Ciena reports fiscal fourth quarter 2022 and year-end financial results

Shares of Ciena Corp. were on an upswing in pre-market trading on Thursday Dec 8, shooting up by more than 15% as the supplier of telecommunications networking equipment and software services announced better-than-expected fiscal Q4 results.

Ciena posted revenues of $971 million in Q4, down by 6.8% year-over-year but still surpassing Street expectations by $123.17 million.

The company’s adjusted earnings came in at $0.61 per share versus $0.85 in the same period last year, handsomely beating Street expectations of $0.08.

Ciena® Corporation announced unaudited financial results for its fiscal fourth quarter ended October 29, 2022.

• Q4 Revenue: $971.0 million
• Q4 Net Income per Share: $0.39 GAAP; $0.61 adjusted (non-GAAP)
• Share Repurchases: Repurchased approximately 154,200 shares of common stock for an aggregate price of $8.0 million during the quarter.

“Our strong fiscal fourth quarter financial results were better than expected as we benefited from some favorable supply chain developments in the second half of the quarter,” said Gary Smith, president and CEO of Ciena. “Looking ahead, we expect to deliver outsized revenue growth in fiscal 2023 given our significant backlog and continued signs of gradual supply improvement. And, we remain confident that the durability of secular demand drivers and our strategic investments to expand our addressable market position us to deliver strong revenue growth over the next several years.”

For fiscal fourth quarter 2022, Ciena reported revenue of $971.0 million as compared to $1.04 billion for the fiscal fourth quarter 2021. For fiscal year 2022, Ciena reported revenue of $3.63 billion, as compared to $3.62 billion for fiscal year 2021.

Ciena’s GAAP net income for the fiscal fourth quarter 2022 was $57.6 million, or $0.39 per diluted common share, which compares to a GAAP net income of $103.5 million, or $0.66 per diluted common share, for the fiscal fourth quarter 2021. For fiscal year 2022, Ciena’s GAAP net income was $152.9 million, or $1.00 per diluted common share, as compared to GAAP net income of $500.2 million, or $3.19 per diluted common share, for fiscal year 2021.

Ciena’s adjusted (non-GAAP) net income for the fiscal fourth quarter 2022 was $90.9 million, or $0.61 per diluted common share, which compares to an adjusted (non-GAAP) net income of $132.7 million, or $0.85 per diluted common share, for the fiscal fourth quarter 2021. For fiscal year 2022, Ciena’s adjusted (non-GAAP) net income was $288.9 million, or $1.90 per diluted common share, as compared to adjusted (non-GAAP) net income of $456.5 million, or $2.91 per diluted common share, for fiscal year 2021.

Performance Summary for Fiscal Fourth Quarter and the Year Ended October 29, 2022
The tables below (in millions, except percentage data) provide comparisons of certain quarterly results to the prior year. Appendices A and B set forth reconciliations between the GAAP and adjusted (non-GAAP) measures contained in this release.

* Denotes % change, or in the case of margin, absolute change

** Denotes % of total revenue

Additional Performance Metrics for Fiscal Fourth Quarter and Year Ended October 29, 2022

** Denotes % of total revenue

• Two customers each represented 10%-plus of revenue for the fiscal fourth quarter and fiscal year 2022, combining for a total of 25.6% of revenue for the fiscal fourth quarter and 23.0% of revenue for the fiscal year 2022
• Cash and investments at the end of fiscal year 2022 totaled $1.2 billion
• Cash flow used in operations totaled $14.5 million and $167.8 million for the fiscal fourth quarter and the fiscal year 2022, respectively
• Average days’ sales outstanding (DSOs) were 100 and 107 for the fiscal fourth quarter and the fiscal year 2022, respectively
• Accounts receivable, net balance was $920.8 million
• Unbilled contract asset, net balance was $156.0 million
• Inventories totaled $946.7 million, including:
• Raw materials: $664.9 million
• Work in process: $18.2 million
• Finished goods: $258.6 million
• Deferred cost of sales: $41.1 million
• Reserve for excess and obsolescence: $(36.1) million
• Product inventory turns were 1.9 and 1.8 for the fiscal fourth quarter and the fiscal year 2022, respectively
• Headcount totaled 8,079 at the end of fiscal year 2022

Supplemental Materials and Live Web Broadcast of Unaudited Fiscal Fourth Quarter 2022 Results

Thursday, December 08, 2022, in conjunction with this announcement, Ciena has posted to the Quarterly Results page of the Investor Relations section of its website certain related supporting materials for its unaudited fiscal fourth quarter and fiscal year 2022 results.

Ciena’s management will also host a discussion today with investors and financial analysts that will include the Company’s outlook. The live audio web broadcast beginning at 8:30 a.m. Eastern will be accessible via www.ciena.com. An archived replay of the live broadcast will be available shortly following its conclusion on the Investor Relations page of Ciena’s website.

CT Bureau