Track market-moving stories before they get noisy

Posted by Defense World Staff on Jul 24th, 2026

Atika Capital Management LLC cut its holdings in Ciena Corporation (NYSE:CIEN – Free Report) by 27.2% during the first quarter, according to the company in its most recent Form 13F filing with the Securities and Exchange Commission (SEC). The institutional investor owned 43,651 shares of the communications equipment provider’s stock after selling 16,349 shares during the quarter. Ciena accounts for 2.1% of Atika Capital Management LLC’s portfolio, making the stock its 10th biggest holding. Atika Capital Management LLC’s holdings in Ciena were worth $16,947,000 as of its most recent SEC filing.

A number of other institutional investors and hedge funds have also recently bought and sold shares of CIEN. Bogart Wealth LLC lifted its holdings in Ciena by 635.7% in the first quarter. Bogart Wealth LLC now owns 103 shares of the communications equipment provider’s stock valued at $40,000 after acquiring an additional 89 shares during the period. Transamerica Financial Advisors LLC boosted its stake in shares of Ciena by 71.0% during the 4th quarter. Transamerica Financial Advisors LLC now owns 106 shares of the communications equipment provider’s stock worth $25,000 after acquiring an additional 44 shares in the last quarter. Whittier Trust Co. of Nevada Inc. grew its holdings in shares of Ciena by 85.5% in the 1st quarter. Whittier Trust Co. of Nevada Inc. now owns 141 shares of the communications equipment provider’s stock worth $55,000 after acquiring an additional 65 shares during the period. Truvestments Capital LLC grew its holdings in shares of Ciena by 45.3% in the 4th quarter. Truvestments Capital LLC now owns 154 shares of the communications equipment provider’s stock worth $36,000 after acquiring an additional 48 shares during the period. Finally, Ascentis Independent Advisors purchased a new position in Ciena in the 1st quarter valued at approximately $65,000. Institutional investors and hedge funds own 91.99% of the company’s stock.

Wall Street Analysts Forecast Growth CIEN has been the subject of several research reports. Barclays lifted their price objective on Ciena from $372.00 to $607.00 and gave the stock an “overweight” rating in a report on Friday, June 5th. Zacks Research upgraded shares of Ciena from a “hold” rating to a “strong-buy” rating in a research report on Thursday, July 2nd. Argus set a $650.00 target price on shares of Ciena in a report on Friday, June 5th. Weiss Ratings cut shares of Ciena from a “buy (b-)” rating to a “hold (c+)” rating in a research report on Tuesday, July 7th. Finally, Citigroup increased their price target on shares of Ciena from $345.00 to $658.00 and gave the company a “buy” rating in a research report on Monday, May 18th. One research analyst has rated the stock with a Strong Buy rating, twelve have given a Buy rating and seven have assigned a Hold rating to the company’s stock. According to MarketBeat.com, the company has a consensus rating of “Moderate Buy” and a consensus price target of $530.56.

Read Our Latest Stock Analysis on Ciena

Ciena Stock Up 2.3% Shares of NYSE:CIEN opened at $406.37 on Friday. The company has a current ratio of 2.73, a quick ratio of 2.11 and a debt-to-equity ratio of 0.53. The firm has a market cap of $57.52 billion, a price-to-earnings ratio of 135.46 and a beta of 1.27. The stock’s 50-day moving average price is $480.43 and its two-hundred day moving average price is $409.42. Ciena Corporation has a 12-month low of $84.41 and a 12-month high of $637.51.

Ciena (NYSE:CIEN – Get Free Report) last posted its quarterly earnings data on Thursday, June 4th. The communications equipment provider reported $1.64 EPS for the quarter, beating analysts’ consensus estimates of $1.46 by $0.18. Ciena had a net margin of 7.87% and a return on equity of 18.15%. The company had revenue of $1.57 billion during the quarter, compared to the consensus estimate of $1.50 billion. During the same quarter in the prior year, the company posted $0.42 EPS. The company’s quarterly revenue was up 39.5% compared to the same quarter last year. On average, research analysts forecast that Ciena Corporation will post 5.4 EPS for the current year.

Insider Buying and Selling In related news, CFO Marc D. Graff sold 126 shares of the stock in a transaction on Wednesday, July 1st. The stock was sold at an average price of $466.20, for a total value of $58,741.20. Following the transaction, the chief financial officer directly owned 126,955 shares of the company’s stock, valued at approximately $59,186,421. This trade represents a 0.10% decrease in their position. The sale was disclosed in a filing with the SEC, which can be accessed through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, SVP Joseph Cumello sold 1,586 shares of Ciena stock in a transaction on Friday, June 26th. The shares were sold at an average price of $466.33, for a total value of $739,599.38. Following the completion of the transaction, the senior vice president owned 42,872 shares in the company, valued at $19,992,499.76. The trade was a 3.57% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold 21,627 shares of company stock worth $10,974,985 over the last 90 days. Company insiders own 0.58% of the company’s stock.

Ciena Profile (Free Report)

Ciena Corporation (NYSE: CIEN) is a global supplier of telecommunications networking equipment, software and services. The company develops high-capacity optical transport systems and packet-optical platforms that enable service providers, cloud operators and large enterprises to build, manage and scale their networks. Ciena’s product portfolio includes coherent optical solutions, packet networking platforms and a suite of network automation software designed to optimize bandwidth, reduce latency and simplify network operations.

In addition to hardware offerings, Ciena provides professional services and support, including network design, implementation and ongoing maintenance.

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Investors interested in Computer and Technology stocks should always be looking to find the best-performing companies in the group. Ciena (CIEN - Free Report) is a stock that can certainly grab the attention of many investors, but do its recent returns compare favorably to the sector as a whole? A quick glance at the company's year-to-date performance in comparison to the rest of the Computer and Technology sector should help us answer this question.

Ciena is a member of the Computer and Technology sector. This group includes 613 individual stocks and currently holds a Zacks Sector Rank of #2. The Zacks Sector Rank gauges the strength of our 16 individual sector groups by measuring the average Zacks Rank of the individual stocks within the groups.

The Zacks Rank is a successful stock-picking model that emphasizes earnings estimates and estimate revisions. The system highlights a number of different stocks that could be poised to outperform the broader market over the next one to three months. Ciena is currently sporting a Zacks Rank of #1 (Strong Buy).

Over the past three months, the Zacks Consensus Estimate for CIEN's full-year earnings has moved 5.9% higher. This means that analyst sentiment is stronger and the stock's earnings outlook is improving.

Our latest available data shows that CIEN has returned about 62% since the start of the calendar year. Meanwhile, the Computer and Technology sector has returned an average of 12.1% on a year-to-date basis. This shows that Ciena is outperforming its peers so far this year.

Arista Networks (ANET - Free Report) is another Computer and Technology stock that has outperformed the sector so far this year. Since the beginning of the year, the stock has returned 29.3%.

Over the past three months, Arista Networks' consensus EPS estimate for the current year has increased 4.1%. The stock currently has a Zacks Rank #2 (Buy).

Looking more specifically, Ciena belongs to the Communication - Components industry, a group that includes 13 individual stocks and currently sits at #39 in the Zacks Industry Rank. On average, stocks in this group have gained 77.4% this year, meaning that CIEN is slightly underperforming its industry in terms of year-to-date returns.

Arista Networks, however, belongs to the Internet - Software industry. Currently, this 175-stock industry is ranked #85. The industry has moved -6.2% so far this year.

Investors with an interest in Computer and Technology stocks should continue to track Ciena and Arista Networks. These stocks will be looking to continue their solid performance.

Key Takeaways Ciena and Nokia are benefiting from rising AI-driven demand for networking infrastructure.Ciena reported record revenues, expanded margins and raised its fiscal 2026 outlook.Nokia raised its AI and Network Infrastructure growth outlook as optical and IP demand accelerated. Ciena Corporation (CIEN - Free Report) and Nokia (NOK - Free Report) are benefiting from the rapid adoption of artificial intelligence (AI), which is driving strong demand for high-speed networking infrastructure. As hyperscalers and service providers expand AI deployments, both companies are strengthening their optical networking, routing and switching portfolios to support higher-capacity, low-latency connectivity. Ciena is leveraging its broad networking portfolio and deep customer relationships, while Nokia is expanding its AI and cloud business through optical and IP networking solutions.

Both companies are also introducing new AI-focused networking technologies and increasing investments to capture the growing opportunity. Ciena continues to expand its AI-driven portfolio with solutions such as RLS Hyper-Rail and DCOM, while Nokia has launched next-generation hyperscale optical solutions and AI-ready mobile networking products, alongside raising its Network Infrastructure growth outlook.

Let’s analyze their fundamentals, growth opportunities, market challenges and valuation to assess which one presents a stronger investment opportunity.

The Case for CIENCiena is benefiting from robust AI-driven demand for networking infrastructure, supported by its technology leadership, diversified product portfolio and long-standing customer relationships. In the second quarter of fiscal 2026, the company reported record revenues of $1.57 billion, up 40% year over year. Adjusted gross margin expanded to 44.9%, while adjusted earnings per share climbed to $1.64, nearly four times the prior-year level. Management stated that these results were delivered despite ongoing supply constraints. Backed by a growing backlog and offerings spanning networking systems, interconnects, software and services, Ciena remains well positioned to address rising connectivity needs across wide area networks and data centers.

The company continues to benefit from increasing investments by hyperscalers and service providers in networking infrastructure. Management indicated that hyperscalers have expanded their capital expenditure plans for 2026, with further investments expected beyond 2027, while service providers are resuming spending on optical infrastructure after a prolonged slowdown. Demand is being fueled by AI applications requiring high-capacity, low-latency and high-speed connectivity for model training, data ingestion and inference. Ciena expects these trends to significantly expand its addressable market to nearly $50 billion by 2029, covering both traditional WAN opportunities and fast-growing data center networking markets.

Ciena is further strengthening its competitive position through new product adoption and expanding customer engagements. The company secured the industry's first multi-rail order for its RLS Hyper-Rail platform from a leading hyperscaler and is actively working with additional hyperscalers, neoscalers and service providers that have shown strong interest in the solution. Its Data Center Out-of-Band Management (DCOM) platform drove 88% year-over-year growth in the Routing and Switching business, while Ciena also secured orders from a second hyperscaler, progressed qualifications with a third and won a major contract for coherent modules.

Demand for its 400G and 800G pluggables remains strong, with management expecting pluggable revenues to more than double from 2025. Customer collaboration is also increasing, as clients engage earlier in network design, helping shape Ciena's product roadmap and improving demand visibility. During the quarter, direct cloud customer revenues increased 70% year over year, service provider revenues rose 28%, India service provider revenues more than doubled and backlog expanded by more than $600 million sequentially to $7.7 billion, providing visibility into fiscal 2027.

The favorable demand environment has also strengthened Ciena's financial outlook. The adjusted operating margin improved to 19.5%, free cash flow reached $219 million and cash and investments totaled $1.4 billion. Management attributed the stronger profitability to engineering cost reductions, pricing optimization and disciplined working capital management. Reflecting solid first-half execution, the company raised its fiscal 2026 guidance and expects revenues of approximately $6.3 billion, plus or minus $100 million, an adjusted gross margin of 44.5%-45% and an adjusted operating margin of around 19%.

However, Ciena continues to face supply constraints as customer demand outpaces available component supply, requiring ongoing investments to secure manufacturing capacity and maintain execution. The company also operates in a highly competitive networking market and remains exposed to customer concentration risk.

The Case for NOKNokia is gaining from accelerating AI-driven demand and strengthening momentum across its network infrastructure business. The company reported 49% year-over-year growth in AI and cloud net sales, supported by strong demand from AI and cloud customers and €1 billion in new orders, primarily driven by Optical Networks. Management stated that rising AI adoption is increasing demand for data center interconnect, routing, switching and transport networks, creating a multi-year structural growth opportunity. Nokia also raised its AI and cloud addressable market growth outlook to a 27% CAGR for 2025-2028 from the previously expected 16%, while increasing its network infrastructure market growth outlook to 14% from 9%, reflecting stronger customer demand and higher AI-related infrastructure investments.

The company is also benefiting from expanding investments in Optical and IP Networks as AI deployments drive higher networking requirements. The company introduced a next-generation hyperscale multi-rail solution that significantly increases fiber density without expanding physical infrastructure and unveiled a new optical architecture designed to simplify deployments while reducing customers' total cost of ownership. Nokia also reported growing engagement with AI and cloud customers in switching and routing, secured new design wins, expanded its IP Networks pipeline and increased investments in optical manufacturing capacity. Reflecting these trends, management raised its 2026 Network Infrastructure growth outlook to 12-14% from 6-8% and increased its Optical and IP Networks growth forecast to 18-20% from 10-12%.

Nokia is strengthening its mobile network portfolio through AI-focused innovation and product development. The company introduced a new generation of AI RAN-ready radios featuring improved power efficiency and lower weight while continuing development of AI RAN solutions with NVIDIA, with field trials expected by year-end. Management also highlighted strong customer demand for cloud-native core software, new security capabilities and end-to-end automation as operators modernize their networks. At the same time, Nokia expects AI-related design wins in IP networking to translate into additional orders over the coming quarters, supporting future growth opportunities.

However, Nokia continues to face supply constraints as AI-related demand exceeds available capacity. Management noted that semiconductor supply limitations and the need to expand optical manufacturing capacity remain challenges as the company scales production. The company is investing in manufacturing capabilities, supply chain expansion and additional production capacity to capture growing demand, but acknowledged that the broader optical ecosystem continues to experience more demand than supply.

Nokia continues to face weakness in parts of its traditional networking business. Fixed Networks sales declined 13% in the quarter due to the company's strategy of prioritizing higher-margin products, while IP Networks growth was partly offset by softness in non-AI customer segments. Management also expects continued headwinds in the customer premises equipment business as it remains disciplined in focusing on long-term profitable opportunities, while describing the overall telecom market as relatively flat.

CIEN Shares vs. NOKOver the past year, CIEN shares have soared 393.5% while Nokia stock has surged 139.4%.

Image Source: Zacks Investment Research

Valuation for CIEN & NOKIn terms of Price/Book, CIEN shares are trading at 20.48X, higher than NOK’s 2.6X.

Image Source: Zacks Investment Research

How Do Zacks Estimates Compare for CIEN & NOK?Analysts have significantly revised their earnings estimates upward for CIEN’s bottom line for the current year.

Image Source: Zacks Investment Research

For NOK, there have been no revisions for the current year.

Image Source: Zacks Investment Research

CIEN or NOK: Which Stock to Bet on?CIEN sports a Zacks Rank #1 (Strong Buy) at present, while NOK has a Zacks Rank #3 (Hold). Consequently, in terms of Zacks Rank and valuation, CIEN seems to be a better pick at the moment.

You can see the complete list of today’s Zacks #1 Rank stocks here. 

Shares of Ciena (CIEN +0.17%) rose 109.8% in the first half of 2026, according to data from S&P Global Market Intelligence. The networking equipment veteran more than doubled due to accelerating demand for optical networking infrastructure tied to artificial intelligence workloads.

The rally peaked in late May before a 21.8% pullback in June. For context, the S&P 500 (^GSPC +0.35%) gained 12.3% over the same period, and the Nasdaq-100 rose 15.7%.

The stock also outperformed other networking heavyweights. For instance, Cisco Systems (CSCO +1.41%) gained 52.5% in the first half while Extreme Networks (EXTR +0.91%) stopped just short of doubling with a 94.4% rise.

Image source: The Motley Fool.

The network finally gets its moment For years, the AI infrastructure conversation revolved almost exclusively around semiconductors. But as hyperscalers built out massive clusters of GPUs and started training ever-larger models, a new bottleneck emerged: the network itself. Moving enormous amounts of data over long distances without introducing latency requires high-speed networking equipment capable of handling the load.

Ciena's optical networking systems transport massive volumes of data across long distances with minimal latency, positioning the company at the center of the AI infrastructure build-out. In February, Ciena released the Vesta 200 series of pluggable optical modules, delivering massive data speeds with minimal power consumption.

In its fiscal second quarter ended May 2, 2026, the company reported revenue of $1.57 billion, up 40% year over year. The backlog hit $7.7 billion, with management noting that about 80% of the hardware backlog would convert to revenue in the next 12 months. Direct cloud customer revenue jumped 70% year over year.

The results also beat Wall Street's consensus estimates, and the management's full-year guidance was boosted across the board.

One might think investors would have loved the soaring sales and sizzling profits in this early June report. But Ciena's stock fell 9% the next day as lots of investors slammed the "sell" button to lock in their gains.

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Priced for perfection Ciena is growing by leaps and bounds, but the stock returns include a heaping dose of future growth expectations. And I mean, it's a lot.

As of July 10, Ciena's stock has more than quintupled over the last year. In the same period, Cisco and Extreme are lagging with returns of 73% and 82%, respectively.

As a result, Ciena's shares are trading at 153 times trailing earnings and 78 times free cash flow. The business is healthy, but Ciena's investors are looking for superhero-level vital signs.

This stock traded just above $1,000 per share at the peak of the dot-com bubble. Ciena is almost back there again, though it passed the old market cap record of $42.5 billion in February this year.

And I'm afraid it's too much, too fast. Ciena's skyrocketing multiples are exposing investors to a massive valuation risk.

Liquidity reflects a company's ability to meet its short-term financial obligations and is an important indicator of financial health. Companies with healthy liquidity levels are generally better positioned to support day-to-day operations, navigate economic uncertainties and capitalize on growth opportunities, making them attractive investment candidates.

However, liquidity should not be viewed in isolation. While strong liquidity underscores financial stability, an excessively high level may indicate that a company is not deploying its assets efficiently. Idle cash or underutilized resources can weigh on profitability and limit long-term growth prospects. Therefore, investors should evaluate liquidity alongside operational efficiency when screening for potential outperformers. Companies that strike the right balance between maintaining adequate liquidity and efficiently utilizing their assets are often better equipped to generate sustainable growth and deliver superior shareholder returns. Argan, Inc. (AGX - Free Report) , Ciena Corporation (CIEN - Free Report) , Dillard's, Inc. (DDS - Free Report) , and Semtech Corporation (SMTC - Free Report) meet the criteria and are solid investment bets.

A balanced assessment of both liquidity and efficiency can help identify truly promising investment opportunities.

Current Ratio: It measures current assets relative to current liabilities. The ratio gauges a company’s potential to meet short and long-term debt obligations. A current ratio — the working capital ratio — below 1 indicates that the company has more liabilities than assets. A high current ratio does not always suggest that the company is in good financial shape. It may also indicate that the firm failed to utilize its assets significantly. Hence, a range of 1-3 is considered ideal.

Quick Ratio: Unlike the current ratio, the quick ratio — the “acid-test ratio” or “quick assets ratio” — indicates a company’s ability to pay short-term obligations. It considers inventory, excluding current assets, relative to current liabilities. A quick ratio of more than 1 is desirable, like the current ratio.

Cash Ratio: This is the most conservative ratio among the three, considering cash, cash equivalents and invested funds relative to current liabilities. It measures a company’s ability to meet existing debt obligations using the most liquid assets. Though a cash ratio of more than 1 may suggest sound financials, a higher number may indicate inefficiency in cash utilization. A ratio greater than 1 is always desirable, but it may not always represent a company’s financial condition.

To pick the best of the lot, we have added asset utilization — a widely used measure of a company’s efficiency — as one of the screening criteria. Asset utilization is the ratio of total sales in the past 12 months to the last four-quarter average of total assets. Though this ratio varies across industries, companies with a ratio higher than that of their industry can be considered efficient.

We added our proprietary Growth Score to the screen to ensure these liquid and efficient stocks have solid growth potential.

Current Ratio, Quick Ratio, and Cash Ratio between 1 and 3: While liquidity ratios greater than 1 are desirable, significantly high ratios may indicate inefficiency.

Asset utilization is more significant than the industry average: A higher asset utilization than the industry average indicates a company’s efficiency.

Zacks Rank equal to #1 (Strong Buy): Only Strong Buy-rated stocks can get through. You can see the complete list of today’s Zacks #1 Rank stocks here.

Growth Score less than or equal to B: Back-tested results show that stocks with a Growth Score of A or B handily beat other stocks when combined with a Zacks Rank #1 or 2 (Buy).

These criteria have narrowed the universe of more than 7,700 stocks to only 14.

Here are four of the 14 stocks that qualified the screen:

Argan offers comprehensive construction and related services to the power industry through its operations at Gemma Power Systems and Atlantic Projects.

Driven by favorable project timings in the Power segment, AGX reported first-quarter fiscal 2027 revenues of $291 million, up 50% year over year. It ended the quarter with a backlog of $2.8 billion. The Power segment remained the top contributor, accounting for 78% of total revenues.

Increasing demand for energy infrastructure, driven by electrification trends, data center expansion, electric vehicles and grid reliability needs, is creating strong opportunities, positioning Argan well for long-term growth. The company expects to add a “handful” of new projects over the next 10-18 months and believes it can execute 10-12 concurrent jobs.

The Zacks Consensus Estimate for AGX’s fiscal 2027 earnings is $12.60 per share, unchanged over the past seven days. The company has a Growth Score of A and a trailing four-quarter earnings surprise of 40.49%, on average.

Headquartered in Hanover, MD, Ciena is a leading provider of optical networking equipment, software and services.

Fiscal second-quarter 2026 revenues rose 39.5% year over year to $1.57 billion, driven by cloud demand and higher adoption of optical networking solutions.

Networking Platforms remained the largest contributor, generating $1.27 billion in revenues and representing 81.1% of total sales. Within the segment, Optical Networking revenues increased to $1.10 billion from $773.6 million a year ago, while Routing and Switching revenues advanced to $174.2 million from $92.7 million.

For third-quarter fiscal 2026, management expects revenues of $1.625 billion (+/- $50 million). Adjusted gross margin is projected at 45% (+/-50 bps), while adjusted operating margin is expected between 19% and 20%.

The Zacks Consensus Estimate for CIEN’s fiscal 2026 earnings is pegged at $6.52 per share, unchanged in the past seven days. The company has a Growth Score of A and a trailing four-quarter earnings surprise of 19.45%, on average.

Based in Little Rock, AR, Dillard's is a large departmental store chain featuring fashion apparel and home furnishings.

Net sales in first-quarter fiscal 2026 rose 2.6% year over year to $1.57 billion. Retail sales improved 3% year over year, with the company noting that all merchandise categories posted gains compared with the prior-year period.

The Zacks Consensus Estimate for DDS’ fiscal 2026 earnings is $35.26 per share, unchanged over the past seven days. The company has a Growth Score of B and a trailing four-quarter earnings surprise of 27.89%, on average.

Headquartered in Flynn Road Camarillo, CA, Semtech designs, manufactures and markets a wide range of analog and mixed-signal semiconductors for commercial applications.

Net sales in first-quarter fiscal 2027 surged 16% year over year to $291 million. Sales from the infrastructure market totaled $98.8 million (33.9% of net sales), exhibiting year-over-year growth of 36%, supported by the expanding data center business. A key highlight was record data center net sales of $71.6 million, rising 39% year over year, reflecting continued strength in high-speed interconnect solutions.

The Zacks Consensus Estimate for SMTC’s fiscal 2027 earnings is pegged at $2.66 per share, unchanged over the past seven days. The company has a Growth Score of B and a trailing four-quarter earnings surprise of 6.81%, on average.

Ciena benefits from unprecedented demand for optical connectivity, driving revenue acceleration, expanding backlog, and improving gross margins. CIEN's backlog surged 47% to $2.3B, with rapid revenue flow-through and strong demand for coherent pluggables and multi-rail line systems. Gross margin guidance has increased to nearly 45%, with operating margins projected at 19% adjusted, reflecting robust pricing power and operational leverage.

Key Takeaways MU is benefiting from AI-driven memory demand, with strong HBM adoption and rising earnings estimates.STX sees AI-led storage demand, Mozaic adoption and HAMR technology supporting profitable growth. CIEN is gaining from AI-driven optical networking demand and raised its fiscal 2026 revenue outlook. U.S. stock markets ended June on a mixed note. The Dow was up 2.6%, while the S&P 500 and the Nasdaq Composite fell 1.5% and 3.3%, respectively. Soaring crude oil prices due to the war between the U.S.-Israel joint forces and Iran, sticky inflation and serious concerns about the sustainability of highly overvalued artificial intelligence (AI) trade dented investors' sentiment to some extent.

However, as the Middle-East geopolitical conflicts cool down and crude oil prices return to normalcy, the fear of a surge in the inflation rate has evaporated. Moreover, weak job data for June raised hope that the Fed may hold the benchmark lending rate steady and will not raise it anytime soon.

At this stage, we have identified five growth stocks that investors should purchase to strengthen their portfolios in July. Growth investors are primarily focused on stocks with aggressive earnings or revenue growth, which should propel prices higher in the future.

The stocks are: Micron Technology Inc. (MU - Free Report) , Seagate Technology Holdings plc (STX - Free Report) , Dell Technologies Inc. (DELL - Free Report) , Palantir Technologies Inc. (PLTR - Free Report) and Ciena Corp. (CIEN - Free Report) . Each of our picks sports a Zacks Rank #1 (Strong Buy) and has a Growth Score of A. You can see the complete list of today’s Zacks #1 Rank stocks here.

The chart below shows the price performance of our five picks in the past three months.

Image Source: Zacks Investment Research

Micron Technology Inc.Micron has been benefiting tremendously from the enormous application of AI in day-to-day life, which has pushed up the demand for memory chips. The four major hyperscalers raised their AI capital expenditure budget to $750 billion for 2026. This figure is set to cross $1 trillion next year and is likely to rise further beyond 2027. 

This has resulted in more AI semiconductor sales, implying the need for multiple AI memory chips to operate. Flash memory technologies like DRAM and NAND are used in AI chips, enabling them to perform optimally. 

This has pushed up the demand for AI-enabled memory chips. In their last earnings reports, all four major hyperscalers highlighted a shortage of memory and storage chips, resulting in soaring prices of these products. As a result, MU benefits significantly. 

Micron has meaningful exposure to AI, cloud data centers, industrial IoT and autonomous vehicles, all of which require increasingly advanced memory solutions. As AI adoption accelerates, demand for DRAM and NAND products continues to rise. 

MU has invested heavily in next-generation memory technologies, positioning itself to meet the growing performance and efficiency requirements of AI systems. A particularly important growth driver is high-bandwidth memory (“HBM”), which has become essential for advanced AI workloads. Micron Technology’s HBM3E and HBM4 products are seeing exceptionally strong demand because they offer the speed and efficiency required by modern AI systems.

MU’s position in the AI ecosystem continues to strengthen. NVIDIA identified Micron as a key HBM supplier for its GeForce RTX 50 Blackwell GPUs, reinforcing its importance within the AI supply chain. Demand for HBM4 is also benefiting from next-generation AI infrastructure deployments, including NVIDIA’s Vera Rubin platform. 

Micron has an expected revenue and earnings growth rate of more than 100% each for the current year (ending August 2026). The Zacks Consensus Estimate for the current year’s earnings has improved 16.3% in the last seven days.

Seagate Technology Holdings plcSeagate Technology has been benefiting from AI-led storage demand, a robust technology roadmap anchored in Mozaic and HAMR and disciplined execution focused on converting demand into profitable growth and long-term value creation. 

STX highlighted that the company is entering a “new era of structural growth” driven by strong AI-led demand, the rising adoption of Mozaic products and disciplined execution focused on expanding margins, cash flow and long-term value.

HDDs remain significantly more cost-effective for bulk storage—especially critical in hyperscale data centers supporting AI infrastructure. Seagate is well-positioned to capture this expanding opportunity through a technology strategy focused on increasing areal density rather than unit volumes, enabling a more capital- and manufacturing-efficient path to scale while improving cost and power efficiency per terabyte. 

This supports STX’s target of mid-20% exabyte growth. Its Mozaic 4+ platform, a second-generation HAMR product, delivers up to 44TB per drive — more than 30% higher capacity than earlier versions — achieved with minimal changes to materials, while integrating advanced laser and photonics technology for precision manufacturing at scale. 

Seagate Technology has an expected revenue and earnings growth rate of 38% and 85.6%, respectively, for the current year (ending June 2027). The Zacks Consensus Estimate for the current year’s earnings has improved 5.2% in the last 30 days.

Dell Technologies Inc.Dell Technologies is benefiting from strong demand for AI-optimized servers driven by the ongoing digital transformation and heightened interest in generative AI applications. Its PowerEdge XE9680 AI-optimized server is much in demand. 

DELL’s advanced AI-optimized servers, including the PowerEdge XE9780 and 9780L platforms supporting up to 256 NVIDIA HGX B300 GPUs per rack, the XE9712 with NVIDIA GB300 NVL72, and the XE7745 supporting NVIDIA RTX Pro 6000 Blackwell GPUs, are noteworthy. 

In fiscal fourth-quarter 2026, DELL launched the PowerEdge XE9712 supporting NVIDIA's NVL72 GB200. It launched the Dell Infrastructure Rack Sobel system, IR7000 and 5000 in both 21-inch and 19-inch versions, providing up to 96 GPUs in a rack and 786 GPUs in a scalable unit. The strong demand trend bodes well for the company’s long-term prospects.

Dell Technology has an expected revenue and earnings growth rate of 50.2% and 82.2%, for the current year (ending January 2027). The Zacks Consensus Estimate for the current year’s earnings has improved 0.6% over the last 30 days. 

Palantir Technologies Inc.Palantir Technologies’ AI strategy is comprehensive, combining its proprietary Foundry and Gotham platforms with a solid plan to promote AI adoption across both government and commercial sectors. 

PLTR’s AI Platform is the backbone of these capabilities, enabling organizations to process large datasets and derive real-time insights. This is especially valuable in sectors requiring extensive data integration, such as defense, healthcare, finance and intelligence, where operational efficiency and decision-making speed are critical. 

In the government sector, Palantir is aligning its AI strategy with U.S. defense priorities. Its work in high-profile initiatives, such as the Department of Defense’s Open DAGIR project, highlights its ability to modernize military operations through AI-driven solutions where data interoperability and real-time decision-making capabilities are imperative. These capabilities solidify PLTR’s position as a key player in the defense sector. 

In the commercial space, Palantir’s AIP boot camps — providing hands-on experience to over 1,000 companies — have proven instrumental in customer acquisition. Boot camps showcase the platform’s capabilities and demonstrate its adaptability across logistics, manufacturing, and supply-chain management. PLTR’s core customer base comprises businesses seeking tailored AI/ML services, particularly large government and corporate clients willing to invest heavily in its systems. 

Palantir has an expected revenue and earnings growth rate of 71.9% and 96%, respectively, for the current year. The Zacks Consensus Estimate for the current year’s earnings has improved 9.7% over the last 60 days. 

Ciena Corp.Ciena is well poised to benefit from AI-led demand for optical networking across cloud and service providers and a growing backlog despite ongoing supply woes. Expanding bandwidth needs, rising data center interconnect activity, and solid uptake of coherent optical technologies bode well. 

Ciena's revenues are primarily generated from packet optical transport, switching products, integrated networks and software platforms. CIEN continues to diversify its footprint in data center connectivity and AI networking infrastructure. Management reported new hyperscaler wins for coherent modules, additional DCOM customer engagements and continued demand for 400G and 800G pluggables.

Strong traction in Hyper-Rail, DCOM and coherent modules reinforces CIEN’s position in high-speed connectivity and broadens its opportunities across WAN and data center environments. CIEN is also driving operating leverage through higher margins, earnings and cash flow. CIEN raised its fiscal 2026 revenue outlook to $6.3 billion, up 32% at the midpoint.

Ciena has an expected revenue and earnings growth rate of 32.4% and more than 100%, respectively, for the current year (ending October 2026). The Zacks Consensus Estimate for the current year’s earnings has improved 5.3% in the last 30 days.

Ciena (CIEN +2.41%) could be one of the most intriguing hidden AI infrastructure stories in the market. As AI clusters spread across larger data centers, the network itself may become the bottleneck. That creates a powerful setup for Ciena, but after a massive stock run, investors still have to weigh the upside against valuation risk.

Stock prices used were the market prices of June 19, 2026. The video was published on June 30, 2026.

Rick Orford has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Ciena. The Motley Fool has a disclosure policy. Rick Orford is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through their link, they will earn some extra money that supports their channel. Their opinions remain their own and are unaffected by The Motley Fool.

Three semi stocks, a networking stalwart and a quantum computing name set to receive the Tradr treatment

, /PRNewswire/ -- Tradr ETFs, a provider of ETFs designed for sophisticated investors and professional traders, announced that it expects to launch five single stock leveraged ETFs on Wednesday, July 1. The Cboe-listed funds seek to deliver two times (200%) the daily performance of a specific underlying stock.

Expected Tradr launches:

Tradr 2X Long CIEN Daily ETF (Cboe: CIEX) – tracks Ciena Corporation (NYSE: CIEN) Tradr 2X Long QNT Daily ETF (Cboe: QNTU) – tracks Quantinuum Inc. (Nasdaq: QNT) Tradr 2X Long RMBS Daily ETF (Cboe: RMBX) – tracks Rambus Inc. (Nasdaq: RMBS) Tradr 2X Long TSEM Daily ETF (Cboe: TSEU) – tracks Tower Semiconductor Ltd. (Nasdaq: TSEM) Tradr 2X Long TTMI Daily ETF (Cboe: TTMX) – tracks TTM Technologies, Inc. (Nasdaq: TTMI) For detailed information on Tradr ETFs and the significant risks involved with leveraged ETFs, please visit www.tradretfs.com.

About Tradr ETFs
Tradr ETFs are designed for sophisticated investors and professional traders who are looking to express high conviction investment views. The strategies include leveraged and inverse ETFs that seek short or long exposure to actively traded stocks and ETFs.

IMPORTANT RISK INFORMATION

Tradr ETFs are for sophisticated investors and professional traders with high conviction views and are very different from most other ETFs. The Funds are intended to be used as short-term trading vehicles and pursue leveraged investment objectives, which means they are riskier than alternatives that do not use leverage because the Funds magnify the performance of their underlying security. The volatility of the underlying security may affect a Fund's return as much as, or more than, the return of the underlying security.

Investors in the fund should: (a) understand the risks associated with the use of leverage; (b) understand the consequences of seeking inverse and leveraged investment results; (c) for short ETFs, understand the risk of shorting; (d) intend to actively monitor and manage their investment. Fund performance will likely be significantly different than the benchmark over periods longer than the specified reset period and the performance may trend in the opposite direction than its benchmark over periods other than that period.

Leverage increases the risk of a total loss of an investor's investment, may increase the volatility of the Funds, and may magnify any differences between the performance of the Funds and their reference security. The Funds seek leveraged investment results for a specific period (daily, monthly or quarterly). The exact exposure of an investment in the Fund intra-period will depend upon the movement of the reference security from the end of the prior period until the time of investment by the investor.

The Fund will not attempt to position its portfolio to ensure it does not gain or lose more than a maximum percentage of its net asset value on a given trading day. As a consequence, investors in a Fund that seeks two times daily performance would lose all of their money if the Fund's underlying security moves more than 50% in a direction adverse to the Fund on a given trading day.

ETFs involve risk including possible loss of the full principal value. There is no assurance that the Fund will achieve its investment objective. Principal risks and other important risks may be found in the prospectus. Past performance does not guarantee future results.

ETF shares are bought and sold at market price (not NAV) and are not individually redeemed from the ETF. There can be no guarantee that an active trading market for ETF shares will develop or be maintained, or that their listing will continue or remain unchanged. Buying or selling ETF shares on an exchange may require the payment of brokerage commissions and frequent trading may incur brokerage costs that detract significantly from investment returns.

Investors should carefully consider the investment objectives, risks, charges and expenses of the Funds. This and other important information about the Fund is contained in the Prospectus, which can be obtained by visiting www.tradretfs.com. The Prospectus should be read carefully before investing.

Distributed by ALPS Distributors, Inc, which is not affiliated with AXS Investments or its Tradr ETFs. AXI000977

SOURCE Tradr ETFs

Also from this source

BERLIN--(BUSINESS WIRE)--Telefónica Deutschland and Blue Planet, a division of Ciena (NYSE: CIEN), have successfully completed a joint proof of concept (PoC) exploring the use of AI agents to accelerate the design and fulfillment of advanced 5G network slicing services. The initiative demonstrates how agentic AI can help communications service providers address the growing operational complexity of next‑generation services while significantly reducing service design time. As part of Telefónica.

HANOVER, Md.--(BUSINESS WIRE)--Blue Planet, a division of Ciena (NYSE: CIEN), is closing the governance gap in network operations by unveiling Blue Planet Configuration and Change Management (CCM), unifying device configuration, change, and lifecycle management across multi-vendor networks. Backed by Blue Planet’s deep Operations Support System (OSS) expertise, CCM replaces fragmented tools and manual processes with AI-driven workflows to reduce risk, prevent outages, and strengthen the foundation for autonomous networking.

As networks grow more complex, configuration errors and unmanaged changes remain a leading cause of outages. Service providers must manage simultaneous manual and AI-driven automated changes across multi-vendor environments, often with limited visibility and fragmented control. CCM provides a real-time view of network state and activity, enabling service providers to safely scale automation and AI-driven operations. With embedded governance, it closes the automation loop by validating and tracking every change, reducing operational risk and strengthening network reliability.

"All network change carries an element of risk, not only in designing the right change to make, but also in executing the change and ultimately validating it correctly," said Robert Curran, Consulting Analyst, Appledore Research. "Increasing autonomy in network operations depends on progressively building trust in the agents and systems empowered to change the network. Auditability and explainability are essential elements in the autonomous networks vision."

“The industry is moving toward AI-driven autonomous networks, but autonomy requires governance, control, and traceability of network changes,” said Joe Cumello, Senior Vice President and General Manager, Blue Planet. “Designed with input from customers, Blue Planet Configuration and Change Management provides a unified governance layer for network changes. It helps service providers realize the operational benefits of AI-driven automation with trust and confidence.”

Key capabilities of CCM include:

Centralized configuration and change visibility and governance across multi-vendor networks Automated configuration drift detection and policy-driven compliance validation Software image and device lifecycle management, with automated workflows, from upgrades to end-of-life AI-enabled risk assessment, compliance monitoring, and pre-change impact analysis CCM embeds governance directly into network operations, with pre-built AI agents for drift detection, compliance validation, and change risk assessment to reduce manual review cycles and improve operational efficiency. Integrated across the Blue Planet portfolio, CCM connects inventory, orchestration, and assurance to ensure every change is informed, executed, and monitored in context. The result is a more controlled approach to network change, helping operators improve outcomes today while accelerating the shift to autonomous operations.

For more information about CCM, see the following blog post.

About Blue Planet

Blue Planet empowers communications service providers (CSPs) to be more software-driven, digital businesses with the industry’s first truly cloud-native operations support systems (OSS) platform. The Blue Planet intelligent automation portfolio helps CSPs automate network and service operations to speed the introduction of new services across any network domain or vendor. A division of Ciena and a key provider for many of the world’s leading CSPs, Blue Planet brings unparalleled expertise in accelerating digital transformation. For updates on Blue Planet, visit http://www.blueplanet.com/.

Note to Ciena Investors

You are encouraged to review the Investors section of our website, where we routinely post press releases, SEC filings, recent news, financial results, and other announcements. From time to time we exclusively post material information to this website along with other disclosure channels that we use. This press release contains certain forward-looking statements that are based on our current expectations, forecasts, information and assumptions. These statements involve inherent risks and uncertainties. Actual results or outcomes may differ materially from those stated or implied, because of risks and uncertainties, including those detailed in our most recent annual and quarterly reports filed with the SEC. Forward-looking statements include statements regarding our expectations, beliefs, intentions or strategies and can be identified by words such as "anticipate," "believe," "could," "estimate," "expect," "intend," "may," "should," "will," and "would" or similar words. Ciena assumes no obligation to update the information included in this press release, whether as a result of new information, future events or otherwise.

Listen to the audio version of this article (generated by AI).

Editor’s Note: Most people who lived through the dot-com boom remember what happened when it ended. Louis Navellier remembers what happened while it was running — and he’s seeing the same patterns emerge in AI right now.

He’s been refining his stock-selection system for decades. And what he’s built with TradeSmith over the past year may be the most significant upgrade to his system in nearly 50 years. He explained exactly how it works — and what he’s doing with it — in a free event last week. You can catch the replay here before midnight tonight.

Read on to see why he believes most investors are already in the right trend — and still at risk of walking away with the wrong result…

“How much would it cost me to buy you?”

That’s how Cisco Systems Inc. (CSCO) CEO John Chambers greeted the founder of telecom startup Cerent Corp. in 1999.

Not his company. You.

Cerent had only about $10 million in annual sales, but Cisco paid roughly $6.9 billion in stock because Chambers believed the technology and that founder were critical to the internet buildout.

At the time, Chambers had a simple solution whenever he found a bottleneck: 

Buy it.

By the late 1990s, the internet was growing so fast that Cisco couldn’t build products quickly enough to keep up. So it started buying competitors, technologies, and choke points throughout Silicon Valley.

That strategy helped make Cisco the most valuable company in the world for a brief moment in March 2000.

Most people remember what happened next. I remember what came before.

The Last Time Capital Moved This Fast The internet buildout was real. Networks got built, servers got installed, and infrastructure spending exploded. Investors who understood that trend made fortunes.

I’ve been thinking about Cisco lately because we’re watching the same movie again.

The AI buildout is real. First-quarter S&P 500 earnings grew nearly 29% from a year ago — more than double what analysts expected. Analysts keep revising estimates higher. The spending behind this is staggering and it’s accelerating.

That’s what I want to talk about today. 

In this piece, I’ll show you four stocks prospering from the AI buildout beyond Nvidia and Micron… 

Why I believe this infrastructure boom is still early… 

And why the hardest part of the AI trade isn’t finding the right companies. It’s staying with them.

Everybody Wants the Next Nvidia. That’s Exactly the Wrong Way to Think About This. I’ve been investing through major technology shifts for nearly five decades. I was using computers to analyze stocks in the 1970s, long before it became common on Wall Street. Over the years, my quantitative systems helped identify winning stocks such as Apple Inc. (AAPL) and Nike Inc. (NKE) — and Nvidia Corp. (NVDA) and Microsoft Corp. (MSFT) — long before they became household names.

In the late 1990s, everybody wanted the next internet stock. Today, everybody wants the next AI stock.

That’s understandable. Nvidia has become one of the most successful investments in modern market history.

But investors often become so focused on one company that they miss the broader trend unfolding around it.

Artificial intelligence is no longer just a Nvidia story. There are a lot more AI-related stocks prospering now. Memory companies, networking companies, power-generation companies (we used to call those “utilities”)… all are benefiting.

Why? Because AI requires an enormous amount of infrastructure.

The average investor sees ChatGPT or Claude on their browser and thinks software. I see hundreds of billions of dollars flowing into an entirely new computing architecture.

What the Earnings Numbers Are Actually Saying About the AI Buildout To appreciate the scale, one proposed AI data-center project in Utah would cover nearly three times the area of Manhattan. Similar projects are being planned across the country. These facilities will require thousands upon thousands of chips, servers, and networking systems.

That’s why companies like Micron Technology Inc. (MU) have become so important.

Most investors still think of it as a cyclical memory-chip company from the middle of the country. But on May 26, Micron became Boise, Idaho’s first trillion-dollar company. 

Wall Street sees something different. Sales are expected to grow more than 250%. Earnings are expected to rise more than 900%. 

Those aren’t normal numbers. They’re what happens when a major technological shift is underway and demand overwhelms supply. Micron has reportedly sold out much of its high-bandwidth memory production under long-term contracts, and analysts expect supply shortages to persist for years.

It’s also why I want you to pay attention to companies like Dell Technologies Inc. (DELL), Hewlett Packard Enterprise Co. (HPE), Ciena Corp. (CIEN)… and, yes, Cisco. These aren’t the first names investors think about when they hear “AI,” but they’re increasingly prospering from the buildout.

The opportunity is getting bigger. Not smaller. When a major investment theme spreads beyond a handful of stocks and starts lifting entire industries, it usually means the trend is becoming more durable and more profitable — not less.

That’s what we’re seeing right now.

The Real Risk to Your AI Infrastructure Stocks Isn’t What You Think I focus on a combination of fundamental and quantitative measures — sales growth, earnings growth, analyst revisions, institutional buying pressure. That’s how my Stock Grader system has identified winning stocks for well over 40 years.

And right now, those indicators continue to point in the right direction. I think many of the best AI and data-center stocks still have substantial upside ahead of them before the year is over.

But being bullish doesn’t mean being complacent.

The spending behind this boom is staggering. Microsoft, Amazon.com Inc. (AMZN), Alphabet Inc. (GOOG), and Meta Platforms Inc. (META) are expected to spend roughly $700 billion on AI infrastructure this year alone. That’s data centers, networking equipment, chips, power generation, and everything needed to support the next generation of AI applications. 

Those aren’t startup projections. They’re some of the largest and most successful companies in the world committing enormous capital because they believe AI will reshape the global economy.

The biggest risk facing investors right now isn’t that AI suddenly becomes less popular. It’s not that companies stop spending on data centers. And it’s not that earnings suddenly collapse.

The bigger risk is that investors get shaken out of fundamentally superior stocks during perfectly normal periods of volatility.

I’ve seen it happen throughout my career. A stock pulls back. The headlines get scary. Investors become nervous. They sell. Six months later, the stock is substantially higher.

The late 1990s were full of those moments. Even the biggest winners experienced sharp pullbacks from time to time. Investors who stayed focused on the long-term trend were rewarded. Investors who reacted emotionally often weren’t.

I think we’re approaching a similar period now. The market remains healthy, but summer can get bumpy. Trading volume thins out. Volatility increases. Short sellers become more aggressive.

That’s normal.

The Hard Part of the AI Infrastructure Trade Is Staying With It Through Volatility And it’s one reason I’ve been spending so much time with Keith Kaplan and the team at TradeSmith. Over the past year, Keith and I have been exploring a new AI-enhanced approach that combines my Stock Grader system with TradeSmith’s pattern-recognition technology. What interested me wasn’t the technology itself. It was the results.

More importantly, it showed how investors can stay with opportunities like Dell, HPE, Ciena, and Cisco when volatility inevitably shows up. Because the hard part isn’t finding promising AI stocks anymore. The trend is staring us in the face. The hard part is staying invested when the headlines turn negative and investors start questioning the same companies they loved a month earlier.

That’s exactly what Keith and I discussed at our free event last week. We showed investors how we’re using AI to become more tactical and amplify the gains you can make with the stocks I recommend. 

You can catch the replay of that event right now and get access to a “lite” version of this new system.

Whether it’s Micron, Dell, HPE, Ciena, Cisco — or another company prospering from the AI buildout — the opportunity is still much bigger than most investors realize.

The challenge isn’t finding the trend.

The challenge is staying with it.

On June 15, 2026, Ciena Corp CIEN shares rose 3.9% today, reaching a current price of $463.41. Despite today's positive move, the stock has faced volatility, with a 52-week range between $71.72 and $637.51.

GF Value™ verdict: Current price is $463.41, indicating a 384.1% overvaluation against a GF Value™ of $95.73.GF Score™ of 72/100 suggests the company is above average in terms of financial health and growth potential.Notable signal: Insiders sold $27.2 million worth of stock in the last 3 months, indicating a lack of confidence in the current valuation. Is CIEN Overvalued or Undervalued? Ciena Corp's current price of $463.41 is significantly higher than the GF Value™ of $95.73, suggesting that the stock is overvalued by 384.1%. This substantial gap indicates a lack of margin of safety for potential investors. The GF Valuation label classifies CIEN as "Significantly Overvalued," which poses risks for those considering an investment based on current prices. In a scenario where the market corrects itself, investors may face considerable losses if the stock price moves closer to its intrinsic value.

GF Value™ is GuruFocus' proprietary measure of intrinsic value, calculated from historical trading multiples, past business growth, and future performance estimates. As it stands, the steep overvaluation raises concerns about the sustainability of Ciena’s current price, especially in light of recent insider selling activity.

How Does CIEN's Valuation Compare to Its History? Metric Current Historical P/E (TTM) 154.5x 41.4x Forward P/E 70.5x N/A CIEN's current P/E ratio of 154.5x is 273% above its 5-year median P/E of 41.4x, indicating that the stock is trading well above its historical valuation levels. This analysis aligns with the GF Value™ verdict, reinforcing the conclusion that the stock is significantly overvalued relative to its historical performance.

What Does CIEN's GF Score™ Tell Us? Metric Rating GF Score™ 72/100 Financial Strength 8/10 Profitability 7/10 Growth 9/10 Valuation 1/10 Momentum 3/10 The GF Score™ of 72/100 indicates that Ciena Corp shows above-average strength across several key performance metrics. Its strongest area is growth, with a score of 9/10, reflecting robust potential for future earnings. However, the weakest area is valuation, scoring only 1/10, which corroborates the findings of significant overvaluation as indicated by the GF Value™. The financial strength and profitability ranks are solid, suggesting that while the company is fundamentally strong, its current stock price does not align with its intrinsic value.

What Are Insiders Doing with CIEN Stock? In the last three months, insiders at Ciena Corp have sold $27.2 million worth of shares without any buying activity reported. This pattern often raises red flags for potential investors, as it may suggest that those closest to the company lack confidence in the stock's future performance. The absence of insider buying further emphasizes the concern regarding the current valuation and potential overextension in the market.

What This Means for Investors Based on the GF Value™ analysis, Ciena Corp CIEN is considered overvalued at its current price of $463.41. With a significant gap between the market price and the estimated intrinsic value, potential investors should be cautious about entering positions in this stock until further corrective actions are observed.

For the complete analysis, visit the Ciena Corp CIEN stock page. You can also explore the GF Value™ page for detailed valuation methodology, or use the GuruFocus Stock Screener to find similar opportunities.

Frequently Asked Questions What is CIEN's GF Score™?

CIEN has a GF Score™ of 72/100, indicating above-average performance in key financial metrics and growth potential.

Is CIEN overvalued or undervalued?

CIEN is currently overvalued, with a GF Value™ of $95.73 compared to its market price of $463.41, reflecting a significant discrepancy.

What is CIEN's P/E ratio?

CIEN's P/E ratio is 154.5x, which is substantially higher than its 5-year median P/E of 41.4x, indicating a significant overvaluation relative to its historical performance.

This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].

Shares of Ciena CIEN fell sharply on Thursday even after the networking equipment maker reported fiscal second-quarter earnings and revenue that exceeded Wall Street expectations.

Ciena stock dropped more than 19% in early trading, putting the shares on track for their biggest one-day percentage decline since Jan. 27, 2025, according to Dow Jones Market Data.

The decline came despite strong financial results and higher full-year guidance, as investors appeared to have been expecting an even stronger performance.

UBS analyst David Vogt said in a note that the market had been pricing in a "more material beat and raise" than what Ciena delivered.

At the time of writing, Ciena shares were down 14.61%.

For its fiscal second quarter, Ciena reported adjusted earnings of $1.64 per share, up from 42 cents a year earlier and ahead of the FactSet consensus estimate of $1.46.

Revenue increased 40% year over year to $1.57 billion, exceeding analysts' expectations of $1.51 billion.

The company also raised its fiscal 2026 revenue outlook to a range of $6.2 billion to $6.4 billion, compared with its previous guidance of $5.9 billion to $6.3 billion.

Analysts had been forecasting revenue of $6.18 billion.

For the fiscal third quarter, Ciena projected revenue between $1.58 billion and $1.68 billion, also above Wall Street expectations of $1.56 billion.

Despite the better-than-expected figures, investors appeared to focus on whether the results fully justified the stock's substantial gains over the past year.

Through Wednesday's close, Ciena shares had climbed 165% in 2026, while fellow optical suppliers Lumentum, Coherent and Corning had gained 143%, 114% and 121%, respectively.

The optical networking sector has been one of the biggest beneficiaries of the artificial intelligence investment cycle, as hyperscale data center operators expand infrastructure to support increasingly powerful AI models.

Some investors view optical and networking components as the next major bottleneck in the AI buildout, helping drive significant gains across the sector.

Earlier this week, enthusiasm for the group received another boost after Nvidia Chief Executive Officer Jensen Huang reportedly identified Marvell Technology as the next "trillion-dollar company."

Ciena Chief Executive Officer Gary Smith said the company remains well-positioned to benefit from the long-term expansion of AI-related networking demand. 

"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," Smith said in a press release.

He was referring to wide-area networks, which connect data infrastructure across large geographic areas.

While Ciena's results pointed to continued strong demand, the stock's reaction underscored the high expectations built into AI-related infrastructure companies.

The company's improved revenue guidance represented a relatively modest increase from its previous forecast, even though it exceeded analyst estimates.

The broader optical networking sector also came under pressure during Thursday's session, extending a pullback after a strong rally earlier in the week.

For investors, the market reaction suggested that solid earnings growth alone may no longer be enough to support valuations, with companies increasingly needing to deliver results that significantly exceed already elevated expectations.

Ciena (CIEN +1.01%) stock is rapidly moving lower in Thursday's trading. The company's share price was down 14.9% as of 2 p.m. ET. Meanwhile, the S&P 500 was up 0.5%, and the Nasdaq Composite was up 0.2%.

Before the market opened this morning, Ciena published results for the second quarter of its 2026 fiscal year -- which ended May 2. The networking technologies specialist posted sales and earnings that beat Wall Street's expectations and also raised its full-year guidance, but its stock is still losing ground.

Image source: Getty Images.

Ciena actually posted strong quarterly results Ciena recorded non-GAAP (adjusted) earnings of $1.64 per share on sales of $1.57 billion in fiscal Q2. Adjusted earnings beat the average analyst forecast by $0.19 per share, and sales came in $70 million higher than the average forecast. Revenue was up roughly 38.9% year over year in the period, and adjusted earnings per share were up 290% compared to the prior-year period.

Today's Change

(

1.01

%) $

4.48

Current Price

$

449.70

Ciena raised its full-year guidance, but that wasn't enough Along with its fiscal Q2 report, Ciena raised its midpoint full-year sales target to roughly $6.3 billion and its adjusted gross margin for the year to between 44.5% and 45%. Previously, the company had guided for sales between $5.9 billion and $6.3 billion and an adjusted gross margin between 43.5% and 44.5%.

While the company posted encouraging fiscal Q2 results and forward guidance, the company's share price is falling today due to the market having a negative reaction to Broadcom's recent quarterly results. Broadcom also posted a strong performance, but it wasn't enough for the market -- and some investors are wondering whether the artificial intelligence trade is losing steam.

Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Broadcom and Ciena. The Motley Fool has a disclosure policy.

HANOVER, Md.--(BUSINESS WIRE)--Ciena® Corporation (NYSE: CIEN) (the “Company”), the global leader in high-speed connectivity, today announced that it intends to offer $2.0 billion aggregate principal amount of convertible senior notes due 2031 (the “Notes”) in a private offering (the “Offering”). The Notes will be fully and unconditionally guaranteed, on a senior unsecured basis, by each wholly-owned domestic subsidiary of Ciena that currently or in the future guarantees its 4.00% senior notes due 2030 or any refinancing of such notes (the “guarantees”). The Company also intends to grant the initial purchasers of the Notes an option to purchase up to an additional $300.0 million aggregate principal amount of the Notes within a 13-day period beginning on, and including, the initial closing date of the Offering.

The Company intends to use a portion of the net proceeds from the Offering (i) to pay the net cost of the convertible note hedge transactions described below (after such cost is partially offset by the proceeds of the Company’s entry into the warrant transactions described below) and (ii) to repurchase up to $140 million of shares of the Company’s common stock pursuant to its existing stock repurchase program concurrently with the pricing of the Offering in privately negotiated transactions effected with or through one of the initial purchasers or its affiliate. The Company intends to use approximately $1.14 billion of the remaining net proceeds from the Offering to repay amounts outstanding under its term loan under its existing credit facility and pay related fees and expenses. The Company intends to use the remainder of the net proceeds for general corporate purposes, including investments to enhance supply chain capacity.

Any concurrent repurchases of shares of the Company’s common stock described above may result in the Company’s common stock trading at prices that are higher than would be the case in the absence of these repurchases, which may result in a higher initial conversion price for the Notes to be offered. In addition, any repurchases of our common stock following the Offering could affect the trading price of the Notes and, if conducted during an observation period for the conversion of any Notes, could affect the number of shares and value of the consideration that is due upon such conversion. Potential hedging activity in connection with the convertible note hedge and warrant transactions described below may also affect the market price of the Company’s common stock or the Notes, holders’ ability to convert the Notes or the number of shares and value of the consideration to be received upon conversion of the Notes as described below.

The Notes will be senior unsecured obligations of the Company. The Notes will mature on September 15, 2031, unless earlier converted, redeemed or repurchased. Prior to June 15, 2031, the Notes will be convertible only upon satisfaction of certain conditions and during certain periods, and thereafter, the Notes will be convertible at any time until the close of business on the second scheduled trading day immediately preceding the maturity date. The Company will satisfy any conversion by paying cash up to the aggregate principal amount of the Notes to be converted and by paying or delivering, as the case may be, cash, shares of the Company’s common stock or a combination of cash and shares of the Company’s common stock, at its election, in respect of the remainder, if any, of its conversion obligation in excess of the aggregate principal amount of the Notes being converted. The Company may not redeem the Notes prior to September 20, 2029, except in the event of a cleanup redemption (as defined below). The Notes will be redeemable, in whole or in part, at the Company’s option on or after September 20, 2029, upon the satisfaction of certain conditions and subject to certain limitations. In addition, the Notes will be redeemable at any time if the aggregate principal amount of the Notes that remains outstanding is less than 10% of the aggregate principal amount of the Notes initially issued in the Offering and certain other conditions are satisfied (a “cleanup redemption”).

In connection with the pricing of the Notes, the Company expects to enter into convertible note hedge transactions with one or more of the initial purchasers of the Notes or affiliates thereof and/or other financial institutions (the “option counterparties”). These transactions are expected to cover, subject to anti-dilution adjustments substantially similar to those applicable to the Notes, the same number of shares of the Company’s common stock that will initially underlie the Notes, and are expected generally to reduce any dilutive effect on the Company’s common stock of the Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of converted Notes, as the case may be. Concurrently with entry into the convertible note hedge transactions, the Company also expects to enter into warrant transactions with the option counterparties relating to the same number of shares of the Company’s common stock, subject to customary anti-dilution adjustments. The warrant transactions could separately have a dilutive effect on the Company’s common stock to the extent that the market price per share of the Company’s common stock exceeds the strike price of the warrants.

If the initial purchasers exercise their option to purchase additional Notes, the Company expects to enter into additional convertible note hedge transactions and additional warrant transactions with the option counterparties.

The Company has been advised by the option counterparties that, in connection with establishing their initial hedges of the convertible note hedge and warrant transactions, the option counterparties or their respective affiliates expect to enter into various derivative transactions with respect to the Company’s common stock and/or purchase shares of the Company’s common stock concurrently with or shortly after the pricing of the Notes. This activity could increase (or reduce the size of any decrease in) the market price of the Company’s common stock and/or the Notes at that time. The option counterparties or their respective affiliates may also modify their hedge positions by entering into or unwinding various derivatives with respect to the Company’s common stock and/or purchasing or selling the Company’s common stock or other securities of the Company in secondary market transactions following the pricing of the Notes and prior to the maturity of the Notes (and are likely to do so in connection with any conversion of the Notes, any redemption of Notes, any repurchase of the Notes upon a fundamental change or any other repurchase of Notes if the Company elects to terminate a corresponding portion of the convertible note hedge transactions). This activity could also cause or avoid an increase or a decrease in the market price of the Company’s common stock and/or the Notes, which could affect the ability of holders to convert the Notes and, to the extent the activity occurs during any observation period related to a conversion of the Notes, it could affect the number of shares and value of the consideration that noteholders will receive upon conversion of the Notes.

The Notes and guarantees are being offered only to persons reasonably believed to be qualified institutional buyers in reliance on Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”). This release shall not constitute an offer to sell or the solicitation of an offer to buy the Notes or guarantees. Any offers of the Notes and guarantees are being made only by means of a private offering memorandum. The Notes, guarantees, and any common stock issuable upon conversion have not been registered under the Securities Act or the securities laws of any other jurisdiction and may not be offered or sold in the United States without registration or an applicable exemption from registration requirements.

About Ciena

Ciena is the global leader in high-speed connectivity. We build the world’s most advanced networks to support exponential growth in bandwidth demand. By harnessing the power of our networking systems, interconnects, automation software, and services, Ciena revolutionizes data transmission and network management. With unparalleled expertise and innovation, we empower our customers, partners, and communities to thrive in the AI era.

Note to Ciena Investors

This press release contains certain forward-looking statements that are based on our current expectations, forecasts, information and assumptions. These statements involve inherent risks and uncertainties. Actual results or outcomes may differ materially from those stated or implied, because of risks and uncertainties, including those detailed in our most recent annual and quarterly reports filed with the SEC. Forward-looking statements include statements regarding our expectations, beliefs, intentions or strategies and can be identified by words such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “should,” “will,” and “would” or similar words. Ciena assumes no obligation to update the information included in this press release, whether as a result of new information, future events or otherwise.

These forward-looking statements include, among others, whether Ciena will offer the Notes or consummate the Offering, the final terms of the Offering, prevailing market conditions, the anticipated principal amount of the Notes, which could differ based upon market conditions, the anticipated use of the net proceeds from the Offering, which could change as a result of market conditions or for other reasons, whether the convertible note hedge and warrant transactions described above will become effective, the effects of entering into these transactions, and the impact of general economic, industry or political conditions in the United States or internationally.

Ciena (CIEN +1.01%) had a tough Monday on the stock exchange. The company is going to the investor well to borrow a significant amount of capital, and investors expressed their displeasure by trading out of the stock. This left it with a more than 4% decline that trading session.

A $2 billion development Ciena announced early that morning that it was floating a $2 billion issue of senior convertible notes in a private offering. The company added that it intends to grant the initial purchasers of those notes -- which, if not converted, will mature on Sept. 15, 2031 -- a 13-day option to collectively buy up to an additional $300 million worth of the securities.

Image source: Getty Images.

In its press release on the issue, Ciena said it intends to use the net proceeds to pay the net cost of certain convertible note hedge transactions, and to repurchase $140 million worth of its common stock. It also aims to utilize $1.14 billion of the proceeds to retire debt and to pay related expenses and fees. Finally, it said it would use what's left for "general corporate purposes"; these include investments in its supply chain.

Ciena added that, before June 15, 2031, the notes will only be convertible under specific conditions and at certain periods. Thereafter, they can be converted at any time up to two trading days before the maturity date. As of this writing, the company had not yet finalized the conversion rate and premium.

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This felt like an overreaction Investors weren't worried about the $2 billion of fresh debt and/or equity; their concern was about the warrants Ciena is issuing to enter into hedging transactions with the notes. If the strike price of those warrants is exceeded, share dilution could be considerable.

That's a legitimate fear, but in the long run, I'd be more bullish on Ciena's solid position as an important equipment supplier for the tech industry than on its share count or balance sheet shifts. There remain plenty of reasons to be bullish on this company's future.

Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Ciena. The Motley Fool has a disclosure policy.

Ciena®Corporation (NYSE: CIEN) (the “Company”), the global leader in high-speed connectivity, today announced that it has priced its private offering (the “Offering”) of $2.5 billion aggregate principal amount of 0.00% convertible senior notes due 2031 (the “Notes”). The Notes will be fully and unconditionally guaranteed, on a senior unsecured basis, by each wholly-owned domestic subsidiary of Ciena that currently or in the future guarantees its 4.00% senior notes due 2030 or any refinancing of such notes (the “guarantees”). The size of the Offering was increased from the previously announced $2.0 billion aggregate principal amount of Notes. The Company also granted to the initial purchasers of the Notes an option to purchase up to an additional $375.0 million aggregate principal amount of the Notes within a 13-day period beginning on, and including, the first date on which the Notes are issued. The Offering and the convertible note hedge and warrant transactions described below are expected to close on June 11, 2026, subject to customary closing conditions. The closing of the Offering is not contingent upon the closing of such convertible note hedge and warrant transactions.

The Company intends to use (i) $100.0 million of the net proceeds from the Offering to pay the net cost of the convertible note hedge transactions described below (after such cost is partially offset by the proceeds of the Company’s entry into the warrant transactions described below) and (ii) approximately $140.0 million of the net proceeds to repurchase approximately 0.3 million shares of the Company’s common stock concurrently with the Offering in privately negotiated transactions effected with or through one of the initial purchasers or its affiliate, at a purchase price per share equal to the last reported sale price of $466.67 per share of the Company’s common stock on the New York Stock Exchange (“NYSE”) on June 8, 2026. The Company intends to use approximately $1.14 billion of the remaining net proceeds from the Offering to repay amounts outstanding under its term loan under its existing credit facility and pay related fees and expenses. The Company intends to use the remainder of the net proceeds for general corporate purposes, including investments to enhance supply chain capacity.

The concurrent repurchases of shares of the Company’s common stock described above may result in the Company’s common stock trading at prices that are higher than would be the case in the absence of these repurchases, which may have resulted in a higher initial conversion price for the Notes. In addition, any repurchases of the Company’s common stock following the Offering could affect the trading price of the Notes and, if conducted during an observation period for the conversion of any Notes, could affect the number of shares and value of the consideration that is due upon such conversion. Potential hedging activity in connection with the convertible note hedge and warrant transactions described below may also affect the market price of the Company’s common stock or the Notes, holders’ ability to convert the Notes or the number of shares and value of the consideration to be received upon conversion of the Notes as described below.

The Notes will be senior unsecured obligations of the Company. The Notes will not bear regular interest and the principal amount of the Notes will not accrete. The Notes will mature on September 15, 2031, unless earlier converted, redeemed or repurchased. The initial conversion rate for the Notes is 1.3393 shares of the Company’s common stock per $1,000 principal amount of Notes (equivalent to an initial conversion price of approximately $746.66 per share of the Company’s common stock), which represents a conversion premium of approximately 60.0% percent over the last reported sale price of $466.67 per share of the Company’s common stock on the NYSE on June 8, 2026.

Prior to June 15, 2031, the Notes will be convertible only upon satisfaction of certain conditions and during certain periods, and thereafter, the Notes will be convertible at any time until the close of business on the second scheduled trading day immediately preceding the maturity date. The Company will satisfy any conversion by paying cash up to the aggregate principal amount of the Notes to be converted and by paying or delivering, as the case may be, cash, shares of the Company’s common stock or a combination of cash and shares of the Company’s common stock, at its election, in respect of the remainder, if any, of its conversion obligation in excess of the aggregate principal amount of the Notes being converted. The Company may not redeem the Notes prior to September 20, 2029, except in the event of a cleanup redemption (as defined below). The Notes will be redeemable, in whole or in part, at the Company’s option on or after September 20, 2029, upon the satisfaction of certain conditions and subject to certain limitations. In addition, the Notes will be redeemable at any time if the aggregate principal amount of the Notes that remains outstanding is less than 10% of the aggregate principal amount of the Notes initially issued in the Offering and certain other conditions are satisfied (a “cleanup redemption”).

In connection with the pricing of the Notes, the Company has entered into convertible note hedge transactions with certain of the initial purchasers of the Notes or their respective affiliates and certain other financial institutions (the “option counterparties”). These transactions cover, subject to anti-dilution adjustments substantially similar to those applicable to the Notes, the same number of shares of the Company’s common stock that will initially underlie the Notes, and are expected generally to reduce any dilutive effect on the Company’s common stock of the Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of converted Notes, as the case may be. Concurrently with entry into the convertible note hedge transactions, the Company has also entered into warrant transactions with the option counterparties relating to the same number of shares of the Company’s common stock, subject to customary anti-dilution adjustments. The strike price of the warrant transactions will initially be $1,000.00 per share, which represents an approximate 114.3% premium to the last reported sale price of the Company’s common stock on the NYSE on June 8, 2026. The warrant transactions could separately have a dilutive effect on the Company’s common stock to the extent that the market price per share of the Company’s common stock exceeds the strike price of the warrants.

If the initial purchasers exercise their option to purchase additional Notes, the Company expects to enter into additional convertible note hedge transactions and additional warrant transactions with the option counterparties.

The Company has been advised by the option counterparties that, in connection with establishing their initial hedges of the convertible note hedge and warrant transactions, the option counterparties or their respective affiliates expect to enter into various derivative transactions with respect to the Company's common stock and/or purchase shares of the Company’s common stock concurrently with or shortly after the pricing of the Notes. This activity could increase (or reduce the size of any decrease in) the market price of the Company’s common stock and/or the Notes at that time. The option counterparties or their respective affiliates may also modify their hedge positions by entering into or unwinding various derivatives with respect to the Company’s common stock and/or purchasing or selling the Company’s common stock or other securities of the Company in secondary market transactions following the pricing of the Notes and prior to the maturity of the Notes (and are likely to do so in connection with any conversion of the Notes, any redemption of Notes, any repurchase of the Notes upon a fundamental change or any other repurchase of Notes if the Company elects to terminate a corresponding portion of the convertible note hedge transactions). This activity could also cause or avoid an increase or a decrease in the market price of the Company’s common stock and/or the Notes, which could affect the ability of holders to convert the Notes and, to the extent the activity occurs during any observation period related to a conversion of the Notes, it could affect the number of shares and value of the consideration that noteholders will receive upon conversion of the Notes.

The Notes and the guarantees are being offered only to persons reasonably believed to be qualified institutional buyers in reliance on Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”). This release shall not constitute an offer to sell or the solicitation of an offer to buy the Notes and the guarantees. Any offers of the Notes and the guarantees are being made only by means of a private offering memorandum. The Notes, the guarantees, and any common stock issuable upon conversion have not been registered under the Securities Act or the securities laws of any other jurisdiction and may not be offered or sold in the United States without registration or an applicable exemption from registration requirements.

About Ciena

Ciena is the global leader in high-speed connectivity. We build the world’s most advanced networks to support exponential growth in bandwidth demand. By harnessing the power of our networking systems, interconnects, automation software, and services, Ciena revolutionizes data transmission and network management. With unparalleled expertise and innovation, we empower our customers, partners, and communities to thrive in the AI era.

Note to Ciena Investors

This press release contains certain forward-looking statements that are based on our current expectations, forecasts, information and assumptions. These statements involve inherent risks and uncertainties. Actual results or outcomes may differ materially from those stated or implied, because of risks and uncertainties, including those detailed in our most recent annual and quarterly reports filed with the SEC. Forward-looking statements include statements regarding our expectations, beliefs, intentions or strategies and can be identified by words such as “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “should,” “will,” and “would” or similar words. Ciena assumes no obligation to update the information included in this press release, whether as a result of new information, future events or otherwise.

These forward-looking statements include, among others, statements regarding our ability to complete the Offering (including our intended use of proceeds), the concurrent share repurchases and the convertible note hedge and warrant transactions on favorable terms, if at all, and general market conditions which might affect the Offering, the concurrent share repurchases and the convertible note hedge and warrant transactions.

View source version on businesswire.com: https://www.businesswire.com/news/home/20260608618202/en/

CIEN beats Q2 estimates, raises fiscal 2026 revenue guidance and builds a larger backlog as AI network demand fuels cloud and optical growth.

Colt Technology Services (Colt), the global digital infrastructure company, and Ciena (NYSE: CIEN), the global leader in high-speed connectivity, have completed one of the fastest quantum-safe data transmissions ever demonstrated and the fastest across a transatlantic route. The landmark trial successfully protected live data running across 6900km of Colt’s subsea and terrestrial network between New York and London with Ciena’s WaveLogic 6 Extreme (WL6e) encryption solution1. The trial proved that data can be securely transmitted at an 800Gb Ethernet (GbE) service rate - fast enough to move data-centre-scale volumes across the Atlantic in seconds - while remaining protected against growing quantum threats.

This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20260610044038/en/

Businesses are moving now to protect their data from “harvest now, decrypt later” attacks, in which bad actors intercept and store data in transit waiting for future quantum computing capabilities to break through traditional data encryption methods to access it. This could be possible as early as 2030. According to research, 69% of organisations believe quantum computing poses a real risk to current encryption and 46% believe large portions of their data could be compromised2. The successful Colt and Ciena trial demonstrates that high-speed quantum-safe connectivity is ready to secure customer data reliably across continents, along one of the world’s busiest data corridors.

The trial is the latest in a series of quantum-safe encryption trials led by Colt across transatlantic subsea networks and stands out due to its:

Speed: 800GbE is still at the very early adoption stage as most deployed long-haul and subsea systems today run at 100GbE or 400GbE. The trial successfully showcased an 800GbE encrypted service across the Atlantic on one of the most popular routes in the world Security: Ciena’s WL6e 1.6T quantum-safe encryption solution on the Waveserver platform offers PQC algorithms enabling high-capacity secure connectivity that can function at extreme bandwidths over any distance3. Performance: the trial demonstrated outstanding optical performance, stability over subsea infrastructure and readiness to secure AI traffic demands Buddy Bayer, chief operating officer, Colt Technology Services said, “Quantum computing is redefining the security challenge for global connectivity. This trial marks a significant step forward in protecting the world’s data as it moves across continents. It proves that quantum-safe protection can be delivered at real-world scale. Colt’s infrastructure combines global reach, sustained investment and robust security, giving businesses, hyperscalers and neoscalers the confidence to grow. At the same time, Ciena’s quantum-safe solutions show how next-generation security can be embedded into high-speed networks, ensuring protection keeps pace with performance. Together, we’re helping customers protect critical data today while preparing for the quantum era, building future-ready networks that simply work, and are secure, scalable and ready to power the AI economy.”

Dino DiPerna, senior vice president, Global Research and Development, Ciena said, “As network demand surges, operators are raising the security bar to stay ahead of the threat posed by quantum computers. This Colt-Ciena trial shows how post-quantum cryptography and proven high-performance optical encryption can play an important role in protecting high-speed services over real-world long-haul and submarine networks, helping secure critical in-flight data across any distance.”

Following this and other successful optical network trials, Colt can offer quantum-safe services to meet a diverse range of customer needs. These include solutions based on Post-Quantum Cryptography (PQC), Quantum Key Distribution (QKD), Symmetric Key Infrastructure (SKI), and hybrid models, across both terrestrial and subsea networks. The solutions are ideal for organisations including:

Enterprises seeking resilient and secure global connectivity and reducing compliance risk Global content providers, hyperscalers and neoscalers exploring quantum-safe integration Financial institutions and healthcare providers requiring robust protection for sensitive data in transit Government and defence organisations prioritising national security and compliance Colt and Ciena have a strong track record of collaborating to drive customer success. The latest trial follows an announcement in 2025 highlighting the rollout of a powerful new terabit network to support two hyperscaler customers/global content providers, and the completion of the world’s first 1.2 terabit per second wavelength transmission across the Atlantic Ocean, announced by Colt and Ciena in November 2024.

Notes to Editors

1The solution uses National Institute of Standards and Technology (NIST)-compliant, commercially approved post-quantum cryptography (PQC) algorithms, which means it has been approved by a trusted global standards body as commercially viable.

2 DigiCert global enterprise study

3 The solution uses a new type of encryption designed to keep data secure against future quantum threats. ML-KEM (Module-Lattice-Based Key-Encapsulation Mechanism) is one of the first PQC methods to be officially standardised and approved by the National Institute of Standards and Technology (NIST) as FIPS 203.

About Colt Technology Services

We’re Colt. We own and operate exceptional digital infrastructure which powers the global AI economy, connects societies, builds communities and transforms lives. Thousands of colleagues in 65+ offices across Europe, Asia, and North America share a deep commitment to delivering an outstanding experience and making every interaction effortless for our customers.

Customers and partners choose our award-winning fibre infrastructure, digital platforms and security solutions, delivered across a network that spans continents and crosses oceans. We’re Europe’s largest B2B operator: we connect 40+ countries, 32,000 enterprise buildings, 275+ points of presence, and 12 cable landing stations and we manage eight subsea cable systems. We also co-manage AS3356 - the most widely peered network in the world.

Founded in London over 30 years ago, we’re privately funded and driven by values of fairness, inclusion and equity. We’re known for our urgent call for social and sustainable change and we're guided by our purpose in everything we do: creating effortless connections and extraordinary outcomes for our customers, communities and people. Be a part of our story: come on over to www.colt.net or join our amazing communities at LinkedIn, Instagram, TikTok, Facebook and YouTube. Media enquiry? Email us at [email protected].

About Ciena

Ciena is the global leader in high-speed connectivity. We build the world’s most advanced networks to support exponential growth in bandwidth demand. By harnessing the power of our networking systems, interconnects, automation software, and services, Ciena revolutionizes data transmission and network management. With unparalleled expertise and innovation, we empower our customers, partners, and communities to thrive in the AI era. For updates on Ciena, follow us on LinkedIn or visit the Ciena website.

Note to Ciena Investors

You are encouraged to review the Investors section of our website, where we routinely post press releases, SEC filings, recent news, financial results, and other announcements. From time to time we exclusively post material information to this website along with other disclosure channels that we use. This press release contains certain forward-looking statements that are based on our current expectations, forecasts, information and assumptions. These statements involve inherent risks and uncertainties. Actual results or outcomes may differ materially from those stated or implied, because of risks and uncertainties, including those detailed in our most recent annual and quarterly reports filed with the SEC. Forward-looking statements include statements regarding our expectations, beliefs, intentions or strategies and can be identified by words such as "anticipate," "believe," "could," "estimate," "expect," "intend," "may," "should," "will," and "would" or similar words. Ciena assumes no obligation to update the information included in this press release, whether as a result of new information, future events or otherwise.

View source version on businesswire.com: https://www.businesswire.com/news/home/20260610044038/en/

Key Takeaways CIEN posted 39.5% revenue growth and 71% free cash flow surge in fiscal Q2, beating estimates.Ciena is investing in capacity, AI networking tech and supply chain to support a $7.7B backlog.CIEN returned $83.1M via buybacks while maintaining $1.4B cash for growth and shareholder returns. Ciena (CIEN - Free Report) delivered a strong fiscal second-quarter performance, with solid cash flow generation emerging as a key highlight. Quarterly revenues rose 39.5% year over year to $1.57 billion and surpassed the Zacks Consensus Estimate of $1.50 billion. Cash provided by operations increased 66% year over year to $260 million, while free cash flow climbed 71% to $219 million.

This cash flow strength comes at a time when Ciena is scaling operations to meet surging AI-driven network demand, raising an important question: how effectively can it balance reinvestment with shareholder returns?

The company is investing in capacity expansion and ramping output to meet the explosive demand tied to AI-driven networking requirements from both cloud and service providers.  Ciena is also using resources for securing supply and manufacturing capacity. It is advancing next-generation technologies such as Hyper-Rail and expanding its product line for more use cases like data center out-of-band management with its PON technology.

Capital expenditures for fiscal 2026 are expected to be between $250 million and $275 million. These investments are aimed at supporting a rapidly expanding backlog, which reached $7.7 billion at the quarter-end, providing strong revenue visibility.

Despite a sharp acceleration in reinvestment, management remains focused on shareholder returns. During the second quarter, it repurchased approximately 0.2 million shares for $83.1 million under its $1 billion repurchase authorization.

With an impressive cash balance of $1.4 billion, Ciena has ample flexibility to fund both growth initiatives and capital return programs. The key will be sustaining the balance as demand and investment needs continue to soar.

Capital Allocation Strategy of RivalsNokia (NOK - Free Report) generated a strong free cash flow of €629 million in the first quarter of 2026 and ended with a solid net cash position of €3.8 billion, underscoring its financial flexibility. The company plans capital expenditures of approximately €900 million to €1 billion in 2026.

Management is prioritizing investment, particularly in high-growth areas such as optical networks and AI-driven infrastructure. Increased investments in manufacturing capacity, including the ramp-up of its indium phosphide facility, bode well. Nokia noted that it was confident about its cash position, and if it has excess capital (after R&D, inorganic growth and dividend), the company can consider share buybacks as well.

Arista Networks (ANET - Free Report) capital expenditure plans remain relatively modest. In 2025, the company spent about $100 million on capex, primarily tied to the initial construction of expanded facilities in Santa Clara. For the first quarter of 2026, it spent $54.5 million on capex. Capex is expected to reach $180 million in 2026.

The company generated $1.69 billion in operating cash flow in the first quarter and ended with a substantial $12.35 billion in cash, cash equivalents and marketable securities. Notably, the company did not repurchase shares during the quarter, despite having authorization remaining. Arista has $817.9 billion worth of shares available for buyback under its $1.5 billion existing authorization.

CIEN Price Performance, Valuation and EstimatesShares of CIEN have plunged 24.4% in the past month against the Communications - Components industry’s growth of 18.6%.

Image Source: Zacks Investment Research

CIEN trades at a forward 12-month price-to-earnings (P/E) ratio of 55.62, above the industry’s 47.29.

Image Source: Zacks Investment Research

The Zacks Consensus Estimate for CIEN’s earnings for fiscal 2026 has been marginally revised upward over the past 60 days.

Image Source: Zacks Investment Research

CIEN currently sports a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.

Key Takeaways CIEN introduced RLS Hyper-Rail to boost high-speed connectivity with multi-rail photonic design.Ciena won the first multi-rail order and says customer interest has exceeded expectations.CIEN expects 2027 deployments, with multi-year contracts and higher-margin revenue potential. Ciena Corporation (CIEN - Free Report) is strengthening its position in high-speed connectivity with the introduction of RLS Hyper-Rail, its next-generation intelligent line system designed to address the increasing capacity and efficiency requirements of hyperscalers and service providers. Built as a multi-rail solution and co-created with multiple hyperscalers, the platform leverages an innovative photonic design to support multiple fiber pairs in parallel over hundreds of kilometers using advanced amplification. This architecture delivers significantly higher density while improving space and power efficiency, particularly at intermediary amplifier sites where these resources are limited.

The company recently secured the industry's first multi-rail order from a leading hyperscaler, validating early demand for the RLS Hyper-Rail platform and reinforcing its position in the intelligent line systems market. Ciena is also engaged in discussions with multiple additional hyperscalers, neoscalers and service providers across domestic and international markets, with management noting that customer interest has exceeded expectations. Management highlighted that the platform enables high-intensity AI training across greater distances with enhanced amplification and density, making it a strategic technology for customers seeking to standardize on Hyper-Rail.

Management expects deployments to begin in 2027, with contracts representing hundreds of millions of dollars over multiple years. The company anticipates linear growth as adoption expands among multiple hyperscalers and service providers, particularly those involved in managed optical fiber networks (MOFN), where the technology is considered highly transformative.

Beyond AI training, Hyper-Rail is designed to support long-distance, high-density and low-latency connectivity for data center interconnections, while also addressing growing inference and agentic AI workloads. Ciena expects the platform to generate higher revenues beginning in 2027 and believes its larger revenue contribution, combined with higher margin potential than its single-rail RLS product, will support continued margin expansion as adoption accelerates.

Taking a Look at CIEN’s CompetitorsArista Networks (ANET - Free Report) is benefiting from rising AI and cloud networking investments as enterprises and hyperscalers expand high-speed Ethernet infrastructure. The company is gaining traction in 800-gig deployments and expects broader adoption of scale-up and scale-out AI fabrics over time. The Arista 2.0 strategy continues to resonate with customers as modern networking platforms become increasingly important for AI-driven data center architectures. In March 2026, Arista announced XPO, a high-density, liquid-cooled pluggable optics solution for data centers. It delivers ultra-fast connectivity, improves energy efficiency and reduces cooling requirements, supporting modern AI, cloud and high-performance workloads. Expanding software automation, campus networking and routing capabilities are also supporting customer diversification and operational efficiency.

Cisco Systems’ (CSCO - Free Report) partner base supports expansion in AI infrastructure and security. The company is working with NVIDIA on Cisco Secure AI Factory with NVIDIA, founded on the NVIDIA Spectrum-X Ethernet networking platform, and is including Cisco AI Defense and Cisco Hypershield in validated designs for enterprise AI factories. Cisco also offers NVIDIA RTX PRO 6000 Blackwell Server Edition GPUs with Cisco UCS C845A M8 servers, broadening its compute attach opportunities. Beyond NVIDIA, Cisco has been selected as a technology partner to HUMAIN, a new AI company in Saudi Arabia, alongside partners such as BlackRock Global Infrastructure Partners, MGX, Microsoft, NVIDIA and xAI.

CIEN Price Performance, Valuation and EstimatesShares of CIEN have plunged 23% in the past month against the Communications - Components industry’s growth of 15.3%.

Image Source: Zacks Investment Research

CIEN trades at a forward 12-month price-to-earnings (P/E) ratio of 64.53, above the industry’s 48.34.

Image Source: Zacks Investment Research

The Zacks Consensus Estimate for CIEN’s earnings for fiscal 2026 has been revised upward over the past 60 days.

Image Source: Zacks Investment Research

CIEN currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.