Ciena Corporation (NYSE:CIEN)

Second Quarter 2010 Performance Summary

• $253.5 million in revenue, reflecting approximately $53.5 million from the acquired MEN business.
• Non-U.S. customers contributed 29% of total revenue.
• Two customers each accounted for greater than 10% of revenue, and 42% of total sales in the aggregate.
• GAAP gross margin of 41%.
• Adjusted (non-GAAP) gross margin of 49%, which excludes share-based compensation costs, amortization of intangible assets, charges for product rationalization, and fair value adjustment of acquired inventory.
• GAAP net loss of $(90.0) million or $(0.97) per common share.
• Adjusted (non-GAAP) net loss of $(11.7) million or $(0.13) per common share.
• Ended the quarter with cash, cash equivalents and short-term investments of $614 million, using $78 million in cash for operations during the quarter, which includes the effect of $38 million of cash spent on acquisition and integration-related costs and a $36 million increase in working capital.
• Incurred $39.2 million in acquisition and integration-related expense, and $1.9 million in restructuring costs.
• Completed a private offering of 4.0% Convertible Senior Notes due March 15, 2015, in aggregate principal amount of $375.0 million.

Business Outlook

“We are encouraged by recent signs of recovery in customer spending, although Europe remains a challenge due to volatile macroeconomic conditions,” stated Smith. “While we still have work to do in delivering the full value of the combined company, we believe we are strategically well-positioned, with strong customer relationships and a portfolio of leading solutions that are tightly aligned with the market trend toward high-capacity, scalable next-generation networks.”

Smith continued, “We anticipate that our fiscal third quarter revenue will be in the range of $375 million to $400 million, and we expect that as-adjusted gross margin will be consistent with our near-term expectation of low 40s.”