Opticals up today, some by a lot. Must be some news item that affected the whole industry.
The thing is. It has got to be a way bigger engineering challenge to develop a next generation highly integrated PIC compared to developing a next generation discrete photonic component. In fact I wonder if the realistic technological tradeoff here is whether it is inevitable that discrete photonic components will be more advanced than PICs and that the question is whether the integration benefits of a PIC that is not at the leading edge can outweigh the advantages of a module built from leading edge discrete components.
Lightreading had their yearly Leading Lights award dinner. Infinera was in the running for 2 categories but came up as the bridesmaid again, this year (against Cisco. Makes sense, seeing as how they've lost their revenue momentum and tripped over their new product cadence. Maybe next year they'll win in category, "Best Deal Maker"
Most Innovative New Cable Product or Service Winner: Calix -- AXOS E3-2 Intelligent Node
Most Innovative Video/Multimedia Product or Service Winner: SK Telecom -- Oksusu
Most Innovative Mobile/Wireless Product or Service Winner: Qualcomm Technologies -- Snapdragon X16 Modem
Most Innovative Telecoms Product or Service (Fixed/Carrier Ethernet/Optical) Winner: Cisco Systems -- Catena
Most Innovative Enterprise Service/SMB Service Winner: Equinix -- Data Hub
Most Innovative Cloud Service Winner: AT&T -- ECOMP (Enhanced Control Orchestration Management and Policy)
Most Innovative NFV Deployment Strategy (Network/Data Center Operator) Winner: AT&T -- NFV deployment with AT&T FlexWare
Most Innovative Gigabit/Ultra-Broadband Service Winner: Starman Eesti AS -- 10-gigabit EPON service
Most Innovative IoT/M2M Strategy (Service Provider) Winner: AT&T
Most Innovative IoT/M2M Strategy (Vendor) Awarded to the vendor that has unveiled the most innovative Internet of Things/Machine to Machine (IoT/M2M) strategy during the past year.
Most Innovative 5G Technology Strategy (Vendor) Awarded to the company that has outlined and clearly communicated an innovative, market-leading 5G networking technology development strategy during the past year.
Winner: Nokia -- Nokia 5G FIRST
Outstanding Transformation Strategy (Service Provider) Awarded to the communications service provider that has devised and implemented a transformation strategy of any kind (business, technical, cultural) that will improve its business
Winner: Boingo Wireless -- Boingo's Transformation Story
Outstanding Components Vendor Winner: Oclaro
Outstanding Test & Measurement Vendor Winner: Viavi Solutions
Outstanding Digital Enablement Vendor Winner: CENX
Company of the Year (Public) Winner: GTT Communications
Best Deal Maker Winner: Amdocs
I was never aware of Acacia until just the other day. They appear to do very similar technology to INFN except their PICs are silicon based instead of what INFN uses, InP I believe?
I feel in hindsight that was a pretty big gap in my knowledge of the players in this field considering I've had some INFN stock for at least a couple years or so.
The questions this leads me to are: 1). Those with technical expertise in this field, is it possible to anticipate which of these two PIC technologies has more capability to continue advancing rapidly in performance before it hits some sort of wall as far as what the physics will allow? (in business terms, that would translate to "which has the better future performance wise") 2). For PICs with comparable performance, does one have better potential to be the lower cost technology of the two? One would be inclined to believe that would be Silicon, but perhaps that would be way too simplistic a view.
Anyway, I bought some Acacia just now, I like stocks that have been hammered hard based on a stumble in business performance that may only be temporary.
You may noticed that Infinera got two upgrades, more interest is upgrade from Goldman (Neutral to Buy) and see its short-term target moved to $15. It is time to load?
Should we double down on this stock?
Top line beat. Bottom line on target but margins squeezed a bit. Need a real good guidance or it's going to be a long summer
Infinera needs to get back to their past $250M/quarter revenue run rate, to garner a $20+/share takeout price. At the rate of their Q2 guidance and new product intro, that won't happened until mid-2018. In the meantime, analysts probably wondering how long their DTN 10G and DTN-X 500G line module legacy sales base can be the main support for their revenue. DTN is really long in the tooth (10 year system) and their 500G PIC-based line module for the DTN-X has been out for almost 5 years.
3 x sales would be a reasonable factor to apply to a renewed growth trend.
3 X $1B revenue / 150M shares = $20/share
They need to sell out about a year before ICE5 comes due, in 2018-19... supercharge their R&D cadence. Two years is too slow, when they're starting the faster cadence 6-12 months behind. Maintaining that kind of delay from the get-go throws cold water on all of their talk about increased cadence.
One year behind on 400G Metro, too. Other vendors trialing 600G, now as Infinera is talking 2018-19.
That all said, I wish they would agree to some kind of capital infusion partnership to light a fire under their R&D. If they cannot keep up with the discrete component folks, they have to act now to bulk up, when economic times are relatively good.
Q2 guidance of $180M.
CX2 just now shipping, so booked revenue will be in the low single digits.
Pent up interest in new products looking good.
RFQ#$%$ a bottom in 2Q2016 and hit a record in 1Q2017 across their product line.Customers are focused on asset utilization, pausing purchasing, and deploying stocked systems, especially since Infinera has a 2-3 week delivery turnaround. Mr Fallon eventually sees these purchase pauses will end soon and Customers will need to restart buying.They have not missed any product qualification deadlines in DCI and Mr Fallon expects to maintain at least a 50% market share, down from being first to market a few years ago with a 90%+ market share.ICE4 delay of one month for the CX2 does somewhat impact the XT, since they are similar implementations.Other ICE4 implementations are being executed on a parallel schedule.
I was worried that George Notter passed on this CC, but he did call in with a Question.
Timing question on new products.
- CX2 delayed one month from previously mentioned (Q2 revenue recognition in the low $M)
- Meshponder 3300 on same schedule as previously mentioned (Q3 revenue recognition)
- Meshponder 3600 , DTN-X, XTM-Series going to 400G (same schedule with Q4 revenue recognition)
- Common system operating system coming out in 2018
INFN will guide higher for Q2....looking for 20% pop after earning announcement.
Below is a response from Level3's CFO during their conference call Q&A with respect to their recent past CapEx spending:
Nick Del Deo - MoffettNathanson LLC
Hi. Thanks for taking my questions. First, the last several quarters, you've had higher CapEx in part to support dark fiber and wavelength's growth. When do we start to see the revenue benefit from that spending closer to P&L?
Sunit S. Patel - Level 3 Communications, Inc.
So we're already seeing the revenue benefit as measured by cash coming in through the door. For dark fiber revenues, typically, and if you have 20 year higher use, the gap benefit stretches out for 20 years, but in addition we get space and power revenues which are monthly recurring in nature, and annual maintenance fees which are recurring in nature. So I think that we will continue to see the benefit of that coming through over the next years, because the business, as we pointed out, has been pretty – demand has been very, very healthy.
Some news that is very good for INFN is that Altice is doing a stock offering. Altice is the company that had slowed down for a while as it acquired Cablevision. Now, that acquisition is complete. Altice is now a company with over $9 billion in annual revenue. They are expanding more aggressively again. Cablevision has been a great customer of INFN in the past and that division is likely to use a significant portion of the new USA IPO funds to update their transmission equipment. “ALTICE USA FILES REGISTRATION STATEMENT FOR PROPOSED INITIAL PUBLIC OFFERING NEW YORK, NY, April 11, 2017 – Altice USA, Inc., one of the largest broadband communications and video services providers in the United States and the U.S. business of Altice N.V. (Euronext: ATC, ATCB), announces today that it has filed a registration statement with the U.S. Securities and Exchange Commission (the “SEC”) for a proposed initial public offering of shares of Class A Common Stock.”
Q117 came in at $175M.
Options Activity Opening interest in Infinera(INFN) June calls ahead of earnings. The stock up 17c to $10.15 and 4K Jun 10 calls trade for $1.05 when bid-ask was 80c to $1.10. Separately, but at almost the same time, 2.3K Jul 11 calls trade for 60c when bid-ask was 40 to 60c. Total volume is 6X daily average at 7.4K calls and 1K puts. More than 80% of today's bullish flow is in the June term. The company is due to report 5/4 and the stock is a notable earnings mover, including a 27.2% spike on 2/10/17 last quarter and a 22.9% dive on 4/28/16 a year ago.
Juniper had a good Q1 and pitched good Q2 guidance. They're expanding away from their traditional monster telecom contracts to cloud computing and corporate data centers.
Sounds familiar. Do a deal with Infinera and diverify across the entire network, except for the slugfest going on with RAN equipment.
Eurofiber upgrades their network with the Infinera XTC-2E.
Eurofiber Scales Service Offerings with End-to-End Infinera Network - Infinera
International Network Expands in the Netherlands and Belgium Sunnyvale, CA – April 4, 2011 – Eurofiber has selected an end-to-end Infinera (Nasdaq: INFN) Digital Optical Network for its backbone network extending throughout the Netherlands and into B
Infinera has a new Metro deployment with Virtual1.
Virtual1 was already doing business with Juniper.
Infinera and Juniper should do the deal and bulk up as a combined entity just down the street from each other.
Virtual1 to expand network across UK Monday 10 April 2017 | 11:22 CET | News UK operator Virtual1 announced the expansion of its network across the UK. The company will be extending both its existing footprint within Greater London and out to include a further 180 towns and cities across the UK. The company said it aims to provide the largest and most advanced wholesale-only network in the UK by the end of 2017.
The expanded footprint of Virtual1’s network has been designed specifically to suit its partners’ target markets, so it will cover over 75 percent of UK businesses. The company said the network will be rich in SDN functionality to expand the services possible for partners.
Equipment suppliers on the project include Juniper Networks and Infinera. Virtual1 had already deployed Juniper's SDN-ready MX Series 3D Universal Edge Routers to build out a high-capacity core network, and EX Series Ethernet Switches in each of its PoPs. These were deployed in Virtual Chassis configurations to provide a blend of 100 Megabit and Gigabit Ethernet services. To enhance network operations, Virtual1 added the ACX Series Universal Access Routers that are controlling the distribution layer within the new roll-out, representing the largest Juniper Networks ACX Series deployment in the UK. Virtual1 also has a new partnership with Infinera for metro deployments.