pressuring industry sales.
Aug. 14, 2014, 12:06 PM
- Dan Loeb's Third Point LLC took a 7.25M-share position in Rackspace (RAX +4.3%) in Q2, along with a 3.5M-share position in Finisar (FNSR -0.2%) and a 2M-share position in InterActiveCorp (IACI +1.7%). (13F)
- Rackspace has jumped on the disclosure. The Web hosting/IaaS provider remains in the midst of a strategic review, and has been the subject of many M&A rumors.
- Finisar has ticked higher after selling off earlier in the wake of Cisco and Oclaro's reports. Shares fell yesterday in response to JDS Uniphase's guidance.
- IAC has moved slightly higher. Shares were already up following news the company has bought Ask.fm.
Aug. 12, 2014, 4:49 PM
- Though it beat FQ4 estimates, JDS Uniphase (NASDAQ:JDSU) is guiding for FQ1 revenue of $405M-$425M and EPS of $0.08-$0.12, below a consensus of $440.9M and $0.14.
- FQ4 gross margin was 50%, +240 bps Q/Q and +390 bps Y/Y. Opex rose 17% Y/Y to $226M. $160M was spent on buybacks in FY14.
- Network service & enablement revenue (test equipment/software) +10.2% Y/Y to $209.1M; optical communications (components/modules) +1.4% to $156.2M; lasers +44.3% to $40.7M; optical security/performance -13.4% to $42.6M. Test equipment and laser sales were respectively boosted by the Trendium and Time-Bandwidth acquisitions.
- Finisar (NASDAQ:FNSR) is following JDS lower.
- FQ4 results, PR
Jul. 23, 2014, 1:45 PM
- Juniper's (JNPR -9.8%) soft Q3 guidance, along with its related commentary on U.S. telco demand, is taking a toll on fellow telecom equipment suppliers Cisco (CSCO -1.2%), Ciena (CIEN -3.2%), Cyan (CYNI -2.5%), Zhone (ZHNE -6.5%) Ruckus (RKUS -1.6%), and Sonus (SONS -3.8%).
- Optical component vendors JDS Uniphase (JDSU -2.9%) and Finisar (FNSR -2%) are also off, as are several chipmakers (previous) with heavy networking/telecom exposure.
- On its CC (transcript), Juniper stated "market dynamics including M&A activity" are affecting the "sequencing and timing" of U.S. carrier projects. Jefferies reported in June AT&T has significantly cut its wireline capex in the wake of the DirecTV deal.
- There has been speculation AT&T is keeping a lid on wireline capex ahead of the full rollout of its ambitious Domain 2.0 initiative, which will feature the launch of software-defined networking (SDN) and network functions virtualization (NFV) platforms.
- Juniper insists it remains well-positioned with the aforementioned U.S. carriers, and that it has "major design wins" for next-gen projects. The company adds demand remains healthy with U.S. federal, cable, and Internet clients.
- The company's router revenue rose 7% Y/Y in Q2 to $617.8M, and its switch revenue rose 25% to $199.8M. Security product revenue fell 8% to $111.6M. The Junos Pulse VPN software ops (about to be sold for $250M) contributed $31.4M in revenue ($15.9M product, $15.5M service).
Jun. 13, 2014, 12:46 PM
Jun. 13, 2014, 9:11 AM
Jun. 12, 2014, 5:36 PM
Jun. 12, 2014, 4:19 PM
- Finisar (FNSR) expects FQ1 revenue of $320M-$335M, above a $317M consensus. But EPS guidance of $0.30-$0.34 is below a $0.41 consensus.
- Gross margin pressure is responsible for both the guidance and FQ4's EPS miss. FQ4 GM was 34.2%, +200 bps Y/Y but -300 bps Q/Q and below guidance of 35.5%. GM is expected to fall to 32% in FQ1.
- Finisar blames the FQ4 margin weakness on telecom product price cuts and the impact of recently-acquired u2t Photonics, whose products carry a lower GM.
- Opex +4.3% Y/Y in FQ4 to $65.9M, well below rev. growth of 25.7%. A 39.1% Y/Y increase in datacom product sales (boosted by the investments of Web/cloud service providers) offset a 2.5% drop in telecom sales, and helped drive the revenue beat.
- JDS Uniphase (JDSU) is following Finisar lower. Other optical component firms that could be hit: OPLK, OCLR, FN, NPTN.
- FQ4 results, PR
Jun. 12, 2014, 4:03 PM
Jun. 11, 2014, 5:35 PM
Jun. 5, 2014, 10:12 AM
- Ciena is flying higher after beating FQ2 estimates and issuing above-consensus FQ3 guidance. As is its custom, rival Infinera (INFN +2.2%) is heading in the same direction as Ciena, as are component vendors Finisar (FNSR +3.6%) and JDS Uniphase (JDSU +1.7%).
- Other gainers include deep packet inspection hardware vendors Allot (ALLT +5.5%) and Procera (PKT +3%), access/metro equipment provider Adtran (ADTN +3%), network processor developer Cavium (CAVM +1.2%), and carrier Wi-Fi hardware vendor Ruckus (RKUS +1.8%). An upbeat Oppenheimer note could be contributing to Allot's gains.
- The rally comes a few days after Ciena and other industry names fell due to a Jefferies report stating AT&T has slashed wireline capex ahead of the DirecTV deal's closing and the full rollout of its giant Domain 2.0 SDN/NFV initiative.
Jun. 2, 2014, 4:43 PM
- Jefferies reports AT&T (T -0.1%) significantly cut its wireline capex starting last month.
- It thinks many companies could be affected, including equipment vendors Alcatel-Lucent (ALU -2.2%), Ciena (CIEN -3.9%), Juniper (JNPR +0.2%), and Adtran (ADTN -5.1%), and component vendors JDS Uniphase (JDSU -2%) and Finisar (FNSR -0.7%).
- As its is, AT&T's 2014 capex budget ($21B) is down $200M from 2013's spending level. Moreover, the carrier's huge mobile infrastructure needs and the DirecTV deal could be motivating it to cut wireline spend.
- Also: AT&T may be looking to keep capex down ahead of the full rollout of Domain 2.0, an initiative meant to improve network flexibility, lower costs, and cut provisioning times through the embrace of software-defined networking (SDN) and network functions virtualization (NFV).
- MKM has argued Domain 2.0 will be a negative for Cisco, but a positive for Ciena and Finisar, among others.
May 14, 2014, 5:44 PM
- Cisco's FQ3 beat, above-consensus FQ4 guidance,, and positive CC commentary are providing a lift to networking equipment rivals and component suppliers.
- Up AH: ALU +1%. JNPR +1.6%. FFIV +0.8%. FNSR +2%. JDSU +1.5%. RVBD +0.9%. JBL (a major Cisco contract manufacturer) +0.8%.
- Cisco's product orders were nearly flat Y/Y in FQ3 after falling 4% in FQ2. U.S. orders (+7%, with 10%+ increases in enterprise/SMB orders) provided a boost, as did a 4% increase in Northern European orders.
- The company's service provider orders fell another 5% Y/Y (router/set-top share loss), but that was better than FQ2's 12% drop. Emerging markets (-7% vs -3% in FQ2) also remained weak.
Apr. 30, 2014, 5:09 PM
- In addition to missing FQ3 estimates, JDS Uniphase (JDSU -6.9% AH) is guiding for FQ4 revenue of $425M-$445M and EPS of $0.10-$0.14, below a consensus of $459M and $0.17.
- The company blames its FQ3 miss on "later-than-expected carrier orders." Optical communications product sales grew 7.1% Y/Y, slower than FQ2's 12.1% clip. Network and service enablement (test equipment) sales fell 1.1% after declining 0.2% in FQ2.
- Peer Oplink (OPLK -6.7% AH) also posted an FQ3 miss, while adding it's seeing "a bit of softness" in its optical business. FQ4 guidance is for revenue of $48M-$52M and EPS of $0.05-$0.11, below a consensus of $53.3M and $0.17.
- Finisar (FNSR) is down 1.1% AH. Others that might slip: OCLR, AFOP, NPTN, FN.
Apr. 2, 2014, 9:52 AM
- Alliance Fiber (AFOP +13.8%) expects to report Q1 revenue of $24.8M, +104% Y/Y and soundly above prior guidance of $22.5M (it's also the consensus).
- The announcement comes less than two months after shares tumbled due to a Q4 miss. Full Q1 results arrive on April 24.
- Needham's bullish March 25 coverage launch was well-timed. In general, Street sentiment towards optical component and networking hardware vendors has been improving, thanks in part to strong numbers from Ciena and Infinera.
- Optical component peers are trading moderately higher: FNSR +2.3%. JDSU +1.3%. NPTN +1.6%. OCLR +2.6%.
Mar. 28, 2014, 11:20 AM
- Though RBC has downgraded JDS Uniphase to Market Perform (along with Ciena), it has upgraded rival Finisar (FNSR +4.7%) to Outperform, while upping its PT to $30 from $26.
- The firm thinks Finisar can outperform peers thanks to a fixed-cost business model and better operating leverage.
- Shares made a new 52-week high of $28.07 on Monday, but proceeded to fall hard amid a general tech selloff.
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