Ciena dips to new 52-week low
Ciena Corp.'s shareholders may have approved its merger with ONI Systems Corp., but the news that accompanied it didn't give the Street much to smile about. The fiber-optic manufacturer has warned that the combined company's third-quarter sales will fall below Ciena's second-quarter results.
Ciena said third-quarter revenue could be "down meaningfully" from the $87.1 million posted in the second quarter. The severity of the dip will depend on the timing of customer purchases and the acceptance of previously placed equipment orders. Analysts on average were predicting the combined company would produce $100 million in sales in Q3, according to Thomson Financial/First Call.
In an attempt to lessen the blow, the companies plan to eliminate 335 positions over the next three months — 225 employees will be released tomorrow. The affected employees will receive severance based on position and length of service, as well as outplacement services.
Ciena is slated to report fiscal third-quarter results on Aug. 22. As of 11:04 a.m. EDT, Ciena shares had lost nearly 9 percent of their value, trading at a new 52-week low of $4.01.