Networking strategy and technology company, Ciena Corporation (NYSE: CIEN), reported their Q2 earnings and is showing considerable growth compared to both Q1 of the current fiscal year and Q2 of the previous fiscal year, respectively. After taking a peak at the number’s, a picture begins to materialize for potential investor’s.
Ciena’s GAAP results almost doubled from last years’ Q2 operating margin, jumping from 4.4 percent to a strong 8.2 percent, indicating positive growth and a stock increasingly worthy of your intentions. Net Income was up over 38-million, with 55.4 percent coming from the United States. While many liken the stock market to a casino, financial luminaries such as Warren Buffet will tell you, “Risk comes from not knowing.” Investing is never a gamble to those who know what they’re doing.
President and CEO, Gary B. Smith, took the “win” as a clear indication of his company’s future outlooks and said, “We continue to win as an innovation powerhouse with global scale and deep customer relationships across a broad set of applications and market segments.” When the market wins, the people of America win. “Ciena expects fiscal third quarter 2017 financial performance to include: Revenue in the range of $710 to $740 million; Adjusted (non-GAAP) gross margin in the mid-40s percentage range; Adjusted (non-GAAP) operating expense of approximately.” Of course, GAAP are the General Accepted Accounting Principles for a reason.
Upon further observation, a couple of things stood out to me. While the growth signals positive progress, 15% of the company’s Total Revenue came from one undisclosed client out of a 5,663 Headcount. This means that the remaining 85% of Total Revenue came from the remaining 5,662 accounts. Assets were also given a considerable boost as Ciena has approximately $85.1-million in deferred Cost of Sales which, ultimately, lists future expenses as an asset that has yet to be consumed. Is this a good or bad thing, that remains to be seen, but one thing is for sure; Ciena Corporation is going to be an interesting stock to keep track of. Happy investing!