CIEN
$56.16
Ciena
$.65
1.17%
Earnings Details
2nd Quarter April 2020
Thursday, June 4, 2020 7:00:00 AM
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Summary

Ciena Beats

Ciena (CIEN) reported 2nd Quarter April 2020 earnings of $0.71 per share on revenue of $894.1 million. The consensus earnings estimate was $0.49 per share on revenue of $881.8 million. The Earnings Whisper number was $0.54 per share. Revenue grew 3.4% on a year-over-year basis.

The company said during its conference call it expects third quarter revenue of $955.0 million to $985.0 million. The current consensus revenue estimate is $969.0 million for the quarter ending July 31, 2020.

Ciena Corp is a network specialist providing networking solutions. It provides equipment, software & services supporting the transport, switching, aggregation, service delivery & management of voice, video and data traffic on communications networks.

Results
Reported Earnings
$0.71
Earnings Whisper
$0.54
Consensus Estimate
$0.49
Reported Revenue
$894.1 Mil
Revenue Estimate
$881.8 Mil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

Ciena Reports Fiscal Second Quarter 2020 Financial Results

HANOVER, Md.--(BUSINESS WIRE)--Ciena® Corporation (NYSE:CIEN), a networking systems, services and software company, today announced unaudited financial results for its fiscal second quarter ended May 2, 2020.

  • Q2 Revenue: $894.1 million, increasing 3.4% year over year
  • Q2 Net Income per Share: $0.59 GAAP; $0.76 adjusted (non-GAAP)
  • Share Repurchases: Prior to suspending repurchases during the quarter, we repurchased approximately 0.6 million shares of common stock for an aggregate price of $23.8 million during the quarter

"In this uncertain environment, we delivered industry leading financial performance during our second quarter, including strong revenue and outstanding profitability," said Gary Smith, President and CEO, Ciena. "Our strategy, centered around innovation, diversification and global scale, has resulted in a resilient business capable of navigating challenging times and delivering strong shareholder value over the long-term."

For the fiscal second quarter 2020, Ciena reported revenue of $894.1 million as compared to $865.0 million for the fiscal second quarter 2019.

Ciena's GAAP net income for the fiscal second quarter 2020 was $91.7 million, or $0.59 per diluted common share, which compares to a GAAP net income of $52.7 million, or $0.33 per diluted common share, for the fiscal second quarter 2019.

Ciena's adjusted (non-GAAP) net income for the fiscal second quarter 2020 was $117.4 million, or $0.76 per diluted common share, which compares to an adjusted (non-GAAP) net income of $76.2 million, or $0.48 per diluted common share, for the fiscal second quarter 2019.

Fiscal Second Quarter 2020 Performance Summary

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.

 

GAAP Results

 

Q2

 

Q2

 

 

 

FY 2020

 

FY 2019

 

Y-T-Y*

Revenue

$

 

894.1

 

 

$

 

865.0

 

 

3.4

%

Gross margin

 

 

46.2

%

 

 

 

43.3

%

 

2.9

%

Operating expense

$

 

285.8

 

 

$

 

294.4

 

 

(2.9

)%

Operating margin

 

 

14.3

%

 

 

 

9.3

%

 

5.0

%

 

Non-GAAP Results

 

Q2

 

Q2

 

 

 

FY 2020

 

FY 2019

 

Y-T-Y*

Revenue

$

 

894.1

 

 

$

 

865.0

 

 

3.4

%

Adj. gross margin

 

 

46.9

%

 

 

 

43.9

%

 

3.0

%

Adj. operating expense

$

 

258.7

 

 

$

 

269.7

 

 

(4.1

)%

Adj. operating margin

 

 

17.9

%

 

 

 

12.7

%

 

5.2

%

Adj. EBITDA

$

 

183.0

 

 

$

 

131.4

 

 

39.3

%

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

 

 

Revenue by Segment

 

 

Q2 FY 2020

 

Q2 FY 2019

 

 

Revenue

 

%**

 

Revenue

 

%**

Networking Platforms

 

 

 

 

 

 

 

 

Converged Packet Optical

 

$

654.3

 

 

73.2

 

 

$

623.9

 

 

72.1

 

Packet Networking

 

64.2

 

 

7.2

 

 

73.1

 

 

8.5

 

Total Networking Platforms

 

718.5

 

 

80.4

 

 

697.0

 

 

80.6

 

 

 

 

 

 

 

 

 

 

Platform Software and Services

 

45.0

 

 

5.0

 

 

35.2

 

 

4.0

 

 

 

 

 

 

 

 

 

 

Blue Planet Automation Software and Services

 

15.0

 

 

1.7

 

 

12.5

 

 

1.4

 

 

 

 

 

 

 

 

 

 

Global Services

 

 

 

 

 

 

 

 

Maintenance Support and Training

 

71.5

 

 

8.0

 

 

68.8

 

 

8.0

 

Installation and Deployment

 

34.2

 

 

3.8

 

 

41.3

 

 

4.8

 

Consulting and Network Design

 

9.9

 

 

1.1

 

 

10.2

 

 

1.2

 

Total Global Services

 

115.6

 

 

12.9

 

 

120.3

 

 

14.0

 

 

 

 

 

 

 

 

 

 

Total

 

$

894.1

 

 

100.0

 

 

$

865.0

 

 

100.0

 

** Denotes % of total revenue

Additional Performance Metrics for Fiscal Second Quarter 2020

 

 

Revenue by Geographic Region

 

 

Q2 FY 2020

 

Q2 FY 2019

 

 

Revenue

 

% **

 

Revenue

 

% **

Americas

 

$

650.4

 

 

72.7

 

 

$

615.5

 

 

71.1

 

Europe, Middle East and Africa

 

141.4

 

 

15.8

 

 

115.0

 

 

13.3

 

Asia Pacific

 

102.3

 

 

11.5

 

 

134.5

 

 

15.6

 

Total

 

$

894.1

 

 

100.0

 

 

$

865.0

 

 

100.0

 

** Denotes % of total revenue

  • One 10%-plus customer represented a total of 12% of revenue
  • Cash and investments totaled $988.5 million
  • Cash flow from operations totaled $91.2 million
  • Average days' sales outstanding (DSOs) were 79
  • Accounts receivable balance was $694.0 million
  • Unbilled contract asset balance was $87.7 million
  • Inventories totaled $325.8 million, including:
    • Raw materials: $106.2 million
    • Work in process: $11.5 million
    • Finished goods: $194.5 million
    • Deferred cost of sales: $56.9 million
    • Reserve for excess and obsolescence: $(43.3) million
  • Product inventory turns were 5.0
  • Headcount totaled 6,684

Supplemental Materials and Live Web Broadcast of Unaudited Fiscal Second Quarter 2020 Results

Today, Thursday, June 4, 2020, in conjunction with this announcement, Ciena has posted to the Quarterly Results page of the Investor Relations section of its website an accompanying investor presentation for its unaudited fiscal second quarter 2020 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.

Notes to Investors

Forward-Looking Statements. You are encouraged to review the Investors section of our website, where we routinely post press releases, SEC filings, recent news, financial results, supplemental financial information, and other announcements. From time to time we exclusively post material information to this website along with other disclosure channels that we use. This press release contains certain forward-looking statements that involve risks and uncertainties. These statements are based on current expectations, forecasts, assumptions and other information available to the Company as of the date hereof. Forward-looking statements include statements regarding Ciena's expectations, beliefs, intentions or strategies regarding the future and can be identified by forward-looking words such as "anticipate," "believe," "could," "estimate," "expect," "intend," "may," "should," "will," and "would" or similar words. Forward-looking statements in this release include: "In this uncertain environment, we delivered industry leading financial performance during our second quarter, including strong revenue and outstanding profitability. Our strategy, centered around innovation, diversification and global scale, has resulted in a resilient business capable of navigating challenging times and delivering strong shareholder value over the long-term.”

Ciena's actual results, performance or events may differ materially from these forward-looking statements made or implied due to a number of risks and uncertainties relating to Ciena's business, including: the effect of broader economic and market conditions on our customers and their business; our ability to execute our business and growth strategies; the duration and severity of the COVID-19 pandemic and the impact of countermeasures taken to mitigate its spread on macroeconomic conditions, economic activity, demand for our technology solutions, short- and long-term changes in customer or end user needs, continuity of supply chain, our business operations, liquidity and financial results; changes in network spending or network strategy by customers; seasonality and the timing and size of customer orders, including our ability to recognize revenue relating to such sales; the level of competitive pressure we encounter; the product, customer and geographic mix of sales within the period; supply chain disruptions and the level of success relating to efforts to optimize Ciena's operations; changes in foreign currency exchange rates affecting revenue and operating expense; factors beyond our control such as natural disasters, acts of war or terrorism, and public health emergencies, including the COVID-19 pandemic; the impact of the Tax Cuts and Jobs Act; changes in tax or trade regulations, including the imposition of tariffs, duties or efforts to withdraw from or materially modify international trade agreements; changes in estimates of prospective income tax rates and any adjustments to Ciena's provisional estimates whether related to further guidance, analysis or otherwise; and the other risk factors disclosed in its Annual Report on Form 10-K filed with the SEC on December 20, 2019 and included in its Quarterly Report on Form 10-Q for the current quarter. Ciena assumes no obligation to update any forward-looking information included in this press release.

Non-GAAP Presentation of Quarterly and Annual Results. This release includes non-GAAP measures of Ciena's gross profit, operating expense, income from operations, earnings before interest, tax, depreciation and amortization (EBITDA), Adjusted EBITDA, and measures of net income and net income per share. In evaluating the operating performance of Ciena's business, management excludes certain charges and credits that are required by GAAP. These items share one or more of the following characteristics: they are unusual and Ciena does not expect them to recur in the ordinary course of its business; they do not involve the expenditure of cash; they are unrelated to the ongoing operation of the business in the ordinary course; or their magnitude and timing is largely outside of Ciena's control. Management believes that the non-GAAP measures below provide management and investors useful information and meaningful insight to the operating performance of the business. The presentation of these non-GAAP financial measures should be considered in addition to Ciena's GAAP results and these measures are not intended to be a substitute for the financial information prepared and presented in accordance with GAAP. Ciena's non-GAAP measures and the related adjustments may differ from non-GAAP measures used by other companies and should only be used to evaluate Ciena's results of operations in conjunction with our corresponding GAAP results. To the extent not previously disclosed in a prior Ciena financial results press release, Appendices A and B to this press release set forth a complete GAAP to non-GAAP reconciliation of the non-GAAP measures contained in this release.

About Ciena. Ciena (NYSE: CIEN) is a networking systems, services and software company. We provide solutions that help our customers create the Adaptive Network™ in response to the constantly changing demands of their users. By delivering best-in-class networking technology through high-touch consultative relationships, we build the world’s most agile networks with automation, openness and scale. For updates on Ciena, follow us on Twitter @Ciena, LinkedIn, the Ciena Insights blog, or visit www.ciena.com.

CIENA CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

(unaudited)

 

 

Quarter Ended

 

Six Months Ended

 

May 2,

 

May 4,

 

May 2,

 

May 4,

 

2020

 

2019

 

2020

 

2019

Revenue:

 

 

 

 

 

 

 

Products

$

739,892

 

 

$

710,688

 

 

$

1,427,107

 

 

$

1,353,220

 

Services

154,161

 

 

154,323

 

 

299,858

 

 

290,318

 

Total revenue

894,053

 

 

865,011

 

 

1,726,965

 

 

1,643,538

 

Cost of goods sold:

 

 

 

 

 

 

 

Products

405,138

 

 

411,050

 

 

794,151

 

 

791,492

 

Services

75,589

 

 

79,284

 

 

148,953

 

 

154,028

 

Total cost of goods sold

480,727

 

 

490,334

 

 

943,104

 

 

945,520

 

Gross profit

413,326

 

 

374,677

 

 

783,861

 

 

698,018

 

Operating expenses:

 

 

 

 

 

 

 

Research and development

131,530

 

 

137,969

 

 

262,430

 

 

266,602

 

Selling and marketing

101,214

 

 

103,502

 

 

208,280

 

 

201,615

 

General and administrative

42,030

 

 

42,154

 

 

84,498

 

 

81,397

 

Amortization of intangible assets

5,839

 

 

5,529

 

 

11,692

 

 

11,057

 

Significant asset impairments and restructuring costs

3,811

 

 

4,068

 

 

8,283

 

 

6,341

 

Acquisition and integration costs

1,414

 

 

1,135

 

 

3,233

 

 

2,743

 

Total operating expenses

285,838

 

 

294,357

 

 

578,416

 

 

569,755

 

Income from operations

127,488

 

 

80,320

 

 

205,445

 

 

128,263

 

Interest and other income (loss), net

(2,665

)

 

(244

)

 

981

 

 

4,009

 

Interest expense

(7,860

)

 

(9,471

)

 

(16,675

)

 

(18,912

)

Loss on extinguishment and modification of debt

 

 

 

 

(646

)

 

 

Income before income taxes

116,963

 

 

70,605

 

 

189,105

 

 

113,360

 

Provision for income taxes

25,308

17,867

35,122

27,006

Net income

$

91,655

 

 

$

52,738

 

 

$

153,983

 

 

$

86,354

 

 

 

 

 

 

 

 

 

Net Income per Common Share

 

 

 

 

 

 

 

Basic net income per common share

$

0.60

 

 

$

0.34

 

 

$

1.00

 

 

$

0.55

 

Diluted net income per potential common share

$

0.59

 

 

$

0.33

 

 

$

0.99

 

 

$

0.55

 

 

 

 

 

 

 

 

 

Weighted average basic common shares outstanding

153,858

 

 

156,170

 

 

154,099

 

 

156,244

 

Weighted average dilutive potential common shares outstanding1

155,141

 

 

158,289

 

 

155,443

 

 

158,211

 

1. Weighted average dilutive potential common shares outstanding used in calculating GAAP diluted net income per common share for the second quarter of fiscal 2020 includes 1.3 million shares underlying certain stock option and stock unit awards.

Weighted average dilutive potential common shares outstanding used in calculating GAAP diluted net income per common share for the first second quarter of fiscal 2019 includes 2.1 million shares underlying certain stock option and stock unit awards.

CIENA CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)

(unaudited)

 

 

May 2,
2020

 

November 2,
2019

ASSETS

 

 

 

Current assets:

 

 

 

Cash and cash equivalents

$

887,732

 

 

$

904,045

 

Short-term investments

100,742

 

 

109,940

 

Accounts receivable, net

693,963

 

 

724,854

 

Inventories

325,753

 

 

345,049

 

Prepaid expenses and other

332,021

 

 

297,914

 

Total current assets

2,340,211

 

 

2,381,802

 

Long-term investments

 

 

10,014

 

Equipment, building, furniture and fixtures, net

260,867

 

 

286,884

 

Operating lease right-of-use assets

47,864

 

 

 

Goodwill

310,269

 

 

297,937

 

Other intangible assets, net

115,536

 

 

112,781

 

Deferred tax asset, net

689,416

 

 

714,942

 

Other long-term assets

92,599

 

 

88,986

 

Total assets

$

3,856,762

 

 

$

3,893,346

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

Current liabilities:

 

 

 

Accounts payable

$

292,164

 

 

$

344,819

 

Accrued liabilities and other short-term obligations

288,773

 

 

382,740

 

Deferred revenue

107,023

 

 

111,381

 

Operating lease liabilities

18,096

 

 

 

Current portion of long-term debt

6,930

 

 

7,000

 

Total current liabilities

712,986

 

 

845,940

 

Long-term deferred revenue

42,894

 

 

45,492

 

Other long-term obligations

129,850

 

 

148,747

 

Long-term operating lease liabilities

51,100

 

 

 

Long-term debt, net

679,356

 

 

680,406

 

Total liabilities

$

1,616,186

 

 

$

1,720,585

 

Stockholders’ equity:

 

 

 

Preferred stock – par value $0.01; 20,000,000 shares authorized; zero shares issued and outstanding

 

 

 

Common stock – par value $0.01; 290,000,000 shares authorized; 153,641,565
and 154,403,850 shares issued and outstanding

1,536

 

 

1,544

 

Additional paid-in capital

6,790,856

 

 

6,837,714

 

Accumulated other comprehensive loss

(61,386

)

 

(22,084

)

Accumulated deficit

(4,490,430

)

 

(4,644,413

)

Total stockholders’ equity

2,240,576

 

 

2,172,761

 

Total liabilities and stockholders’ equity

$

3,856,762

$

3,893,346

CIENA CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands) (unaudited)

 

 

Six Months Ended

 

May 2,

 

May 4,

 

2020

 

2019

Cash flows provided by operating activities:

 

 

 

Net income

$

153,983

 

 

$

86,354

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

Depreciation of equipment, building, furniture and fixtures, and amortization of leasehold improvements

48,381

 

 

42,995

 

Share-based compensation costs

33,579

 

 

29,362

 

Amortization of intangible assets

19,361

 

 

17,778

 

Deferred taxes

25,420

 

 

18,293

 

Provision for inventory excess and obsolescence

12,640

 

 

10,245

 

Provision for warranty

13,793

 

 

9,276

 

Other

16,190

 

 

(2,259

)

Changes in assets and liabilities:

 

 

 

Accounts receivable

15,865

 

 

43,174

 

Inventories

5,618

 

 

(109,554

)

Prepaid expenses and other

(54,839

)

 

(33,241

)

Operating lease right-of-use assets

8,642

 

 

 

Accounts payable, accruals and other obligations

(151,713

)

 

(26,971

)

Deferred revenue

(5,679

)

 

4,560

 

Short and long-term operating lease liabilities

(10,311

)

 

 

Net cash provided by operating activities

130,930

 

 

90,012

 

Cash flows provided by (used in) investing activities:

 

 

 

Payments for equipment, furniture, fixtures and intellectual property

(45,458

)

 

(35,289

)

Purchase of available for sale securities

(40,894

)

 

(97,897

)

Proceeds from maturities of available for sale securities

60,000

 

 

90,000

 

Proceeds from sales of available for sale securities

 

 

98,263

 

Settlement of foreign currency forward contracts, net

(3,836

)

 

(2,741

)

Acquisition of business, net of cash acquired

(28,300

)

 

 

Purchase of equity investment

 

 

(2,667

)

Net cash provided by (used in) investing activities

(58,488

)

 

49,669

 

Cash flows used in financing activities:

 

 

 

Payment of long term debt

(1,733

)

 

(3,500

)

Payment of debt issuance costs

(382

)

 

 

Payment of finance lease obligations

(1,381

)

 

(1,679

)

Payment for debt conversion liability

 

 

(111,268

)

Shares repurchased for tax withholdings on vesting of restricted stock units

(18,200

)

 

(15,865

)

Repurchases of common stock - repurchase program

(74,535

)

 

(65,103

)

Proceeds from issuance of common stock

12,290

 

 

11,235

 

Net cash used in financing activities

(83,941

)

 

(186,180

)

Effect of exchange rate changes on cash, cash equivalents and restricted cash

(4,876

)

 

224

 

Net decrease in cash, cash equivalents and restricted cash

(16,375

)

 

(46,275

)

Cash, cash equivalents and restricted cash at beginning of period

904,161

 

 

745,423

 

Cash, cash equivalents and restricted cash at end of period

$

887,786

 

 

$

699,148

 

Supplemental disclosure of cash flow information

 

 

 

Cash paid during the period for interest

$

17,590

 

 

$

19,978

 

Cash paid during the period for income taxes, net

$

22,011

 

 

$

9,258

 

Operating lease payments

$

11,409

 

 

$

 

Non-cash investing and financing activities

 

 

 

Purchase of equipment in accounts payable

$

4,480

 

 

$

2,793

 

Repurchase of common stock in accrued liabilities from repurchase program

$

 

 

$

1,441

 

Conversion of debt conversion liability into 1,585,140 shares of common stock

$

 

 

$

52,944

 

Operating lease right-of-use assets subject to lease liability

$

4,887

 

 

$

APPENDIX A - Reconciliation of Adjusted (Non- GAAP) Quarterly Measures (unaudited)

 

 

 

 

 

 

 

Quarter Ended

 

 

May 2,

 

May 4,

 

 

2020

 

2019

Gross Profit Reconciliation (GAAP/non-GAAP)

 

 

 

 

GAAP gross profit

 

$

413,326

 

 

$

374,677

 

Share-based compensation-products

 

827

 

 

702

 

Share-based compensation-services

 

1,036

 

 

907

 

Amortization of intangible assets

 

3,835

 

 

3,303

 

Total adjustments related to gross profit

 

5,698

 

 

4,912

 

Adjusted (non-GAAP) gross profit

 

$

419,024

 

 

$

379,589

 

Adjusted (non-GAAP) gross profit percentage

 

46.9

%

 

43.9

%

 

 

 

 

 

Operating Expense Reconciliation (GAAP/non-GAAP)

 

 

 

 

GAAP operating expense

 

$

285,838

 

 

$

294,357

 

Share-based compensation-research and development

 

4,822

 

 

4,083

 

Share-based compensation-sales and marketing

 

5,264

 

 

4,346

 

Share-based compensation-general and administrative

 

5,975

 

 

5,491

 

Amortization of intangible assets

 

5,839

 

 

5,529

 

Significant asset impairments and restructuring costs

 

3,811

 

 

4,068

 

Acquisition and integration costs

 

1,414

 

 

1,135

 

Total adjustments related to operating expense

 

27,125

 

 

24,652

 

Adjusted (non-GAAP) operating expense

 

$

258,713

 

 

$

269,705

 

 

 

 

 

 

Income from Operations Reconciliation (GAAP/non-GAAP)

 

 

 

 

GAAP income from operations

 

$

127,488

 

 

$

80,320

 

Total adjustments related to gross profit

 

5,698

 

 

4,912

 

Total adjustments related to operating expense

 

27,125

 

 

24,652

 

Total adjustments related to income from operations

 

32,823

 

 

29,564

 

Adjusted (non-GAAP) income from operations

 

$

160,311

 

 

$

109,884

 

Adjusted (non-GAAP) operating margin percentage

 

17.9

%

 

12.7

%

 

 

 

 

 

Net Income Reconciliation (GAAP/non-GAAP)

 

 

 

 

GAAP net income

 

$

91,655

 

 

$

52,738

 

Exclude GAAP provision for income taxes

 

25,308

 

 

17,867

 

Income before income taxes

 

116,963

 

 

70,605

 

Total adjustments related to income from operations

 

32,823

 

 

29,564

 

Adjusted income before income taxes

 

149,786

 

 

100,169

 

Non-GAAP tax provision on adjusted income before income taxes

 

32,354

 

 

23,940

 

Adjusted (non-GAAP) net income

 

$

117,432

 

 

$

76,229

 

 

 

 

 

 

Weighted average basic common shares outstanding

 

153,858

 

156,170

Weighted average dilutive potential common shares outstanding 1

 

155,141

 

158,289

 

 

 

 

 

Net Income per Common Share

 

 

 

 

GAAP diluted net income per common share

 

$

0.59

 

 

$

0.33

 

Adjusted (non-GAAP) diluted net income per common share

 

$

0.76

 

 

$

0.48

 

  1. Weighted average dilutive potential common shares outstanding used in calculating Adjusted (non-GAAP) diluted net income per common share for the second quarter of fiscal 2020 includes 1.3 million shares underlying certain stock option and stock unit awards.

    Weighted average dilutive potential common shares outstanding used in calculating Adjusted (non-GAAP) diluted net income per common share for the second quarter of fiscal 2019 includes 2.1 million shares underlying certain stock option and restricted stock unit awards.

APPENDIX B - Calculation of EBITDA and Adjusted EBITDA (unaudited)

 

 

 

 

 

 

 

Quarter Ended

 

 

May 2,

 

May 4,

 

 

2020

 

2019

Earnings Before Interest, Tax, Depreciation and Amortization (EBITDA)

 

 

 

 

Net income (GAAP)

 

$

91,655

 

 

$

52,738

 

Add: Interest expense

 

7,860

 

 

9,471

 

Less: Interest and other income, net

 

(2,665

)

 

(244

)

Add: Provision for income taxes

 

25,308

 

 

17,867

 

Add: Depreciation of equipment, building, furniture and fixtures, and amortization of leasehold improvements

 

22,599

 

 

21,482

 

Add: Amortization of intangible assets

 

9,674

 

 

8,832

 

EBITDA

 

$

159,761

 

 

$

110,634

 

Add: Share-based compensation cost

 

17,977

 

 

15,607

 

Add: Significant asset impairments and restructuring costs

 

3,811

 

 

4,068

 

Add: Acquisition and integration costs

 

1,414

 

 

1,135

 

Adjusted EBITDA

 

$

182,963

 

 

$

131,444

 

The adjusted (non-GAAP) measures above and their reconciliation to Ciena's GAAP results for the periods presented reflect adjustments relating to the following items:

  • Share-based compensation - a non-cash expense incurred in accordance with share-based compensation accounting guidance.
  • Amortization of intangible assets - a non-cash expense arising from the acquisition of intangible assets, principally developed technologies and customer-related intangibles, that Ciena is required to amortize over its expected useful life.
  • Significant asset impairments and restructuring costs - costs incurred as a result of restructuring activities taken to align resources with perceived market opportunities.
  • Acquisition and integration costs - consist of financial, legal and accounting advisors' costs and severance and other employment-related costs related to Ciena's acquisition of Centina in the first quarter of fiscal 2020 and costs associated with a three-year earn-out arrangement related to the deal consideration for Ciena's DonRiver acquisition in fiscal 2018. Ciena does not believe that these costs are reflective of its ongoing operating expense following its completion of these integration activities.
  • Non-GAAP tax provision - consists of current and deferred income tax expense commensurate with the level of adjusted income before income taxes and utilizes a current, blended U.S. and foreign statutory annual tax rate of 21.6% for the second fiscal quarter of 2020 and 23.9% for the second fiscal quarter of 2019. This rate may be subject to change in the future, including as a result of changes in tax policy or tax strategy.

 

Press:
Nicole Anderson
Ciena Corporation
+1 (410) 694-5761 
pr@ciena.com

Investors:
Gregg Lampf
Ciena Corporation
+1 (410) 694-5700
ir@ciena.com

Source: Ciena Corporation