Annual revenue increased 21%
Ciena® Corporation (NYSE: CIEN), a networking systems, services
and software company, today announced unaudited financial results
for its fiscal fourth quarter ended October 28, 2023.
- Q4 Revenue: $1.13 billion
- Q4 Net Income per Share: $0.62 GAAP; $0.75 adjusted
(non-GAAP)
- Share Repurchases: Repurchased approximately 4.2 million
shares of common stock for an aggregate price of $188.8 million
during the quarter
"Today we reported strong fiscal fourth quarter results, driven
by positive demand dynamics, particularly with cloud provider
customers. We delivered an outstanding fiscal year with 21% growth
in revenue, gaining significant market share and further advancing
our industry leadership position," said Gary Smith, president and
CEO, Ciena. "Looking ahead, as we execute on our strategy to extend
our market leadership in optical while expanding our opportunities
in routing and switching, we expect to continue to grow revenue
faster than the market and take share."
For fiscal fourth quarter 2023, Ciena reported revenue of $1.13
billion as compared to $971.0 million for the fiscal fourth quarter
2022. For fiscal year 2023, Ciena reported revenue of $4.39
billion, as compared to $3.63 billion for fiscal year 2022.
Ciena's GAAP net income for the fiscal fourth quarter 2023 was
$91.2 million, or $0.62 per diluted common share, which compares to
a GAAP net income of $57.6 million, or $0.39 per diluted common
share, for the fiscal fourth quarter 2022. For fiscal year 2023,
Ciena's GAAP net income was $254.8 million, or $1.71 per diluted
common share, as compared to GAAP net income of $152.9 million, or
$1.00 per diluted common share, for fiscal year 2022.
Ciena's adjusted (non-GAAP) net income for the fiscal fourth
quarter 2023 was $111.2 million, or $0.75 per diluted common share,
which compares to an adjusted (non-GAAP) net income of $90.9
million, or $0.61 per diluted common share, for the fiscal fourth
quarter 2022. For fiscal year 2023, Ciena's adjusted (non-GAAP) net
income was $406.3, or $2.72 per diluted common share, as compared
to adjusted (non-GAAP) net income of $288.9, or $1.90 per diluted
common share, for fiscal year 2022.
Performance Summary For Fiscal Fourth Quarter and Year Ended
October 28, 2023
The tables below (in millions, except percentage data) provide
comparisons of certain quarterly and annual 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
(unaudited)
Quarter Ended
Period
Year Ended
Period
October 28,
October 29,
Change
October 28,
October 29,
Change
2023
2022
Y-T-Y*
2023
2022
Y-T-Y*
Revenue
$
1,129.5
$
971.0
16.3
%
$
4,386.5
$
3,632.7
20.8
%
Gross margin
43.1
%
44.7
%
(1.6
)%
42.8
%
43.0
%
(0.2
)%
Operating expense
$
395.0
$
356.3
10.9
%
$
1,521.3
$
1,337.5
13.7
%
Operating margin
8.1
%
8.0
%
0.1
%
8.2
%
6.1
%
2.1
%
Non-GAAP Results
(unaudited)
Quarter Ended
Period
Year Ended
Period
October 28,
October 29,
Change
October 28,
October 29,
Change
2023
2022
Y-T-Y*
2023
2022
Y-T-Y*
Revenue
$
1,129.5
$
971.0
16.3
%
$
4,386.5
$
3,632.7
20.8
%
Adj. gross margin
43.7
%
45.2
%
(1.5
)%
43.5
%
43.6
%
(0.1
)%
Adj. operating expense
$
337.6
$
312.8
7.9
%
$
1,332.8
$
1,177.0
13.2
%
Adj. operating margin
13.8
%
13.0
%
0.8
%
13.1
%
11.2
%
1.9
%
Adj. EBITDA
$
178.8
$
153.5
16.5
%
$
665.8
$
502.4
32.5
%
* Denotes % change, or in the case of
margin, absolute change
Revenue by Segment
(unaudited)
Quarter Ended
October 28, 2023
October 29, 2022
Revenue
%**
Revenue
%**
Networking Platforms
Optical Networking 1
$
748.0
66.2
$
649.9
66.9
Routing and Switching
128.9
11.4
102.8
10.6
Total Networking Platforms
876.9
77.6
752.7
77.5
Platform Software and Services
82.1
7.3
71.6
7.4
Blue Planet Automation Software and
Services
20.0
1.8
21.2
2.2
Global Services
Maintenance Support and Training
74.4
6.6
73.1
7.5
Installation and Deployment
60.1
5.3
36.9
3.8
Consulting and Network Design
16.0
1.4
15.5
1.6
Total Global Services
150.5
13.3
125.5
12.9
Total
$
1,129.5
100.0
$
971.0
100.0
Revenue by Segment
(unaudited)
Year Ended
October 28, 2023
October 29, 2022
Revenue
%**
Revenue
%**
Networking Platforms
Optical Networking 1
$
2,987.3
68.1
$
2,380.0
65.5
Routing and Switching
506.2
11.5
398.4
11.0
Total Networking Platforms
3,493.5
79.6
2,778.4
76.5
Platform Software and Services
303.9
6.9
277.2
7.6
Blue Planet Automation Software and
Services
69.1
1.6
76.6
2.1
Global Services
Maintenance Support and Training
288.3
6.6
292.4
8.1
Installation and Deployment
181.0
4.1
157.4
4.3
Consulting and Network Design
50.7
1.2
50.7
1.4
Total Global Services
520.0
11.9
500.5
13.8
Total
$
4,386.5
100.0
$
3,632.7
100.0
**
Denotes % of total revenue
1 Ciena renamed its former “Converged
Packet Optical” product line “Optical Networking” effective as of
the fourth quarter of fiscal 2023. This change, affecting only the
presentation of such information, was made on a prospective basis
and does not impact comparability of previous financial results or
the composition of this product category.
Additional Performance Metrics for Fiscal Fourth Quarter and
Year Ended October 28, 2023
Revenue by Geographic Region
(unaudited)
Quarter Ended
October 28, 2023
October 29, 2022
Revenue
% **
Revenue
% **
Americas
$
801.4
71.0
$
723.5
74.5
Europe, Middle East and Africa
164.1
14.5
135.1
13.9
Asia Pacific
164.0
14.5
112.4
11.6
Total
$
1,129.5
100.0
$
971.0
100.0
Revenue by Geographic Region
(unaudited)
Year Ended
October 28, 2023
October 29, 2022
Revenue
% **
Revenue
% **
Americas
$
3,110.3
70.9
$
2,636.9
72.6
Europe, Middle East and Africa
643.1
14.7
555.2
15.3
Asia Pacific
633.1
14.4
440.6
12.1
Total
$
4,386.5
100.0
$
3,632.7
100.0
** Denotes % of total revenue
- Two customers represented 10%-plus of revenue for the fiscal
fourth quarter 2023, combining for a total of 29.7% of revenue. Two
customers represented 10%-plus of revenue for the fiscal year 2023,
combining for a total of 23.4% of revenue.
- Cash and investments at the end of fiscal year 2023 totaled
$1.25 billion
- Cash flow from operations totaled $195.5 million and $168.3
million for the fiscal fourth quarter and the fiscal year 2023,
respectively
- Average days' sales outstanding (DSOs) were 92 and 95 for the
fiscal fourth quarter and the fiscal year 2023, respectively
- Accounts receivable, net balance was $1.00 billion
- Unbilled contract assets, net balance was $150.3 million
- Inventories totaled $1.05 billion, including:
- Raw materials: $664.8 million
- Work in process: $55.2 million
- Finished goods: $314.2 million
- Deferred cost of sales: $66.6 million
- Reserve for excess and obsolescence: $(50.0) million
- Product inventory turns were 2.0 for both the fiscal fourth
quarter and the fiscal year 2023.
- Headcount totaled 8,483 at the end of fiscal year 2023
Supplemental Materials and Live Web Broadcast of Unaudited
Fiscal Fourth Quarter 2023 Results
Today, Thursday, December 7, 2023, in conjunction with this
announcement, Ciena has posted to the Quarterly Results page of the
Investor Relations section of its website certain related
supporting materials for its unaudited fiscal fourth quarter 2023
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, Securities and Exchange Commission ("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: "Today we
reported strong fiscal fourth quarter results, driven by positive
demand dynamics, particularly with cloud provider customers"; "We
delivered an outstanding fiscal year with 21% growth in revenue,
gaining significant market share and further advancing our industry
leadership position"; "Looking ahead, as we execute on our strategy
to extend our market leadership in optical while expanding our
opportunities in routing and switching, we expect to continue to
grow revenue faster than the market and take share."
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, their spending and their businesses
and markets; our ability to execute our business and growth
strategies; the impact of macroeconomic conditions and global
supply chain constraints or disruptions including increased supply
costs and lead times; the impact of the introduction of new
technologies by us or our competitors; seasonality and the timing
and size of customer orders, their delivery dates and 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; changes in foreign
currency exchange rates; factors beyond our control such as natural
disasters, climate change, acts of war or terrorism, geopolitical
tensions or events, including but not limited to the ongoing
conflicts between Ukraine and Russia, and Israel and Hamas, and
public health emergencies or epidemics, including the COVID-19
pandemic; changes in tax or trade regulations, including the
imposition of tariffs, duties or efforts to withdraw from or
materially modify international trade agreements; cyberattacks,
data breaches or other security incidents involving our enterprise
network environment or our products; regulatory changes, litigation
involving our intellectual property or government investigations;
and the other risk factors disclosed in Ciena’s periodic reports
filed with the Securities and Exchange Commission (SEC) including
Ciena's Quarterly Report on Form 10-Q filed with the SEC on
September 6, 2023 and its Annual Report on Form 10-K to be filed
with the SEC. 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 global leader in
networking systems, services, and software. We build the most
adaptive networks in the industry, enabling customers to anticipate
and meet ever-increasing digital demands. For three-plus decades,
Ciena has brought our humanity to our relentless pursuit of
innovation. Prioritizing collaborative relationships with our
customers, partners, and communities, we create flexible, open, and
sustainable networks that better serve all users—today and into the
future. 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
Year Ended
October 28,
October 29,
October 28,
October 29,
2023
2022
2023
2022
Revenue:
Products
$
902,797
$
779,609
$
3,581,039
$
2,888,848
Services
226,690
191,401
805,510
743,813
Total revenue
1,129,487
971,010
4,386,549
3,632,661
Cost of goods sold:
Products
529,320
440,253
2,088,440
1,699,631
Services
113,886
97,160
419,258
372,686
Total cost of goods sold
643,206
537,413
2,507,698
2,072,317
Gross profit
486,281
433,597
1,878,851
1,560,344
Operating expenses:
Research and development
189,444
166,898
750,559
624,656
Selling and marketing
123,648
121,865
490,804
466,565
General and administrative
64,100
48,191
215,284
179,382
Significant asset impairments and
restructuring costs
7,209
13,621
23,834
33,824
Amortization of intangible assets
10,578
5,754
37,351
32,511
Acquisition and integration costs
—
—
3,474
598
Total operating expenses
394,979
356,329
1,521,306
1,337,536
Income from operations
91,302
77,268
357,545
222,808
Interest and other income, net
11,297
1,887
62,008
6,747
Interest expense
(24,207
)
(13,775
)
(88,026
)
(47,050
)
Loss on extinguishment and modification of
debt
(7,874
)
—
(7,874
)
—
Income before income taxes
70,518
65,380
323,653
182,505
Provision (benefit) for income taxes1
(20,681
)
7,735
68,826
29,603
Net income
$
91,199
$
57,645
$
254,827
$
152,902
Net Income per Common Share
Basic net income per common share
$
0.62
$
0.39
$
1.71
$
1.01
Diluted net income per potential common
share
$
0.62
$
0.39
$
1.71
$
1.00
Weighted average basic common shares
outstanding
147,437
148,548
148,971
151,208
Weighted average dilutive potential common
shares outstanding 2
147,891
149,111
149,380
152,193
1 For the fourth quarter and year ended
fiscal 2023, reflects a tax benefit resulting, in part, from
guidance in Notice 2023-63 issued by the IRS addressing
capitalization and amortization of specified research or
experimental expenditures under Section 174 in accordance with the
Tax Cuts and Jobs Act.
2 Weighted average dilutive potential
common shares outstanding used in calculating GAAP diluted net
income per potential common share includes the following number of
shares underlying certain stock option and stock unit awards: (i)
0.5 million and 0.4 million shares for the fourth quarter and year
ended fiscal 2023, respectively; and (ii) 0.6 million and 1.0
million shares for the fourth quarter and year ended fiscal 2022,
respectively.
CIENA CORPORATION
CONDENSED CONSOLIDATED BALANCE
SHEETS
(in thousands, except share
data)
(unaudited)
October 28, 2023
October 29, 2022
ASSETS
Current assets:
Cash and cash equivalents
$
1,010,618
$
994,352
Short-term investments
104,753
153,989
Accounts receivable, net
1,003,876
920,772
Inventories, net
1,050,838
946,730
Prepaid expenses and other
405,694
370,053
Total current assets
3,575,779
3,385,896
Long-term investments
134,278
35,385
Equipment, building, furniture and
fixtures, net
280,147
267,779
Operating lease right-of-use assets
35,140
45,108
Goodwill
444,765
328,322
Other intangible assets, net
205,627
69,517
Deferred tax asset, net
809,306
824,008
Other long-term assets
116,453
113,617
Total assets
$
5,601,495
$
5,069,632
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable
$
317,828
$
516,047
Accrued liabilities and other short-term
obligations
431,419
360,782
Deferred revenue
154,419
137,899
Operating lease liabilities
16,655
18,925
Current portion of long-term debt
11,700
6,930
Total current liabilities
932,021
1,040,583
Long-term deferred revenue
74,041
62,336
Other long-term obligations
170,407
150,335
Long-term operating lease liabilities
33,259
42,392
Long-term debt, net
1,543,406
1,061,125
Total liabilities
2,753,134
2,356,771
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; 144,829,938 and 148,412,943 shares
issued and outstanding
1,448
1,484
Additional paid-in capital
6,262,083
6,390,252
Accumulated other comprehensive loss
(37,767
)
(46,645
)
Accumulated deficit
(3,377,403
)
(3,632,230
)
Total stockholders’ equity
2,848,361
2,712,861
Total liabilities and stockholders’
equity
$
5,601,495
$
5,069,632
CIENA CORPORATION
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
Year Ended
October 28,
October 29,
2023
2022
Cash flows used in operating
activities:
Net income
$
254,827
$
152,902
Adjustments to reconcile net income to net
cash used in operating activities:
Loss on extinguishment of debt
1,864
—
Depreciation of equipment, building,
furniture and fixtures, and amortization of leasehold
improvements
92,564
95,922
Share-based compensation expense
130,455
105,131
Amortization of intangible assets
49,616
44,281
Deferred taxes
(14,852
)
(27,502
)
Provision for inventory excess and
obsolescence
29,464
16,184
Provision for warranty
31,742
17,440
Gain on cost method equity investments,
net
(26,368
)
(4,120
)
Other
15,771
4,120
Changes in assets and liabilities:
Accounts receivable
(94,565
)
(47,069
)
Inventories
(132,497
)
(589,113
)
Prepaid expenses and other
(51,965
)
(58,996
)
Operating lease right-of-use assets
14,190
16,453
Accounts payable, accruals and other
obligations
(138,469
)
100,327
Deferred revenue
27,412
26,380
Short and long-term operating lease
liabilities
(20,857
)
(20,096
)
Net cash used in operating activities
168,332
(167,756
)
Cash flows used in investing
activities:
Payments for equipment, furniture,
fixtures and intellectual property
(106,197
)
(90,818
)
Purchases of investments
(252,329
)
(647,526
)
Proceeds from sales and maturities of
investments
208,104
702,197
Settlement of foreign currency forward
contracts, net
(2,984
)
4,942
Purchase of cost method equity
investments
—
(8,000
)
Acquisition of business, net of cash
acquired
(230,048
)
(62,043
)
Net cash used in investing activities
(383,454
)
(101,248
)
Cash flows provided by (used in) financing
activities:
Proceeds from issuance of senior notes
—
400,000
Proceeds from issuance of term loan,
net
497,500
—
Payment of long term debt
(9,430
)
(5,197
)
Proceeds for modification of term loan
830
—
Payment of debt issuance costs
(6,379
)
(5,484
)
Payment of finance lease obligations
(3,791
)
(3,468
)
Shares repurchased for tax withholdings on
vesting of stock unit awards
(38,506
)
(48,454
)
Repurchases of common stock - repurchase
program
(242,201
)
(500,800
)
Proceeds from issuance of common stock
31,357
30,348
Net cash provided by (used in) financing
activities
229,380
(133,055
)
Effect of exchange rate changes on cash,
cash equivalents and restricted cash
2,150
(26,167
)
Net increase (decrease) in cash, cash
equivalents and restricted cash
16,408
(428,226
)
Cash, cash equivalents and restricted cash
at beginning of period
994,378
1,422,604
Cash, cash equivalents and restricted cash
at end of period
$
1,010,786
$
994,378
Supplemental disclosure of cash flow
information
Cash paid during the period for
interest
$
84,465
$
42,812
Cash paid during the period for income
taxes, net
$
78,242
$
34,967
Operating lease payments
$
22,782
$
21,661
Non-cash investing and financing
activities
Purchase of equipment in accounts
payable
$
6,990
$
12,373
Repurchase of common stock in accrued
liabilities from repurchase program
$
9,310
$
—
Operating right-of-use assets subject to
lease liability
$
10,236
$
23,242
Gain on cost method equity investments,
net
$
26,368
$
4,120
APPENDIX A - Reconciliation of
Adjusted (Non- GAAP) Measurements
(in thousands, except per
share data) (unaudited)
Quarter Ended
Year Ended
October 28,
October 29,
October 28,
October 29,
2023
2022
2023
2022
Gross Profit Reconciliation
(GAAP/non-GAAP)
GAAP gross profit
$
486,281
$
433,597
$
1,878,851
$
1,560,344
Share-based compensation-products
1,194
907
4,518
3,867
Share-based compensation-services
2,827
2,066
10,470
7,533
Amortization of intangible assets
2,763
2,005
12,264
11,770
Total adjustments related to gross
profit
6,784
4,978
27,252
23,170
Adjusted (non-GAAP) gross profit
$
493,065
$
438,575
$
1,906,103
$
1,583,514
Adjusted (non-GAAP) gross profit
percentage
43.7
%
45.2
%
43.5
%
43.6
%
Operating Expense Reconciliation
(GAAP/non-GAAP)
GAAP operating expense
$
394,979
$
356,329
$
1,521,306
$
1,337,536
Share-based compensation-research and
development
11,412
8,507
42,331
31,879
Share-based compensation-sales and
marketing
9,187
8,084
35,136
31,280
Share-based compensation-general and
administrative
10,274
7,610
37,587
30,435
Significant asset impairments and
restructuring costs
7,209
13,621
23,834
33,824
Amortization of intangible assets
10,578
5,754
37,351
32,511
Acquisition and integration costs
—
—
3,474
598
Legal settlement
8,750
—
8,750
—
Total adjustments related to operating
expense
57,410
43,576
188,463
160,527
Adjusted (non-GAAP) operating expense
$
337,569
$
312,753
$
1,332,843
$
1,177,009
Income from Operations Reconciliation
(GAAP/non-GAAP)
GAAP income from operations
$
91,302
$
77,268
$
357,545
$
222,808
Total adjustments related to gross
profit
6,784
4,978
27,252
23,170
Total adjustments related to operating
expense
57,410
43,576
188,463
160,527
Total adjustments related to income from
operations
64,194
48,554
215,715
183,697
Adjusted (non-GAAP) income from
operations
$
155,496
$
125,822
$
573,260
$
406,505
Adjusted (non-GAAP) operating margin
percentage
13.8
%
13.0
%
13.1
%
11.2
%
Net Income Reconciliation
(GAAP/non-GAAP)
GAAP net income
$
91,199
$
57,645
$
254,827
$
152,902
Exclude GAAP provision for income
taxes
(20,681
)
7,735
68,826
29,603
Income before income taxes
70,518
65,380
323,653
182,505
Total adjustments related to income from
operations
64,194
48,554
215,715
183,697
Loss on extinguishment and modification of
debt
7,874
—
7,874
—
Gain on cost method equity investments,
net
—
—
(26,368
)
(4,120
)
Adjusted income before income taxes
142,586
113,934
520,874
362,082
Non-GAAP tax provision on adjusted income
before income taxes
31,369
23,015
114,592
73,141
Adjusted (non-GAAP) net income
$
111,217
$
90,919
$
406,282
$
288,941
Weighted average basic common shares
outstanding
147,437
148,548
148,971
151,208
Weighted average dilutive potential common
shares outstanding 1
147,891
149,111
149,380
152,193
Net Income per Common Share
GAAP diluted net income per potential
common share
$
0.62
$
0.39
$
1.71
$
1.00
Adjusted (non-GAAP) diluted net income per
potential common share
$
0.75
$
0.61
$
2.72
$
1.90
1 Weighted average dilutive potential
common shares outstanding used in calculating Adjusted (non-GAAP)
diluted net income per potential common share includes the
following number of shares underlying certain stock option and
stock unit awards: (i) 0.5 million and 0.4 million for the fourth
quarter and year ended fiscal 2023, respectively; and (ii) 0.6
million and 1.0 million for the fourth quarter and year ended
fiscal 2022, respectively.
APPENDIX B - Calculation of
EBITDA and Adjusted EBITDA (unaudited)
(in thousands)
(unaudited)
Quarter Ended
Year Ended
October 28,
October 29,
October 28,
October 29,
2023
2022
2023
2022
Earnings Before Interest, Tax,
Depreciation and Amortization (EBITDA)
Net income (GAAP)
$
91,199
$
57,645
$
254,827
$
152,902
Add: Interest expense
24,207
13,775
88,026
47,050
Less: Interest and other income, net
11,297
1,887
62,008
6,747
Add: Loss on extinguishment and
modification of debt
7,874
—
7,874
—
Add: Provision (benefit) for income
taxes
(20,681
)
7,735
68,826
29,603
Add: Depreciation of equipment, building,
furniture and fixtures, and amortization of leasehold
improvements
23,351
27,642
92,564
95,922
Add: Amortization of intangible assets
13,342
7,759
49,616
44,281
EBITDA
$
127,995
$
112,669
$
499,725
$
363,011
Add: Share-based compensation cost
34,894
27,174
130,042
104,994
Add: Significant asset impairments and
restructuring costs
7,209
13,621
23,834
33,824
Add: Acquisition and integration costs
—
—
3,474
598
Add: Legal settlement
8,750
—
8,750
—
Adjusted EBITDA
$
178,848
$
153,464
$
665,825
$
502,427
* * *
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.
- Significant asset impairments and restructuring costs - costs
incurred as a result of restructuring activities taken to align
resources with perceived market opportunities, and the redesign of
business processes including restructuring certain real estate
facilities.
- 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 an expected useful life.
- Acquisition and integration costs - primarily consist of
financial, legal and accounting advisors' costs and
employment-related costs related to Ciena's acquisitions in fiscal
2022 and fiscal 2023.
- Loss on extinguishment and modification of debt - reflects
extinguishment and debt modification expenses related to
refinancing our then existing term loans which occurred during the
fourth quarter of fiscal 2023.
- Gain on cost method equity investments, net - reflects changes
in the carrying value of certain cost method equity investments due
to triggering events.
- Legal settlements - costs incurred as a result of the
settlement of certain patent infringement claims and the resolution
of related legal proceedings during the fourth quarter of fiscal
2023.
- 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 22.0% for the fiscal fourth
quarter and fiscal year 2023 and 20.2% for the fiscal fourth
quarter and fiscal year 2022. This rate may be subject to change in
the future, including as a result of changes in tax policy or tax
strategy.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231206286734/en/
Press Contact: Jamie Moody Ciena Corporation +1 (410) 694-5761
pr@ciena.com Investor Contact: Gregg Lampf Ciena Corporation +1
(877) 243-6273 ir@ciena.com
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