Nokia 2Q16

On August 4th, Nokia announced its quarterly results, and they included good optical results for 2Q16. While optical accounts for less than 10% of Nokia’s corporate revenue, this specific business unit is poised to benefit from the oncoming ramp up in metro coherent 200G.

Nokia is one of the few western optical equipment vendors selling to both incumbents and emerging Cloud and Colo companies in China.  It is also winning business against Huawei in both China and Europe. Herein, Cignal AI examines Nokia’s results and recent wins including Telefonica and China Mobile.
Requires Optical Hardware subscription.

Ciena 2Q16

Cignal’s Active Insight promises real-time information, and with that in mind, we are providing an update on Ciena. Ciena reported results for its April-2016 quarter on June 2nd. Corporate results were decent from an overall revenue perspective, but performance in the optical equipment area was slightly disappointing. Some interesting things from Ciena are reaching market, such as lower cost 200G and Waveserver, but these innovations have not yet positively impacted the company’s optical revenue.
Requires Optical Hardware subscription.

Acacia 2Q16 Preview

Acacia is scheduled to report earnings on August 11th, and this will be the company’s first quarterly report since completing its recent IPO. In April 2016, Cignal AI examined Acacia’s business and S-1 filing in detail and provided our analysis on the company (see Acacia Communications – IPO Analysis).

ADVA’s recent quarterly results hint at what to expect from Acacia’s 2Q16 results announcement. In the following, we provide relevant excerpts on Acacia from our just-posted ADVA 2Q16 notes so that we may share this Active Insight with our wider client and end-user audience, who may not necessarily be subscribers to our Optical Hardware reporting.

Some followers of the market are anticipating flat revenue results from Acacia in Q2.  Based on our analysis, we think this expectation is too conservative.
Requires Optical Active Insight subscription.

ADVA 2Q16

ADVA released excellent quarterly results on Thursday, July 21th and its optical business is hitting on all cylinders right now. The company expects to sustain its current revenue surge through the coming quarter as it continues to ship an impressive amount of 100G ports.

ADVA’s results illustrate the pivotal impact that Cloud and Colo customers exercise over quarter to quarter revenue. These customers don’t follow the more steady and predictable buying patterns of traditional incumbent wholesale carriers.

Furthermore, ADVA’s robust results are an exceptional leading indicator for Acacia, which will report shortly on August 11th.

Cignal AI analyzes ADVA’s Cloudconnect, the ripple effect on Acacia, Inphi ColorZ, and offers our commentary on ADVA’s British Telecom business.
Requires Optical Hardware subscription.

Infinera 2Q16

Infinera held it’s Q2 Earnings Call on Wednesday, July 27th, and it was surprising to say the least. The company conveyed expectations for an exceptional slowdown in demand for Q3. Cignal AI has analyzed Infinera’s 2Q16 results and we present both company comments and our own opinions on what caused this major shift in expected demand and the forces behind it.
Requires Optical Hardware subscription.

Next Gen Optical Networking 2016

Andrew presented the keynote presentation to kick off Next Gen Optical Networking in Nice, France on June 29th. His presentation was titled “Making Technology Decisions in a Challenging Environment”, and used Cignal AI’s recently released optical equipment market data to support observations of the market.

Registered users (free) can read the rest and download the presentation.
Requires subscription.

2H15 Optical Hardware Applications

Our initial set of optical equipment results and forecasts for Datacenter Interconnect, Advanced Optical Switching, as well as detailed 100G+ Coherent and non-coherent port shipments have been published in Excel format.

Report information, tracked vendors, and details on categories have also been updated. Subscribers can download the full excel file, registered users can view updated report information.

Report Details Excel

Investor Call – China, CFP2-ACO, ROADMs & More

Andrew Schmitt created some excitement when he spoke about optical component and equipment market trends on a Piper Jaffray investor call on April 22. 83 investor clients were on the line, and some insightful questions were posed to Andrew as he gave his observations on a wide range of topics. The following is a full transcript of that discussion.
Requires Optical Active Insight subscription.

Metro DCI – What’s Next

Andrew presented “Metro DCI – What’s Next?” at the annual OSA Executive Forum before OFC 2016. His slides focused on the evolution of metro DCI and highlighted the opportunity for metro-access 100G, including coherent and non-coherent approaches.

Co-panelists included Arista and Microsoft. Microsoft used this opportunity to announce it’s intention to deploy InPhi’s ColorZ PAM-4 metro-access 100G technology.
Requires Optical Active Insight subscription.

Optical Whitebox – OFC 2016

Component and equipment vendors outlined the investments they are making in anticipation of some service providers adopting open line systems or fully dis-aggregated optical systems. This is a contentious technology trend in the industry; one which ignites opinions and whose conclusion is far from clear.

After silicon photonics, this was the area of the most interesting activity during OFC 2016. It is a complex trend requires equipment & component vendors to pivot both their hardware architectures and business models to address new potential opportunities. And it is far from clear whether this market will extend beyond the webco.

We review vendor activity and our observations of this market.
Requires Optical Active Insight subscription.

Acacia Communications – IPO Analysis

The optical networking world finally gets a close up view of Acacia’s performance as the company is filing for an IPO. The most recent S-1/A filing by Acacia includes 2015 financial details, which we review through the lenses of Cignal AI’s customer and market knowledge in order to create a fine-grained view of the company’s performance and qualitative outlook. This analysis includes a detailed projection of customer composition for 90%+ of revenue, market share within entire 100G market, and estimates of ASPs beyond what is included in public documents.
Requires Optical Active Insight subscription.

Silicon Photonics – OFC 2016

The optical component industry is changing from one in which existing InP and discrete designs are replicated in SiPho to a new approach under which the unique benefits of SiPho are better exploited. Several announcements made recently at OFC 2016 underscore that companies are beginning to migrate to these key applications for silicon photonics.
Requires Optical Active Insight subscription.

LinkedIn Designs Own 100G DC Switch

LinkedIn joined the cool kids and built its own 100G switch based on Broadcom Tomahawk.

Active Insight

Apple will decrease usage of Amazon AWS

Apple is currently building 2.5mm square feet of data center space, which is nearly 40% of Amazon’s existing datacenter square footage at the end of 2015. DCI expenditure is one of the main drivers of 30% YoY capex growth at Apple.

Morgan Stanley estimates Apple will spend about $1B on Amazon AWS in 2016, which is around 10% of total AWS revenue. This could move internal within 2 years.

Apple DCI capex is now extremely material.