Oclaro quarterly revenue rebounds by 9% to $131.7m, aided by resuming shipments to ZTE

For fiscal first-quarter 2019 (ended 29 September 2018), Oclaro Inc of San Jose, CA, USA (which provides components, modules and subsystems for optical communications) has reported revenue of $131.7m, down 15.4% on $155.6m a year ago but rebounding by 9% from $120.9m last quarter, driven mainly by the recovery of shipments to China’s ZTE Corp (previously a greater-than-10% customer) after the US Department of Commerce’s removal of export sanctions imposed on ZTE in April.

Despite the quarter-to-quarter revenue growth, non-GAAP gross margin fell further, from 40.6% a year ago and 37.7% last quarter to 34.9%, primarily due to a weaker product mix driven by increased sales of certain 100G Datacom modules that are being wound down. “Even so, we delivered strong operating results,” says CEO Greg Dougherty.

Operating expenses were $34.2m, up from $31.5m a year ago but cut from $35.9m last quarter.
Operating income was $16.8m (operating margin of 12.8% of revenue), down from $34.6m a year ago but up from $15.7m last quarter.

Likewise, net income was $14.4m ($0.08 per diluted share), down from $34.5m ($0.20 per diluted share) a year ago but roughly level with $14.6m ($0.08 per diluted share) last quarter.

During the quarter, cash, cash equivalents and short-term investments rose by $18.8m from $323.1m to $341.9m.

Oclaro has not provided guidance for fiscal second-quarter 2019 due to its proposed acquisition (announced on 12 March) by Lumentum Holdings Inc of Milpitas, CA, USA (which makes photonics products for optical networking and commercial lasers for industrial and consumer markets) for $1.8bn.

“While we wait for the Lumentum merger to close, which we believe remains on track to occur in calendar year 2018, we remain a leading innovator of new products,” says Dougherty. “We recently announced several new products for next-generation deployments, including 600G components, DCO [digital coherent optics] modules at 100G and 200G, and 400G PAM4 [4-level pulse amplitude modulation] data-center transceivers,” he adds.

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Tags: Oclaro Optical communications

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