Market trends are favorable - most analysts are revising down their forecasts of 40G product sales and revising up their forecast of 100G product sales.
Demand is good in the marketplace - customers need more bandwidth - even business in Europe is fairly robust.
No competitor can match INFN's instant bandwidth capability - the competitors need 40 days to turn on more capacity - INFN can do it in one day. Instant bandwidth allows INFN to win more deals and has a positive impact on margins.
Their primary competitors right now are CIEN and ALU. They're seeing less and less of Huawei (I assume this is due to the investigations of Huawei that have ocurred and are still ongoing in North America and Europe). ALU is trying to compete on price. In spite of ALU's aggressive pricing INFN continues to win a reasonable amount of business when they compete with ALU. Customers say their experience with INFN is significantly better than with ALU. ALU can continue their aggressive pricing over the very short term but not over the intermediate term.
INFN has started displacing NSN with some of their customers. INFN does not believe that the company that bought the NSN optical business will be an effective competitor since NSN had no differentiating technology.
My thoughts - INFN is starting to pull away from the competition. Huawei will never be able to escape their ties to Chinese Military Intelligence. ALU is in serious financial difficulty and can't go on selling at a loss for very much longer. NSN has exited the business. As the competitive landscape improves and as the gap between INFN technology and everybody else continues to widen, INFN will win more deals and their margins will improve.