What happened
Shares of Ciena (NYSE: CIEN) were up 15% as of noon EDT Thursday after the telecommunications networking and software specialist announced strong results for its fiscal third quarter 2023 (ended July 29, 2023).
Quarterly revenue climbed 23% year over year to $1.068 billion, translating to adjusted (non-GAAP) net income of $89.1 million, or $0.59 per share. Analysts, on average, were expecting adjusted earnings of only $0.51 per share on revenue of $1.04 billion.
So what
Ciena also achieved generally accepted accounting principles (GAAP) profitability during the quarter, with GAAP net income of $29.7 million, or $0.20 per share -- up from $0.07 per share in the same year-ago period. The company also repurchased 1.4 million shares during the quarter for $61.2 million, an average price of around $43.71 per share. For perspective, the stock currently trades around $49.60 per share as of this writing.
Ciena CEO Gary Smith called it an "excellent" quarter "with strength across all regions," adding: "We are encouraged by increased customer activity that, when combined with our elevated backlog, market leadership, and expanding addressable market, we believe will drive growth and market share gains going forward."
Now what
During the subsequent conference call with analysts, Ciena management increased their full fiscal-year outlook to call for revenue growth of 20% to 22% (up from 16% to 18%). It also reiterated previous guidance for full-year gross margin ranging from 42% to 44%.
In the end, this was a straightforward beat-and-raise performance from Ciena. The leading telecom stock is responding in kind.
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Steve Symington has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
