Infinera Corporation Reports Fourth Quarter and Fiscal Year 2012 Financial Results

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Contacts:  
Media: Anna Vue, avue@infinera.com, Infinera Corporation, 916-595-8157

Investors/Analysts: Jenifer Kirtland, Infinera Corporation (jkirtland@infinera.com), 408-543-8139) / Bob Jones, Infinera Corporation (bjones@infinera.com, 408-543-8140)
 


Sunnyvale, CA, February 5, 2013 – Infinera Corporation (NASDAQ: INFN), a leading provider of digital optical networks, today released financial results for the fourth quarter and fiscal year ended December 29, 2012.

GAAP revenues for the quarter were $128.1 million compared to $112.2 million in the third quarter of 2012 and $112.0 million in the fourth quarter of 2011. 

GAAP gross margins for the quarter were 34% compared to 37% in the third quarter of 2012 and 40% in the fourth quarter of 2011.  GAAP net loss for the quarter was $(16.1) million, or $(0.14) per share, compared to net loss of $(19.1) million, or $(0.17) per share, in the third quarter of 2012 and a net loss of $(19.4) million, or $(0.18) per share, in the fourth quarter of 2011.

Non-GAAP gross margins for the quarter were 36% compared to 39% in the third quarter of 2012 and 42% in the fourth quarter of 2011.  Non-GAAP net loss for the quarter was $(6.0) million, or $(0.05) per diluted share, compared to net loss of $(7.8) million, or $(0.07) per diluted share in the third quarter of 2012 and net loss of $(6.7) million, or $(0.06) per diluted share, in the fourth quarter of 2011. These Non-GAAP measures exclude non-cash stock-based compensation expenses and restructuring and other related costs. 

GAAP revenues for the year were $438.4 million compared to $404.9 million in 2011.

GAAP gross margins for the year were 36% compared to 41% in 2011.  GAAP net loss for the year was $(85.3) million, or $(0.77) per share compared to $(81.7) million, or $(0.78) per share in 2011. 

Non-GAAP gross margins for the year were 38% compared to 43% in 2011. Non-GAAP net loss for the year was $(43.5) million or $(0.38) per diluted share in 2012, compared to net loss of $(31.7) million or $(0.29) per diluted share in 2011. These Non-GAAP measures exclude non-cash stock-based compensation expenses and restructuring and other related costs. 

Management Commentary

“Our fourth quarter results reflected solid execution of our growth strategy and represented a strong finish to a productive year for Infinera,” said Tom Fallon, president and chief executive officer. “Our DTN-X continues to gain traction and to date, we have purchase commitments from 22 customers, including seven new to Infinera. These customers represent a broad cross section of our market segments. Revenue from the DTN-X platform continues to ramp.”

“During the fourth quarter, we were pleased to announce our first domestic Tier 1 backbone deployment with CenturyLink. We have also successfully completed the OSMINE certification process, another key milestone in demonstrating our US Tier 1 readiness. Our ability to fully service global Tier 1 customers essentially doubles our addressable market. We also added four new DTN customers during the quarter for a total of 111 customers worldwide,” continued Mr. Fallon.

“We are optimistic about the outlook for 2013.  Interest in our unique 100G converged DWDM/OTN switching solution remains strong, resulting in significant trial activity, which has helped us build a strong pipeline into 2013. A strong focus on winning footprint and gaining market share, balanced with prudent financial management remain our priorities for 2013,” Mr. Fallon concluded.      

Conference Call Information:

Infinera will host a conference call for analysts and investors to discuss its fourth quarter and fiscal year 2012 results and first quarter outlook today at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time).  A live webcast of the conference call will also be accessible from the “Investor Relations” section of the company’s website at www.infinera.com.  Following the webcast, an archived version will be available on the website for 90 days. To hear the replay, parties in the United States and Canada should call 1-888-566-0401.  International parties can access the replay at 1-203-369-3040.


About Infinera

Infinera provides Digital Optical Networking systems to telecommunications carriers worldwide.  Infinera’s systems are unique in their use of a breakthrough semiconductor technology: the photonic integrated circuit (PIC). Infinera’s systems and PIC technology are designed to provide customers with simpler and more flexible engineering and operations, faster time-to-service, and the ability to rapidly deliver differentiated services without reengineering their optical infrastructure. For more information, please visit www.infinera.com.

Forward-Looking Statements

This press release contains forward-looking statements, including statements regarding our expectations for customer interest in, adoption of, and revenue and purchase commitments related to our DTN-X product, our ability to fully service Tier 1 customers and the addressable market related to Tier 1 customers, and customer interest in our 100G converged DWDM/OTN switching solution, and our building of a strong pipeline for 2013. These forward-looking statements involve risks and uncertainties, as well as assumptions that, if they do not fully materialize or prove incorrect, could cause our results to differ materially from those expressed or implied by such forward-looking statements. The risks and uncertainties that could cause our results to differ materially from those expressed or implied by such forward-looking statements include unexpected delays in the development, production or availability of our products; decisions by customers to delay orders of the product; changes in the marketplace that would affect customer demand for the product, as well as our general ability to react to trends and challenges in our business and the markets in which we operate; our ability to anticipate market needs and develop new or enhanced products to meet those needs; the adoption rate of our products; our ability to establish and maintain successful relationships with our customers; our ability to reduce customer concentration; our ability to compete in our industry; fluctuations in demand, sales cycles and prices for our products and services; our ability to operate profitably; aggressive business tactics by our competitors; our reliance on single-source suppliers; shortages or price fluctuations in our supply chain; our ability to protect our intellectual property rights; and general, political, economic and market conditions and events.   Further information about these risks and uncertainties, and other risks and uncertainties that affect our business, are contained in the risk factors section and other sections of our annual report on Form 10-K filed with the Securities Exchange Commission on March 6, 2012, as well as subsequent reports filed with or furnished to the SEC.  These reports are available on our website at www.infinera.com and the SEC’s website at www.sec.gov.  We assume no obligation to, and do not currently intend to, update any such forward-looking statements.