Ciena takes a thousand points of light and puts them in motion at the same time. The company makes transport and switching equipment that increases the capacity of long-distance fiber-optic networks by transmitting multiple light signals simultaneously over the same circuit. It also sells optical transport systems for metro and enterprise wide-area networks, as well as broadband access products that enable communications companies to deliver Internet protocol (IP) services, such as VoIP, IP video, and DSL. Ciena serves telecommunications service providers, cable companies, large enterprises, and government entities.
Ciena's converged packet optical products represent more than two-thirds of its revenue thanks to its products including the 6500 Packet-Optical Platform, the 5430 Reconfigurable Switching System, the line of CoreDirector Multiservice Optical Switches, and embedded operating system software. This segment includes products used by network operators to increase network capacity and the speed of high-bandwidth services.
The software and services segment, about 20% of sales, offers maintenance support, installation, deployment, and consulting services. Software and services includes Ciena One, the On-Center Network & Service Management Suite, and the OMEA and Preside platforms.
Packet networking solutions, another 9% of sales, supplies the 3000 and 5000 families of service delivery switches, service aggregation switches, and legacy metro Ethernet and broadband products. Products in this segment support wireless backhaul infrastructures and business data services. The segment also includes the 8700 Packetwave Platform and the Ethernet packet configuration for the 5410 Service Aggregation Switch.
Optical transport products, 3% of revenue, is supported by demand for 4200 Advanced Services Platform and the Corestream Agility Optical Transport System. This segment includes products that create automated optical infrastructures that support enterprise and consumer-oriented network services.
Ciena has operations in North America, the Caribbean and Latin America, Europe, the Middle East, Africa, and the Asia/Pacific. More than 70% of its sales come from the US.
It doesn't build its own products but uses contract manufacturers with plants located in Canada, Mexico, Thailand, and the US.
Sales and Marketing
The company counts more than 1,000 customers such as AT&T and Comcast in the US and Orange (France), Telefonica (Spain), and Vodafone (UK) overseas. It uses a direct sales force as well as resellers.
AT&T accounted for about 20% of 2015 revenue. It was one of the 10 customers that contributed 52.5% of the year's 2015 revenue.
In 2015 revenue was $2.45 billion, a 7% increase from 2014. Purchases by telecom provider of equipment for high-speed networks helped boost revenue. Hot selling equipment included high-capacity, optical transport for coherent 40G and 100G network infrastructures. Revenue from software and services also rose in 2015.
The revenue increase helped boost the company's bottom line to the black with a $11.6 billion profit. The company lost $40 million in 2014.
Cash flow generated by operations rose to $262 million in 2015 from about $90 million in 2014.
Holding some 1,500 US patents and more than 400 foreign patents, Ciena is focusing product development in all its segments on new demand for converged optical Ethernet networking products and services that support mobile devices, video applications, and cloud and virtual computing.
The company looks to expand in Brazil, India, Japan, the Middle East, and Russia, and in customer markets that include enterprises, wireless operators, cable operators, submarine network operators, Internet content providers, cloud infrastructure providers, research and education organizations, and governments.
Mergers and Acquisitions
In 2016 Ciena agreed to buy TeraXion Inc., which makeshigh-speed photonics components (HSPC), for $32 million in cash. The acquisition give Ciena a bigger footprint in Canada, which is home to most of it research and development team.
In 2015 Ciena acquired Cyan Inc., a provider of software and platforms for software-defined networks, for about $400 million. The addition of Cyan helps Ciena offer more comprehensive virtualized networks and services on-demand services.