Ciena on Thursday reported fiscal fourth-quarter profit and revenue that topped consensus estimates. CIEN stock rose even though its revenue outlook came in below views.
For the quarter ending Oct. 31, Ciena posted adjusted earnings of 75 cents a share, up 23% from a year ago. Revenue climbed 16% to $1.13 billion.
A year earlier, the Hannover, Md.-based maker of optical communications gear, earned 61 cents a share on sales of $971 million. Analysts expected Ciena earnings of 69 cents on sales of $1.105 billion.
Ciena's gear is built into telecom networks and hyperscale data centers operated by internet giants.
"Webscale drove the beat and we expect the cloud (data center) business to remain a larger portion of the business moving forward," said Barclays analyst Tim Long in a report. "Notably the percentage revenue share from the vertical was a record 35%."
CIEN Stock: Guidance Light
Telecom customers are ordering less network gear.
"Telco/cable provided 55% of Q4 sales and still have weak orders as they absorb capacity," said Raymond James analyst Simon Leopold in a report. "Although capex remains under pressure we do not believe operators can defer capacity additions indefinitely. So Ciena should see orders improve in the second half of fiscal 2024."
On the stock market today, CIEN stock rose 1.2% to close at 46.31.
Ciena said it expects revenue in a range of $980 million to $1.06 billion in its fiscal first quarter ending in January. At the midpoint of guidance, the outlook missed views. Analysts had predicted revenue of $1.053 billion.
For full-year, fiscal 2024, Ciena forecast revenue growth in a range of 1% to 4% vs. estimates of 6% growth.
Ciena stock had retreated 9% in 2023 prior to the earnings report.
Heading into the Ciena earnings report, the company owned a Relative Strength Rating of 44 out of a best-possible 99, according to IBD Stock Checkup.
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