LINTHICUM, Md. – Ciena Corp. on Tuesday said it would report a wider-than-expected fiscal first-quarter loss, citing cutbacks and delays in spending by major customers, and said it would cut about 12 percent of its work force and post a second-quarter charge.
The Linthicum, Maryland-based optical networking company said it would report a loss before charges of between 19 cents and 22 cents a share on revenues of about $160 million.
Analysts had expected Ciena to post a first-quarter loss before items of 11 cents, with a range of losses from 6 cents to 18 cents, after the company warned about its 2002 results in December, according to Thomson Financial/First Call. Analysts had expected revenues for the quarter to be about $227.14 million.
``Our first quarter revenues were lower than expected because during the quarter, several of our major customers made substantial changes in their deployment plans resulting in significant reductions in the amounts of equipment they had previously indicated they anticipated purchasing from us,'' Ciena President and Chief Executive Gary Smith said in a statement.
The net loss for the first quarter is expected to be 21 cents to 24 cents a share, Ciena said. The company is scheduled to report first-quarter results on Feb. 21.
Smith said the uncertain market and ongoing discussions with customers led the company also to project that second-quarter revenues will be flat or down from first-quarter levels.
Ciena said it will cut 400 jobs, or about 12 percent of its total work force, and close its Marlborough, Massachusetts, research and development facility, moving that work mostly to California and Atlanta.
Affected employees will be paid through April 5, and be eligible for additional severance packages. They also will receive outplacement assistance and training, Ciena said.
The company said it expects to record a restructuring charge of between $9 million to $11 million in its second quarter associated with the job cuts, lease terminations, noncancelable lease costs and the write-down of certain property, equipment and leasehold improvements.
In December, Ciena posted a fiscal fourth-quarter net loss of $1.8 billion after writing down much of the value of a recent acquisition, and warned it could lose money in fiscal 2002 as customers slash capital expenditures.
Suppliers of the communications and telecommunications industries have been hit hard the past year by the slowdown in spending, including by some of Ciena's largest customers like Qwest Communications International Inc.
Ciena's stock closed trading on Monday at $10.12 in Nasdaq trading. Since the beginning of last year, it has underperformed its competitors in the American Stock Exchange Networking Index by about 65 percent.