CHICAGO – Telecommunications equipment maker Ciena Corp. (CIEN) posted better-than-expected revenue on Thursday and forecast further sales growth amid expanded products and partnerships, sending its shares up 23 percent.
Ciena, whose stock hit a record low in August after it slashed its sales outlook, forecast revenue would grow 7 percent to 10 percent in the current quarter from the fourth quarter, ahead of analysts' expectations.
The strong outlook accompanied Ciena's quarterly results, which included a wider net loss including large charges but a 16 percent increase in revenue from a year earlier.
"We view the October quarter results and January quarter guidance as a step forward for Ciena," said Lehman Bros. analyst Marcus Kupferschmidt in an early note. He said "the company struggled over the past few quarters to begin to recognize revenues on contracts it had previously won, and we believe these deployments have begun."
Ciena said it lost $495.1 million, or 87 cents a share, in the fiscal fourth quarter ended Oct. 31, including an impairment charge of $371.7 million, in part to close a facility. A year earlier it lost $115.0 million, or 24 cents a share.
Excluding unusual items, the loss per share was 6 cents, smaller than Wall Street's 7-cent-a-share average forecast, according to Reuters Estimates. It compared to a loss of 8 cents a share a year earlier.
Fourth-quarter revenue rose to $82.0 million from $70.6 million. Ciena, which last reported a net profit in the 2001 fiscal third quarter, in August had forecast sales would be about flat with third quarter revenue of $75.6 million.
Ciena said that 35 percent of revenue was generated by recently acquired products that target high-value data and service delivery applications. Gross profit margin rose to 29.5 percent from 24.9 percent in the third quarter.
The company forecast a net loss of 5 cents to 7 cents a share in the current quarter before items, roughly in line with Wall Street's view of 5 cents a share on average.
Cash use is seen at roughly $80 million, while gross margins are seen flat to slightly higher, Ciena executives told Wall Street during a call to discuss quarterly results. Longer term, the company said it is targeting gross margins of 40 percent or better.
Shares of Ciena rose 54 cents, or 23.1 percent, to $2.88 on Thursday.