Ciena reported a record QQ4 2025 and full-year 2025, underscoring the durability of AI-driven demand for high-speed connectivity. Q4 revenue of $1.352B and full-year revenue of $4.77B reflect 20% and 19% YoY growth, respectively, supported by a backlog near $5B and an order book totaling $7.8B for the year. The company also delivered a positive margin trajectory, with Q4 adjusted gross margin of 43.4% (annual 42.7%), and Q4 adjusted operating margin of 13.2% (full-year 11.2%). Management signaled a substantial upgrade to 2026 guidance, projecting revenue of $5.7–$6.1B (approximately +24% at the midpoint) with gross margin around 43% and operating margins near 17%. This outlook rests on accelerating demand from cloud providers and service providers, expanded capacity to meet a step-change in demand, and a broadened addressable market “in and around the data center” anchored by interconnects, WaveLogic 6 nano pluggables, and Nubis-derived components.
Executive drivers include: (1) AI-driven scale across data centers and WAN, (2) continued MOFN investments by hyperscalers and emerging Neo scalers, (3) DCOM deployments expanding beyond Meta, and (4) a multi-year ramp in interconnects and data-center-related architectures. While the trajectory is constructive, the outlook embeds supply-chain headwinds tied to NPIs and semiconductor/photonics components, and a concentrated customer base (top three customers accounted for about 44% of Q4 revenue and ~28% for the full year). Ciena plans to maintain OpEx discipline with flat 2026 Opex and to fund capex (~$250–$275M) to support demand and three-nanometer mask sets. Investors should monitor industry-wide component constraints, supply chain rebalancing, and the evolution of Scale Across and Nubis integration as the annual plan unfolds.