Cover
Cover - shares | 9 Months Ended | |
Jul. 29, 2023 | Sep. 01, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jul. 29, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-36250 | |
Entity Registrant Name | Ciena Corp | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 23-2725311 | |
Entity Address, Address Line One | 7035 Ridge Road | |
Entity Address, City or Town | Hanover | |
Entity Address, State or Province | MD | |
Entity Address, Postal Zip Code | 21076 | |
City Area Code | 410 | |
Local Phone Number | 694-5700 | |
Title of 12(b) Security | Common Stock, par value $0.01 per share | |
Trading Symbol | CIEN | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 147,842,355 | |
Entity Central Index Key | 0000936395 | |
Current Fiscal Year End Date | --10-28 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 29, 2023 | Jul. 30, 2022 | Jul. 29, 2023 | Jul. 30, 2022 | |
Revenue: | ||||
Total revenue | $ 1,067,886 | $ 867,981 | $ 3,257,062 | $ 2,661,651 |
Cost of goods sold: | ||||
Total cost of goods sold | 618,945 | 527,202 | 1,864,492 | 1,534,904 |
Gross profit | 448,941 | 340,779 | 1,392,570 | 1,126,747 |
Operating expenses: | ||||
Research and development | 189,392 | 150,025 | 561,115 | 457,758 |
Selling and marketing | 118,266 | 105,880 | 367,156 | 344,700 |
General and administrative | 49,349 | 41,121 | 151,184 | 131,191 |
Significant asset impairments and restructuring costs | 4,174 | 7,692 | 16,625 | 20,203 |
Amortization of intangible assets | 9,487 | 8,919 | 26,773 | 26,757 |
Acquisition and integration costs | 59 | 35 | 3,474 | 598 |
Total operating expenses | 370,727 | 313,672 | 1,126,327 | 981,207 |
Income from operations | 78,214 | 27,107 | 266,243 | 145,540 |
Interest and other income, net | 10,187 | 366 | 50,711 | 4,860 |
Interest expense | (24,060) | (12,642) | (63,819) | (33,275) |
Income before income taxes | 64,341 | 14,831 | 253,135 | 117,125 |
Provision for income taxes | 34,608 | 4,319 | 89,507 | 21,868 |
Net income | $ 29,733 | $ 10,512 | $ 163,628 | $ 95,257 |
Basic net income per common share (in dollars per share) | $ 0.20 | $ 0.07 | $ 1.09 | $ 0.63 |
Diluted net income per potential common share (in dollars per share) | $ 0.20 | $ 0.07 | $ 1.09 | $ 0.62 |
Weighted average basic common shares outstanding (in shares) | 149,690 | 149,862 | 149,472 | 152,083 |
Weighted average dilutive potential common shares outstanding (in shares) | 149,977 | 150,463 | 149,867 | 153,209 |
Products | ||||
Revenue: | ||||
Total revenue | $ 865,197 | $ 684,284 | $ 2,678,242 | $ 2,109,239 |
Cost of goods sold: | ||||
Total cost of goods sold | 516,900 | 434,756 | 1,559,120 | 1,259,378 |
Services | ||||
Revenue: | ||||
Total revenue | 202,689 | 183,697 | 578,820 | 552,412 |
Cost of goods sold: | ||||
Total cost of goods sold | $ 102,045 | $ 92,446 | $ 305,372 | $ 275,526 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 29, 2023 | Jul. 30, 2022 | Jul. 29, 2023 | Jul. 30, 2022 | |
Net income | $ 29,733 | $ 10,512 | $ 163,628 | $ 95,257 |
Change in unrealized gain (loss) on available-for-sale securities, net of tax | 378 | (79) | 2,075 | (2,184) |
Change in cumulative translation adjustments | 10,151 | (4,037) | 17,981 | (22,783) |
Other comprehensive gain (loss) | 27,977 | (5,820) | 34,867 | (22,318) |
Total comprehensive income | 57,710 | 4,692 | 198,495 | 72,939 |
Change in unrealized gain (loss) on foreign currency forward contracts, net of tax | ||||
Change in unrealized gain (loss) on cash flow hedges, net of tax | 5,124 | (91) | 9,314 | (6,776) |
Change in unrealized gain (loss) on interest rate swaps, net of tax | ||||
Change in unrealized gain (loss) on cash flow hedges, net of tax | $ 12,324 | $ (1,613) | $ 5,497 | $ 9,425 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jul. 29, 2023 | Oct. 29, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 1,117,922 | $ 994,352 |
Short-term investments | 141,843 | 153,989 |
Accounts receivable, net of allowance for credit losses of $11.2 million and $11.0 million as of July 29, 2023 and October 29, 2022, respectively. | 997,373 | 920,772 |
Inventories, net | 1,192,522 | 946,730 |
Prepaid expenses and other | 361,692 | 370,053 |
Total current assets | 3,811,352 | 3,385,896 |
Long-term investments | 21,098 | 35,385 |
Equipment, building, furniture and fixtures, net | 287,455 | 267,779 |
Operating right-of-use assets | 40,482 | 45,108 |
Goodwill | 446,596 | 328,322 |
Other intangible assets, net | 219,085 | 69,517 |
Deferred tax asset, net | 792,299 | 824,008 |
Other long-term assets | 104,847 | 113,617 |
Total assets | 5,723,214 | 5,069,632 |
Current liabilities: | ||
Accounts payable | 393,144 | 516,047 |
Accrued liabilities and other short-term obligations | 355,622 | 360,782 |
Deferred revenue | 188,104 | 137,899 |
Operating lease liabilities | 16,941 | 18,925 |
Current portion of long-term debt | 11,930 | 6,930 |
Total current liabilities | 965,741 | 1,040,583 |
Long-term deferred revenue | 71,873 | 62,336 |
Other long-term obligations | 156,893 | 150,335 |
Long-term operating lease liabilities | 37,800 | 42,392 |
Long-term debt, net | 1,543,900 | 1,061,125 |
Total liabilities | 2,776,207 | 2,356,771 |
Commitments and contingencies (Note 23) | ||
Stockholders’ equity: | ||
Preferred stock – par value $0.01; 20,000,000 shares authorized; zero shares issued and outstanding | 0 | 0 |
Common stock – par value $0.01; 290,000,000 shares authorized; 148,772,513 and 148,412,943 shares issued and outstanding | 1,488 | 1,484 |
Additional paid-in capital | 6,425,899 | 6,390,252 |
Accumulated other comprehensive loss | (11,778) | (46,645) |
Accumulated deficit | (3,468,602) | (3,632,230) |
Total stockholders’ equity | 2,947,007 | 2,712,861 |
Total liabilities and stockholders’ equity | $ 5,723,214 | $ 5,069,632 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions | Jul. 29, 2023 | Oct. 29, 2022 |
Statement of Financial Position [Abstract] | ||
Allowance for credit losses | $ 11.2 | $ 11 |
Stockholders’ equity: | ||
Preferred stock, par value per share (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 20,000,000 | 20,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value per share (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 290,000,000 | 290,000,000 |
Common stock, shares outstanding (in shares) | 148,772,513 | 148,412,943 |
Common stock, shares issued (in shares) | 148,772,513 | 148,412,943 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Jul. 29, 2023 | Jul. 30, 2022 | |
Cash flows used in operating activities: | ||
Net income | $ 163,628 | $ 95,257 |
Adjustments to reconcile net income to net cash used in operating activities: | ||
Depreciation of equipment, building, furniture and fixtures, and amortization of leasehold improvements | 69,213 | 68,280 |
Share-based compensation costs | 95,405 | 77,827 |
Amortization of intangible assets | 36,274 | 36,521 |
Deferred taxes | (64,005) | (19,824) |
Provision for inventory excess and obsolescence | 18,767 | 12,038 |
Provision for warranty | 18,860 | 12,416 |
Gain on cost method equity investments, net | (26,368) | (4,120) |
Other | 13,694 | 3,678 |
Changes in assets and liabilities: | ||
Accounts receivable | (80,399) | 74,478 |
Inventories | (262,345) | (464,664) |
Prepaid expenses and other | 72,062 | (39,805) |
Operating lease right-of-use assets | 11,003 | 12,504 |
Accounts payable, accruals and other obligations | (133,880) | (37,587) |
Deferred revenue | 57,547 | 34,949 |
Short- and long-term operating lease liabilities | (16,596) | (15,197) |
Net cash used in operating activities | (27,140) | (153,249) |
Cash flows used in investing activities: | ||
Payments for equipment, furniture, fixtures and intellectual property | (83,422) | (66,908) |
Purchases of investments | (119,240) | (614,333) |
Proceeds from sales and maturities of investments | 150,646 | 460,000 |
Settlement of foreign currency forward contracts, net | (3,272) | 4,450 |
Purchase of cost method equity investments | 0 | (8,000) |
Acquisition of business, net of cash acquired | (230,048) | (62,043) |
Net cash used in investing activities | (285,336) | (286,834) |
Cash flows provided by (used in) financing activities: | ||
Proceeds from issuance of senior notes | 0 | 400,000 |
Proceeds from issuance of term loan, net | 497,500 | 0 |
Payment of long-term debt | (6,448) | (3,465) |
Payment of debt issuance costs | (5,422) | (5,159) |
Payment of finance lease obligations | (2,830) | (2,555) |
Shares repurchased for tax withholdings on vesting of stock unit awards | (29,794) | (41,280) |
Repurchases of common stock - repurchase program, net | (57,736) | (487,792) |
Proceeds from issuance of common stock | 31,276 | 30,224 |
Net cash provided by (used in) financing activities | 426,546 | (110,027) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | 9,501 | (12,780) |
Net increase (decrease) in cash, cash equivalents and restricted cash | 123,571 | (562,890) |
Cash, cash equivalents and restricted cash at beginning of period | 994,378 | 1,422,604 |
Cash, cash equivalents and restricted cash at end of period | 1,117,949 | 859,714 |
Supplemental disclosure of cash flow information | ||
Cash paid during the period for interest | 56,709 | 24,823 |
Cash paid during the period for income taxes, net | 68,058 | 28,593 |
Operating lease payments | 18,038 | 16,342 |
Non-cash investing and financing activities | ||
Purchase of equipment in accounts payable | 4,579 | 9,320 |
Repurchase of common stock in accrued liabilities from repurchase program | 3,500 | 5,000 |
Operating right-of-use assets subject to lease liability | 9,771 | 8,226 |
Gain on cost method equity investments, net | $ 26,368 | $ 4,120 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in-Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit |
Beginning balance (in shares) at Oct. 30, 2021 | 154,858,981 | ||||
Equity - beginning balance at Oct. 30, 2021 | $ 3,020,018 | $ 1,549 | $ 6,803,162 | $ 439 | $ (3,785,132) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 95,257 | 95,257 | |||
Other comprehensive income (loss) | (22,318) | (22,318) | |||
Repurchase of common stock - repurchase program, net (in shares) | (8,279,710) | ||||
Repurchase of common stock - repurchase program, net | (491,992) | $ (83) | (491,909) | ||
Issuance of shares from employee equity plans (in shares) | 2,359,326 | ||||
Issuance of shares from employee equity plans | 30,224 | $ 23 | 30,201 | ||
Share-based compensation expense | 77,827 | 77,827 | |||
Shares repurchased for tax withholdings on vesting of stock unit awards (in shares) | (645,240) | ||||
Shares repurchased for tax withholdings on vesting of stock unit awards | (41,280) | $ (6) | (41,274) | ||
Ending balance (in shares) at Jul. 30, 2022 | 148,293,357 | ||||
Equity- ending balance at Jul. 30, 2022 | $ 2,667,736 | $ 1,483 | 6,378,007 | (21,879) | (3,689,875) |
Beginning balance (in shares) at Oct. 29, 2022 | 148,412,943 | 148,412,943 | |||
Equity - beginning balance at Oct. 29, 2022 | $ 2,712,861 | $ 1,484 | 6,390,252 | (46,645) | (3,632,230) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 163,628 | 163,628 | |||
Other comprehensive income (loss) | 34,867 | 34,867 | |||
Repurchase of common stock - repurchase program, net (in shares) | (1,441,435) | ||||
Repurchase of common stock - repurchase program, net | (61,236) | $ (14) | (61,222) | ||
Issuance of shares from employee equity plans (in shares) | 2,429,069 | ||||
Issuance of shares from employee equity plans | 31,276 | $ 24 | 31,252 | ||
Share-based compensation expense | 95,405 | 95,405 | |||
Shares repurchased for tax withholdings on vesting of stock unit awards (in shares) | (628,064) | ||||
Shares repurchased for tax withholdings on vesting of stock unit awards | $ (29,794) | $ (6) | (29,788) | ||
Ending balance (in shares) at Jul. 29, 2023 | 148,772,513 | 148,772,513 | |||
Equity- ending balance at Jul. 29, 2023 | $ 2,947,007 | $ 1,488 | $ 6,425,899 | $ (11,778) | $ (3,468,602) |
INTERIM FINANCIAL STATEMENTS
INTERIM FINANCIAL STATEMENTS | 9 Months Ended |
Jul. 29, 2023 | |
Quarterly Financial Data [Abstract] | |
INTERIM FINANCIAL STATEMENTS | INTERIM FINANCIAL STATEMENTS The interim financial statements included herein for Ciena Corporation and its wholly owned subsidiaries (“Ciena”) have been prepared by Ciena, without audit, pursuant to the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”). The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires Ciena to make judgments, assumptions, and estimates that affect the amounts reported in the Condensed Consolidated Financial Statements and accompanying notes. Among other things, these estimates form the basis for judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ materially from these estimates under different assumptions or conditions. To the extent that there are material differences between Ciena’s estimates and actual results, Ciena’s consolidated financial statements will be affected. In the opinion of management, the financial statements included in this report reflect all normal recurring adjustments that Ciena considers necessary for the fair statement of the results of operations of Ciena for the interim periods covered and of the financial position of Ciena at the date of the interim balance sheets. Certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to SEC rules and regulations. The Condensed Consolidated Balance Sheet as of October 29, 2022 was derived from audited financial statements, but does not include all disclosures required by GAAP. However, Ciena believes that the disclosures are adequate to understand the information presented herein. The operating results for interim periods are not necessarily indicative of the operating results for the entire year. These financial statements should be read in conjunction with Ciena’s audited consolidated financial statements and the notes thereto included in Ciena’s annual report on Form 10-K for fiscal 2022 (the “2022 Annual Report”). |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Jul. 29, 2023 | |
Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | SIGNIFICANT ACCOUNTING POLICIES There have been no material changes to Ciena’s significant accounting policies, compared to the accounting policies described in Note 1, Ciena Corporation and Significant Accounting Policies and Estimates, in Notes to Consolidated Financial Statements in Item 8 of Part II of the 2022 Annual Report. Newly Issued Accounting Standards - Not Yet Effective In October 2021, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2021-08 (“ASU 2021-08”), Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers to improve the accounting for acquired revenue contracts with customers in a business combination to address recognition of an acquired contract liability and payment terms and their effect on subsequent revenue recognized by the acquirer. ASU 2021-08 is effective for annual periods beginning after December 15, 2022 on a prospective basis. Early adoption is permitted. Ciena is currently evaluating the impact of this ASU on its condensed consolidated financial statements and related disclosures. |
REVENUE
REVENUE | 9 Months Ended |
Jul. 29, 2023 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE | REVENUE Disaggregation of Revenue Ciena’s disaggregated revenue as presented below depicts the nature, amount, and timing of revenue and cash flows for similar groupings of Ciena’s various offerings. The sales cycle, contractual obligations, customer requirements, and go-to-market strategies may differ across Ciena’s product lines, resulting in different economic risk profiles for each line. The tables below set forth Ciena’s disaggregated revenue for the periods indicated (in thousands): Quarter Ended July 29, 2023 Networking Platforms Platform Software and Services Blue Planet Automation Software and Services Global Services Total Product lines: Converged Packet Optical $ 718,997 $ — $ — $ — $ 718,997 Routing and Switching 127,563 — — — 127,563 Platform Software and Services — 78,880 — — 78,880 Blue Planet Automation Software and Services — — 13,167 — 13,167 Maintenance Support and Training — — — 72,887 72,887 Installation and Deployment — — — 46,840 46,840 Consulting and Network Design — — — 9,552 9,552 Total revenue by product line $ 846,560 $ 78,880 $ 13,167 $ 129,279 $ 1,067,886 Timing of revenue recognition: Products and services at a point in time $ 846,560 $ 15,980 $ 2,832 $ 11,886 $ 877,258 Services transferred over time — 62,900 10,335 117,393 190,628 Total revenue by timing of revenue recognition $ 846,560 $ 78,880 $ 13,167 $ 129,279 $ 1,067,886 Quarter Ended July 30, 2022 Networking Platforms Platform Software and Services Blue Planet Automation Software and Services Global Services Total Product lines: Converged Packet Optical $ 563,837 $ — $ — $ — $ 563,837 Routing and Switching 100,741 — — — 100,741 Platform Software and Services — 63,483 — — 63,483 Blue Planet Automation Software and Services — — 17,342 — 17,342 Maintenance Support and Training — — — 72,760 72,760 Installation and Deployment — — — 38,704 38,704 Consulting and Network Design — — — 11,114 11,114 Total revenue by product line $ 664,578 $ 63,483 $ 17,342 $ 122,578 $ 867,981 Timing of revenue recognition: Products and services at a point in time $ 664,578 $ 15,230 $ 4,632 $ 9,408 $ 693,848 Services transferred over time — 48,253 12,710 113,170 174,133 Total revenue by timing of revenue recognition $ 664,578 $ 63,483 $ 17,342 $ 122,578 $ 867,981 Nine Months Ended July 29, 2023 Networking Platforms Platform Software and Services Blue Planet Automation Software and Services Global Services Total Product lines: Converged Packet Optical $ 2,239,180 $ — $ — $ — $ 2,239,180 Routing and Switching 377,378 — — — 377,378 Platform Software and Services — 221,768 — — 221,768 Blue Planet Automation Software and Services — — 49,139 — 49,139 Maintenance Support and Training — — — 213,938 213,938 Installation and Deployment — — — 120,901 120,901 Consulting and Network Design — — — 34,758 34,758 Total revenue by product line $ 2,616,558 $ 221,768 $ 49,139 $ 369,597 $ 3,257,062 Timing of revenue recognition: Products and services at a point in time $ 2,616,558 $ 48,290 $ 14,143 $ 36,553 $ 2,715,544 Services transferred over time — 173,478 34,996 333,044 541,518 Total revenue by timing of revenue recognition $ 2,616,558 $ 221,768 $ 49,139 $ 369,597 $ 3,257,062 Nine months ended July 30, 2022 Networking Platforms Platform Software and Services Blue Planet Automation Software and Services Global Services Total Product lines: Converged Packet Optical $ 1,730,066 $ — $ — $ — $ 1,730,066 Routing and Switching 295,638 — — — 295,638 Platform Software and Services — 205,557 — — 205,557 Blue Planet Automation Software and Services — — 55,334 — 55,334 Maintenance Support and Training — — — 219,270 219,270 Installation and Deployment — — — 120,504 120,504 Consulting and Network Design — — — 35,282 35,282 Total revenue by product line $ 2,025,704 $ 205,557 $ 55,334 $ 375,056 $ 2,661,651 Timing of revenue recognition: Products and services at a point in time $ 2,025,704 $ 66,655 $ 17,442 $ 31,368 $ 2,141,169 Services transferred over time — 138,902 37,892 343,688 520,482 Total revenue by timing of revenue recognition $ 2,025,704 $ 205,557 $ 55,334 $ 375,056 $ 2,661,651 Ciena reports its sales geographically using the following markets: (i) the United States, Canada, the Caribbean and Latin America (“Americas”); (ii) Europe, Middle East and Africa (“EMEA”); and (iii) Asia Pacific, Japan and India (“APAC”). Within each geographic area, Ciena maintains specific teams or personnel that focus on a particular region, country, customer or market vertical. These teams include sales management, account salespersons, and sales engineers, as well as services professionals and commercial management personnel. The following table reflects Ciena’s geographic distribution of revenue based principally on the relevant location for Ciena’s delivery of products and performance of services. For the periods indicated, Ciena’s geographic distribution of revenue was as follows (in thousands): Quarter Ended Nine Months Ended July 29, July 30, July 29, July 30, 2023 2022 2023 2022 Geographic distribution: Americas $ 749,479 $ 617,366 $ 2,308,934 $ 1,913,350 EMEA 152,834 124,185 479,053 420,075 APAC 165,573 126,430 469,075 328,226 Total revenue by geographic distribution $ 1,067,886 $ 867,981 $ 3,257,062 $ 2,661,651 Ciena’s revenue includes $685.8 million and $574.3 million of United States revenue for the third quarter of fiscal 2023 and 2022, respectively. For th e nine months ended July 29, 2023 and July 30, 2022 , United States revenue was $2.1 billion and $1.8 billion, respectively. No other country accounted for 10% or more of total revenue for the periods indicated in the above table. For the periods indicated, the only customers that accounted for at least 10% of Ciena’s revenue were as follows (in thousands): Quarter Ended Nine Months Ended July 29, July 30, July 29, July 30, 2023 2022 2023 2022 Web-scale provider $ 124,897 n/a $ 369,678 n/a AT&T n/a 100,293 $ 357,382 314,358 Verizon n/a 108,495 n/a 273,158 Total $ 124,897 $ 208,788 $ 727,060 $ 587,516 _____________________________________ n/a Denotes revenue representing less than 10% of total revenue for the period The Web-scale provider noted in the above table purchased products from each of Ciena’s operating segments excluding Blue Planet ® Automation Software and Services for each of the periods presented. The other customers identified above purchased products and services from each of Ciena’s operating segments for each of the periods presented. • Networking Platforms revenue reflects sales of Ciena’s Converged Packet Optical and Routing and Switching product lines. • Converged Packet Optical - includes the 6500 Packet-Optical Platform, the Waveserver ® modular interconnect system, the 6500 Reconfigurable Line System (RLS), the 5400 family of Packet-Optical Platforms, and the Coherent ELS open line system (OLS). This product line includes the WL5n 100G-400G coherent pluggable transceivers. This product line also includes the Z-Series Packet-Optical Platform and Optical Microsystems products. • Routing and Switching - includes the 3000 family of service delivery platforms and the 5000 family of service aggregation. This product line also includes the 6500 Packet Transport System (PTS), which combines packet switching, control plane operation, and integrated optics, the 8100 Coherent IP networking platforms, the 8700 Packetwave Platform, and virtualization software. This product line also includes SD-Edge software and passive optical network (“PON”) routing and switching portfolio products from our recent acquisitions of Benu Networks, Inc. (“Benu”) and Tibit Communications, Inc. (“Tibit”) respectively, during the first quarter of fiscal 2023. This product line also includes Ciena’s WaveRouter ® product, which was introduced during the second quarter of fiscal 2023, for which there have been no sales to date. The Networking Platforms segment also includes sales of operating system software and enhanced software features embedded in each of the product lines above. Revenue from this segment is included in product revenue on the Condensed Consolidated Statements of Operations. Operating system software and enhanced software features embedded in Ciena hardware are each considered distinct performance obligations for which the revenue is generally recognized upfront at a point in time upon transfer of control. • Platform Software and Services offerings provide domain control management, analytics, data and planning tools, and applications to assist customers in managing their networks, including by creating more efficient operations and more proactive visibility into their networks. Ciena’s platform software includes its Manage, Control and Plan (“MCP”) domain controller solution, its suite of MCP applications, and its OneControl Unified Management System, as well as planning tools and a number of legacy software solutions that support Ciena’s installed base of network solutions. Platform software-related services revenue includes sales of subscription, installation, support, and consulting services related to Ciena’s software platforms, operating system software and enhanced software features embedded in each of the Networking Platforms product lines above. Revenue from the software portion of this segment is included in product revenue on the Condensed Consolidated Statements of Operations. Revenue from services portions of this segment is included in services revenue on the Condensed Consolidated Statements of Operations. • Blue Planet Automation Software and Services is a comprehensive, cloud native, and standards-based software portfolio, together with related services, that enables customers to realize digital transformation through the automation of the services lifecycle. Ciena’s Blue Planet Automation Platform includes multi-domain service orchestration (MDSO), inventory management (BPI), route optimization and analysis (ROA), network function virtualization orchestration (NFVO), and unified assurance and analytics (UAA). Services revenue includes sales of subscription, installation, support, consulting and design services related to Ciena’s Blue Planet Automation Platform. Revenue from the software portion of this segment is included in product revenue on the Condensed Consolidated Statements of Operations. Revenue from services portions of this segment is included in services revenue on the Condensed Consolidated Statements of Operations. Ciena’s software platform revenue typically reflects either perpetual or term-based software licenses, and these sales are considered distinct performance obligations in which revenue is generally recognized upfront at a point in time upon transfer of control. Revenue from software subscription and support is recognized ratably over the period during which the services are performed. Revenue from professional services for solution customization, software and solution support services, consulting and design, and build-operate-transfer services relating to Ciena’s software offerings is recognized over time with Ciena applying the input method to determine the amount of revenue to be recognized in a given period. • Global Services revenue reflects sales of a broad range of Ciena’s services for maintenance support and training, installation and deployment, and consulting and network design activities. Revenue from this segment is included in services revenue on the Condensed Consolidated Statements of Operations. Ciena’s Global Services are considered a distinct performance obligation for which revenue is generally recognized over time. Revenue from maintenance support is recognized ratably over the period during which the services are performed. Revenue from installation and deployment services and consulting and network design services is also recognized over time with Ciena applying the input method to determine the amount of revenue to be recognized in a given period. Revenue from training services is generally recognized at a point in time upon completion of the service. Contract Balances The following table provides information about receivables, contract assets and contract liabilities (deferred revenue) from contracts with customers as of the dates indicated (in thousands): Balance at July 29, 2023 Balance at October 29, 2022 Accounts receivable, net $ 997,373 $ 920,772 Contract assets for unbilled accounts receivable, net $ 142,305 $ 156,039 Deferred revenue $ 259,977 $ 200,235 Ciena’s contract assets represent unbilled accounts receivable, net where transfer of a product or service has occurred but invoicing is conditional upon completion of future performance obligations. These amounts are primarily related to installation and deployment and professional services arrangements where transfer of control has occurred, but Ciena has not yet invoiced the customer. Contract assets are included in prepaid expenses and other in the Condensed Consolidated Balance Sheets. See Note 11 below. Contract liabilities consist of deferred revenue and represent advanced payments against non-cancelable customer orders received prior to revenue recognition. Ciena recognized approximately $119.8 million and $98.9 million of revenue during the first nine months of fiscal 2023 and 2022, respectively, that was included in the deferred revenue balance as of October 29, 2022 and October 30, 2021, respectively. Revenue recognized due to changes in transaction price from performance obligations satisfied or partially satisfied in previous periods was immaterial during the nine months ended July 29, 2023 and July 30, 2022. Capitalized Contract Acquisition Costs Capitalized contract acquisition costs consist of deferred sales commissions, and were $31.4 million and $39.7 million as of July 29, 2023 and October 29, 2022, respectively. Capitalized contract acquisition costs were included in (i) prepaid expenses and other and (ii) other long-term assets. The amortization expense associated with these costs was $26.0 million and $20.5 million during the first nine months of fiscal 2023 and 2022, respectively, and was included in selling and marketing expense on the Condensed Consolidated Statements of Operations. Remaining Performance Obligations Remaining Performance Obligations (“RPO”) are comprised of non-cancelable customer purchase orders for products and services that are awaiting transfer of control for revenue recognition under the applicable contract terms. As of July 29, 2023, the aggregate amount of RPO was $2.1 billion. As of July 29, 2023, Ciena expects approximately 84% of the RPO to be recognized as revenue within the next 12 months. |
BUSINESS COMBINATIONS
BUSINESS COMBINATIONS | 9 Months Ended |
Jul. 29, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
BUSINESS COMBINATIONS | BUSINESS COMBINATIONS Benu and Tibit Acquisitions On November 17, 2022, Ciena acquired Benu, a portfolio of cloud-native software solutions, including a virtual Broadband Network Gateway ((v)BNG), that complements Ciena’s existing portfolio of broadband access solutions. On December 30, 2022, Ciena acquired Tibit, a provider and developer of PON-specific hardware and operating software that can be integrated into a carrier-grade Ethernet switch and will strengthen Ciena’s portfolio of next-generation PON solutions that support residential, enterprise, and mobility use cases. These businesses were acquired for an aggregate of approximately $291.7 million, of which $244.7 million was paid in cash, and $47.0 million represents the fair value of Ciena’s previously held cost method equity investment in Tibit. The acquisition of Tibit triggered the remeasurement of Ciena’s previously held investment in Tibit to fair value, which resulted in Ciena recognizing a gain on its cost method equity investment of $26.5 million. Each of these transactions has been accounted for as the acquisition of a business. Ciena incurred approximately $3.4 million in acquisition-related costs associated with these acquisitions. These costs and expenses primarily include fees associated with financial, legal, and accounting advisors and employment-related costs. These costs were recorded in acquisition and integration costs on the Condensed Consolidated Statements of Operations. The following table summarizes the final purchase price allocation related to the acquisitions based on the estimated fair value of the acquired assets and assumed liabilities (in thousands): Amount Cash and cash equivalents $ 14,634 Accounts receivable, net 443 Inventories, net 1,406 Prepaid expenses and other 810 Equipment, furniture and fixtures 1,090 Goodwill 117,997 Developed technology 75,400 In-process technology 89,100 Customer relationships and contracts 18,400 Order backlog 2,480 Deferred tax asset, net (27,782) Accounts payable (420) Accrued liabilities and other short-term obligations (874) Deferred revenue (851) Other long-term obligations (144) Total purchase consideration $ 291,689 Developed technology represents purchased technology that has reached technological feasibility and for which the acquired companies had substantially completed development as of the date of acquisition. Fair value was determined using future discounted cash flows related to the projected income stream of the developed technology for a discrete projection period. Cash flows were discounted to their present value as of the closing date. Developed technology is amortized on a straight-line basis over its estimated useful life of five years. In-process technology represents purchased technology that had not reached technological feasibility as of the date of acquisition. Fair value was determined using future discounted cash flows related to the projected income stream of the in-process technology for a discrete projection period. Cash flows were discounted to their present value as of the closing date. Upon completion of the in-process technology, it will be amortized on a straight line basis over its estimated useful life, which will be determined on that date. Customer relationships and contracts represent agreements with existing Tibit customers and have an estimated useful life of three years. Order backlog is amortized over the fulfillment period. The goodwill generated from these acquisitions is primarily related to expected economic synergies. The total goodwill amount was recorded in the Networking Platforms segment. The goodwill is not deductible for income tax purposes. Pro forma disclosures have not been included due to immateriality. The amounts of revenue and earnings for these acquisitions since the acquisition dates, which are included on the Condensed Consolidated Statements of Operations for the reporting period are immaterial. |
SIGNIFICANT ASSET IMPAIRMENT AN
SIGNIFICANT ASSET IMPAIRMENT AND RESTRUCTURING COSTS | 9 Months Ended |
Jul. 29, 2023 | |
Restructuring and Related Activities [Abstract] | |
SIGNIFICANT ASSET IMPAIRMENT AND RESTRUCTURING COSTS | SIGNIFICANT ASSET IMPAIRMENT AND RESTRUCTURING COSTS Restructuring Costs Ciena has undertaken a number of restructuring activities intended to reduce expense and to align its workforce and costs with market opportunities, product development, and business strategies. The following table sets forth the restructuring activity and balance of the restructuring liability accounts, which are included in accrued liabilities and other short-term obligations on the Condensed Consolidated Balance Sheets, for the nine months ended July 29, 2023 (in thousands): Workforce Other restructuring activities Total Balance at October 29, 2022 $ 1,215 $ 4,620 $ 5,835 Charges 4,509 (1) 12,116 (2) 16,625 Cash payments (4,920) (16,736) (21,656) Balance at July 29, 2023 $ 804 $ — $ 804 Current restructuring liabilities $ 804 $ — $ 804 (1) Reflects employee costs associated with workforce reductions during the nine months ended July 29, 2023 as part of a business optimization strategy to improve gross margin, constrain operating expense, and redesign certain business processes. (2) Primarily represents costs related to restructured real estate facilities and the redesign of certain business processes associated with Ciena’s supply chain and distribution structure reorganization. The following table sets forth the restructuring activity and balance of the restructuring liability accounts, which are included in accrued liabilities and other short-term obligations on the Condensed Consolidated Balance Sheets for the nine months ended July 30, 2022 (in thousands): Workforce Other restructuring activities Total Balance at October 30, 2021 $ 781 $ — $ 781 Charges 2,224 (1) 13,992 (2) 16,216 Cash payments (2,423) (13,115) (15,538) Balance at July 30, 2022 $ 582 $ 877 $ 1,459 Current restructuring liabilities $ 582 $ 877 $ 1,459 (1) Reflects employee costs associated with workforce reductions during the nine months ended July 30, 2022 as part of a business optimization strategy to improve gross margin, constrain operating expense, and redesign certain business processes. (2) Primarily represents the redesign of certain business processes associated with Ciena’s supply chain and distribution structure reorganization and costs related to restructured real estate facilities. |
INTEREST AND OTHER INCOME, NET
INTEREST AND OTHER INCOME, NET | 9 Months Ended |
Jul. 29, 2023 | |
Other Income and Expenses [Abstract] | |
INTEREST AND OTHER INCOME, NET | INTEREST AND OTHER INCOME, NET The components of interest and other income, net, are as follows for the periods indicated (in thousands): Quarter Ended Nine Months Ended July 29, July 30, July 29, July 30, 2023 2022 2023 2022 Interest income $ 12,835 $ 2,774 $ 30,365 $ 4,962 Gains (losses) on non-hedge designated foreign currency forward contracts 1,679 (985) (2,885) (2,911) Foreign currency exchange gains (losses) (4,031) (788) (2,927) 2,711 Gain (loss) on cost method equity investments, net (87) — 26,368 4,120 Other (209) (635) (210) (4,022) Interest and other income, net $ 10,187 $ 366 $ 50,711 $ 4,860 During the first quarter of fiscal 2023, the acquisition of Tibit triggered the remeasurement of Ciena’s previously held investment in Tibit to fair value, which resulted in Ciena recognizing a gain on its cost method equity investment of $26.5 million. See Note 4 above. Ciena Corporation, as the U.S. parent entity, uses the U.S. Dollar as its functional currency; however, some of its foreign branch offices and subsidiaries use local currencies as their functional currencies . During the first nine months of fiscal 2023, Ciena recorded $2.9 million in foreign currency exchange rate losses a s a result of monetary assets and liabilities that were transacted in a currency other than Ciena’s functional currency. D uring the first nine months of fiscal 2022, Ciena recorded $2.7 million in foreign currency exchange rate gains a s a result of monetary assets and liabilities that were transacted in a currency other than Ciena’s functional currency. The related remeasurement adjustments were recorded in interest and other income, net, on the Condensed Consolidated Statements of Operations. From time to time, Ciena uses foreign currency forwards to hedge this type of balance sheet exposure. These forwards are not designated as hedges for accounting purposes, and any net gain or loss associated with these derivatives is reported in interest and other income, net, on the Condensed Consolidated Statements of Operations. During each of the first nine months of fiscal 2023 and 2022 , Ciena recorded losses of $2.9 million |
INCOME TAXES
INCOME TAXES | 9 Months Ended |
Jul. 29, 2023 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The effective tax rate for the quarter and nine months ended July 29, 2023 was higher than the effective tax rate for the quarter and nine months ended July 30, 2022, primarily due to the mandatory capitalization of research and development expenses in the third quarter and nine months ended July 29, 2023, in response to changes in U.S. tax policy. |
CASH EQUIVALENT, SHORT-TERM AND
CASH EQUIVALENT, SHORT-TERM AND LONG-TERM INVESTMENTS | 9 Months Ended |
Jul. 29, 2023 | |
Investments, Debt and Equity Securities [Abstract] | |
CASH EQUIVALENT, SHORT-TERM AND LONG-TERM INVESTMENTS | CASH EQUIVALENT, SHORT-TERM AND LONG-TERM INVESTMENTSAs of the dates indicated, investments are comprised of the following (in thousands): July 29, 2023 Amortized Cost Gross Unrealized Gross Unrealized Estimated Fair U.S. government obligations $ 94,715 $ 1 $ (976) $ 93,740 Corporate debt securities 63,401 2 (155) 63,248 Time deposits 80,854 1 (12) 80,843 $ 238,970 $ 4 $ (1,143) $ 237,831 Included in cash equivalents $ 74,890 $ — $ — $ 74,890 Included in short-term investments 142,743 4 (904) 141,843 Included in long-term investments 21,337 — (239) 21,098 $ 238,970 $ 4 $ (1,143) $ 237,831 October 29, 2022 Amortized Cost Gross Unrealized Gross Unrealized Estimated Fair U.S. government obligations $ 137,963 $ — $ (3,379) $ 134,584 Corporate debt securities 54,899 1 (405) 54,495 Time deposits 55,889 — (64) 55,825 $ 248,751 $ 1 $ (3,848) $ 244,904 Included in cash equivalents $ 55,530 $ — $ — $ 55,530 Included in short-term investments 156,430 1 (2,442) 153,989 Included in long-term investments 36,791 — (1,406) 35,385 $ 248,751 $ 1 $ (3,848) $ 244,904 The following table summarizes the final legal maturities of debt investments as of July 29, 2023 (in thousands): Amortized Estimated Less than one year $ 217,633 $ 216,733 Due in 1-2 years 21,337 21,098 $ 238,970 $ 237,831 |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 9 Months Ended |
Jul. 29, 2023 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS As of the dates indicated, the following tables summarize the assets and liabilities that are recorded at fair value on a recurring basis (in thousands): July 29, 2023 Level 1 Level 2 Level 3 Total Assets: Money market funds $ 767,668 $ — $ — $ 767,668 Bond mutual fund 102,715 — — 102,715 Time deposits 80,843 — — 80,843 Deferred compensation plan assets 12,203 — — 12,203 U.S. government obligations — 93,740 — 93,740 Corporate debt securities — 63,248 — 63,248 Foreign currency forward contracts — 2,574 — 2,574 Interest rate swaps — 19,528 — 19,528 Total assets measured at fair value $ 963,429 $ 179,090 $ — $ 1,142,519 Liabilities: Foreign currency forward contracts $ — $ 4,691 $ — $ 4,691 Interest rate swaps — 32 — 32 Total liabilities measured at fair value $ — $ 4,723 $ — $ 4,723 October 29, 2022 Level 1 Level 2 Level 3 Total Assets: Money market funds $ 639,024 $ — $ — $ 639,024 Bond mutual fund 71,145 — — 71,145 Time deposits 55,825 — — 55,825 Deferred compensation plan assets 12,751 — — 12,751 U.S. government obligations — 134,584 — 134,584 Corporate debt securities — 54,495 — 54,495 Foreign currency forward contracts — 251 — 251 Interest rate swaps — 12,306 — 12,306 Total assets measured at fair value $ 778,745 $ 201,636 $ — $ 980,381 Liabilities: Foreign currency forward contracts $ — $ 15,605 $ — $ 15,605 Total liabilities measured at fair value $ — $ 15,605 $ — $ 15,605 As of the dates indicated, the assets and liabilities above are presented on Ciena’s Condensed Consolidated Balance Sheets as follows (in thousands): July 29, 2023 Level 1 Level 2 Level 3 Total Assets: Cash equivalents $ 944,714 $ 559 $ — $ 945,273 Short-term investments 6,512 135,331 — 141,843 Prepaid expenses and other — 2,574 — 2,574 Long-term investments — 21,098 — 21,098 Other long-term assets 12,203 19,528 — 31,731 Total assets measured at fair value $ 963,429 $ 179,090 $ — $ 1,142,519 Liabilities: Accrued liabilities and other short-term obligations $ — $ 4,691 $ — $ 4,691 Other long-term obligations — 32 — 32 Total liabilities measured at fair value $ — $ 4,723 $ — $ 4,723 October 29, 2022 Level 1 Level 2 Level 3 Total Assets: Cash equivalents $ 757,725 $ 7,974 $ — $ 765,699 Short-term investments 8,269 145,720 — 153,989 Prepaid expenses and other — 251 — 251 Long-term investments — 35,385 — 35,385 Other long-term assets 12,751 12,306 — 25,057 Total assets measured at fair value $ 778,745 $ 201,636 $ — $ 980,381 Liabilities: Accrued liabilities and other short-term obligations $ — $ 15,605 $ — $ 15,605 Total liabilities measured at fair value $ — $ 15,605 $ — $ 15,605 Ciena did not have any transfers between Level 1 and Level 2 fair value measurements during the periods presented. |
INVENTORIES
INVENTORIES | 9 Months Ended |
Jul. 29, 2023 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | INVENTORIES As of the dates indicated, inventories are comprised of the following (in thousands): July 29, October 29, Raw materials $ 771,955 $ 664,916 Work-in-process 51,763 18,232 Finished goods 333,544 258,584 Deferred cost of goods sold 77,521 41,084 Gross inventories 1,234,783 982,816 Reserve for inventory excess and obsolescence (42,261) (36,086) Inventories, net $ 1,192,522 $ 946,730 The increase in raw materials inventory is related to the steps Ciena has taken to mitigate the impact of supply chain constraints on its business and customers in recent prior periods and a global market shortage of semiconductor components. The increase in finished goods inventories resulted primarily from planned fulfillment of customer advance orders for which some deliveries have been rescheduled. Ciena writes down its inventory for estimated obsolescence or unmarketable inventory by an amount equal to the difference between the cost of inventory and the estimated net realizable value based on assumptions about future demand, |
PREPAID EXPENSES AND OTHER
PREPAID EXPENSES AND OTHER | 9 Months Ended |
Jul. 29, 2023 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
PREPAID EXPENSES AND OTHER | PREPAID EXPENSES AND OTHER As of the dates indicated, prepaid expenses and other are comprised of the following (in thousands): July 29, October 29, Contract assets for unbilled accounts receivable, net $ 142,305 $ 156,039 Prepaid VAT and other taxes 75,637 63,975 Prepaid expenses 55,997 55,440 Product demonstration equipment, net 41,691 35,929 Capitalized contract acquisition costs 24,349 33,516 Other non-trade receivables 17,734 24,026 Foreign currency forward contracts 2,574 251 Deferred deployment expense 1,405 877 $ 361,692 $ 370,053 Depreciation of product demonstration equipment was $5.9 million during the first nine months of fiscal 2023 and $6.8 million during the first nine months of fiscal 2022. For further discussion on contract assets and capitalized contract acquisition costs, see Note 3 above. |
INTANGIBLE ASSETS
INTANGIBLE ASSETS | 9 Months Ended |
Jul. 29, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS | INTANGIBLE ASSETS As of the dates indicated, intangible assets are comprised of the following (in thousands): July 29, 2023 October 29, 2022 Gross Accumulated Net Gross Accumulated Net Developed technology $ 503,618 $ (408,090) $ 95,528 $ 428,218 $ (386,300) $ 41,918 In-process technology 89,100 — 89,100 — — — Patents and licenses 8,795 (4,967) 3,828 8,415 (4,228) 4,187 Customer relationships, covenants not to compete, outstanding purchase orders and contracts 411,384 (380,755) 30,629 390,271 (366,859) 23,412 Total intangible assets $ 1,012,897 $ (793,812) $ 219,085 $ 826,904 $ (757,387) $ 69,517 The aggregate amortization expense of intangible assets was $36.3 million during the first nine months of fiscal 2023 and $36.5 million during the first nine months of fiscal 2022. Expected future amortization of intangible assets for the fiscal years indicated is as follows (in thousands): Fiscal Year Amount Remaining fiscal 2023 $ 14,170 2024 39,836 2025 34,635 2026 23,348 2027 15,843 Thereafter 2,153 $ 129,985 (1) (1) Does not include amortization of in-process technology, as estimation of the timing of future amortization expense would be impractical. |
GOODWILL
GOODWILL | 9 Months Ended |
Jul. 29, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL | GOODWILL The following table presents the goodwill allocated to Ciena’s operating segments as of July 29, 2023 and October 29, 2022, as well as the changes to goodwill during the first nine months of fiscal 2023 (in thousands): Balance at October 29, 2022 Acquisitions Impairments Translation Balance at July 29, 2023 Platform Software and Services $ 156,191 $ — $ — $ — $ 156,191 Blue Planet Automation Software and Services 89,049 — — — 89,049 Networking Platforms 83,082 117,997 — 277 201,356 Total $ 328,322 $ 117,997 $ — $ 277 $ 446,596 |
OTHER BALANCE SHEET DETAILS
OTHER BALANCE SHEET DETAILS | 9 Months Ended |
Jul. 29, 2023 | |
Balance Sheet Related Disclosures [Abstract] | |
OTHER BALANCE SHEET DETAILS | OTHER BALANCE SHEET DETAILS As of the dates indicated, accrued liabilities and other short-term obligations are comprised of the following (in thousands): July 29, October 29, Compensation, payroll related tax and benefits $ 104,303 $ 126,338 Warranty 49,504 45,503 Income taxes payable 34,577 11,472 Vacation 30,344 26,396 Foreign currency forward contracts 4,691 15,604 Interest payable 9,779 4,793 Finance lease liabilities 4,063 3,758 Other 118,361 126,918 $ 355,622 $ 360,782 The following table summarizes the activity in Ciena’s accrued warranty for the periods indicated (in thousands): Beginning Balance Current Period Provisions Settlements Ending Balance Nine Months Ended July 30, 2022 $ 48,019 12,416 (14,746) $ 45,689 Nine Months Ended July 29, 2023 $ 45,503 18,860 (14,859) $ 49,504 As of the dates indicated, deferred revenue is comprised of the following (in thousands): July 29, October 29, Products $ 34,102 $ 19,814 Services 225,875 180,421 Total deferred revenue 259,977 200,235 Less current portion (188,104) (137,899) Long-term deferred revenue $ 71,873 $ 62,336 |
DERIVATIVE INSTRUMENTS
DERIVATIVE INSTRUMENTS | 9 Months Ended |
Jul. 29, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE INSTRUMENTS | DERIVATIVE INSTRUMENTS Foreign Currency Derivatives Ciena conducts business globally in numerous currencies, and thus is exposed to adverse foreign currency exchange rate changes. To limit this exposure, Ciena enters into foreign currency contracts. Ciena does not enter into such contracts for speculative purposes. As of July 29, 2023 and October 29, 2022, Ciena had forward contracts to hedge its foreign exchange exposure in order to reduce variability in certain currencies for expenses principally related to research and development activities. The notional amount of these contracts was approximately $291.4 million and $272.2 million as of July 29, 2023 and October 29, 2022, respectively. These foreign exchange contracts have maturities of 24 months or less and have been designated as cash flow hedges. In May 2023, Ciena entered into forward contracts designated as net investment hedges to minimize the effect of foreign exchange rate movements on its net investments in foreign operations. The notional amount of these contracts was approximately $48.6 million as of July 29, 2023. These foreign exchange contracts have maturities of 24 months or less and have been designated as net investment hedges. As of July 29, 2023 and October 29, 2022, Ciena had forward contracts to hedge its foreign exchange exposure in order to reduce the variability in various currencies of certain balance sheet items. The notional amount of these contracts was approximately $255.9 million and $108.0 million as of July 29, 2023 and October 29, 2022, respectively. These foreign exchange contracts have maturities of 12 months or less and have not been designated as hedges for accounting purposes. Interest Rate Derivatives Ciena is exposed to floating rates of interest on its term loan borrowings (see Note 16 below) and has hedged such risk by entering into floating-to-fixed interest rate swap arrangements. Prior to amending the 2025 Term Loan (as defined in Note 16 below) to replace LIBOR with the Secured Overnight Financing Rate (“SOFR”), Ciena was exposed to floating rates of LIBOR interest on its 2025 Term Loan borrowings. Ciena hedged this risk by entering into floating-to-fixed interest rate swap arrangements (“interest rate swaps”). The interest rate swaps fix the LIBOR rate for $350.0 million of the 2025 Term Loan at 2.957% through September 2023. In January 2023, Ciena entered into a LIBOR to SOFR basis swap (“basis swap”) to hedge its exposure to SOFR rate. The basis swap offsets the LIBOR exposure risk of the interest rate swaps and effectively fixes the SOFR rate for $350.0 million of the 2025 Term Loan at 2.883% through September 2023. The total notional amount of these swaps in effect was $350.0 million as of July 29, 2023 and October 29, 2022. In April 2022, Ciena entered into floating to fixed forward starting interest rate swap arrangements (“forward starting swaps”). The forward starting swaps fix the SOFR for $350.0 million of the 2025 Term Loan at 2.968% from September 2023 through the 2025 Term Loan maturity. The total notional amount of forward starting swaps effective September 2023 was $350.0 million as of July 29, 2023. In January 2023, Ciena entered into floating-to-fixed interest rate swap arrangements (“2028 interest rate swaps”). The 2028 interest rate swaps fix the SOFR rate of approximately $350.0 million of the principal amount of the 2030 Term Loan (as defined in Note 16 below) at 3.47% through January 2028. The total notional amount of these interest rate swaps in effect as of July 29, 2023 was $350.0 million. Ciena expects the variable rate payments to be received under the terms of the interest rate swaps, basis swap, forward starting swaps, and 2028 interest rate swaps to offset exactly the forecasted variable rate payments on the equivalent notional amounts of the 2025 Term Loan and 2030 Term Loan. These derivative contracts have been designated as cash flow hedges. Other information regarding Ciena’s derivatives is immaterial for separate financial statement presentation. See Note 6 and Note 9 above. |
SHORT-TERM AND LONG-TERM DEBT
SHORT-TERM AND LONG-TERM DEBT | 9 Months Ended |
Jul. 29, 2023 | |
Debt Disclosure [Abstract] | |
SHORT-TERM AND LONG-TERM DEBT | SHORT-TERM AND LONG-TERM DEBT Outstanding Term Loans Payable 2025 Term Loan On January 23, 2020, Ciena entered into a Refinancing Amendment to Credit Agreement pursuant to which Ciena refinanced the entire outstanding amount of its then existing senior secured term loan and incurred a new senior secured term loan in an aggregate principal amount of $693.0 million and maturing on September 28, 2025 (the “2025 Term Loan”). On January 19, 2023, in connection with the Incremental Agreement (as defined below) to the Credit Agreement (as defined below), the Credit Agreement was amended to replace LIBOR with SOFR for the 2025 Term Loan in response to pending impact of FASB Accounting Standards Codification 848, Reference Rate Reform . The net carrying value of the 2025 Term Loan was comprised of the following as of the dates indicated (in thousands): July 29, 2023 October 29, 2022 Principal Balance Unamortized Discount Deferred Debt Issuance Costs Net Carrying Value Net Carrying Value 2025 Term Loan $ 670,478 $ (687) $ (1,286) $ 668,505 $ 673,010 Deferred debt issuance costs that were deducted from the carrying amounts of the 2025 Term Loan totaled $1.3 million as of July 29, 2023 and $1.7 million at October 29, 2022. Deferred debt issuance costs are amortized using the straight-line method, which approximates the effect of the effective interest rate, through the maturity of the 2025 Term Loan. The amortization of deferred debt issuance costs for the 2025 Term Loan is included in interest expense, and was approximately $0.5 million during the first nine months of each of fiscal 2023 and fiscal 2022. The carrying value of the 2025 Term Loan listed above is also net of any unamortized debt discounts. As of July 29, 2023, the estimated fair value of the 2025 Term Loan was $668.8 million. Ciena’s 2025 Term Loan is categorized as Level 2 in the fair value hierarchy. Ciena estimated the fair value of its 2025 Term Loan using a market approach based on observable inputs, such as current market transactions involving comparable securities. 2030 Term Loan On January 19, 2023, Ciena entered into an Incremental Joinder and Amendment Agreement (the “Incremental Agreement”) to its Credit Agreement, dated July 15, 2014, as amended (the “Credit Agreement”), by and among Ciena, the lenders party thereto and Bank of America, N.A., as administrative agent, pursuant to which Ciena incurred a new tranche of senior secured term loans in an aggregate principal amount of $500.0 million and maturing on January 19, 2030 (the “2030 Term Loan”). Net of original issue discount and debt issuance costs, the $492.5 million in proceeds from the 2030 Term Loan are intended to be used for general corporate purposes. The Incremental Agreement amends the Credit Agreement and provides that the 2030 Term Loan will, among other things: • mature on January 19, 2030; • amortize in equal quarterly installments in aggregate amounts equal to 0.25% of the principal amount of the 2030 Term Loan as of January 19, 2023, or $1.25 million, with the balance payable at maturity; • be subject to mandatory prepayment on the same basis as the 2025 Term Loan, including on the occurrence of certain specified events such as asset sales, debt issuances, and receipt of annual Excess Cash Flow (as defined in the Credit Agreement); • bear interest, at Ciena’s election, at a per annum rate equal to (a) SOFR (subject to a floor of 0.00%) plus an applicable margin of 2.50%, or (b) a base rate (subject to a floor of 1.00%) plus an applicable margin of 1.50%; and • be repayable at any time at Ciena’s election, provided that repayment of the 2030 Term Loan with proceeds of certain indebtedness prior to July 19, 2023 will require a prepayment premium of 1.00% of the aggregate principal amount of such prepayment. Except as amended by the Incremental Agreement, the remaining terms of the Credit Agreement remain in full force and effect. The net carrying value of the 2030 Term Loan was comprised of the following as of the date indicated (in thousands): July 29, 2023 Principal Balance Unamortized Discount Deferred Debt Issuance Costs Net Carrying Value 2030 Term Loan $ 498,750 $ (2,308) $ (4,679) $ 491,763 Deferred debt issuance costs that were deducted from the carrying amounts of the 2030 Term Loan totaled $4.7 million as of July 29, 2023. Deferred debt issuance costs are amortized using the straight-line method, which approximates the effect of the effective interest rate, through the maturity of the 2030 Term Loan. The amortization of deferred debt issuance costs for the 2030 Term Loan is included in interest expense and was $0.4 million during the first nine months of fiscal 2023. The carrying value of the 2030 Term Loan listed above is also net of any unamortized debt discounts. As of July 29, 2023, the estimated fair value of the 2030 Term Loan was $500.0 million. Ciena’s 2030 Term Loan is categorized as Level 2 in the fair value hierarchy. Ciena estimated the fair value of its 2030 Term Loan using a market approach based on observable inputs, such as current market transactions involving comparable securities. Outstanding Senior Notes Payable 2030 Notes On January 18, 2022, Ciena entered into an Indenture among Ciena, as issuer, certain domestic subsidiaries of Ciena, as guarantors, and U.S. Bank National Association, as trustee, pursuant to which Ciena issued $400.0 million in aggregate principal amount of 4.00% senior notes due 2030 (the “2030 Notes”). The net carrying value of the 2030 Notes was comprised of the following as of the dates indicated (in thousands): July 29, 2023 October 29, 2022 Principal Balance Deferred Debt Issuance Costs Net Carrying Value Net Carrying Value 2030 Senior Notes 4.00% fixed-rate $ 400,000 $ (4,438) $ 395,562 $ 395,045 Deferred debt issuance costs that were deducted from the carrying amount of the 2030 Notes totaled $4.4 million as of July 29, 2023 and $5.0 million as of October 29, 2022. Deferred debt issuance costs are amortized using the straight-line method, which approximates the effect of the effective interest rate, through the maturity of the 2030 Notes. The amortization of deferred debt issuance costs for the 2030 Notes is included in interest expense, and was approximately $0.5 million and $0.4 million during the first nine months of fiscal 2023 and fiscal 2022, respectively . As of July 29, 2023, the estimated fair value of the 2030 Notes was $350.0 million. The 2030 Notes are categorized as Level 2 in the fair value hierarchy. Ciena estimated the fair value of its 2030 Notes using a market approach based on observable inputs, such as current market transactions involving comparable securities. |
ABL CREDIT FACILITY
ABL CREDIT FACILITY | 9 Months Ended |
Jul. 29, 2023 | |
Debt Disclosure [Abstract] | |
ABL CREDIT FACILITY | SHORT-TERM AND LONG-TERM DEBT Outstanding Term Loans Payable 2025 Term Loan On January 23, 2020, Ciena entered into a Refinancing Amendment to Credit Agreement pursuant to which Ciena refinanced the entire outstanding amount of its then existing senior secured term loan and incurred a new senior secured term loan in an aggregate principal amount of $693.0 million and maturing on September 28, 2025 (the “2025 Term Loan”). On January 19, 2023, in connection with the Incremental Agreement (as defined below) to the Credit Agreement (as defined below), the Credit Agreement was amended to replace LIBOR with SOFR for the 2025 Term Loan in response to pending impact of FASB Accounting Standards Codification 848, Reference Rate Reform . The net carrying value of the 2025 Term Loan was comprised of the following as of the dates indicated (in thousands): July 29, 2023 October 29, 2022 Principal Balance Unamortized Discount Deferred Debt Issuance Costs Net Carrying Value Net Carrying Value 2025 Term Loan $ 670,478 $ (687) $ (1,286) $ 668,505 $ 673,010 Deferred debt issuance costs that were deducted from the carrying amounts of the 2025 Term Loan totaled $1.3 million as of July 29, 2023 and $1.7 million at October 29, 2022. Deferred debt issuance costs are amortized using the straight-line method, which approximates the effect of the effective interest rate, through the maturity of the 2025 Term Loan. The amortization of deferred debt issuance costs for the 2025 Term Loan is included in interest expense, and was approximately $0.5 million during the first nine months of each of fiscal 2023 and fiscal 2022. The carrying value of the 2025 Term Loan listed above is also net of any unamortized debt discounts. As of July 29, 2023, the estimated fair value of the 2025 Term Loan was $668.8 million. Ciena’s 2025 Term Loan is categorized as Level 2 in the fair value hierarchy. Ciena estimated the fair value of its 2025 Term Loan using a market approach based on observable inputs, such as current market transactions involving comparable securities. 2030 Term Loan On January 19, 2023, Ciena entered into an Incremental Joinder and Amendment Agreement (the “Incremental Agreement”) to its Credit Agreement, dated July 15, 2014, as amended (the “Credit Agreement”), by and among Ciena, the lenders party thereto and Bank of America, N.A., as administrative agent, pursuant to which Ciena incurred a new tranche of senior secured term loans in an aggregate principal amount of $500.0 million and maturing on January 19, 2030 (the “2030 Term Loan”). Net of original issue discount and debt issuance costs, the $492.5 million in proceeds from the 2030 Term Loan are intended to be used for general corporate purposes. The Incremental Agreement amends the Credit Agreement and provides that the 2030 Term Loan will, among other things: • mature on January 19, 2030; • amortize in equal quarterly installments in aggregate amounts equal to 0.25% of the principal amount of the 2030 Term Loan as of January 19, 2023, or $1.25 million, with the balance payable at maturity; • be subject to mandatory prepayment on the same basis as the 2025 Term Loan, including on the occurrence of certain specified events such as asset sales, debt issuances, and receipt of annual Excess Cash Flow (as defined in the Credit Agreement); • bear interest, at Ciena’s election, at a per annum rate equal to (a) SOFR (subject to a floor of 0.00%) plus an applicable margin of 2.50%, or (b) a base rate (subject to a floor of 1.00%) plus an applicable margin of 1.50%; and • be repayable at any time at Ciena’s election, provided that repayment of the 2030 Term Loan with proceeds of certain indebtedness prior to July 19, 2023 will require a prepayment premium of 1.00% of the aggregate principal amount of such prepayment. Except as amended by the Incremental Agreement, the remaining terms of the Credit Agreement remain in full force and effect. The net carrying value of the 2030 Term Loan was comprised of the following as of the date indicated (in thousands): July 29, 2023 Principal Balance Unamortized Discount Deferred Debt Issuance Costs Net Carrying Value 2030 Term Loan $ 498,750 $ (2,308) $ (4,679) $ 491,763 Deferred debt issuance costs that were deducted from the carrying amounts of the 2030 Term Loan totaled $4.7 million as of July 29, 2023. Deferred debt issuance costs are amortized using the straight-line method, which approximates the effect of the effective interest rate, through the maturity of the 2030 Term Loan. The amortization of deferred debt issuance costs for the 2030 Term Loan is included in interest expense and was $0.4 million during the first nine months of fiscal 2023. The carrying value of the 2030 Term Loan listed above is also net of any unamortized debt discounts. As of July 29, 2023, the estimated fair value of the 2030 Term Loan was $500.0 million. Ciena’s 2030 Term Loan is categorized as Level 2 in the fair value hierarchy. Ciena estimated the fair value of its 2030 Term Loan using a market approach based on observable inputs, such as current market transactions involving comparable securities. Outstanding Senior Notes Payable 2030 Notes On January 18, 2022, Ciena entered into an Indenture among Ciena, as issuer, certain domestic subsidiaries of Ciena, as guarantors, and U.S. Bank National Association, as trustee, pursuant to which Ciena issued $400.0 million in aggregate principal amount of 4.00% senior notes due 2030 (the “2030 Notes”). The net carrying value of the 2030 Notes was comprised of the following as of the dates indicated (in thousands): July 29, 2023 October 29, 2022 Principal Balance Deferred Debt Issuance Costs Net Carrying Value Net Carrying Value 2030 Senior Notes 4.00% fixed-rate $ 400,000 $ (4,438) $ 395,562 $ 395,045 Deferred debt issuance costs that were deducted from the carrying amount of the 2030 Notes totaled $4.4 million as of July 29, 2023 and $5.0 million as of October 29, 2022. Deferred debt issuance costs are amortized using the straight-line method, which approximates the effect of the effective interest rate, through the maturity of the 2030 Notes. The amortization of deferred debt issuance costs for the 2030 Notes is included in interest expense, and was approximately $0.5 million and $0.4 million during the first nine months of fiscal 2023 and fiscal 2022, respectively . As of July 29, 2023, the estimated fair value of the 2030 Notes was $350.0 million. The 2030 Notes are categorized as Level 2 in the fair value hierarchy. Ciena estimated the fair value of its 2030 Notes using a market approach based on observable inputs, such as current market transactions involving comparable securities. |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE INCOME | 9 Months Ended |
Jul. 29, 2023 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE INCOME | ACCUMULATED OTHER COMPREHENSIVE INCOME The following table summarizes the changes in accumulated balances of other comprehensive income (“AOCI”), net of tax, for the nine months ended July 29, 2023 (in thousands): Unrealized Gain (Loss) on Available-for-sale Securities Foreign Currency Forward Contracts Interest Rate Swaps Cumulative Total Balance at October 29, 2022 $ (2,965) $ (10,197) $ 9,397 $ (42,880) $ (46,645) Other comprehensive gain before reclassifications 2,075 17,070 11,763 17,981 48,889 Amounts reclassified from AOCI — (7,756) (6,266) — (14,022) Balance at July 29, 2023 $ (890) $ (883) $ 14,894 $ (24,899) $ (11,778) The following table summarizes the changes in AOCI, net of tax, for the nine months ended July 30, 2022 (in thousands): Unrealized Gain (Loss) on Available-for-sale Securities Foreign Currency Forward Contracts Interest Rate Swaps Cumulative Total Balance at October 30, 2021 $ (164) $ 6,216 $ (12,179) $ 6,566 $ 439 Other comprehensive gain (loss) before reclassifications (2,184) (5,207) 2,786 (22,783) (27,388) Amounts reclassified from AOCI — (1,569) 6,639 — 5,070 Balance at July 30, 2022 $ (2,348) $ (560) $ (2,754) $ (16,217) $ (21,879) All amounts reclassified from AOCI, related to settlement (gains) losses on foreign currency forward contracts designated as cash flow hedges, impacted research and development expense on the Condensed Consolidated Statements of Operations. All amounts reclassified from AOCI, related to settlement (gains) losses on interest rate swaps designated as cash flow hedges, impacted interest and other income, net, on the Condensed Consolidated Statements of Operations. |
EARNINGS_PER SHARE CALCULATION
EARNINGS PER SHARE CALCULATION | 9 Months Ended |
Jul. 29, 2023 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE CALCULATION | EARNINGS PER SHARE CALCULATION Basic net income per common share (“Basic EPS”) is computed using the weighted average number of common shares outstanding. Diluted net income per potential common share (“Diluted EPS”) is computed using the weighted average number of the following, in each case, to the extent that the effect is not anti-dilutive: (i) common shares outstanding; (ii) shares issuable upon vesting of stock unit awards; and (iii) shares issuable under Ciena’s employee stock purchase plan and upon exercise of outstanding stock options, using the treasury stock method. The following table presents the calculation of Basic and Diluted EPS for the periods indicated (in thousands, except per share amounts): Quarter Ended Nine Months Ended July 29, July 30, July 29, July 30, 2023 2022 2023 2022 Net income $ 29,733 $ 10,512 $ 163,628 $ 95,257 Basic weighted average shares outstanding 149,690 149,862 149,472 152,083 Effect of dilutive potential common shares 287 601 395 1,126 Diluted weighted average shares 149,977 150,463 149,867 153,209 Basic EPS $ 0.20 $ 0.07 $ 1.09 $ 0.63 Diluted EPS $ 0.20 $ 0.07 $ 1.09 $ 0.62 Antidilutive employee share-based awards, excluded 3,383 1,640 2,567 1,264 |
STOCKHOLDERS_ EQUITY
STOCKHOLDERS’ EQUITY | 9 Months Ended |
Jul. 29, 2023 | |
Equity [Abstract] | |
STOCKHOLDERS’ EQUITY | STOCKHOLDERS’ EQUITY Stock Repurchase Program On December 9, 2021, Ciena announced that its Board of Directors authorized a program to repurchase up to $1.0 billion of its common stock. During the third quarter of fiscal 2023, Ciena repurchased an additional 1.4 million shares of its common stock for an aggregate purchase price of $61.2 million at an average price of $42.48 per share. As of July 29, 2023, Ciena (i) has repurchased 9.9 million shares for an aggregate purchase price of $561.2 million at an average price of $56.83 per share, and (ii) has an aggregate of $438.8 million authorized and remaining under its stock repurchase program. The purchase price for the shares of Ciena’s stock repurchased is reflected as a reduction of common stock and additional paid-in capital. Stock Repurchases Related to Stock Unit Award Tax Withholdings Ciena repurchases shares of its common stock to satisfy employee tax withholding obligations due on vesting of stock unit awards. The related purchase price of $29.8 million for the shares of Ciena’s stock repurchased during the first nine months of |
SHARE-BASED COMPENSATION EXPENS
SHARE-BASED COMPENSATION EXPENSE | 9 Months Ended |
Jul. 29, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
SHARE-BASED COMPENSATION EXPENSE | SHARE-BASED COMPENSATION EXPENSE The following table summarizes share-based compensation expense for the periods indicated (in thousands): Quarter Ended Nine Months Ended July 29, July 30, July 29, July 30, 2023 2022 2023 2022 Products $ 1,118 $ 1,002 $ 3,324 $ 2,960 Services 2,687 1,940 7,643 5,467 Share-based compensation expense included in cost of goods sold 3,805 2,942 10,967 8,427 Research and development 10,954 8,233 30,919 23,372 Selling and marketing 8,770 8,075 25,949 23,196 General and administrative 9,377 7,579 27,313 22,825 Share-based compensation expense included in operating expense 29,101 23,887 84,181 69,393 Share-based compensation expense capitalized in inventory, net 127 28 257 7 Total share-based compensation expense $ 33,033 $ 26,857 $ 95,405 $ 77,827 As of July 29, 2023, total unrecognized share-based compensation expense was approximately $231.5 million , which relates to unvested stock unit awards and is expected to be recognized over a weighted-average period of 1.45 years. Stock Unit Awards |
SEGMENTS AND ENTITY-WIDE DISCLO
SEGMENTS AND ENTITY-WIDE DISCLOSURES | 9 Months Ended |
Jul. 29, 2023 | |
Segment Reporting [Abstract] | |
SEGMENTS AND ENTITY-WIDE DISCLOSURES | SEGMENTS AND ENTITY-WIDE DISCLOSURES Segment Reporting Ciena has the following operating segments for reporting purposes: (i) Networking Platforms; (ii) Platform Software and Services; (iii) Blue Planet Automation Software and Services; and (iv) Global Services. Ciena's long-lived assets, including equipment, building, furniture and fixtures, right-of-use (“ROU”) assets, finite-lived intangible assets, and maintenance spares, are not reviewed by Ciena's chief operating decision maker for purposes of evaluating performance and allocating resources. As of July 29, 2023, equipment, building, furniture and fixtures, net, totaled $287.5 million, and operating ROU assets totaled $40.5 million both of which support asset groups within Ciena’s four operating segments and unallocated selling and general and administrative activities. As of July 29, 2023, finite-lived intangible assets, goodwill, and maintenance spares are assigned to asset groups within the following segments (in thousands): July 29, 2023 Networking Platforms Platform Software and Services Blue Planet Automation Software and Services Global Services Total Other intangible assets, net $ 198,937 — 20,148 — $ 219,085 Goodwill $ 201,356 156,191 89,049 — $ 446,596 Maintenance spares, net $ — — — 48,165 $ 48,165 Segment Profit (Loss) Segment profit (loss) is determined based on internal performance measures used by Ciena’s chief executive officer to assess the performance of each operating segment in a given period. In connection with that assessment, the chief executive officer excludes the following items: selling and marketing costs; general and administrative costs; significant asset impairments and restructuring costs; amortization of intangible assets; acquisition and integration costs; interest and other income, net; interest expense; and provision for income taxes. The table below sets forth Ciena’s segment profit (loss) and the reconciliation to net income for the periods indicated (in thousands): Quarter Ended Nine Months Ended July 29, July 30, July 29, July 30, 2023 2022 2023 2022 Segment profit (loss): Networking Platforms $ 171,380 $ 108,282 $ 588,281 $ 395,176 Platform Software and Services 49,691 39,646 136,028 132,698 Blue Planet Automation Software and Services (12,072) (10,139) (30,044) (17,693) Global Services 50,550 52,965 137,190 158,808 Total segment profit 259,549 190,754 831,455 668,989 Less: Non-performance operating expenses Selling and marketing 118,266 105,880 367,156 344,700 General and administrative 49,349 41,121 151,184 131,191 Significant asset impairments and restructuring costs 4,174 7,692 16,625 20,203 Amortization of intangible assets 9,487 8,919 26,773 26,757 Acquisition and integration costs 59 35 3,474 598 Add: Other non-performance financial items Interest and other income, net 10,187 366 50,711 4,860 Interest expense (24,060) (12,642) (63,819) (33,275) Less: Provision for income taxes 34,608 4,319 89,507 21,868 Net income $ 29,733 $ 10,512 $ 163,628 $ 95,257 Entity-Wide Reporting The following table reflects Ciena’s geographic distribution of equipment, building, furniture and fixtures, net, and operating ROU assets, with any country accounting for at least 10% of total equipment, building, furniture and fixtures, net, and operating ROU assets specifically identified. Equipment, building, furniture and fixtures, net, and operating ROU assets attributable to geographic regions outside of the United States and Canada are reflected as “Other International.” For the periods indicated, Ciena’s geographic distribution of equipment, building, furniture and fixtures, net, and operating ROU assets was as follows (in thousands): July 29, October 29, Canada $ 241,416 $ 226,451 United States 46,936 47,515 Other International 39,585 38,921 Total $ 327,937 $ 312,887 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Jul. 29, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Tax Contingencies Ciena is subject to various tax liabilities arising in the ordinary course of business. Ciena does not expect that the ultimate settlement of these tax liabilities will have a material effect on its results of operations, financial position, or cash flows. Litigation Ciena is subject to various legal proceedings, claims, and other matters arising in the ordinary course of business, including those that relate to employment, commercial, tax, and other regulatory matters. Ciena is also subject to intellectual property related claims, including claims against third parties that may involve contractual indemnification obligations on the part of Ciena. Ciena does not expect that the ultimate costs to resolve such matters will have a material effect on its results of operations, financial position, or cash flows. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Jul. 29, 2023 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTSStock Repurchase ProgramFrom the end of the third quarter of fiscal 2023 through September 1, 2023, Ciena repurchased an additional 0.9 million shares of its common stock, for an aggregate purchase price of $38.8 million at an average price of $41.67 per share, inclusive of repurchases pending settlement. As of September 1, 2023, Ciena has repurchased an aggregate of 10.8 million shares and has an aggregate of $400.0 million of authorized funds remaining under its stock repurchase program. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 29, 2023 | Jul. 30, 2022 | Jul. 29, 2023 | Jul. 30, 2022 | |
Pay vs Performance Disclosure | ||||
Net income | $ 29,733 | $ 10,512 | $ 163,628 | $ 95,257 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Jul. 29, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Jul. 29, 2023 | |
Accounting Policies [Abstract] | |
Newly Issued Accounting Standards - Not Yet Effective | Newly Issued Accounting Standards - Not Yet Effective In October 2021, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2021-08 (“ASU 2021-08”), Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers to improve the accounting for acquired revenue contracts with customers in a business combination to address recognition of an acquired contract liability and payment terms and their effect on subsequent revenue recognized by the acquirer. ASU 2021-08 is effective for annual periods beginning after December 15, 2022 on a prospective basis. Early adoption is permitted. Ciena is currently evaluating the impact of this ASU on its condensed consolidated financial statements and related disclosures. |
REVENUE (Tables)
REVENUE (Tables) | 9 Months Ended |
Jul. 29, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue | The tables below set forth Ciena’s disaggregated revenue for the periods indicated (in thousands): Quarter Ended July 29, 2023 Networking Platforms Platform Software and Services Blue Planet Automation Software and Services Global Services Total Product lines: Converged Packet Optical $ 718,997 $ — $ — $ — $ 718,997 Routing and Switching 127,563 — — — 127,563 Platform Software and Services — 78,880 — — 78,880 Blue Planet Automation Software and Services — — 13,167 — 13,167 Maintenance Support and Training — — — 72,887 72,887 Installation and Deployment — — — 46,840 46,840 Consulting and Network Design — — — 9,552 9,552 Total revenue by product line $ 846,560 $ 78,880 $ 13,167 $ 129,279 $ 1,067,886 Timing of revenue recognition: Products and services at a point in time $ 846,560 $ 15,980 $ 2,832 $ 11,886 $ 877,258 Services transferred over time — 62,900 10,335 117,393 190,628 Total revenue by timing of revenue recognition $ 846,560 $ 78,880 $ 13,167 $ 129,279 $ 1,067,886 Quarter Ended July 30, 2022 Networking Platforms Platform Software and Services Blue Planet Automation Software and Services Global Services Total Product lines: Converged Packet Optical $ 563,837 $ — $ — $ — $ 563,837 Routing and Switching 100,741 — — — 100,741 Platform Software and Services — 63,483 — — 63,483 Blue Planet Automation Software and Services — — 17,342 — 17,342 Maintenance Support and Training — — — 72,760 72,760 Installation and Deployment — — — 38,704 38,704 Consulting and Network Design — — — 11,114 11,114 Total revenue by product line $ 664,578 $ 63,483 $ 17,342 $ 122,578 $ 867,981 Timing of revenue recognition: Products and services at a point in time $ 664,578 $ 15,230 $ 4,632 $ 9,408 $ 693,848 Services transferred over time — 48,253 12,710 113,170 174,133 Total revenue by timing of revenue recognition $ 664,578 $ 63,483 $ 17,342 $ 122,578 $ 867,981 Nine Months Ended July 29, 2023 Networking Platforms Platform Software and Services Blue Planet Automation Software and Services Global Services Total Product lines: Converged Packet Optical $ 2,239,180 $ — $ — $ — $ 2,239,180 Routing and Switching 377,378 — — — 377,378 Platform Software and Services — 221,768 — — 221,768 Blue Planet Automation Software and Services — — 49,139 — 49,139 Maintenance Support and Training — — — 213,938 213,938 Installation and Deployment — — — 120,901 120,901 Consulting and Network Design — — — 34,758 34,758 Total revenue by product line $ 2,616,558 $ 221,768 $ 49,139 $ 369,597 $ 3,257,062 Timing of revenue recognition: Products and services at a point in time $ 2,616,558 $ 48,290 $ 14,143 $ 36,553 $ 2,715,544 Services transferred over time — 173,478 34,996 333,044 541,518 Total revenue by timing of revenue recognition $ 2,616,558 $ 221,768 $ 49,139 $ 369,597 $ 3,257,062 Nine months ended July 30, 2022 Networking Platforms Platform Software and Services Blue Planet Automation Software and Services Global Services Total Product lines: Converged Packet Optical $ 1,730,066 $ — $ — $ — $ 1,730,066 Routing and Switching 295,638 — — — 295,638 Platform Software and Services — 205,557 — — 205,557 Blue Planet Automation Software and Services — — 55,334 — 55,334 Maintenance Support and Training — — — 219,270 219,270 Installation and Deployment — — — 120,504 120,504 Consulting and Network Design — — — 35,282 35,282 Total revenue by product line $ 2,025,704 $ 205,557 $ 55,334 $ 375,056 $ 2,661,651 Timing of revenue recognition: Products and services at a point in time $ 2,025,704 $ 66,655 $ 17,442 $ 31,368 $ 2,141,169 Services transferred over time — 138,902 37,892 343,688 520,482 Total revenue by timing of revenue recognition $ 2,025,704 $ 205,557 $ 55,334 $ 375,056 $ 2,661,651 Quarter Ended Nine Months Ended July 29, July 30, July 29, July 30, 2023 2022 2023 2022 Geographic distribution: Americas $ 749,479 $ 617,366 $ 2,308,934 $ 1,913,350 EMEA 152,834 124,185 479,053 420,075 APAC 165,573 126,430 469,075 328,226 Total revenue by geographic distribution $ 1,067,886 $ 867,981 $ 3,257,062 $ 2,661,651 For the periods indicated, the only customers that accounted for at least 10% of Ciena’s revenue were as follows (in thousands): Quarter Ended Nine Months Ended July 29, July 30, July 29, July 30, 2023 2022 2023 2022 Web-scale provider $ 124,897 n/a $ 369,678 n/a AT&T n/a 100,293 $ 357,382 314,358 Verizon n/a 108,495 n/a 273,158 Total $ 124,897 $ 208,788 $ 727,060 $ 587,516 _____________________________________ n/a Denotes revenue representing less than 10% of total revenue for the period |
Schedule of Contract Balances | The following table provides information about receivables, contract assets and contract liabilities (deferred revenue) from contracts with customers as of the dates indicated (in thousands): Balance at July 29, 2023 Balance at October 29, 2022 Accounts receivable, net $ 997,373 $ 920,772 Contract assets for unbilled accounts receivable, net $ 142,305 $ 156,039 Deferred revenue $ 259,977 $ 200,235 As of the dates indicated, deferred revenue is comprised of the following (in thousands): July 29, October 29, Products $ 34,102 $ 19,814 Services 225,875 180,421 Total deferred revenue 259,977 200,235 Less current portion (188,104) (137,899) Long-term deferred revenue $ 71,873 $ 62,336 |
BUSINESS COMBINATIONS (Tables)
BUSINESS COMBINATIONS (Tables) | 9 Months Ended |
Jul. 29, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed | The following table summarizes the final purchase price allocation related to the acquisitions based on the estimated fair value of the acquired assets and assumed liabilities (in thousands): Amount Cash and cash equivalents $ 14,634 Accounts receivable, net 443 Inventories, net 1,406 Prepaid expenses and other 810 Equipment, furniture and fixtures 1,090 Goodwill 117,997 Developed technology 75,400 In-process technology 89,100 Customer relationships and contracts 18,400 Order backlog 2,480 Deferred tax asset, net (27,782) Accounts payable (420) Accrued liabilities and other short-term obligations (874) Deferred revenue (851) Other long-term obligations (144) Total purchase consideration $ 291,689 |
SIGNIFICANT ASSET IMPAIRMENT _2
SIGNIFICANT ASSET IMPAIRMENT AND RESTRUCTURING COSTS (Tables) | 9 Months Ended |
Jul. 29, 2023 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Activity and Balance of the Restructuring Liability Accounts | The following table sets forth the restructuring activity and balance of the restructuring liability accounts, which are included in accrued liabilities and other short-term obligations on the Condensed Consolidated Balance Sheets, for the nine months ended July 29, 2023 (in thousands): Workforce Other restructuring activities Total Balance at October 29, 2022 $ 1,215 $ 4,620 $ 5,835 Charges 4,509 (1) 12,116 (2) 16,625 Cash payments (4,920) (16,736) (21,656) Balance at July 29, 2023 $ 804 $ — $ 804 Current restructuring liabilities $ 804 $ — $ 804 (1) Reflects employee costs associated with workforce reductions during the nine months ended July 29, 2023 as part of a business optimization strategy to improve gross margin, constrain operating expense, and redesign certain business processes. (2) Primarily represents costs related to restructured real estate facilities and the redesign of certain business processes associated with Ciena’s supply chain and distribution structure reorganization. The following table sets forth the restructuring activity and balance of the restructuring liability accounts, which are included in accrued liabilities and other short-term obligations on the Condensed Consolidated Balance Sheets for the nine months ended July 30, 2022 (in thousands): Workforce Other restructuring activities Total Balance at October 30, 2021 $ 781 $ — $ 781 Charges 2,224 (1) 13,992 (2) 16,216 Cash payments (2,423) (13,115) (15,538) Balance at July 30, 2022 $ 582 $ 877 $ 1,459 Current restructuring liabilities $ 582 $ 877 $ 1,459 (1) Reflects employee costs associated with workforce reductions during the nine months ended July 30, 2022 as part of a business optimization strategy to improve gross margin, constrain operating expense, and redesign certain business processes. (2) Primarily represents the redesign of certain business processes associated with Ciena’s supply chain and distribution structure reorganization and costs related to restructured real estate facilities. |
INTEREST AND OTHER INCOME, NET
INTEREST AND OTHER INCOME, NET (Tables) | 9 Months Ended |
Jul. 29, 2023 | |
Other Income and Expenses [Abstract] | |
Schedule of Interest and Other Income, Net | The components of interest and other income, net, are as follows for the periods indicated (in thousands): Quarter Ended Nine Months Ended July 29, July 30, July 29, July 30, 2023 2022 2023 2022 Interest income $ 12,835 $ 2,774 $ 30,365 $ 4,962 Gains (losses) on non-hedge designated foreign currency forward contracts 1,679 (985) (2,885) (2,911) Foreign currency exchange gains (losses) (4,031) (788) (2,927) 2,711 Gain (loss) on cost method equity investments, net (87) — 26,368 4,120 Other (209) (635) (210) (4,022) Interest and other income, net $ 10,187 $ 366 $ 50,711 $ 4,860 |
CASH EQUIVALENT, SHORT-TERM A_2
CASH EQUIVALENT, SHORT-TERM AND LONG-TERM INVESTMENTS (Tables) | 9 Months Ended |
Jul. 29, 2023 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of Available-for-Sale Securities Reconciliation | As of the dates indicated, investments are comprised of the following (in thousands): July 29, 2023 Amortized Cost Gross Unrealized Gross Unrealized Estimated Fair U.S. government obligations $ 94,715 $ 1 $ (976) $ 93,740 Corporate debt securities 63,401 2 (155) 63,248 Time deposits 80,854 1 (12) 80,843 $ 238,970 $ 4 $ (1,143) $ 237,831 Included in cash equivalents $ 74,890 $ — $ — $ 74,890 Included in short-term investments 142,743 4 (904) 141,843 Included in long-term investments 21,337 — (239) 21,098 $ 238,970 $ 4 $ (1,143) $ 237,831 October 29, 2022 Amortized Cost Gross Unrealized Gross Unrealized Estimated Fair U.S. government obligations $ 137,963 $ — $ (3,379) $ 134,584 Corporate debt securities 54,899 1 (405) 54,495 Time deposits 55,889 — (64) 55,825 $ 248,751 $ 1 $ (3,848) $ 244,904 Included in cash equivalents $ 55,530 $ — $ — $ 55,530 Included in short-term investments 156,430 1 (2,442) 153,989 Included in long-term investments 36,791 — (1,406) 35,385 $ 248,751 $ 1 $ (3,848) $ 244,904 |
Schedule of Legal Maturities of Debt Investments | The following table summarizes the final legal maturities of debt investments as of July 29, 2023 (in thousands): Amortized Estimated Less than one year $ 217,633 $ 216,733 Due in 1-2 years 21,337 21,098 $ 238,970 $ 237,831 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 9 Months Ended |
Jul. 29, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of the Fair Value of Assets and Liabilities Recorded on a Recurring Basis | As of the dates indicated, the following tables summarize the assets and liabilities that are recorded at fair value on a recurring basis (in thousands): July 29, 2023 Level 1 Level 2 Level 3 Total Assets: Money market funds $ 767,668 $ — $ — $ 767,668 Bond mutual fund 102,715 — — 102,715 Time deposits 80,843 — — 80,843 Deferred compensation plan assets 12,203 — — 12,203 U.S. government obligations — 93,740 — 93,740 Corporate debt securities — 63,248 — 63,248 Foreign currency forward contracts — 2,574 — 2,574 Interest rate swaps — 19,528 — 19,528 Total assets measured at fair value $ 963,429 $ 179,090 $ — $ 1,142,519 Liabilities: Foreign currency forward contracts $ — $ 4,691 $ — $ 4,691 Interest rate swaps — 32 — 32 Total liabilities measured at fair value $ — $ 4,723 $ — $ 4,723 October 29, 2022 Level 1 Level 2 Level 3 Total Assets: Money market funds $ 639,024 $ — $ — $ 639,024 Bond mutual fund 71,145 — — 71,145 Time deposits 55,825 — — 55,825 Deferred compensation plan assets 12,751 — — 12,751 U.S. government obligations — 134,584 — 134,584 Corporate debt securities — 54,495 — 54,495 Foreign currency forward contracts — 251 — 251 Interest rate swaps — 12,306 — 12,306 Total assets measured at fair value $ 778,745 $ 201,636 $ — $ 980,381 Liabilities: Foreign currency forward contracts $ — $ 15,605 $ — $ 15,605 Total liabilities measured at fair value $ — $ 15,605 $ — $ 15,605 |
Schedule of Assets and Liabilities as Presented on Ciena's Condensed Consolidated Balance Sheets | As of the dates indicated, the assets and liabilities above are presented on Ciena’s Condensed Consolidated Balance Sheets as follows (in thousands): July 29, 2023 Level 1 Level 2 Level 3 Total Assets: Cash equivalents $ 944,714 $ 559 $ — $ 945,273 Short-term investments 6,512 135,331 — 141,843 Prepaid expenses and other — 2,574 — 2,574 Long-term investments — 21,098 — 21,098 Other long-term assets 12,203 19,528 — 31,731 Total assets measured at fair value $ 963,429 $ 179,090 $ — $ 1,142,519 Liabilities: Accrued liabilities and other short-term obligations $ — $ 4,691 $ — $ 4,691 Other long-term obligations — 32 — 32 Total liabilities measured at fair value $ — $ 4,723 $ — $ 4,723 October 29, 2022 Level 1 Level 2 Level 3 Total Assets: Cash equivalents $ 757,725 $ 7,974 $ — $ 765,699 Short-term investments 8,269 145,720 — 153,989 Prepaid expenses and other — 251 — 251 Long-term investments — 35,385 — 35,385 Other long-term assets 12,751 12,306 — 25,057 Total assets measured at fair value $ 778,745 $ 201,636 $ — $ 980,381 Liabilities: Accrued liabilities and other short-term obligations $ — $ 15,605 $ — $ 15,605 Total liabilities measured at fair value $ — $ 15,605 $ — $ 15,605 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 9 Months Ended |
Jul. 29, 2023 | |
Inventory Disclosure [Abstract] | |
Schedule of Inventories | As of the dates indicated, inventories are comprised of the following (in thousands): July 29, October 29, Raw materials $ 771,955 $ 664,916 Work-in-process 51,763 18,232 Finished goods 333,544 258,584 Deferred cost of goods sold 77,521 41,084 Gross inventories 1,234,783 982,816 Reserve for inventory excess and obsolescence (42,261) (36,086) Inventories, net $ 1,192,522 $ 946,730 |
PREPAID EXPENSES AND OTHER (Tab
PREPAID EXPENSES AND OTHER (Tables) | 9 Months Ended |
Jul. 29, 2023 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of Prepaid Expenses and Other | As of the dates indicated, prepaid expenses and other are comprised of the following (in thousands): July 29, October 29, Contract assets for unbilled accounts receivable, net $ 142,305 $ 156,039 Prepaid VAT and other taxes 75,637 63,975 Prepaid expenses 55,997 55,440 Product demonstration equipment, net 41,691 35,929 Capitalized contract acquisition costs 24,349 33,516 Other non-trade receivables 17,734 24,026 Foreign currency forward contracts 2,574 251 Deferred deployment expense 1,405 877 $ 361,692 $ 370,053 |
INTANGIBLE ASSETS (Tables)
INTANGIBLE ASSETS (Tables) | 9 Months Ended |
Jul. 29, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Finite-Lived Intangible Assets | As of the dates indicated, intangible assets are comprised of the following (in thousands): July 29, 2023 October 29, 2022 Gross Accumulated Net Gross Accumulated Net Developed technology $ 503,618 $ (408,090) $ 95,528 $ 428,218 $ (386,300) $ 41,918 In-process technology 89,100 — 89,100 — — — Patents and licenses 8,795 (4,967) 3,828 8,415 (4,228) 4,187 Customer relationships, covenants not to compete, outstanding purchase orders and contracts 411,384 (380,755) 30,629 390,271 (366,859) 23,412 Total intangible assets $ 1,012,897 $ (793,812) $ 219,085 $ 826,904 $ (757,387) $ 69,517 |
Schedule of Expected Future Amortization of Finite-Lived Intangible Assets | Expected future amortization of intangible assets for the fiscal years indicated is as follows (in thousands): Fiscal Year Amount Remaining fiscal 2023 $ 14,170 2024 39,836 2025 34,635 2026 23,348 2027 15,843 Thereafter 2,153 $ 129,985 (1) (1) Does not include amortization of in-process technology, as estimation of the timing of future amortization expense would be impractical. |
GOODWILL (Tables)
GOODWILL (Tables) | 9 Months Ended |
Jul. 29, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The following table presents the goodwill allocated to Ciena’s operating segments as of July 29, 2023 and October 29, 2022, as well as the changes to goodwill during the first nine months of fiscal 2023 (in thousands): Balance at October 29, 2022 Acquisitions Impairments Translation Balance at July 29, 2023 Platform Software and Services $ 156,191 $ — $ — $ — $ 156,191 Blue Planet Automation Software and Services 89,049 — — — 89,049 Networking Platforms 83,082 117,997 — 277 201,356 Total $ 328,322 $ 117,997 $ — $ 277 $ 446,596 |
OTHER BALANCE SHEET DETAILS (Ta
OTHER BALANCE SHEET DETAILS (Tables) | 9 Months Ended |
Jul. 29, 2023 | |
Balance Sheet Related Disclosures [Abstract] | |
Schedule of Accrued Liabilities | As of the dates indicated, accrued liabilities and other short-term obligations are comprised of the following (in thousands): July 29, October 29, Compensation, payroll related tax and benefits $ 104,303 $ 126,338 Warranty 49,504 45,503 Income taxes payable 34,577 11,472 Vacation 30,344 26,396 Foreign currency forward contracts 4,691 15,604 Interest payable 9,779 4,793 Finance lease liabilities 4,063 3,758 Other 118,361 126,918 $ 355,622 $ 360,782 |
Schedule of Accrued Warranties | The following table summarizes the activity in Ciena’s accrued warranty for the periods indicated (in thousands): Beginning Balance Current Period Provisions Settlements Ending Balance Nine Months Ended July 30, 2022 $ 48,019 12,416 (14,746) $ 45,689 Nine Months Ended July 29, 2023 $ 45,503 18,860 (14,859) $ 49,504 |
Schedule of Contract Balances | The following table provides information about receivables, contract assets and contract liabilities (deferred revenue) from contracts with customers as of the dates indicated (in thousands): Balance at July 29, 2023 Balance at October 29, 2022 Accounts receivable, net $ 997,373 $ 920,772 Contract assets for unbilled accounts receivable, net $ 142,305 $ 156,039 Deferred revenue $ 259,977 $ 200,235 As of the dates indicated, deferred revenue is comprised of the following (in thousands): July 29, October 29, Products $ 34,102 $ 19,814 Services 225,875 180,421 Total deferred revenue 259,977 200,235 Less current portion (188,104) (137,899) Long-term deferred revenue $ 71,873 $ 62,336 |
SHORT-TERM AND LONG-TERM DEBT (
SHORT-TERM AND LONG-TERM DEBT (Tables) | 9 Months Ended |
Jul. 29, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Carrying Values and Estimated Fair Values of Convertible Notes | The net carrying value of the 2025 Term Loan was comprised of the following as of the dates indicated (in thousands): July 29, 2023 October 29, 2022 Principal Balance Unamortized Discount Deferred Debt Issuance Costs Net Carrying Value Net Carrying Value 2025 Term Loan $ 670,478 $ (687) $ (1,286) $ 668,505 $ 673,010 The net carrying value of the 2030 Term Loan was comprised of the following as of the date indicated (in thousands): July 29, 2023 Principal Balance Unamortized Discount Deferred Debt Issuance Costs Net Carrying Value 2030 Term Loan $ 498,750 $ (2,308) $ (4,679) $ 491,763 The net carrying value of the 2030 Notes was comprised of the following as of the dates indicated (in thousands): July 29, 2023 October 29, 2022 Principal Balance Deferred Debt Issuance Costs Net Carrying Value Net Carrying Value 2030 Senior Notes 4.00% fixed-rate $ 400,000 $ (4,438) $ 395,562 $ 395,045 |
ACCUMULATED OTHER COMPREHENSI_2
ACCUMULATED OTHER COMPREHENSIVE INCOME (Tables) | 9 Months Ended |
Jul. 29, 2023 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Schedule of Accumulated Other Comprehensive Income | The following table summarizes the changes in accumulated balances of other comprehensive income (“AOCI”), net of tax, for the nine months ended July 29, 2023 (in thousands): Unrealized Gain (Loss) on Available-for-sale Securities Foreign Currency Forward Contracts Interest Rate Swaps Cumulative Total Balance at October 29, 2022 $ (2,965) $ (10,197) $ 9,397 $ (42,880) $ (46,645) Other comprehensive gain before reclassifications 2,075 17,070 11,763 17,981 48,889 Amounts reclassified from AOCI — (7,756) (6,266) — (14,022) Balance at July 29, 2023 $ (890) $ (883) $ 14,894 $ (24,899) $ (11,778) The following table summarizes the changes in AOCI, net of tax, for the nine months ended July 30, 2022 (in thousands): Unrealized Gain (Loss) on Available-for-sale Securities Foreign Currency Forward Contracts Interest Rate Swaps Cumulative Total Balance at October 30, 2021 $ (164) $ 6,216 $ (12,179) $ 6,566 $ 439 Other comprehensive gain (loss) before reclassifications (2,184) (5,207) 2,786 (22,783) (27,388) Amounts reclassified from AOCI — (1,569) 6,639 — 5,070 Balance at July 30, 2022 $ (2,348) $ (560) $ (2,754) $ (16,217) $ (21,879) |
EARNINGS_PER SHARE CALCULATION
EARNINGS PER SHARE CALCULATION (Tables) | 9 Months Ended |
Jul. 29, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Reconciliation of Numerator and Denominator of Basic and Diluted Earnings Per Share | The following table presents the calculation of Basic and Diluted EPS for the periods indicated (in thousands, except per share amounts): Quarter Ended Nine Months Ended July 29, July 30, July 29, July 30, 2023 2022 2023 2022 Net income $ 29,733 $ 10,512 $ 163,628 $ 95,257 Basic weighted average shares outstanding 149,690 149,862 149,472 152,083 Effect of dilutive potential common shares 287 601 395 1,126 Diluted weighted average shares 149,977 150,463 149,867 153,209 Basic EPS $ 0.20 $ 0.07 $ 1.09 $ 0.63 Diluted EPS $ 0.20 $ 0.07 $ 1.09 $ 0.62 Antidilutive employee share-based awards, excluded 3,383 1,640 2,567 1,264 |
SHARE-BASED COMPENSATION EXPE_2
SHARE-BASED COMPENSATION EXPENSE (Tables) | 9 Months Ended |
Jul. 29, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Share-based Compensation Expense | The following table summarizes share-based compensation expense for the periods indicated (in thousands): Quarter Ended Nine Months Ended July 29, July 30, July 29, July 30, 2023 2022 2023 2022 Products $ 1,118 $ 1,002 $ 3,324 $ 2,960 Services 2,687 1,940 7,643 5,467 Share-based compensation expense included in cost of goods sold 3,805 2,942 10,967 8,427 Research and development 10,954 8,233 30,919 23,372 Selling and marketing 8,770 8,075 25,949 23,196 General and administrative 9,377 7,579 27,313 22,825 Share-based compensation expense included in operating expense 29,101 23,887 84,181 69,393 Share-based compensation expense capitalized in inventory, net 127 28 257 7 Total share-based compensation expense $ 33,033 $ 26,857 $ 95,405 $ 77,827 |
SEGMENTS AND ENTITY-WIDE DISC_2
SEGMENTS AND ENTITY-WIDE DISCLOSURES (Tables) | 9 Months Ended |
Jul. 29, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Reconciliation of Assets From Segment to Consolidated | As of July 29, 2023, finite-lived intangible assets, goodwill, and maintenance spares are assigned to asset groups within the following segments (in thousands): July 29, 2023 Networking Platforms Platform Software and Services Blue Planet Automation Software and Services Global Services Total Other intangible assets, net $ 198,937 — 20,148 — $ 219,085 Goodwill $ 201,356 156,191 89,049 — $ 446,596 Maintenance spares, net $ — — — 48,165 $ 48,165 |
Schedule of Segment Profit (Loss) and the Reconciliation to Consolidated Net Income (Loss) | The table below sets forth Ciena’s segment profit (loss) and the reconciliation to net income for the periods indicated (in thousands): Quarter Ended Nine Months Ended July 29, July 30, July 29, July 30, 2023 2022 2023 2022 Segment profit (loss): Networking Platforms $ 171,380 $ 108,282 $ 588,281 $ 395,176 Platform Software and Services 49,691 39,646 136,028 132,698 Blue Planet Automation Software and Services (12,072) (10,139) (30,044) (17,693) Global Services 50,550 52,965 137,190 158,808 Total segment profit 259,549 190,754 831,455 668,989 Less: Non-performance operating expenses Selling and marketing 118,266 105,880 367,156 344,700 General and administrative 49,349 41,121 151,184 131,191 Significant asset impairments and restructuring costs 4,174 7,692 16,625 20,203 Amortization of intangible assets 9,487 8,919 26,773 26,757 Acquisition and integration costs 59 35 3,474 598 Add: Other non-performance financial items Interest and other income, net 10,187 366 50,711 4,860 Interest expense (24,060) (12,642) (63,819) (33,275) Less: Provision for income taxes 34,608 4,319 89,507 21,868 Net income $ 29,733 $ 10,512 $ 163,628 $ 95,257 |
Schedule of Ciena's Geographic Distribution of Revenue and Long-Lived Assets | For the periods indicated, Ciena’s geographic distribution of equipment, building, furniture and fixtures, net, and operating ROU assets was as follows (in thousands): July 29, October 29, Canada $ 241,416 $ 226,451 United States 46,936 47,515 Other International 39,585 38,921 Total $ 327,937 $ 312,887 |
REVENUE - Disaggregation of Rev
REVENUE - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 29, 2023 | Jul. 30, 2022 | Jul. 29, 2023 | Jul. 30, 2022 | |
Disaggregation of Revenue [Line Items] | ||||
Total revenue | $ 1,067,886 | $ 867,981 | $ 3,257,062 | $ 2,661,651 |
Products and services at a point in time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 877,258 | 693,848 | 2,715,544 | 2,141,169 |
Services transferred over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 190,628 | 174,133 | 541,518 | 520,482 |
Networking Platforms | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 846,560 | 664,578 | 2,616,558 | 2,025,704 |
Networking Platforms | Products and services at a point in time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 846,560 | 664,578 | 2,616,558 | 2,025,704 |
Networking Platforms | Services transferred over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Platform Software and Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 78,880 | 63,483 | 221,768 | 205,557 |
Platform Software and Services | Products and services at a point in time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 15,980 | 15,230 | 48,290 | 66,655 |
Platform Software and Services | Services transferred over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 62,900 | 48,253 | 173,478 | 138,902 |
Blue Planet Automation Software and Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 13,167 | 17,342 | 49,139 | 55,334 |
Blue Planet Automation Software and Services | Products and services at a point in time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 2,832 | 4,632 | 14,143 | 17,442 |
Blue Planet Automation Software and Services | Services transferred over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 10,335 | 12,710 | 34,996 | 37,892 |
Global Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 129,279 | 122,578 | 369,597 | 375,056 |
Global Services | Products and services at a point in time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 11,886 | 9,408 | 36,553 | 31,368 |
Global Services | Services transferred over time | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 117,393 | 113,170 | 333,044 | 343,688 |
Converged Packet Optical | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 718,997 | 563,837 | 2,239,180 | 1,730,066 |
Converged Packet Optical | Networking Platforms | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 718,997 | 563,837 | 2,239,180 | 1,730,066 |
Converged Packet Optical | Platform Software and Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Converged Packet Optical | Blue Planet Automation Software and Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Converged Packet Optical | Global Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Routing and Switching | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 127,563 | 100,741 | 377,378 | 295,638 |
Routing and Switching | Networking Platforms | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 127,563 | 100,741 | 377,378 | 295,638 |
Routing and Switching | Platform Software and Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Routing and Switching | Blue Planet Automation Software and Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Routing and Switching | Global Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Platform Software and Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 78,880 | 63,483 | 221,768 | 205,557 |
Platform Software and Services | Networking Platforms | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Platform Software and Services | Platform Software and Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 78,880 | 63,483 | 221,768 | 205,557 |
Platform Software and Services | Blue Planet Automation Software and Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Platform Software and Services | Global Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Blue Planet Automation Software and Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 13,167 | 17,342 | 49,139 | 55,334 |
Blue Planet Automation Software and Services | Networking Platforms | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Blue Planet Automation Software and Services | Platform Software and Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Blue Planet Automation Software and Services | Blue Planet Automation Software and Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 13,167 | 17,342 | 49,139 | 55,334 |
Blue Planet Automation Software and Services | Global Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Maintenance Support and Training | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 72,887 | 72,760 | 213,938 | 219,270 |
Maintenance Support and Training | Networking Platforms | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Maintenance Support and Training | Platform Software and Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Maintenance Support and Training | Blue Planet Automation Software and Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Maintenance Support and Training | Global Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 72,887 | 72,760 | 213,938 | 219,270 |
Installation and Deployment | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 46,840 | 38,704 | 120,901 | 120,504 |
Installation and Deployment | Networking Platforms | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Installation and Deployment | Platform Software and Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Installation and Deployment | Blue Planet Automation Software and Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Installation and Deployment | Global Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 46,840 | 38,704 | 120,901 | 120,504 |
Consulting and Network Design | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 9,552 | 11,114 | 34,758 | 35,282 |
Consulting and Network Design | Networking Platforms | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Consulting and Network Design | Platform Software and Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Consulting and Network Design | Blue Planet Automation Software and Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 0 | 0 | 0 | 0 |
Consulting and Network Design | Global Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | $ 9,552 | $ 11,114 | $ 34,758 | $ 35,282 |
REVENUE - Geographical Distribu
REVENUE - Geographical Distribution of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 29, 2023 | Jul. 30, 2022 | Jul. 29, 2023 | Jul. 30, 2022 | |
Disaggregation of Revenue [Line Items] | ||||
Total revenue | $ 1,067,886 | $ 867,981 | $ 3,257,062 | $ 2,661,651 |
Revenue | Customer Concentration Risk | Web-scale provider | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 124,897 | 369,678 | ||
Americas | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 749,479 | 617,366 | 2,308,934 | 1,913,350 |
EMEA | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | 152,834 | 124,185 | 479,053 | 420,075 |
APAC | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenue | $ 165,573 | $ 126,430 | $ 469,075 | $ 328,226 |
REVENUE - Narrative (Details)
REVENUE - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Jul. 29, 2023 | Jul. 30, 2022 | Jul. 29, 2023 | Jul. 30, 2022 | Oct. 29, 2022 | |
Disaggregation of Revenue [Line Items] | |||||
Total revenue | $ 1,067,886 | $ 867,981 | $ 3,257,062 | $ 2,661,651 | |
Revenue recognized that was previously deferred | 119,800 | 98,900 | |||
Capitalized contract acquisition costs | 31,400 | 31,400 | $ 39,700 | ||
Amortization of capitalized contract acquisition costs | 26,000 | 20,500 | |||
United States | |||||
Disaggregation of Revenue [Line Items] | |||||
Total revenue | $ 685,800 | $ 574,300 | $ 2,100,000 | $ 1,800,000 |
REVENUE - Revenue by Major Cust
REVENUE - Revenue by Major Customers (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 29, 2023 | Jul. 30, 2022 | Jul. 29, 2023 | Jul. 30, 2022 | |
Revenue, Major Customer [Line Items] | ||||
Total revenue | $ 1,067,886 | $ 867,981 | $ 3,257,062 | $ 2,661,651 |
Web-scale provider | Revenue | Customer Concentration Risk | ||||
Revenue, Major Customer [Line Items] | ||||
Total revenue | 124,897 | 369,678 | ||
AT&T | Revenue | Customer Concentration Risk | ||||
Revenue, Major Customer [Line Items] | ||||
Total revenue | 100,293 | 357,382 | 314,358 | |
Verizon | Revenue | Customer Concentration Risk | ||||
Revenue, Major Customer [Line Items] | ||||
Total revenue | 108,495 | 273,158 | ||
Total | Revenue | Customer Concentration Risk | ||||
Revenue, Major Customer [Line Items] | ||||
Total revenue | $ 124,897 | $ 208,788 | $ 727,060 | $ 587,516 |
REVENUE - Contract Balances (De
REVENUE - Contract Balances (Details) - USD ($) $ in Thousands | Jul. 29, 2023 | Oct. 29, 2022 |
Revenue from Contract with Customer [Abstract] | ||
Accounts receivable, net | $ 997,373 | $ 920,772 |
Contract assets for unbilled accounts receivable, net | 142,305 | 156,039 |
Deferred revenue | $ 259,977 | $ 200,235 |
REVENUE - Performance Obligatio
REVENUE - Performance Obligation (Details) $ in Billions | Jul. 29, 2023 USD ($) |
Revenue from Contract with Customer [Abstract] | |
Remaining performance obligation | $ 2.1 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-07-30 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Percentage of remaining performance obligation | 84% |
Period of remaining performance obligation | 12 months |
BUSINESS COMBINATIONS - Narrati
BUSINESS COMBINATIONS - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Dec. 30, 2022 | Jul. 29, 2023 | Jan. 28, 2023 | Jul. 30, 2022 | Jul. 29, 2023 | Jul. 30, 2022 | |
Business Acquisition [Line Items] | ||||||
Gain (loss) on cost method equity investments, net | $ (87) | $ 26,500 | $ 0 | $ 26,368 | $ 4,120 | |
Acquisition and integration costs | $ 59 | $ 35 | $ 3,474 | $ 598 | ||
Benu and Tibit | ||||||
Business Acquisition [Line Items] | ||||||
Consideration transferred | $ 291,700 | |||||
Payment to acquire business | 244,700 | |||||
Fair value of previously held cost method equity investment | 47,000 | |||||
Gain (loss) on cost method equity investments, net | 26,500 | |||||
Acquisition and integration costs | $ 3,400 | |||||
Benu and Tibit | Developed technology | ||||||
Business Acquisition [Line Items] | ||||||
Intangible assets, useful life | 5 years | |||||
Benu and Tibit | Customer relationships and contracts | ||||||
Business Acquisition [Line Items] | ||||||
Intangible assets, useful life | 3 years |
BUSINESS COMBINATIONS - Purchas
BUSINESS COMBINATIONS - Purchase Price Allocation (Details) - USD ($) $ in Thousands | Jul. 29, 2023 | Dec. 30, 2022 | Oct. 29, 2022 |
Business Acquisition [Line Items] | |||
Goodwill | $ 446,596 | $ 328,322 | |
Benu and Tibit | |||
Business Acquisition [Line Items] | |||
Cash and cash equivalents | $ 14,634 | ||
Accounts receivable | 443 | ||
Inventories, net | 1,406 | ||
Prepaid expenses and other | 810 | ||
Equipment, furniture and fixtures | 1,090 | ||
Goodwill | 117,997 | ||
Deferred tax asset, net | (27,782) | ||
Accounts payable | (420) | ||
Accrued liabilities and other short-term obligations | (874) | ||
Deferred revenue | (851) | ||
Other long-term obligations | (144) | ||
Total purchase consideration | 291,689 | ||
Benu and Tibit | Developed technology | |||
Business Acquisition [Line Items] | |||
Intangible assets | 75,400 | ||
Benu and Tibit | In-process technology | |||
Business Acquisition [Line Items] | |||
Intangible assets | 89,100 | ||
Benu and Tibit | Customer relationships and contracts | |||
Business Acquisition [Line Items] | |||
Intangible assets | 18,400 | ||
Benu and Tibit | Order backlog | |||
Business Acquisition [Line Items] | |||
Intangible assets | $ 2,480 |
SIGNIFICANT ASSET IMPAIRMENT _3
SIGNIFICANT ASSET IMPAIRMENT AND RESTRUCTURING COSTS - Schedule of Restructuring Liabilities (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Jul. 29, 2023 | Jul. 30, 2022 | |
Restructuring Reserve [Roll Forward] | ||
Balance at beginning of period | $ 5,835 | $ 781 |
Charges | 16,625 | 16,216 |
Cash payments | (21,656) | (15,538) |
Balance at end of period | 804 | 1,459 |
Current restructuring liabilities | 804 | 1,459 |
Workforce reduction | ||
Restructuring Reserve [Roll Forward] | ||
Balance at beginning of period | 1,215 | 781 |
Charges | 4,509 | 2,224 |
Cash payments | (4,920) | (2,423) |
Balance at end of period | 804 | 582 |
Current restructuring liabilities | 804 | 582 |
Other restructuring activities | ||
Restructuring Reserve [Roll Forward] | ||
Balance at beginning of period | 4,620 | 0 |
Charges | 12,116 | 13,992 |
Cash payments | (16,736) | (13,115) |
Balance at end of period | 0 | 877 |
Current restructuring liabilities | $ 0 | $ 877 |
INTEREST AND OTHER INCOME, NE_2
INTEREST AND OTHER INCOME, NET (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Jul. 29, 2023 | Jan. 28, 2023 | Jul. 30, 2022 | Jul. 29, 2023 | Jul. 30, 2022 | |
Other Income and Expenses [Abstract] | |||||
Interest income | $ 12,835 | $ 2,774 | $ 30,365 | $ 4,962 | |
Gains (losses) on non-hedge designated foreign currency forward contracts | 1,679 | (985) | (2,885) | (2,911) | |
Foreign currency exchange gains (losses) | (4,031) | (788) | (2,927) | 2,711 | |
Gain (loss) on cost method equity investments, net | (87) | $ 26,500 | 0 | 26,368 | 4,120 |
Other | (209) | (635) | (210) | (4,022) | |
Interest and other income, net | $ 10,187 | $ 366 | $ 50,711 | $ 4,860 |
CASH EQUIVALENT, SHORT-TERM A_3
CASH EQUIVALENT, SHORT-TERM AND LONG-TERM INVESTMENTS - Schedule of Short-term and Long-term Investments (Details) - USD ($) $ in Thousands | Jul. 29, 2023 | Oct. 29, 2022 |
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | $ 238,970 | $ 248,751 |
Gross Unrealized Gains | 4 | 1 |
Gross Unrealized Losses | (1,143) | (3,848) |
Estimated Fair Value | 237,831 | 244,904 |
Included in cash equivalents | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 74,890 | 55,530 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Estimated Fair Value | 74,890 | 55,530 |
Included in short-term investments | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 142,743 | 156,430 |
Gross Unrealized Gains | 4 | 1 |
Gross Unrealized Losses | (904) | (2,442) |
Estimated Fair Value | 141,843 | 153,989 |
Included in long-term investments | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 21,337 | 36,791 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (239) | (1,406) |
Estimated Fair Value | 21,098 | 35,385 |
U.S. government obligations | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 94,715 | 137,963 |
Gross Unrealized Gains | 1 | 0 |
Gross Unrealized Losses | (976) | (3,379) |
Estimated Fair Value | 93,740 | 134,584 |
Corporate debt securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 63,401 | 54,899 |
Gross Unrealized Gains | 2 | 1 |
Gross Unrealized Losses | (155) | (405) |
Estimated Fair Value | 63,248 | 54,495 |
Time deposits | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 80,854 | 55,889 |
Gross Unrealized Gains | 1 | 0 |
Gross Unrealized Losses | (12) | (64) |
Estimated Fair Value | $ 80,843 | $ 55,825 |
CASH EQUIVALENT, SHORT-TERM A_4
CASH EQUIVALENT, SHORT-TERM AND LONG-TERM INVESTMENTS - Legal Maturities of Debt Investments (Details) - USD ($) $ in Thousands | Jul. 29, 2023 | Oct. 29, 2022 |
Amortized Cost | ||
Less than one year | $ 217,633 | |
Due in 1-2 years | 21,337 | |
Amortized Cost | 238,970 | $ 248,751 |
Estimated Fair Value | ||
Less than one year | 216,733 | |
Due in 1-2 years | 21,098 | |
Estimated Fair Value | $ 237,831 | $ 244,904 |
FAIR VALUE MEASUREMENTS - Fair
FAIR VALUE MEASUREMENTS - Fair Value Measurements (Details) - USD ($) $ in Thousands | Jul. 29, 2023 | Oct. 29, 2022 |
Assets: | ||
Estimated Fair Value | $ 237,831 | $ 244,904 |
Corporate debt securities | ||
Assets: | ||
Estimated Fair Value | 63,248 | 54,495 |
Fair value, Measurements, Recurring | ||
Assets: | ||
Deferred compensation plan assets | 12,203 | 12,751 |
Total assets measured at fair value | 1,142,519 | 980,381 |
Liabilities: | ||
Total liabilities measured at fair value | 4,723 | 15,605 |
Fair value, Measurements, Recurring | Foreign Currency Forward Contracts | ||
Assets: | ||
Foreign currency forward contracts | 2,574 | 251 |
Liabilities: | ||
Derivative liability | 4,691 | 15,605 |
Fair value, Measurements, Recurring | Interest rate swaps | ||
Assets: | ||
Foreign currency forward contracts | 19,528 | 12,306 |
Liabilities: | ||
Derivative liability | 32 | |
Fair value, Measurements, Recurring | Bond mutual fund | ||
Assets: | ||
Estimated Fair Value | 102,715 | 71,145 |
Fair value, Measurements, Recurring | U.S. government obligations | ||
Assets: | ||
Estimated Fair Value | 93,740 | 134,584 |
Fair value, Measurements, Recurring | Corporate debt securities | ||
Assets: | ||
Estimated Fair Value | 63,248 | 54,495 |
Level 1 | Fair value, Measurements, Recurring | ||
Assets: | ||
Deferred compensation plan assets | 12,203 | 12,751 |
Total assets measured at fair value | 963,429 | 778,745 |
Liabilities: | ||
Total liabilities measured at fair value | 0 | 0 |
Level 1 | Fair value, Measurements, Recurring | Foreign Currency Forward Contracts | ||
Assets: | ||
Foreign currency forward contracts | 0 | 0 |
Liabilities: | ||
Derivative liability | 0 | 0 |
Level 1 | Fair value, Measurements, Recurring | Interest rate swaps | ||
Assets: | ||
Foreign currency forward contracts | 0 | 0 |
Liabilities: | ||
Derivative liability | 0 | |
Level 1 | Fair value, Measurements, Recurring | Bond mutual fund | ||
Assets: | ||
Estimated Fair Value | 102,715 | 71,145 |
Level 1 | Fair value, Measurements, Recurring | U.S. government obligations | ||
Assets: | ||
Estimated Fair Value | 0 | 0 |
Level 1 | Fair value, Measurements, Recurring | Corporate debt securities | ||
Assets: | ||
Estimated Fair Value | 0 | 0 |
Level 2 | Fair value, Measurements, Recurring | ||
Assets: | ||
Deferred compensation plan assets | 0 | 0 |
Total assets measured at fair value | 179,090 | 201,636 |
Liabilities: | ||
Total liabilities measured at fair value | 4,723 | 15,605 |
Level 2 | Fair value, Measurements, Recurring | Foreign Currency Forward Contracts | ||
Assets: | ||
Foreign currency forward contracts | 2,574 | 251 |
Liabilities: | ||
Derivative liability | 4,691 | 15,605 |
Level 2 | Fair value, Measurements, Recurring | Interest rate swaps | ||
Assets: | ||
Foreign currency forward contracts | 19,528 | 12,306 |
Liabilities: | ||
Derivative liability | 32 | |
Level 2 | Fair value, Measurements, Recurring | Bond mutual fund | ||
Assets: | ||
Estimated Fair Value | 0 | 0 |
Level 2 | Fair value, Measurements, Recurring | U.S. government obligations | ||
Assets: | ||
Estimated Fair Value | 93,740 | 134,584 |
Level 2 | Fair value, Measurements, Recurring | Corporate debt securities | ||
Assets: | ||
Estimated Fair Value | 63,248 | 54,495 |
Level 3 | Fair value, Measurements, Recurring | ||
Assets: | ||
Deferred compensation plan assets | 0 | 0 |
Total assets measured at fair value | 0 | 0 |
Liabilities: | ||
Total liabilities measured at fair value | 0 | 0 |
Level 3 | Fair value, Measurements, Recurring | Foreign Currency Forward Contracts | ||
Assets: | ||
Foreign currency forward contracts | 0 | 0 |
Liabilities: | ||
Derivative liability | 0 | 0 |
Level 3 | Fair value, Measurements, Recurring | Interest rate swaps | ||
Assets: | ||
Foreign currency forward contracts | 0 | 0 |
Liabilities: | ||
Derivative liability | 0 | |
Level 3 | Fair value, Measurements, Recurring | Bond mutual fund | ||
Assets: | ||
Estimated Fair Value | 0 | 0 |
Level 3 | Fair value, Measurements, Recurring | U.S. government obligations | ||
Assets: | ||
Estimated Fair Value | 0 | 0 |
Level 3 | Fair value, Measurements, Recurring | Corporate debt securities | ||
Assets: | ||
Estimated Fair Value | 0 | 0 |
Money market funds | Fair value, Measurements, Recurring | ||
Assets: | ||
Cash equivalents | 767,668 | 639,024 |
Money market funds | Level 1 | Fair value, Measurements, Recurring | ||
Assets: | ||
Cash equivalents | 767,668 | 639,024 |
Money market funds | Level 2 | Fair value, Measurements, Recurring | ||
Assets: | ||
Cash equivalents | 0 | 0 |
Money market funds | Level 3 | Fair value, Measurements, Recurring | ||
Assets: | ||
Cash equivalents | 0 | 0 |
Time deposits | Fair value, Measurements, Recurring | ||
Assets: | ||
Cash equivalents | 80,843 | 55,825 |
Time deposits | Level 1 | Fair value, Measurements, Recurring | ||
Assets: | ||
Cash equivalents | 80,843 | 55,825 |
Time deposits | Level 2 | Fair value, Measurements, Recurring | ||
Assets: | ||
Cash equivalents | 0 | 0 |
Time deposits | Level 3 | Fair value, Measurements, Recurring | ||
Assets: | ||
Cash equivalents | $ 0 | $ 0 |
FAIR VALUE MEASUREMENTS - Conde
FAIR VALUE MEASUREMENTS - Condensed Consolidated Balance Sheet (Details) - Fair value, Measurements, Recurring - USD ($) $ in Thousands | Jul. 29, 2023 | Oct. 29, 2022 |
Assets: | ||
Total assets measured at fair value | $ 1,142,519 | $ 980,381 |
Liabilities: | ||
Total liabilities measured at fair value | 4,723 | 15,605 |
Level 1 | ||
Assets: | ||
Total assets measured at fair value | 963,429 | 778,745 |
Liabilities: | ||
Total liabilities measured at fair value | 0 | 0 |
Level 2 | ||
Assets: | ||
Total assets measured at fair value | 179,090 | 201,636 |
Liabilities: | ||
Total liabilities measured at fair value | 4,723 | 15,605 |
Level 3 | ||
Assets: | ||
Total assets measured at fair value | 0 | 0 |
Liabilities: | ||
Total liabilities measured at fair value | 0 | 0 |
Included in cash equivalents | ||
Assets: | ||
Cash equivalents | 945,273 | 765,699 |
Included in cash equivalents | Level 1 | ||
Assets: | ||
Cash equivalents | 944,714 | 757,725 |
Included in cash equivalents | Level 2 | ||
Assets: | ||
Cash equivalents | 559 | 7,974 |
Included in cash equivalents | Level 3 | ||
Assets: | ||
Cash equivalents | 0 | 0 |
Included in short-term investments | ||
Assets: | ||
Short-term investments | 141,843 | 153,989 |
Included in short-term investments | Level 1 | ||
Assets: | ||
Short-term investments | 6,512 | 8,269 |
Included in short-term investments | Level 2 | ||
Assets: | ||
Short-term investments | 135,331 | 145,720 |
Included in short-term investments | Level 3 | ||
Assets: | ||
Short-term investments | 0 | 0 |
Prepaid expenses and other | ||
Assets: | ||
Other assets | 2,574 | 251 |
Prepaid expenses and other | Level 1 | ||
Assets: | ||
Other assets | 0 | 0 |
Prepaid expenses and other | Level 2 | ||
Assets: | ||
Other assets | 2,574 | 251 |
Prepaid expenses and other | Level 3 | ||
Assets: | ||
Other assets | 0 | 0 |
Long-term investments | ||
Assets: | ||
Long-term investments | 21,098 | 35,385 |
Long-term investments | Level 1 | ||
Assets: | ||
Long-term investments | 0 | 0 |
Long-term investments | Level 2 | ||
Assets: | ||
Long-term investments | 21,098 | 35,385 |
Long-term investments | Level 3 | ||
Assets: | ||
Long-term investments | 0 | 0 |
Other long-term assets | ||
Assets: | ||
Other assets | 31,731 | 25,057 |
Other long-term assets | Level 1 | ||
Assets: | ||
Other assets | 12,203 | 12,751 |
Other long-term assets | Level 2 | ||
Assets: | ||
Other assets | 19,528 | 12,306 |
Other long-term assets | Level 3 | ||
Assets: | ||
Other assets | 0 | 0 |
Accrued liabilities and other short-term obligations | ||
Liabilities: | ||
Accrued liabilities and other short-term obligations | 4,691 | 15,605 |
Accrued liabilities and other short-term obligations | Level 1 | ||
Liabilities: | ||
Accrued liabilities and other short-term obligations | 0 | 0 |
Accrued liabilities and other short-term obligations | Level 2 | ||
Liabilities: | ||
Accrued liabilities and other short-term obligations | 4,691 | 15,605 |
Accrued liabilities and other short-term obligations | Level 3 | ||
Liabilities: | ||
Accrued liabilities and other short-term obligations | 0 | $ 0 |
Other long-term obligations | ||
Liabilities: | ||
Other long-term obligations | 32 | |
Other long-term obligations | Level 1 | ||
Liabilities: | ||
Other long-term obligations | 0 | |
Other long-term obligations | Level 2 | ||
Liabilities: | ||
Other long-term obligations | 32 | |
Other long-term obligations | Level 3 | ||
Liabilities: | ||
Other long-term obligations | $ 0 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Jul. 29, 2023 | Jul. 30, 2022 | Oct. 29, 2022 | |
Inventory Disclosure [Abstract] | |||
Raw materials | $ 771,955 | $ 664,916 | |
Work-in-process | 51,763 | 18,232 | |
Finished goods | 333,544 | 258,584 | |
Deferred cost of goods sold | 77,521 | 41,084 | |
Gross inventories | 1,234,783 | 982,816 | |
Reserve for inventory excess and obsolescence | (42,261) | (36,086) | |
Inventories, net | 1,192,522 | $ 946,730 | |
Provision for inventory excess and obsolescence | $ 18,767 | $ 12,038 |
PREPAID EXPENSES AND OTHER (Det
PREPAID EXPENSES AND OTHER (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Jul. 29, 2023 | Jul. 30, 2022 | Oct. 29, 2022 | |
Capitalized Contract Cost [Line Items] | |||
Prepaid VAT and other taxes | $ 75,637 | $ 63,975 | |
Prepaid expenses | 55,997 | 55,440 | |
Product demonstration equipment, net | 41,691 | 35,929 | |
Other non-trade receivables | 17,734 | 24,026 | |
Foreign currency forward contracts | 2,574 | 251 | |
Deferred deployment expense | 1,405 | 877 | |
Prepaid expenses and other | 361,692 | 370,053 | |
Depreciation of product demonstration equipment | 5,900 | $ 6,800 | |
Contract assets for unbilled accounts receivable, net | |||
Capitalized Contract Cost [Line Items] | |||
Contract assets | 142,305 | 156,039 | |
Capitalized contract acquisition costs | |||
Capitalized Contract Cost [Line Items] | |||
Contract assets | $ 24,349 | $ 33,516 |
INTANGIBLE ASSETS - Schedule of
INTANGIBLE ASSETS - Schedule of Finite-Lived Intangible Assets (Details) - USD ($) $ in Thousands | Jul. 29, 2023 | Oct. 29, 2022 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Intangible | $ 1,012,897 | $ 826,904 |
Accumulated Amortization | (793,812) | (757,387) |
Net Intangible | 219,085 | 69,517 |
Developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Intangible | 503,618 | 428,218 |
Accumulated Amortization | (408,090) | (386,300) |
Net Intangible | 95,528 | 41,918 |
In-process technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Intangible | 89,100 | 0 |
Accumulated Amortization | 0 | 0 |
Net Intangible | 89,100 | 0 |
Patents and licenses | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Intangible | 8,795 | 8,415 |
Accumulated Amortization | (4,967) | (4,228) |
Net Intangible | 3,828 | 4,187 |
Customer relationships, covenants not to compete, outstanding purchase orders and contracts | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Intangible | 411,384 | 390,271 |
Accumulated Amortization | (380,755) | (366,859) |
Net Intangible | $ 30,629 | $ 23,412 |
INTANGIBLE ASSETS - Narrative (
INTANGIBLE ASSETS - Narrative (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Jul. 29, 2023 | Jul. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization of intangible assets | $ 36,274 | $ 36,521 |
INTANGIBLE ASSETS - Schedule _2
INTANGIBLE ASSETS - Schedule of Expected Future Amortization of Finite-Lived Intangible Assets (Details) - USD ($) $ in Thousands | Jul. 29, 2023 | Oct. 29, 2022 |
Finite-Lived Intangible Assets [Line Items] | ||
Net Intangible | $ 219,085 | $ 69,517 |
Intangible Assets, Excluding In-Process Research And Development | ||
Finite-Lived Intangible Assets [Line Items] | ||
Remaining fiscal 2023 | 14,170 | |
2024 | 39,836 | |
2025 | 34,635 | |
2026 | 23,348 | |
2027 | 15,843 | |
Thereafter | 2,153 | |
Net Intangible | $ 129,985 |
GOODWILL (Details)
GOODWILL (Details) $ in Thousands | 9 Months Ended |
Jul. 29, 2023 USD ($) | |
Goodwill [Roll Forward] | |
Goodwill beginning balance | $ 328,322 |
Acquisitions | 117,997 |
Impairments | 0 |
Translation | 277 |
Goodwill ending balance | 446,596 |
Platform Software and Services | |
Goodwill [Roll Forward] | |
Goodwill beginning balance | 156,191 |
Acquisitions | 0 |
Impairments | 0 |
Translation | 0 |
Goodwill ending balance | 156,191 |
Blue Planet Automation Software and Services | |
Goodwill [Roll Forward] | |
Goodwill beginning balance | 89,049 |
Acquisitions | 0 |
Impairments | 0 |
Translation | 0 |
Goodwill ending balance | 89,049 |
Networking Platforms | |
Goodwill [Roll Forward] | |
Goodwill beginning balance | 83,082 |
Acquisitions | 117,997 |
Impairments | 0 |
Translation | 277 |
Goodwill ending balance | $ 201,356 |
OTHER BALANCE SHEET DETAILS - A
OTHER BALANCE SHEET DETAILS - Accrued Liabilities and Other Short-term Obligations (Details) - USD ($) $ in Thousands | Jul. 29, 2023 | Oct. 29, 2022 | Jul. 30, 2022 | Oct. 30, 2021 |
Balance Sheet Related Disclosures [Abstract] | ||||
Compensation, payroll related tax and benefits | $ 104,303 | $ 126,338 | ||
Warranty | 49,504 | 45,503 | $ 45,689 | $ 48,019 |
Income taxes payable | 34,577 | 11,472 | ||
Vacation | 30,344 | 26,396 | ||
Foreign currency forward contracts | 4,691 | 15,604 | ||
Interest payable | 9,779 | 4,793 | ||
Finance lease liabilities | 4,063 | 3,758 | ||
Other | 118,361 | 126,918 | ||
Accrued liabilities and other short-term obligations | $ 355,622 | $ 360,782 | ||
Derivative Liability, Current, Statement of Financial Position [Extensible Enumeration] | Accrued liabilities and other short-term obligations | Accrued liabilities and other short-term obligations |
OTHER BALANCE SHEET DETAILS -_2
OTHER BALANCE SHEET DETAILS - Accrued Warranty (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Jul. 29, 2023 | Jul. 30, 2022 | |
Movement in Standard Product Warranty Accrual [Roll Forward] | ||
Beginning Balance | $ 45,503 | $ 48,019 |
Current Period Provisions | 18,860 | 12,416 |
Settlements | (14,859) | (14,746) |
Ending Balance | $ 49,504 | $ 45,689 |
OTHER BALANCE SHEET DETAILS - D
OTHER BALANCE SHEET DETAILS - Deferred Revenue (Details) - USD ($) $ in Thousands | Jul. 29, 2023 | Oct. 29, 2022 |
Disaggregation of Revenue [Line Items] | ||
Total deferred revenue | $ 259,977 | $ 200,235 |
Less current portion | (188,104) | (137,899) |
Long-term deferred revenue | 71,873 | 62,336 |
Products | ||
Disaggregation of Revenue [Line Items] | ||
Total deferred revenue | 34,102 | 19,814 |
Services | ||
Disaggregation of Revenue [Line Items] | ||
Total deferred revenue | $ 225,875 | $ 180,421 |
DERIVATIVE INSTRUMENTS (Details
DERIVATIVE INSTRUMENTS (Details) - USD ($) $ in Millions | 9 Months Ended | ||
Jul. 29, 2023 | Jan. 31, 2023 | Oct. 29, 2022 | |
Foreign Currency Forward Contracts | Not Designated as Hedging Instrument | |||
Derivative [Line Items] | |||
Derivative asset, notional amount | $ 255.9 | $ 108 | |
Derivative maturity (in months) | 12 months | ||
Foreign Currency Forward Contracts | Cash Flow Hedging | Designated as Hedging Instrument | |||
Derivative [Line Items] | |||
Derivative asset, notional amount | $ 291.4 | 272.2 | |
Derivative maturity (in months) | 24 months | ||
Foreign Currency Forward Contracts | Net Investment Hedges | Designated as Hedging Instrument | INDIA | |||
Derivative [Line Items] | |||
Derivative asset, notional amount | $ 48.6 | ||
Derivative maturity (in months) | 24 months | ||
Interest Rate Swaps | Cash Flow Hedging | Designated as Hedging Instrument | Secured Debt | 2025 Term Loan | |||
Derivative [Line Items] | |||
Derivative asset, notional amount | $ 350 | $ 350 | $ 350 |
Derivative, fixed interest rate | 2.957% | 2.883% | |
Interest Rate Swaps | Cash Flow Hedging | Designated as Hedging Instrument | Secured Debt | 2025 Term Loan | SOFR | |||
Derivative [Line Items] | |||
Derivative asset, notional amount | $ 350 | ||
Derivative, fixed interest rate | 2.968% | ||
Interest Rate Swaps | Cash Flow Hedging | Designated as Hedging Instrument | Secured Debt | Term loan 2030 | |||
Derivative [Line Items] | |||
Derivative asset, notional amount | $ 350 | $ 350 | |
Derivative, fixed interest rate | 3.47% |
SHORT-TERM AND LONG-TERM DEBT -
SHORT-TERM AND LONG-TERM DEBT - Narrative (Details) - USD ($) $ in Thousands | 9 Months Ended | |||||
Jan. 19, 2023 | Jul. 29, 2023 | Jul. 30, 2022 | Oct. 29, 2022 | Jan. 18, 2022 | Jan. 23, 2020 | |
2025 Term Loan | Secured Debt | ||||||
Debt Instrument [Line Items] | ||||||
Principal Balance | $ 670,478 | $ 693,000 | ||||
Deferred debt issuance costs | 1,286 | $ 1,700 | ||||
Amortization of debt issuance costs | 500 | $ 500 | ||||
Fair value of debt | 668,800 | |||||
Term loan 2030 | ||||||
Debt Instrument [Line Items] | ||||||
Principal Balance | $ 1,250 | |||||
Debt instrument, face amount | 500,000 | |||||
Proceeds from issuance of debt | $ 492,500 | |||||
Debt instrument, redemption price, percentage | 0.25% | |||||
Deferred Debt Issuance Costs | 500,000 | |||||
Term loan 2030 | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate | 1% | |||||
Term loan 2030 | Minimum | SOFR | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate | 0% | |||||
Term loan 2030 | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate | 1.50% | |||||
Term loan 2030 | Maximum | SOFR | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate | 2.50% | |||||
Term loan 2030 | Secured Debt | ||||||
Debt Instrument [Line Items] | ||||||
Principal Balance | 498,750 | |||||
Deferred debt issuance costs | 4,679 | |||||
Amortization of debt issuance costs | 400 | |||||
Term loan 2030 | Senior Notes | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, interest rate, stated percentage | 1% | |||||
Deferred Debt Issuance Costs | 4,700 | |||||
2030 Senior Notes 4.00% fixed-rate | ||||||
Debt Instrument [Line Items] | ||||||
Deferred Debt Issuance Costs | 350,000 | |||||
2030 Senior Notes 4.00% fixed-rate | Secured Debt | ||||||
Debt Instrument [Line Items] | ||||||
Principal Balance | 400,000 | |||||
Deferred debt issuance costs | 4,438 | |||||
2030 Senior Notes 4.00% fixed-rate | Senior Notes | ||||||
Debt Instrument [Line Items] | ||||||
Amortization of debt issuance costs | $ 500 | $ 400 | ||||
Debt instrument, face amount | $ 400,000 | |||||
Debt instrument, interest rate, stated percentage | 4% | 4% | ||||
Deferred Debt Issuance Costs | $ 4,400 | $ 5,000 |
SHORT-TERM AND LONG-TERM DEBT_2
SHORT-TERM AND LONG-TERM DEBT - Net Carrying Values of Term Loans (Details) - USD ($) $ in Thousands | Jul. 29, 2023 | Jan. 19, 2023 | Oct. 29, 2022 | Jan. 18, 2022 | Jan. 23, 2020 |
2025 Term Loan | Secured Debt | |||||
Debt Instrument [Line Items] | |||||
Principal Balance | $ 670,478 | $ 693,000 | |||
Unamortized Discount | (687) | ||||
Deferred Debt Issuance Costs | (1,286) | $ (1,700) | |||
Net Carrying Value | 668,505 | 673,010 | |||
Term loan 2030 | |||||
Debt Instrument [Line Items] | |||||
Principal Balance | $ 1,250 | ||||
Term loan 2030 | Secured Debt | |||||
Debt Instrument [Line Items] | |||||
Principal Balance | 498,750 | ||||
Unamortized Discount | (2,308) | ||||
Deferred Debt Issuance Costs | (4,679) | ||||
Net Carrying Value | 491,763 | ||||
Term loan 2030 | Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, interest rate, stated percentage | 1% | ||||
2030 Senior Notes 4.00% fixed-rate | Secured Debt | |||||
Debt Instrument [Line Items] | |||||
Principal Balance | 400,000 | ||||
Deferred Debt Issuance Costs | (4,438) | ||||
Net Carrying Value | $ 395,562 | $ 395,045 | |||
2030 Senior Notes 4.00% fixed-rate | Senior Notes | |||||
Debt Instrument [Line Items] | |||||
Debt instrument, interest rate, stated percentage | 4% | 4% |
ABL CREDIT FACILITY (Details)
ABL CREDIT FACILITY (Details) $ in Millions | Feb. 10, 2023 USD ($) |
Revolving Credit Facility | |
Line of Credit Facility [Line Items] | |
Current borrowing capacity | $ 300 |
ACCUMULATED OTHER COMPREHENSI_3
ACCUMULATED OTHER COMPREHENSIVE INCOME (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Jul. 29, 2023 | Jul. 30, 2022 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Equity - beginning balance | $ 2,712,861 | $ 3,020,018 |
Other comprehensive gain before reclassifications | 48,889 | (27,388) |
Amounts reclassified from AOCI | (14,022) | 5,070 |
Equity- ending balance | 2,947,007 | 2,667,736 |
Accumulated Other Comprehensive Income (Loss) | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Equity - beginning balance | (46,645) | 439 |
Equity- ending balance | (11,778) | (21,879) |
Available-for-sale Securities | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Equity - beginning balance | (2,965) | (164) |
Other comprehensive gain before reclassifications | 2,075 | (2,184) |
Amounts reclassified from AOCI | 0 | 0 |
Equity- ending balance | (890) | (2,348) |
Unrealized Gain (Loss) Derivatives | Foreign Currency Forward Contracts | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Equity - beginning balance | (10,197) | 6,216 |
Other comprehensive gain before reclassifications | 17,070 | (5,207) |
Amounts reclassified from AOCI | (7,756) | (1,569) |
Equity- ending balance | (883) | (560) |
Unrealized Gain (Loss) Derivatives | Interest Rate Swaps | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Equity - beginning balance | 9,397 | (12,179) |
Other comprehensive gain before reclassifications | 11,763 | 2,786 |
Amounts reclassified from AOCI | (6,266) | 6,639 |
Equity- ending balance | 14,894 | (2,754) |
Cumulative Translation Adjustment | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||
Equity - beginning balance | (42,880) | 6,566 |
Other comprehensive gain before reclassifications | 17,981 | (22,783) |
Amounts reclassified from AOCI | 0 | 0 |
Equity- ending balance | $ (24,899) | $ (16,217) |
EARNINGS_PER SHARE CALCULATIO_2
EARNINGS PER SHARE CALCULATION - Earnings Per Share Calculation (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 29, 2023 | Jul. 30, 2022 | Jul. 29, 2023 | Jul. 30, 2022 | |
Earnings Per Share [Abstract] | ||||
Net income | $ 29,733 | $ 10,512 | $ 163,628 | $ 95,257 |
Basic weighted average shares outstanding (in shares) | 149,690 | 149,862 | 149,472 | 152,083 |
Effect of dilutive potential common shares (in shares) | 287 | 601 | 395 | 1,126 |
Dilutive weighted average shares (in shares) | 149,977 | 150,463 | 149,867 | 153,209 |
Basic EPS (in dollars per share) | $ 0.20 | $ 0.07 | $ 1.09 | $ 0.63 |
Diluted EPS (in dollars per share) | $ 0.20 | $ 0.07 | $ 1.09 | $ 0.62 |
Antidilutive employee share-based awards, excluded (in shares) | 3,383 | 1,640 | 2,567 | 1,264 |
STOCKHOLDERS_ EQUITY (Details)
STOCKHOLDERS’ EQUITY (Details) - USD ($) $ / shares in Units, $ in Thousands, shares in Millions | 3 Months Ended | 9 Months Ended | ||
Jul. 29, 2023 | Jul. 29, 2023 | Jul. 30, 2022 | Dec. 09, 2021 | |
Equity [Abstract] | ||||
Stock repurchase program authorized amount | $ 1,000,000 | |||
Repurchase of common stock under the stock repurchase program (in shares) | 1.4 | |||
Repurchase of common stock under the stock repurchase program (in shares) | $ 61,200 | |||
Repurchase of common stock under the stock repurchase program (in dollars per share) | $ 42.48 | |||
Aggregate shares repurchased (in shares) | 9.9 | 9.9 | ||
Aggregate shares repurchased | $ 561,200 | $ 561,200 | ||
Aggregate average price of shares repurchased (in dollars per share) | $ 56.83 | $ 56.83 | ||
Authorized funds remaining under stock repurchase program | $ 438,800 | $ 438,800 | ||
Shares repurchased for tax withholdings on vesting of restricted stock units | $ 29,794 | $ 41,280 |
SHARE-BASED COMPENSATION EXPE_3
SHARE-BASED COMPENSATION EXPENSE - Schedule of Share-Based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 29, 2023 | Jul. 30, 2022 | Jul. 29, 2023 | Jul. 30, 2022 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense capitalized in inventory, net | $ 127 | $ 28 | $ 257 | $ 7 |
Total share-based compensation expense | 33,033 | 26,857 | 95,405 | 77,827 |
Share-based compensation expense included in cost of goods sold | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense included in operating expense | 3,805 | 2,942 | 10,967 | 8,427 |
Products | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense included in operating expense | 1,118 | 1,002 | 3,324 | 2,960 |
Services | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense included in operating expense | 2,687 | 1,940 | 7,643 | 5,467 |
Share-based compensation expense included in operating expense | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense included in operating expense | 29,101 | 23,887 | 84,181 | 69,393 |
Research and development | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense included in operating expense | 10,954 | 8,233 | 30,919 | 23,372 |
Selling and marketing | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense included in operating expense | 8,770 | 8,075 | 25,949 | 23,196 |
General and administrative | ||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | ||||
Share-based compensation expense included in operating expense | $ 9,377 | $ 7,579 | $ 27,313 | $ 22,825 |
SHARE-BASED COMPENSATION EXPE_4
SHARE-BASED COMPENSATION EXPENSE - Narrative (Details) - Restricted Stock Units (RSUs) - USD ($) $ in Millions | 1 Months Ended | 9 Months Ended |
Dec. 31, 2022 | Jul. 29, 2023 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Unrecognized share-based compensation | $ 231.5 | |
Weighted-average period for recognition of share-based compensation (in years) | 1 year 5 months 12 days | |
Service period | 10 years | |
Age reached | 60 years | |
Retirement notice period | 12 months |
SEGMENTS AND ENTITY-WIDE DISC_3
SEGMENTS AND ENTITY-WIDE DISCLOSURES - Narrative (Details) $ in Thousands | 9 Months Ended | |
Jul. 29, 2023 USD ($) segment | Oct. 29, 2022 USD ($) | |
Segment Reporting [Abstract] | ||
Equipment, building, furniture and fixtures, net | $ 287,455 | $ 267,779 |
Operating right-of-use assets | $ 40,482 | $ 45,108 |
Number of operating segments | segment | 4 |
SEGMENTS AND ENTITY-WIDE DISC_4
SEGMENTS AND ENTITY-WIDE DISCLOSURES - Other Intangibles Assets, Goodwill and Maintenance Spares (Details) - USD ($) $ in Thousands | Jul. 29, 2023 | Oct. 29, 2022 |
Segment Reporting Information [Line Items] | ||
Other intangible assets, net | $ 219,085 | $ 69,517 |
Goodwill | 446,596 | 328,322 |
Maintenance spares, net | 48,165 | |
Networking Platforms | ||
Segment Reporting Information [Line Items] | ||
Other intangible assets, net | 198,937 | |
Goodwill | 201,356 | $ 83,082 |
Maintenance spares, net | 0 | |
Platform Software and Services | ||
Segment Reporting Information [Line Items] | ||
Other intangible assets, net | 0 | |
Goodwill | 156,191 | |
Maintenance spares, net | 0 | |
Blue Planet Automation Software and Services | ||
Segment Reporting Information [Line Items] | ||
Other intangible assets, net | 20,148 | |
Goodwill | 89,049 | |
Maintenance spares, net | 0 | |
Global Services | ||
Segment Reporting Information [Line Items] | ||
Other intangible assets, net | 0 | |
Goodwill | 0 | |
Maintenance spares, net | $ 48,165 |
SEGMENTS AND ENTITY-WIDE DISC_5
SEGMENTS AND ENTITY-WIDE DISCLOSURES - Revenue, Profit (Loss) and Net Income (Loss) Reconciliation (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 29, 2023 | Jul. 30, 2022 | Jul. 29, 2023 | Jul. 30, 2022 | |
Less: Non-performance operating expenses | ||||
Selling and marketing | $ 118,266 | $ 105,880 | $ 367,156 | $ 344,700 |
General and administrative | 49,349 | 41,121 | 151,184 | 131,191 |
Significant asset impairments and restructuring costs | 4,174 | 7,692 | 16,625 | 20,203 |
Amortization of intangible assets | 9,487 | 8,919 | 26,773 | 26,757 |
Acquisition and integration costs | 59 | 35 | 3,474 | 598 |
Add: Other non-performance financial items | ||||
Interest and other income, net | 10,187 | 366 | 50,711 | 4,860 |
Interest expense | (24,060) | (12,642) | (63,819) | (33,275) |
Less: Provision for income taxes | 34,608 | 4,319 | 89,507 | 21,868 |
Net income | 29,733 | 10,512 | 163,628 | 95,257 |
Operating Segments | ||||
Add: Other non-performance financial items | ||||
Net income | 259,549 | 190,754 | 831,455 | 668,989 |
Operating Segments | Networking Platforms | ||||
Add: Other non-performance financial items | ||||
Net income | 171,380 | 108,282 | 588,281 | 395,176 |
Operating Segments | Platform Software and Services | ||||
Add: Other non-performance financial items | ||||
Net income | 49,691 | 39,646 | 136,028 | 132,698 |
Operating Segments | Blue Planet Automation Software and Services | ||||
Add: Other non-performance financial items | ||||
Net income | (12,072) | (10,139) | (30,044) | (17,693) |
Operating Segments | Global Services | ||||
Add: Other non-performance financial items | ||||
Net income | $ 50,550 | $ 52,965 | $ 137,190 | $ 158,808 |
SEGMENTS AND ENTITY-WIDE DISC_6
SEGMENTS AND ENTITY-WIDE DISCLOSURES - Geographic Distribution of Equipment, Building, Furniture and Fixtures (Details) - USD ($) $ in Thousands | Jul. 29, 2023 | Oct. 29, 2022 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Equipment, building, furniture and fixtures, net | $ 327,937 | $ 312,887 |
Canada | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Equipment, building, furniture and fixtures, net | 241,416 | 226,451 |
United States | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Equipment, building, furniture and fixtures, net | 46,936 | 47,515 |
Other International | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Equipment, building, furniture and fixtures, net | $ 39,585 | $ 38,921 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 1 Months Ended | 3 Months Ended |
Sep. 01, 2023 | Jul. 29, 2023 | |
Subsequent Event [Line Items] | ||
Repurchase of common stock under the stock repurchase program (in shares) | 1.4 | |
Repurchase of common stock under the stock repurchase program (in shares) | $ 61.2 | |
Repurchase of common stock under the stock repurchase program (in dollars per share) | $ 42.48 | |
Aggregate shares repurchased (in shares) | 9.9 | |
Authorized funds remaining under stock repurchase program | $ 438.8 | |
Subsequent event | ||
Subsequent Event [Line Items] | ||
Repurchase of common stock under the stock repurchase program (in shares) | 0.9 | |
Repurchase of common stock under the stock repurchase program (in shares) | $ 38.8 | |
Repurchase of common stock under the stock repurchase program (in dollars per share) | $ 41.67 | |
Aggregate shares repurchased (in shares) | 10.8 | |
Authorized funds remaining under stock repurchase program | $ 400 |