Ciena's loss deepens after Nortel metro Ethernet acquisition

Revenue from legacy products remained flat compared to a year earlier

Ciena plunged deeper into the red following its acquisition of Nortel Networks' metro Ethernet business, with sales of its legacy products stagnating, it reported Wednesday.

Revenue for the three months ended July 31 totaled $US389.7 million, up from $164.8 million a year earlier, but Ciena's net loss for the period grew too, to $109.9 million from just $26.5 million a year earlier.

However, Ciena is cautiously optimistic about the future, predicting that increasing levels of customer activity could boost revenue as high as $US409 million for the three months to 31 October.

This is the first full fiscal quarter for which Ciena has reported results since it completed its $774 million acquisition of Nortel's optical networking and carrier Ethernet assets on 19 March.

The former Nortel business unit brought in revenue of around $US221.8 million for the three-month period, with Ciena's legacy business contributing just $167.9 million, almost unchanged from a year earlier.

Two of Ciena's customers together accounted for over a third of the company's revenue, it said. Ciena did not provide the names of those customers.

Peter Sayer covers open source software, European intellectual property legislation and general technology breaking news for IDG News Service. Send comments and news tips to Peter at peter_sayer@idg.com.

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Peter Sayer

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