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Why Ciena Corporation Shares Are Soaring Today

By Anders Bylund – Aug 30, 2018 at 1:49PM

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The telecom networking equipment veteran crushed analyst estimates in the third quarter.

What happened

Shares of Ciena (CIEN -2.23%) jumped as much as 16.9% on Thursday morning, following the release of strong third-quarter results. The maker of telecommunications networking equipment set a fresh 10-year high before retreating to a 13% gain as of 1 p.m., EDT.

So what

Ciena's third-quarter sales rose 12% year over year, landing at $819 million. Adjusted earnings jumped 37% over the same period, stopping at $0.48 per share. Your average Wall Street analyst would have settled for earnings near $0.36 on sales in the neighborhood of $791 million.

Close-up shot of an enterprise network router with Ethernet cables and many activity lights.

Image source: Getty Images.

Now what

Management gave credit for these results to solid execution amid "robust, broad-based customer demand." That being said, the Asia Pacific segment led the way with 49% year-over-year revenue growth. North America, which is Ciena's largest reportable region, hung back at a 7% annual growth rate.

The company's bottom-line performance may have been hit-and-miss in recent reports, but this was the sixth positive revenue surprise in a row. Ciena's stock is earning its multiyear highs based on a long run of improving business results.

Anders Bylund has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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