Shares of Ciena (CIEN) are up $1.24, or over 5%, at $24.60, in early trading, after the company this morning reportedfiscal Q1 revenue and earnings that topped analysts' expectations, and forecast revenue this quarter slightly higher as well.
In a first pass at the news, Catharine Trebnick with Dougherty & Co., who has a Buy on the stock, writes that the results were "solid," and suggest the company "continues too benefit from improved end-market demand," including in the " DCI," submarine and metro markets. She notes the operating profit margin was higher than she was expecting as operating expenses were kept in check.
The company said it continues to evaluate the impact of U.S. tax reform, given it pays almost no cash taxes now because it has deferred tax assets.
CEO Gary Smith called it a "strong start toward achieving our long-term financial goals," and said the company was confident in its ability to take market share.
Revenue in the three months ended in January rose 4%, year over year, to $646 million, yielding EPS of 15 cents, excluding some costs.
Analysts had been modeling $642 million and 12 cents per share.
Ciena's revenue from networking products, making up 77% of its sales, rose by just over 1%, year over year, to 496 million. Revenue from software was up 36% at $53.5 million.
Gross profit margin declined from 44.9% a year earlier to 42.6%. Operating margin was down from 8.5% to 6.3%.
For the current quarter, the company during its conference call with analysts projected revenue of $710 million to $740 million, above consensus for $721 million.