Ciena Corp (CIEN)

[chmcnfunds]

Ciena, Infinera See Boost in Q3 North America Optical Sales, Say Ovum, Dell’Oro

November 20, 2013, 1:14 P.M. ET
By Tiernan Ray

Fiber-optic networking equipment and component suppliers got a couple of pieces of good news in new market research this morning, essentially concentrated in North America, while the rest of the world proved less rewarding for vendors.

Ovum Research reported that optical networking spending in Q3 was flat with the year-ago period, but that sales in North America showed gains, which was good for Ciena (CIEN), Fujitsu (6702JP), and Infinera (INFN), given their exposure to the region:

All three vendors took advantage of the hot North American market. Fujitsu reported its best quarterly revenues since 1Q08, while Ciena reported its best results since the acquisition of Nortel’s Metro Ethernet Networks business in 1Q10. Infinera moved into the top 10 globally, ousting Coriant.

Some select product categories rose despite the flat result:

Spending for ROADM, 40G and 100G all increased slightly over the prior quarter.Although CPO revenues fell for the first time in a year due to lower spending in Asia-Pacific, annualized CPO spending surpassed US$7bn for the first time.

And Dell’Oro Group announced that “wavelength division multiplexing” (WDM) equipment sales in North America rose 20% in the last three quarters, combined, and that Ciena and Fujitsu dominated the market.

Analyst Jimmy Yu, calling the North American market “strong,” thinks things may cool a bit going forward:

Growth started modestly in the first quarter at five percent, and rose to 25 percent in the third quarter. However, following the strong level of WDM equipment rollout in the first nine months of the year, we do expect equipment sales to be softer in the current fourth quarter as service providers conserve their capital.

Ciena had top spot in North American WDM equipment sales, with its sales up 9%. Fujitsu, in second spot, saw a 65% rise in sales. Cisco Systems (CSCO) was third, and saw a mere 1% sales rise. Infinera, in fourth place, saw a 22% rise in sales.

Shares of Ciena are up 25 cents, or 1%, at $22.33, while shares of Infinera are up 2 cents at $8.75.
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http://blogs.barrons.com/techtraderdaily/2013/11/20/ciena-infinera-see-boost-in-north-america-optical-sales-say-ovum-delloro/

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