Ciena Corp (CIEN) delivered mixed results for the fiscal third quarter of 2024, reporting a revenue decline of 11.8% year-on-year to $942.3 million. However, the company surpassed analyst expectations, exceeding the consensus revenue estimate of $927.2 million and delivering an adjusted EPS of $0.35, beating the anticipated $0.26.
Despite the overall revenue dip, Ciena highlighted positive trends within its business. Total Networking Platforms revenue, while down 17.4% year-over-year, reached $699.5 million. Meanwhile, Total Global Services demonstrated growth, increasing by 3.5% year-over-year to $133.8 million. Ciena emphasized that two key customers, each representing over 10% of its business, contributed to 26.6% of its total revenue.
On the financial front, Ciena exhibited strong margins. Adjusted gross margin climbed 100 basis points to 43.7%. However, adjusted operating margin declined by 400 basis points to 8.0%. The company held $1.2 billion in cash and equivalents and generated $(159.4) million in operating cash flow.
CEO Gary Smith expressed optimism, stating that the results reflected “growing momentum with cloud providers and continued gradual recovery with service providers.” He attributed the positive performance to these key market segments.
In a significant announcement, Ciena disclosed that CFO James E. Moylan, Jr., plans to retire in twelve months, effective August 28, 2025. The company will commence a search for his successor. Moylan will remain in his role until a replacement is found and will assist in the transition of responsibilities.
Ciena’s stock has exhibited strong performance over the past year, rising over 15%. In pre-market trading on Wednesday, CIEN stock was up 1.36% at $56.10.
Overall, Ciena’s third-quarter results highlight a mixed bag of performance, with revenue decline offset by earnings beat and positive market trends. The company’s outlook remains optimistic, supported by growth in cloud and service provider segments. Ciena’s upcoming leadership transition will be a key focus as the company navigates its strategic path.
