News

22 July 2009

 

Infinera’s revenues rebound slightly as non-US customers grow

For second-quarter 2009, Infinera Corp of Sunnyvale, CA, USA, a vertically integrated manufacturer of digital optical network systems incorporating its own indium phosphide-based photonic integrated circuits (PICs), has reported revenue of $68.9m, up slightly from $66.6m last quarter but down 24% on $90.8m a year ago. Of total revenue, 36% came from Europe and Asia (compared to just 22% a year ago), with three of the top five customers coming from these regions (one from Europe and two from Asia).

Excluding non-cash stock-based compensation expense, non-GAAP gross margin was 31%, level on last quarter but down from 47% a year ago. Non-GAAP net loss was $18.2m, compared to $17.6m last quarter and net income of $10.7m on an adjusted GAAP basis a year ago.

“We saw a number of positive developments in the second quarter, with both existing and new customers,” says president & CEO Jagdeep Singh. “There was a significant quarter-over-quarter increase in orders, including over 2000 TAMs [Tributary Adapter Modules] booked, and we continued our new customer win momentum, adding four new customers to our roster [including a win at COLT for a pan-European network, bringing customer count to 62],” he adds. “We also announced another tier-one win today with NTT, the world's second largest service provider.”

The new business at NTT is for its new IP backbone network in the Tokyo area. Wins over the last 12 months with tier-one service providers include Deutsche Telecom, OTE, and TeliaSonera. The firm also won a new sizeable submarine network build (its second in six months).

“These developments indicate that our strategy of winning new footprint during the economic downturn to generate growth once the economy recovers is a sound one,” asserts Singh. “We believe that over time, as the economy improves and as our customers add capacity to existing footprint, our gross margins will continue to rebound.”

CEO Singh to become executive chairman in January, replaced by COO Tom Fallon

Chairman & CEO Jagdeep Singh (who co-founded Infinera in 2000 with chief marketing & strategy officer Dr Dave Welch and chief technology officer Drew Perkins) plans to step down as CEO and become executive chairman on 1 January 2010, when chief operating officer Tom Fallon will succeed him as president & CEO.

Singh will remain actively involved, working with Fallon and the executive team on product strategy and long-term direction of the firm. “It is time to pass the baton of leadership for the day-to-day operations of the company,” says Singh. “I look forward to continuing to work with Tom and other members of the team as we continue to capitalize on our unique opportunity to disrupt the optical transport industry,” he adds.

“As an experienced operations executive, Tom has an exceptional background for the CEO role,” says Singh. “He spent many years in management at Cisco, including his role as VP & general manager of Cisco’s optical business unit. He is one of the veterans of the Infinera management team, having joined us early in our development, and has led an increasingly broad set of functional groups at our company over the years... I look forward to working with him on his transition into the CEO role over the next six months.”

Fallon joined Infinera in 2004 and served as VP, engineering and operations through 2006, when he was named COO. From 2003 to 2004, he was VP, corporate quality and development operations at Cisco Systems Inc. From 2001 to 2003, he was Cisco’s general manager of the optical transport business unit. Fallon has a B.S.M.E. and M.B.A. from the University of Texas at Austin.

“We have a significant competitive advantage in the DWDM market with our PIC-based technology, a world-class team, and strong customer momentum, and we look forward to extending this lead in the years to come and delivering sustained profitable growth,” says Fallon.

See related items:

Infinera’s revenue falls 23%, but gains two tier-one European customers

Infinera makes quarterly loss but adds seven new customers

Infinera’s invoiced revenue falls 11%

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Visit: www.infinera.com