Slide 1: Fiscal Q4 2024 Earnings Presentation
Ciena Corporation Fiscal Q4 2024 Earnings Presentation Period ended November 2, 2024 December 12, 2024 © Ciena Corporation 2024. All rights reserved. Proprietary Information.
Slide 2: Forward-looking statements and non-GAAP measures
Forward-looking statements and non-GAAP measures You are encouraged to review the Investors section of our website, where we routinely post press releases, Securities and Exchange Commission (SEC) filings, recent news, financial results, supplemental financial information, and other announcements. F
Slide 3: Table of Contents
Table of Contents 1. Overview and Ciena's portfolio 2. Industry context and addressable market expansion 3. Ciena is positioned for accelerated growth 4. Fiscal year 2024 financial performance 5. Fiscal Q4 2024 financial performance 6. Fiscal Q1 and full-year 2025 outlook and long-term targets 7. Ap
Slide 4: Overview and Ciena's portfolio
Overview and Ciena's portfolio © Ciena Corporation 2024. All rights reserved. Proprietary Information.
Slide 5: Ciena is an industry-leading global networking systems, services, and software company
Ciena is an industry-leading global networking systems, services, and software company 5 © Ciena Corporation 2024. All rights reserved. Proprietary Information.
Slide 6: Our vision for networking: How it works
Our vision for networking: How it works 6 © Ciena Corporation 2024. All rights reserved. Proprietary Information.
Slide 7: Our strategy leverages our Optical technology to create expanded addressable market opportunities
Our strategy leverages our Optical technology to create expanded addressable market opportunities 7 © Ciena Corporation 2024. All rights reserved. Proprietary Information.
Slide 8: Industry context and addressable market expansion
Industry context and addressable market expansion © Ciena Corporation 2024. All rights reserved. Proprietary Information.
Slide 9: Increasing bandwidth consumption as a driver of network expansion
Increasing bandwidth consumption as a driver of network expansion 9 © Ciena Corporation 2024. All rights reserved. Proprietary Information.
Slide 10: Our addressable market expansion strategy allows us to access higher growth markets
Our addressable market expansion strategy allows us to access higher growth markets 1 Sources: Dell'Oro, CignalAI, LightCounting, and Ciena internal analysis. 10 © Ciena Corporation 2024. All rights reserved. Proprietary Information.
Slide 11: Our market leadership
Our market leadership #1 Globally #1 Globally #1 Globally • Purpose-built/compact modular DCI • Purpose-built/compact modular DCI • Data center interconnect • SLTE WDM • Optical for cloud and colo • Purpose-built/compact modular DCI • Access switching • SLTE WDM • Optical for internet content provid
Slide 12: Ciena is positioned for accelerated growth
Ciena is positioned for accelerated growth © Ciena Corporation 2024. All rights reserved. Proprietary Information.
Slide 13: Our future growth
Our future growth Long-term growth in core business plus new addressable markets result in opportunity to outpace our traditional revenue CAGR over time 13 © Ciena Corporation 2024. All rights reserved. Proprietary Information.
Slide 14: Our portfolio addresses all key applications
Our portfolio addresses all key applications 14 © Ciena Corporation 2024. All rights reserved. Proprietary Information.
Slide 15: We expect coherent technology will have growing applications in the AI era
We expect coherent technology will have growing applications in the AI era 15 © Ciena Corporation 2024. All rights reserved. Proprietary Information.
Slide 16: Fiscal full-year 2024 results
Fiscal full-year 2024 results © Ciena Corporation 2024. All rights reserved. Proprietary Information.
Slide 17: Fiscal FY 2024 key highlights
Fiscal FY 2024 key highlights We are committed to our people, We are driving the pace of We have a strong business and communities, and the innovation financial model environment Introduced WaveLogic 6 Extreme the • Ended the fiscal quarter with approximately • Released our annual Sustainability ind
Slide 18: Fiscal full-year 2024 comparative financial highlights
Fiscal full-year 2024 comparative financial highlights FY 2024 FY 2023 Revenue $4,014.9M $4,386.5M Adjusted Gross Margin* 43.6% 43.5% Adjusted Operating Expense* $1,361.7M $1,332.8M Adjusted Operating Margin* 9.7% 13.1% Adjusted EBITDA* $481.0M $665.8M Adjusted EPS* $1.82 $2.72 * Reconciliations of
Slide 19: Q4 FY 2024 results
Q4 FY 2024 results © Ciena Corporation 2024. All rights reserved. Proprietary Information.
Slide 20: Q4 FY 2024 key highlights
Q4 FY 2024 key highlights Prioritizing long term Achieving balanced growth Driving the pace of innovation shareholder value Non-telco represented 48% of total • Achieved commercial availability of • Total shareholder return five-year CAGR of revenue WaveLogic 6 Extreme, industry’s first 1.6T 14% 1 c
Slide 21: Q4 FY 2024 comparative financial highlights
Q4 FY 2024 comparative financial highlights Q4 FY 2024 Q4 FY 2023 Revenue $1,124.1M $1,129.5M Adjusted Gross Margin* 41.6% 43.7% Adjusted Operating Expense* $354.9M $337.6M Adjusted Operating Margin* 10.0% 13.8% Adjusted EBITDA* $136.7M $178.8M Adjusted EPS* $0.54 $0.75 * Reconciliations of these no
Slide 22: Q4 FY 2024 comparative operating metrics
Q4 FY 2024 comparative operating metrics Q4 FY 2024 Q4 FY 2023 Cash and investments $1.33B $1.25B Cash provided by operations $349M $196M DSO 89.0 92.0 Inventory Turns 2.7 2.0 Gross Leverage 3.34x 2.44x Net Debt $274M $373M 22 © Ciena Corporation 2024. All rights reserved. Proprietary Information.
Slide 23: Revenue by segment
Revenue by segment (Amounts in millions) Q4 FY 2024 Q4 FY 2023 Revenue %** Revenue %** Networking Platforms Optical Networking $779.6 69.4 $748.0 66.2 Routing and Switching 79.4 7.0 128.9 11.4 Total Networking Platforms 859.0 76.4 876.9 77.6 Platform Software and Services 99.6 8.9 82.1 7.3 Blue Plan
Slide 24: Revenue derived from non-telco customers
Revenue derived from non-telco customers 24 © Ciena Corporation 2024. All rights reserved. Proprietary Information.
Slide 25: Revenue by geographic region
Revenue by geographic region 10.8% 14.5% 10.8% 9.4% 13.4% 14.5% 10.1% 20.0% 14.3% 17.1% 71.0% 69.2% 72.8% 76.3% 75.8% 25 © Ciena Corporation 2024. All rights reserved. Proprietary Information.
Slide 26: Business outlook
Business outlook © Ciena Corporation 2024. All rights reserved. Proprietary Information.
Slide 27: Economic considerations and assumptions in our 2025 outlook
Economic considerations and assumptions in our 2025 outlook Business Assumptions Revenue Assumptions Profitability Assumptions • Macro environment does not significantly • We secure increased orders from Service • Operating expense increases moderately worsen or result in any adverse effects on Prov
Slide 28: Business outlook
Business outlook1 Q1 FY 2025 Revenue $1.01B to $1.09B Adjusted Gross Margin Low-40s% Adjusted Operating Expense Approximately $350M Full Fiscal Year 2025 Revenue Growth 8% to 11% Adjusted Gross Margin 42% to 44% Adjusted Operating Expense An average of $350M to $360M per quarter 1 Projections or out
Slide 29: Long-term targets
Long-term targets1 Fiscal years 2025 through 2027 Revenue Growth 8% to 11% average FY2025 through FY2027 Adjusted Operating Margin 15% to 16% in FY2027 Free Cash Flow as % of Adj. Operating Income 55% to 60% 1 Projections or outlook with respect to future operating results are only as of December 12
Slide 30: Q4 FY 2024 appendix
Q4 FY 2024 appendix © Ciena Corporation 2024. All rights reserved. Proprietary Information.
Slide 31: Gross Profit Reconciliation
Gross Profit Reconciliation (Amounts in thousands) Q4 FY 2024 Q3 FY 2024 Q2 FY 2024 Q1 FY 2024 Q4 FY 2023 GAAP gross profit $460,022 $403,945 $388,661 $466,962 $486,281 Share-based compensation-products 1,736 1,660 1,760 1,318 1,194 Share-based compensation-services 3,257 3,122 3,344 3,020 2,827 Amo
Slide 32: Operating Expense Reconciliation
Operating Expense Reconciliation (Amounts in thousands) Q4 FY 2024 Q3 FY 2024 Q2 FY 2024 Q1 FY 2024 Q4 FY 2023 GAAP operating expense $400,812 $377,202 $392,626 $382,333 $394,979 Share-based compensation-research and development 14,065 13,118 14,066 12,880 11,412 Share-based compensation-sales and m
Slide 33: Net Income (Loss) Reconciliation
Net Income (Loss) Reconciliation (Amounts in thousands) Q4 FY 2024 Q3 FY 2024 Q2 FY 2024 Q1 FY 2024 Q4 FY 2023 GAAP net income (loss) $37,028 $14,230 $(16,849) $49,547 $91,199 Exclude GAAP provision (benefit) for income taxes 10,993 2,125 820 21,956 (20,681) Income (loss) before income taxes 48,021
Slide 34: Earnings Before Interest, Tax, Depreciation and Amortization (EBITDA)
Earnings Before Interest, Tax, Depreciation and Amortization (EBITDA) (Amounts in thousands) Earnings Before Interest, Tax, Depreciation and Amortization Q4 FY 2024 Q3 FY 2024 Q2 FY 2024 Q1 FY 2024 Q4 FY 2023 (EBITDA) Net income (loss) (GAAP) $37,028 $14,230 $(16,849) $49,547 $91,199 Add: Interest e
Slide 35: Thank You
Thank You © Ciena Corporation 2024. All rights reserved. Proprietary Information.