Ciena Gains on Tycom Deal

Ciena (Nasdaq: CIEN) jumped US$4.41 to $59.69 in morning trading Tuesday, after the company said it sold more than $150 million worth of optical systems to broadband communications company Tycom, which is building an undersea network.

Ciena said the two-year agreement covers Tycom's purchase of Ciena's MultiWave CoreDirector and MultiWave CoreStream systems for use in the new network, which will link all six inhabited continents. Tycom also may use Ciena systems to further increase its network's capacity and efficiency.

Tycom president and chief executive officer Neil Garvey said the decision to use Ciena's optical networking systems was "driven by Ciena's leading-edge technology and our continual push to provide greater value" to customers.

In February, Ciena reported strong results for the quarter ended in January and boosted its outlook for the next quarter.

The company said revenue rose more than 130 percent from a year earlier to $352.0 million, while income before payroll tax on stock-option exercises totaled $54.1 million, or 18 cents per fully diluted share, up from $9.1 million, or 3 cents, a year earlier and ahead of analyst per-share estimate of 15 cents.

"Ciena continues to see robust growth opportunities across its family of next-generation intelligent optical networking products," Ciena chairman and chief executive officer Patrick Nettles said.

Ciena also raised its revenue growth projection for the current year to 85 percent over 2000 from 75 percent.

"We expect our business will continue to grow faster than the overall market, provided we execute successfully," said Nettles.