Ciena's stock is tumbling and taking other optical-networking shares down with it

By Hannah Pedone

Investors were expecting a 'more material beat and raise' than what Ciena delivered with its latest earnings report, analyst says

Shares of Ciena were down more than 19% on Thursday despite an earnings and revenue beat.

Optical stocks had been on a hot streak recently, but are showing a sharp reversal Thursday after underwhelming results from networking company Ciena.

UBS analyst David Vogt wrote in a Thursday note that the market was pricing in a "more material beat and raise" than what Ciena (CIEN) posted on Thursday morning.

Ciena shares were down about 19% shortly after Thursday's open and heading for their largest one-day percentage decline since Jan. 27, 2025, according to Dow Jones Market Data. Shares of fellow optical suppliers Lumentum Holdings (LITE), Coherent (COHR) and Corning (GLW) were down between 4% and 6%.

Shares of those companies are up 143%, 114% and 121% respectively so far this year as investors see what some are saying is the next big bottleneck in the AI boom - optical and networking components. Shares of Ciena have climbed 165% on the year through Wednesday's close.

Ciena reported revenue of $1.57 billion for the fiscal second quarter, up 40% from the prior-year quarter. Analysts were expecting $1.51 billion.

The company reported adjusted earnings per share of $1.64, up from 42 cents in the second quarter last year, beating the FactSet consensus of $1.46.

Ciena raised its revenue guidance for the 2026 fiscal year to a range of $6.2 billion to $6.4 billion from a range of $5.9 billion to $6.3 billion. Analysts were anticipating $6.18 billion.

For the fiscal third quarter, the company expects revenue of $1.58 billion to $1.68 billion, above the $1.56 billion expected by analysts.

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"Our long-term strategy to be the global leader in high-speed connectivity - both across the WAN and in and around the data center - is tightly aligned to the structural, multi-year opportunities created by AI-driven demand," Ciena CEO Gary Smith said in a press release. He was referring to wide-area network, a term for optical networks across large geographies.

Read more: Optical stocks are booming. Here's how to invest in one of the most explosive areas of tech.

-Hannah Pedone

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06-04-26 1011ET