Ciena (CIEN) investor relations material

Executive summary

• Fiscal Q3 2025 revenue reached $1.22 billion, up 29.4% year-over-year, driven by strong demand from cloud, service providers, and AI-related network growth.

• Adjusted EPS was $0.67, up 91% year-over-year; GAAP net income was $50.3 million ($0.35 per share), both significantly higher than the prior year.

• Order book set a new quarterly record, fueled by AI infrastructure investments and broad-based customer strength.

• Strategic wins included industry-first AI infrastructure projects, co-developed solutions with hyperscalers, and record product shipments.

• Announced a restructuring plan, including ceasing 25G PON investment and a 4–5% workforce reduction.

Financial highlights

• Adjusted gross margin in Q3 was 41.9%, with adjusted operating margin at 10.7% and adjusted EBITDA at $158 million.

• Cash and investments at quarter-end were $1.39 billion; cash flow from operations was $174.3 million.

• Repurchased 1.0 million shares for $81.8 million in Q3; year-to-date repurchases totaled $245 million.

• Free cash flow margin was 11% in Q3; DSO improved to 88, and inventory turns reached 2.7.

• Net debt at $204 million; gross leverage at 2.81x.

Outlook and guidance

• Q4 revenue expected between $1.24 billion and $1.32 billion; adjusted gross margin guidance of 42–43%.

• Q4 adjusted operating expense projected at $390–400 million.

• FY26 revenue growth expected at approximately 17% year-over-year, with gross margin estimated at 43% ±1 point and operating margin target of 15–16%.

• 82% of $2.0 billion remaining performance obligations expected to be recognized as revenue within 12 months.

• Guidance assumes stable macro environment and continued demand for bandwidth.