Ciena beats estimates on strong AI-driven demand, shares rise

Investing.com -- Ciena Corporation (NYSE: CIEN) reported fiscal third-quarter results that exceeded analyst expectations, with shares rising 4.3% premarket following the announcement.

The optical networking equipment maker posted adjusted earnings per share of $2.11 for the quarter ended August 1, 2026, beating the analyst consensus of $1.72 by $0.39. Revenue reached $1.67 billion, surpassing the $1.63 billion estimate and marking a 37% increase from $1.22 billion in the same quarter last year.

The company attributed the strong performance to AI-driven network investment.

"Today's outstanding financial performance demonstrates Ciena's leadership in providing industry-leading, high-speed connectivity solutions as AI continues to drive compounding waves of network investment," said Gary Smith, president and CEO.

For the fiscal fourth quarter of 2026, Ciena provided revenue guidance of $1.75 billion, plus or minus $50 million. The midpoint of $1.75 billion aligns with the analyst consensus of $1.7 billion. The company also raised its full fiscal year 2026 revenue guidance to $6.42 billion, plus or minus $50 million, representing a 35% YoY increase at the midpoint.

Ciena's adjusted gross margin for the third quarter was 46.4%, up from 41.9% in the prior-year period. Adjusted operating margin expanded to 22.5% from 10.7% YoY.

The company's Optical Networking segment generated $1.19 billion in revenue, up from $815.5 million in the third quarter of fiscal 2025. Two customers represented more than 10% of revenue each, totaling 41.7% of quarterly revenue.

Marc Graff, Chief Financial Officer, stated, "Our record fiscal third quarter results reflect Ciena's ability to deliver increasingly profitable growth while positioning for future opportunities."

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