We now have a counter-example to the thesis of carrier spending pullbacks in 2012. Infinera (NASDAQ:INFN, news, filings) easily bested analyst projections for the fourth quarter, despite warning in November of the impact of flooding in Thailand on its supply chain and despite the dismal winter some other vendors have seen (e.g. Juniper, Acme Packet). Here is a quick table putting the company's fourth quarter in some context:
|$ in millions||Q4/10||Q1/11||Q2/11||Q3/11||Q4/11||Q1/12
Revenues of $112M were almost $15M above Yahoos composite estimates of $97M and $7M above the top end of their guidance of $85-105M. That revised guidance included the effects of the flooding in Thailand, but Infinera was able to work past most of the feared shortages and even beat their original guided range of $100-110M. But perhaps we can also say that this quarter there was a bit of benefit to not yet having a big presence at the very largest carriers which several other vendors have blamed for weakness this winter. Revenue guidance for Q1 was also higher than projected, despite cautious assumptions from the company on TAM sales in the short term.
On the earnings front, non-GAAP loss per share of $0.06 was half the projected loss of $0.12. Guidance for Q1 was slightly below that of analyst projections as the company gears up for DTN-X sales to start in Q2. The overall schedule for the 100G DTN-X product remained in place, with trials goin on this quarter, production volume expected next quarter, and revenues starting to land in the second half. The company went as far as to suggest that Q2 revenues may be light due to existing customers already switching to the DTN-X and having revenues pushed out a quarter.
The market has had Infinera in something of a holding pattern since it switched gears on 40G a year ago and redirected its product roadmap toward an earlier 100G. A quarter from now, it seems like they will be well positioned in the 100G game, just in time for the next and very likely larger wave of adoption.
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