By Rex Crum, MarketWatch
SAN FRANCISCO (MarketWatch) -- Ciena Corp. and Cisco Systems
Inc. were among the decliners in the tech sector Thursday, but
Facebook Inc. managed to post strong gains as the social-networking
giant said it would soon be added to the S&P 500 index.
Ciena (CIEND) fell almost 7%, to close at $21.31, after the
company reported on Thursday a quarterly loss of $9.8 million, or 9
cents a share, on revenue of $583.4 million, compared with a loss
of $38.8 million, or 39 cents a share, on $465.5 million in sales
in the same period a year ago. Excluding one-time items, Ciena
would have earned 16 cents a share.
Analysts surveyed by Thomson Reuters had forecast Ciena to earn
24 cents a share on $568 million in revenue.
Ciena said gross margins as a percentage of revenue fell to
39.7% from 41.3% a year ago. Operating expenses also rose to $232
million from $214 million in last year's fourth quarter.
Ciena Chief Executive Gary Smith said that the initial market
reaction should be taken with a grain of salt.
"All of our [business] metrics performed strongly," Smith said.
"We've got record backlog [of orders] and a lot of engagement with
carriers around the world."
For its current fiscal first quarter, Ciena forecast revenue in
a range of $515 million to $545 million, while analysts had
forecast the company to post sales of $538 million.
With Ciena losing ground, other companies in the networking
sector also closed in the red as the sector often moves in tandem
when one of its major companies reports upbeat or negative
quarterly results.
Cisco Systems Inc. (CSCO) fell almost 2% to close at $20.51.
Cisco officials on Thursday said the company expects revenue to
grow between 3% and 6% over the next 3 to 5 years, which fell below
analysts' expectations for 5% to 7% sales growth. And on Wednesday,
Citigroup started coverage of the networking giant with a sell
rating.
Juniper Networks Inc. (JNPR), F5 Networks Inc. (FFIV) and JDS
Uniphase Corp. (JDSUD) also closed in the red.
Separately, Ciena said it would transfer its stock listing to
the New York Stock Exchange from the Nasdaq (RIXF) on Dec. 23. The
tech-heavy Nasdaq Composite Index fell 5 points to close at 3,998,
while the Philadelphia Semiconductor Index (SOX) gave up almost 1%
on the day.
Among other leading tech companies, Facebook Inc. (FB) rose
almost 5%, to close at $51.83 a share, as the social-networking
giant said it would be added to the S&P 500 Index (SPX). The
move was seen as a mixed blessing in some quarters, based on the
historical performance of companies that replace others in the
closely watched stock index.
Microsoft Corp. (MSFT) shares gave up 1%, to close at $37.22
following reports that Ford Motor Co. (F) CEO Alan Mulally might
not be the leading candidate to replace retiring CEO Steve
Ballmer.
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