Infinera Reports Disappointing Q3

Infinera, a maker of InP photonic integrated circuits (PICs) and network equipment, has released financial results for Q3 2016 ended September 24, 2016.

GAAP revenue for Q3 was $185.5 million compared to $258.8 million in Q2 2016 and $232.5 million in Q3 2015.

"As expected, weak demand across much of our business in the third quarter led to financial results that were below our standards," said Tom Fallon, Infinera's CEO.

"While the revenue environment is likely to remain challenging in the near term, we are making continued progress towards delivering our next generation of products and increasing the cadence in which we will introduce step function technology improvements. I firmly believe that we have the team and the core technologies that will enable us to recover from our current challenges and ultimately return to delivering differentiated financial results."

GAAP gross margin for Q3 was 45.6 percent compared to 47.8 percent in Q2 2016 and 44.2 percent in Q3 2015. GAAP operating margin for Q3 was (5.9) percent compared to 6.2 percent in Q2 2016 and 6.1 percent in Q3 2015.

GAAP net loss for Q3 was $(11.2) million, or $(0.08) per share, compared to net income of $11.5 million, or $0.08 per diluted share, in Q2 2016, and net income of $8.5 million, or $0.06 per diluted share, in Q3 2015.

Non-GAAP revenue for Q3 was $185.5 million compared to $259.0 million in Q2 2016 and $233.2 million in Q3 2015.

Non-GAAP gross margin for Q3 was 49.2 percent compared to 50.4 percent in Q2 2016 and 47.5 percent in Q3 2015. Non-GAAP operating margin for Q3 was 3.6 percent compared to 13.2 percent in Q2 2016 and 14.4 percent in Q3 2015.

Non-GAAP net income for Q3 was $7.4 million, or $0.05 per diluted share, compared to $30.9 million, or $0.21 per diluted share, in Q2 2016, and $32.2 million, or $0.22 per diluted share, in Q3 2015.

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