Slide 1: Ciena Corporation Investor Presentation, Quarter ended January 31, 2018
Copyright © Ciena Corporation 2018. All rights reserved. Confidential & Proprietary. Ciena Corporation For the Quarter ended January 31, 2018 March 6, 2018 Investor presentation
Slide 2: Forward-looking statements and non-GAAP measures
Copyright © Ciena Corporation 2018. All rights reserved. Confidential & Proprietary. 2 Forward-looking statements and non-GAAP measures Information in this presentation and related comments of presenters contain a number of forward-looking statements. These statements are based on current expectatio
Slide 3: Diversification, innovation and shareholder value
Copyright © Ciena Corporation 2018. All rights reserved. Confidential & Proprietary. 3 Diversification and growth through market share gains Forcing the pace of innovation with next generation solutions Delivering shareholder value and strengthening our balance sheet ▪ Non-telco represented 35% of t
Slide 4: Q1 Fiscal 2018 Financial Highlights
Copyright © Ciena Corporation 2018. All rights reserved. Confidential & Proprietary. 4 Q1 Fiscal 2018 Financial Highlights * A reconciliation of these non-GAAP measures to our GAAP results is included in the appendix to this presentation.
Slide 5: Q1 Fiscal 2018 Comparisons (Year-over-Year)
Copyright © Ciena Corporation 2018. All rights reserved. Confidential & Proprietary. 5 Q1 Fiscal 2018 Comparisons (Year-over-Year) 44.9% 42.6% Adj. Gross Margin* Q1'17 Q1'18 $621.5 $646.1 Revenue in millions Q1'17 Q1'18 8.5% 6.3% Adj. Operating Margin* Q1'17 Q1'18 * A reconciliation of these non-GAA
Slide 6: Q1 Fiscal 2018 Comparisons (Revenue by Segment)
Copyright © Ciena Corporation 2018. All rights reserved. Confidential & Proprietary. 6 Q1 Fiscal 2018 Comparisons (Revenue by Segment) (in millions) $496.0 $490.0 $53.5 $39.3 $96.6 $92.2 $0.0 $100.0 $200.0 $300.0 $400.0 $500.0 $600.0 $700.0 Q1'18 Q1'17 Networking Platforms Software & Software-Relate
Slide 7: Q1 Fiscal 2018 Revenue by Segment
Copyright © Ciena Corporation 2018. All rights reserved. Confidential & Proprietary. 7 Q1 Fiscal 2018 Revenue by Segment (Amounts in millions) Q1 FY 2018 Q1 FY 2017 Revenue %* Revenue %* Networking Platforms Converged Packet Optical $427.4 66.1 $417.8 67.2 Packet Networking 68.6 10.6 72.2 11.6 Total
Slide 8: U.S. and International Revenue
Copyright © Ciena Corporation 2018. All rights reserved. Confidential & Proprietary. 8 U.S. and International Revenue (Amounts in millions) Revenue Q1 FY 2018 Q4 FY 2017 Q3 FY 2017 Q2 FY 2017 Q1 FY 2017 United States $383.4 $418.2 $438.1 $392.0 $379.7 International $262.7 $326.2 $290.6 $315.0 $241.8
Slide 9: Q1 Fiscal 2018 Revenue by Geographic Region
Copyright © Ciena Corporation 2018. All rights reserved. Confidential & Proprietary. 9 Q1 Fiscal 2018 Revenue by Geographic Region 62.4%15.1% 5.4% 17.1% North America Europe, Middle East and Africa Caribbean and Latin America Asia Pacific
Slide 10: Revenue by Geographic Region
Copyright © Ciena Corporation 2018. All rights reserved. Confidential & Proprietary. 10 Revenue by Geographic Region (Amounts in millions) Revenue Q1 FY 2018 Q4 FY 2017 Q3 FY 2017 Q2 FY 2017 Q1 FY 2017 North America $402.9 $440.5 $465.2 $424.4 $405.9 Europe, Middle East and Africa 97.8 110.7 96.1 10
Slide 11: Q1 Fiscal 2018 Balance Sheet and Operating Metrics
Copyright © Ciena Corporation 2018. All rights reserved. Confidential & Proprietary. 11 Q1 Fiscal 2018 Balance Sheet and Operating Metrics DSO
Slide 12: Strengthening balance sheet
Copyright © Ciena Corporation 2018. All rights reserved. Confidential & Proprietary. 12 Strengthening balance sheet Ciena has improved its leverage and reduced its debt position Leverage Trend Net Debt Position (in millions) *Cash & cash equivalents $486 $777 $1,021 $1,143 $969 $987 $1,198 $1,451 $1
Slide 13: Impact of the Tax Cuts and Jobs Act
Copyright © Ciena Corporation 2018. All rights reserved. Confidential & Proprietary. 13 Impact of the Tax Cuts and Jobs Act
Slide 14: Convertible Debt Overview
Copyright © Ciena Corporation 2018. All rights reserved. Confidential & Proprietary. 14 Convertible Debt Overview
Slide 15: 3.75% Senior Convertible Notes due 2018
Copyright © Ciena Corporation 2018. All rights reserved. Confidential & Proprietary. 15 (1) On August 2, 2017, a portion of our 3.75% Senior Convertible Notes due October 15, 2018 (Issued 10/18/2010) (the “Original 2018 Notes”) were exchanged by the holders thereof for 3.75% Senior Convertible Notes
Slide 16: Average Stock Price Per Share and Additional EPS Shares
Copyright © Ciena Corporation 2018. All rights reserved. Confidential & Proprietary. 16 Average Stock Price Per Share A Below $20.17 21 22 23 24 25 26 27 28 29 30 31 32 33 34 $ 35 Underlying Shares B Additional Shares in Diluted EPS Calculation (Additional EPS Shares) E÷A Conversion Value C = (A * B
Slide 17: Q1 Fiscal 2018 Appendix
Copyright © Ciena Corporation 2018. All rights reserved. Confidential & Proprietary. 17 Q1 Fiscal 2018 Appendix
Slide 18: Gross profit reconciliation
Copyright © Ciena Corporation 2018. All rights reserved. Confidential & Proprietary. 18 Q1 FY 2018 Q4 FY 2017 Q3 FY 2017 Q2 FY 2017 Q1 FY 2017 GAAP gross profit $271,765 $325,685 $328,076 $318,240 $273,785 Share-based compensation-products 672 694 709 708 561 Share-based compensation-services 625 56
Slide 19: Operating expense and income from operations reconciliation
Copyright © Ciena Corporation 2018. All rights reserved. Confidential & Proprietary. 19 Q1 FY 2018 Q4 FY 2017 Q3 FY 2017 Q2 FY 2017 Q1 FY 2017 GAAP operating expense $255,029 $269,886 $246,077 $260,420 $254,681 Share-based compensation-research and development 3,255 2,956 3,139 3,653 3,209 Share-bas
Slide 20: Net income reconciliation
Copyright © Ciena Corporation 2018. All rights reserved. Confidential & Proprietary. 20 Q1 FY 2018 Q4 FY 2017 Q3 FY 2017 Q2 FY 2017 Q1 FY 2017 GAAP net income (loss) ($473,363) $1,160,056 $60,010 $38,026 $3,861 Exclude GAAP provision (benefit) for income taxes 477,940 (1,117,531) 7,726 3,568 410 Inc
Slide 21: Earnings Before Interest, Tax, Depreciation and Amortization (EBITDA)
Copyright © Ciena Corporation 2018. All rights reserved. Confidential & Proprietary. 21 Earnings Before Interest, Tax, Depreciation and Amortization (EBITDA) Q1 FY 2018 Q4 FY 2017 Q3 FY 2017 Q2 FY 2017 Q1 FY 2017 Net income (loss) (GAAP) ($473,363) $1,160,056 $60,010 $38,026 $3,861 Add: Interest exp
Slide 22: & Proprietary. • • • • • • • • •
Copyright © Ciena Corporation 2018. All rights reserved. Confidential & Proprietary. 22 • • • • • • • • •
Slide 23: 23Copyright
23Copyright © Ciena Corporation 2018. All rights reserved. Confidential & Proprietary.