Monday, August 22, 2005
Om Malik has a post on his site about Dell' Oro report that says that Q2'05 saw sequential growth of global optical revenues up 10%. I do not doubt findings of Dell' Oro given that all the high-speed internet subscriber growth will lead to capacity adds down the network. Given where this market fell from, its of little suprise that any good news is welcomed. Remember the $7B acquistion of Cerent by CSCO, anyone? Om also mentions my Why Ciena Can't get it right post from June 2005. I still think CIEN has a tough time ahead of it; but this quarter will be ok given all the DSL adds and somewhat better optical market driven by Metro Ethernet- yes. Plus read my original post to understand how "cookie jar accounting" will help CIEN to post better gross margins. Just for all you stock buffs out there, CIEN has declined 13% still I posted my original post on June 2nd and Nasdaq is up about 1.7%, now that 15% relative outperformance will make anyone happy and that's only in 2.5 months- annualize that !