Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below): | |||||||||||
☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act: | ||||||||
Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered |
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Common stock, $0.01 par value |
CIEN |
New York Stock Exchange |
Exhibit Number |
Description of Document |
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Exhibit 99.1 |
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Exhibit 99.2 |
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Exhibit 99.3 | |||||||||||
Exhibit 104 |
Cover Page Interactive Data File (embedded within the Inline XBRL document). |
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. |
Ciena Corporation |
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Date: September 4, 2024 |
By: |
/s/ Sheela Kosaraju | ||||||
Sheela Kosaraju |
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Senior Vice President, General Counsel and Assistant Secretary |
GAAP Results (unaudited) | ||||||||||||||||||||
Q3 | Q3 | Period Change | ||||||||||||||||||
FY 2024 | FY 2023 | Y-T-Y* | ||||||||||||||||||
Revenue | $ | 942.3 | $ | 1,067.9 | (11.8) | % | ||||||||||||||
Gross margin | 42.9 | % | 42.0 | % | 0.9 | % | ||||||||||||||
Operating expense | $ | 377.2 | $ | 370.7 | 1.7 | % | ||||||||||||||
Operating margin | 2.9 | % | 7.3 | % | (4.4) | % | ||||||||||||||
Non-GAAP Results (unaudited) | ||||||||||||||||||||
Q3 | Q3 | Period Change | ||||||||||||||||||
FY 2024 | FY 2023 | Y-T-Y* | ||||||||||||||||||
Revenue | $ | 942.3 | $ | 1,067.9 | (11.8) | % | ||||||||||||||
Adj. gross margin | 43.7 | % | 42.7 | % | 1.0 | % | ||||||||||||||
Adj. operating expense | $ | 336.0 | $ | 327.9 | 2.5 | % | ||||||||||||||
Adj. operating margin | 8.0 | % | 12.0 | % | (4.0) | % | ||||||||||||||
Adj. EBITDA | $ | 98.5 | $ | 151.3 | (34.9) | % |
Revenue by Segment (unaudited) | ||||||||||||||||||||||||||
Q3 FY 2024 | Q3 FY 2023 | |||||||||||||||||||||||||
Revenue | %** | Revenue | %** | |||||||||||||||||||||||
Networking Platforms | ||||||||||||||||||||||||||
Optical Networking | $ | 606.8 | 64.4 | $ | 719.0 | 67.3 | ||||||||||||||||||||
Routing and Switching | 92.7 | 9.8 | 127.6 | 11.9 | ||||||||||||||||||||||
Total Networking Platforms | 699.5 | 74.2 | 846.6 | 79.2 | ||||||||||||||||||||||
Platform Software and Services | 83.2 | 8.9 | 78.9 | 7.4 | ||||||||||||||||||||||
Blue Planet Automation Software and Services | 25.8 | 2.7 | 13.1 | 1.3 | ||||||||||||||||||||||
Global Services | ||||||||||||||||||||||||||
Maintenance Support and Training | 74.4 | 7.9 | 72.9 | 6.8 | ||||||||||||||||||||||
Installation and Deployment | 46.5 | 4.9 | 46.8 | 4.4 | ||||||||||||||||||||||
Consulting and Network Design | 12.9 | 1.4 | 9.6 | 0.9 | ||||||||||||||||||||||
Total Global Services | 133.8 | 14.2 | 129.3 | 12.1 | ||||||||||||||||||||||
Total | $ | 942.3 | 100.0 | $ | 1,067.9 | 100.0 | ||||||||||||||||||||
Revenue by Geographic Region (unaudited) | ||||||||||||||||||||||||||
Q3 FY 2024 | Q3 FY 2023 | |||||||||||||||||||||||||
Revenue | % ** | Revenue | % ** | |||||||||||||||||||||||
Americas | $ | 718.6 | 76.3 | $ | 749.5 | 70.2 | ||||||||||||||||||||
Europe, Middle East and Africa | 135.0 | 14.3 | 152.8 | 14.3 | ||||||||||||||||||||||
Asia Pacific | 88.7 | 9.4 | 165.6 | 15.5 | ||||||||||||||||||||||
Total | $ | 942.3 | 100.0 | $ | 1,067.9 | 100.0 | ||||||||||||||||||||
Quarter Ended | Nine Months Ended | ||||||||||||||||||||||
July 27, | July 29, | July 27, | July 29, | ||||||||||||||||||||
2024 | 2023 | 2024 | 2023 | ||||||||||||||||||||
Revenue: | |||||||||||||||||||||||
Products | $ | 729,503 | $ | 865,197 | $ | 2,266,596 | $ | 2,678,242 | |||||||||||||||
Services | 212,805 | 202,689 | 624,247 | 578,820 | |||||||||||||||||||
Total revenue | 942,308 | 1,067,886 | 2,890,843 | 3,257,062 | |||||||||||||||||||
Cost of goods sold: | |||||||||||||||||||||||
Products | 433,533 | 516,900 | 1,315,737 | 1,559,120 | |||||||||||||||||||
Services | 104,830 | 102,045 | 315,538 | 305,372 | |||||||||||||||||||
Total cost of goods sold | 538,363 | 618,945 | 1,631,275 | 1,864,492 | |||||||||||||||||||
Gross profit | 403,945 | 448,941 | 1,259,568 | 1,392,570 | |||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||
Research and development | 188,888 | 189,392 | 571,537 | 561,115 | |||||||||||||||||||
Selling and marketing | 121,520 | 118,266 | 373,749 | 367,156 | |||||||||||||||||||
General and administrative | 58,248 | 49,349 | 162,504 | 151,184 | |||||||||||||||||||
Significant asset impairments and restructuring costs | 1,361 | 4,174 | 21,987 | 16,625 | |||||||||||||||||||
Amortization of intangible assets | 7,185 | 9,487 | 22,384 | 26,773 | |||||||||||||||||||
Acquisition and integration costs | — | 59 | — | 3,474 | |||||||||||||||||||
Total operating expenses | 377,202 | 370,727 | 1,152,161 | 1,126,327 | |||||||||||||||||||
Income from operations | 26,743 | 78,214 | 107,407 | 266,243 | |||||||||||||||||||
Interest and other income, net | 14,013 | 10,187 | 36,460 | 50,711 | |||||||||||||||||||
Interest expense | (24,401) | (24,060) | (72,038) | (63,819) | |||||||||||||||||||
Income before income taxes | 16,355 | 64,341 | 71,829 | 253,135 | |||||||||||||||||||
Provision for income taxes | 2,125 | 34,608 | 24,901 | 89,507 | |||||||||||||||||||
Net income | $ | 14,230 | $ | 29,733 | $ | 46,928 | $ | 163,628 | |||||||||||||||
Net Income per Common Share | |||||||||||||||||||||||
Basic net income per common share | $ | 0.10 | $ | 0.20 | $ | 0.32 | $ | 1.09 | |||||||||||||||
Diluted net income per potential common share | $ | 0.10 | $ | 0.20 | $ | 0.32 | $ | 1.09 | |||||||||||||||
Weighted average basic common shares outstanding | 144,394 | 149,690 | 144,876 | 149,472 | |||||||||||||||||||
Weighted average dilutive potential common shares outstanding 1 |
145,361 | 149,977 | 145,795 | 149,867 |
July 27, 2024 |
October 28, 2023 |
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ASSETS | |||||||||||
Current assets: | |||||||||||
Cash and cash equivalents | $ | 883,365 | $ | 1,010,618 | |||||||
Short-term investments | 217,810 | 104,753 | |||||||||
Accounts receivable, net | 899,877 | 1,003,876 | |||||||||
Inventories, net | 937,399 | 1,050,838 | |||||||||
Prepaid expenses and other | 600,008 | 405,694 | |||||||||
Total current assets | 3,538,459 | 3,575,779 | |||||||||
Long-term investments | 111,833 | 134,278 | |||||||||
Equipment, building, furniture and fixtures, net | 299,161 | 280,147 | |||||||||
Operating lease right-of-use assets | 28,717 | 35,140 | |||||||||
Goodwill | 444,791 | 444,765 | |||||||||
Other intangible assets, net | 174,974 | 205,627 | |||||||||
Deferred tax asset, net | 831,682 | 809,306 | |||||||||
Other long-term assets | 145,513 | 116,453 | |||||||||
Total assets | $ | 5,575,130 | $ | 5,601,495 | |||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||
Current liabilities: | |||||||||||
Accounts payable | $ | 316,599 | $ | 317,828 | |||||||
Accrued liabilities and other short-term obligations | 347,238 | 431,419 | |||||||||
Deferred revenue | 179,457 | 154,419 | |||||||||
Operating lease liabilities | 15,565 | 16,655 | |||||||||
Current portion of long-term debt | 11,700 | 11,700 | |||||||||
Total current liabilities | 870,559 | 932,021 | |||||||||
Long-term deferred revenue | 77,628 | 74,041 | |||||||||
Other long-term obligations | 171,014 | 170,407 | |||||||||
Long-term operating lease liabilities | 26,742 | 33,259 | |||||||||
Long-term debt, net | 1,538,315 | 1,543,406 | |||||||||
Total liabilities | 2,684,258 | 2,753,134 | |||||||||
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; 144,426,873 and 144,829,938 shares issued and outstanding |
1,444 | 1,448 | |||||||||
Additional paid-in capital | 6,260,095 | 6,262,083 | |||||||||
Accumulated other comprehensive loss | (40,192) | (37,767) | |||||||||
Accumulated deficit | (3,330,475) | (3,377,403) | |||||||||
Total stockholders’ equity | 2,890,872 | 2,848,361 | |||||||||
Total liabilities and stockholders’ equity | $ | 5,575,130 | $ | 5,601,495 | |||||||
Nine Months Ended | |||||||||||
July 27, | July 29, | ||||||||||
2024 | 2023 | ||||||||||
Cash flows provided by (used in) operating activities: | |||||||||||
Net income | $ | 46,928 | $ | 163,628 | |||||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | |||||||||||
Depreciation of equipment, building, furniture and fixtures, and amortization of leasehold improvements | 68,997 | 69,213 | |||||||||
Share-based compensation expense | 115,433 | 95,405 | |||||||||
Amortization of intangible assets | 30,675 | 36,274 | |||||||||
Deferred taxes | (19,909) | (64,005) | |||||||||
Provision for inventory excess and obsolescence | 35,400 | 18,767 | |||||||||
Provision for warranty | 14,708 | 18,860 | |||||||||
Gain on equity investments, net | — | (26,368) | |||||||||
Other | 11,968 | 13,694 | |||||||||
Changes in assets and liabilities: | |||||||||||
Accounts receivable | 92,421 | (80,399) | |||||||||
Inventories | 78,220 | (262,345) | |||||||||
Prepaid expenses and other | (221,823) | 72,062 | |||||||||
Operating lease right-of-use assets | 8,963 | 11,003 | |||||||||
Accounts payable, accruals and other obligations | (112,352) | (133,880) | |||||||||
Deferred revenue | 28,833 | 57,547 | |||||||||
Short and long-term operating lease liabilities | (13,290) | (16,596) | |||||||||
Net cash provided by (used in) operating activities | 165,172 | (27,140) | |||||||||
Cash flows used in investing activities: | |||||||||||
Payments for equipment, furniture, fixtures and intellectual property | (53,098) | (83,422) | |||||||||
Purchases of investments | (197,303) | (119,240) | |||||||||
Proceeds from sales and maturities of investments | 114,899 | 150,646 | |||||||||
Settlement of foreign currency forward contracts, net | (362) | (3,272) | |||||||||
Purchase of equity investments | (21,682) | — | |||||||||
Acquisition of business, net of cash acquired | — | (230,048) | |||||||||
Net cash used in investing activities | (157,546) | (285,336) | |||||||||
Cash flows provided by (used in) financing activities: | |||||||||||
Proceeds from issuance of term loan, net | — | 497,500 | |||||||||
Payment of long term debt | (5,850) | (6,448) | |||||||||
Payment of debt issuance costs | (2,554) | (5,422) | |||||||||
Payment of finance lease obligations | (3,004) | (2,830) | |||||||||
Shares repurchased for tax withholdings on vesting of stock unit awards | (33,450) | (29,794) | |||||||||
Repurchases of common stock - repurchase program, net | (125,816) | (57,736) | |||||||||
Proceeds from issuance of common stock | 34,292 | 31,276 | |||||||||
Net cash provided by (used in) financing activities | (136,382) | 426,546 | |||||||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash | 1,499 | 9,501 | |||||||||
Net increase (decrease) in cash, cash equivalents and restricted cash | (127,257) | 123,571 | |||||||||
Cash, cash equivalents and restricted cash at beginning of period | 1,010,786 | 994,378 | |||||||||
Cash, cash equivalents and restricted cash at end of period | $ | 883,529 | $ | 1,117,949 | |||||||
Supplemental disclosure of cash flow information | |||||||||||
Cash paid during the period for interest, net | $ | 64,999 | $ | 56,709 | |||||||
Cash paid during the period for income taxes, net | $ | 41,736 | $ | 68,058 | |||||||
Operating lease payments | $ | 14,672 | $ | 18,038 | |||||||
Non-cash investing and financing activities | |||||||||||
Purchase of equipment in accounts payable | $ | 35,316 | $ | 4,579 | |||||||
Repurchase of common stock in accrued liabilities from repurchase program, net | $ | 1,762 | $ | 3,500 | |||||||
Operating right-of-use assets subject to lease liability | $ | 5,326 | $ | 9,771 | |||||||
Gain on equity investments, net | $ | — | $ | 26,368 |
APPENDIX A - Reconciliation of Adjusted (Non- GAAP) Measurements | ||||||||||||||
(in thousands, except per share data) (unaudited) | ||||||||||||||
Quarter Ended | ||||||||||||||
July 27, | July 29, | |||||||||||||
2024 | 2023 | |||||||||||||
Gross Profit Reconciliation (GAAP/non-GAAP) | ||||||||||||||
GAAP gross profit | $ | 403,945 | $ | 448,941 | ||||||||||
Share-based compensation-products | 1,660 | 1,118 | ||||||||||||
Share-based compensation-services | 3,122 | 2,687 | ||||||||||||
Amortization of intangible assets | 2,764 | 3,187 | ||||||||||||
Total adjustments related to gross profit | 7,546 | 6,992 | ||||||||||||
Adjusted (non-GAAP) gross profit | $ | 411,491 | $ | 455,933 | ||||||||||
Adjusted (non-GAAP) gross profit percentage | 43.7 | % | 42.7 | % | ||||||||||
Operating Expense Reconciliation (GAAP/non-GAAP) | ||||||||||||||
GAAP operating expense | $ | 377,202 | $ | 370,727 | ||||||||||
Share-based compensation-research and development | 13,118 | 10,954 | ||||||||||||
Share-based compensation-sales and marketing | 10,315 | 8,770 | ||||||||||||
Share-based compensation-general and administrative | 9,257 | 9,377 | ||||||||||||
Significant asset impairments and restructuring costs | 1,361 | 4,174 | ||||||||||||
Amortization of intangible assets | 7,185 | 9,487 | ||||||||||||
Acquisition and integration costs | — | 59 | ||||||||||||
Total adjustments related to operating expense | 41,236 | 42,821 | ||||||||||||
Adjusted (non-GAAP) operating expense | $ | 335,966 | $ | 327,906 | ||||||||||
Income from Operations Reconciliation (GAAP/non-GAAP) | ||||||||||||||
GAAP income from operations | $ | 26,743 | $ | 78,214 | ||||||||||
Total adjustments related to gross profit | 7,546 | 6,992 | ||||||||||||
Total adjustments related to operating expense | 41,236 | 42,821 | ||||||||||||
Total adjustments related to income from operations | 48,782 | 49,813 | ||||||||||||
Adjusted (non-GAAP) income from operations | $ | 75,525 | $ | 128,027 | ||||||||||
Adjusted (non-GAAP) operating margin percentage | 8.0 | % | 12.0 | % | ||||||||||
Net Income Reconciliation (GAAP/non-GAAP) | ||||||||||||||
GAAP net income | $ | 14,230 | $ | 29,733 | ||||||||||
Exclude GAAP provision for income taxes | 2,125 | 34,608 | ||||||||||||
Income before income taxes | 16,355 | 64,341 | ||||||||||||
Total adjustments related to income from operations | 48,782 | 49,813 | ||||||||||||
Loss on equity investment | — | 87 | ||||||||||||
Adjusted income before income taxes | 65,137 | 114,241 | ||||||||||||
Non-GAAP tax provision on adjusted income before income taxes | 14,330 | 25,133 | ||||||||||||
Adjusted (non-GAAP) net income | $ | 50,807 | $ | 89,108 | ||||||||||
Weighted average basic common shares outstanding | 144,394 | 149,690 | ||||||||||||
Weighted average dilutive potential common shares outstanding 1 |
145,361 | 149,977 | ||||||||||||
APPENDIX A - Reconciliation of Adjusted (Non- GAAP) Measurements | ||||||||||||||
(in thousands, except per share data) (unaudited) | ||||||||||||||
Quarter Ended | ||||||||||||||
July 27, | July 29, | |||||||||||||
2024 | 2023 | |||||||||||||
Net Income per Common Share | ||||||||||||||
GAAP diluted net income per potential common share | $ | 0.10 | $ | 0.20 | ||||||||||
Adjusted (non-GAAP) diluted net income per potential common share | $ | 0.35 | $ | 0.59 |
APPENDIX B - Calculation of EBITDA and Adjusted EBITDA | ||||||||||||||
(in thousands) (unaudited) | ||||||||||||||
Quarter Ended | ||||||||||||||
July 27, | July 29, | |||||||||||||
2024 | 2023 | |||||||||||||
Earnings Before Interest, Tax, Depreciation and Amortization (EBITDA) | ||||||||||||||
Net income (GAAP) | $ | 14,230 | $ | 29,733 | ||||||||||
Add: Interest expense | 24,401 | 24,060 | ||||||||||||
Less: Interest and other income, net | 14,013 | 10,187 | ||||||||||||
Add: Provision for income taxes | 2,125 | 34,608 | ||||||||||||
Add: Depreciation of equipment, building, furniture and fixtures, and amortization of leasehold improvements | 22,981 | 23,310 | ||||||||||||
Add: Amortization of intangible assets | 9,949 | 12,674 | ||||||||||||
EBITDA | $ | 59,673 | $ | 114,198 | ||||||||||
Add: Share-based compensation expense | 37,472 | 32,906 | ||||||||||||
Add: Significant asset impairments and restructuring costs | 1,361 | 4,174 | ||||||||||||
Add: Acquisition and integration costs | — | 59 | ||||||||||||
Adjusted EBITDA | $ | 98,506 | $ | 151,337 |