Shares of communications equipment maker Ciena Corp. (NASDAQ: CIEN) have been surging today following announcing that its first-quarter profit more than doubled, helped by higher networking equipment sales. Its surprising earnings numbers and also a positive sales outlook gave a lift to the entire sector, whose shares have been rallying in early trading.For the quarter, the company said that its profit rose to $28.8 million, or 28 cents per share as new products helped Ciena to "take share and gain additional customer traction." These numbers are up from $11.1 million, or 12 cents per share reported in the same period a year ago.
Included in the company's earnings figures was $7.7 million related to a patent litigation settlement. Excluding that, Sears earnings numbers would have come at $49.6 million, or 47 cents a share. Analyst, on average, expected the company show quarterly earnings of 40 cents per share.
Ciena posted a respectable growth of 38% for its first-quarter revenue which surged to $227.4 million from $165.1 million a year ago. This was above analysts' predictions for revenue of $226.5 million in the quarter, according to Thomson Financial.
Looking ahead, Ciena expressed its optimism over further gains and said it expects "no change in the fundamental drivers" of its business. The communications equipment maker forecast a rise of 27% for its fiscal 2008 revenue which implies a sales values of more than $779.8 million. Analysts predicted a gain of "only" 22% to $949.7 million for 2008 revenue.
Traders expressed their enthusiasm over the company's positive outlook and pushed telecommunication equipment makers higher in early trading. Thus, Alucatel-Lucent (NYSE: ALU) is up 2.20% to 5.54, AT&T Inc. (NYSE: T) is up 0.50% to 36.17, Verizon Communications Inc. (NYSE: VZ) is up 0.30% to 36.37.
Eliza Popescu is a financial writer for the online investment advisory service Investor's Observer.
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