CIENA CORP

Previous wording

For a discussion identifying some of the important factors that could cause actual results to vary materially from those anticipated in the forward-looking statements, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” in this report. For a more complete understanding of the risks associated with an investment in our securities, you should review these factors and the rest of this report in combination with the more detailed description of our business and management’s discussion and analysis of financial condition and risk factors described in our Annual Report on Form 10-K for the fiscal year ended November 1, 2025, which we filed with the Securities and Exchange Commission (the “SEC”) on December 12, 2025 (our “2025 Annual Report”). However, we operate in a very competitive and dynamic environment and new risks and uncertainties emerge, are identified, or become apparent from time to time, and therefore may not be identified in this report. We cannot predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this report. You should be aware that the forward-looking statements contained in this report are based on our current views and assumptions. We undertake no obligation to revise or to update any forward-looking statements made in this report to reflect events or circumstances after the date hereof or to reflect new information or the occurrence of unanticipated events, except as required by law. The forward-looking statements in this report are intended to be subject to protection afforded by the safe harbor for forward-looking statements contained in the Private Securities Litigation

Current wording

For a discussion identifying some of the important factors that could cause actual results to vary materially from those anticipated in the forward-looking statements, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” in this report. For a more complete understanding of the risks associated with an investment in our securities, you should review these factors and the rest of this report in combination with the more detailed description of our business and management’s discussion and analysis of financial condition and risk factors described in our Annual Report on Form 10-K for the fiscal year ended November 1, 2025, which we filed with the Securities and Exchange Commission (the “SEC”) on December 12, 2025 (our “2025 Annual Report”). However, we operate in a very competitive and dynamic environment and new risks and uncertainties emerge, are identified, or become apparent from time to time, and therefore may not be identified in this report. We cannot predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this report. You should be aware that the forward-looking statements contained in this report are based on our current views and assumptions. We undertake no obligation to revise or to update any forward-looking statements made in this report to reflect events or circumstances after the date hereof or to reflect new information or the occurrence of unanticipated events, except as required by law. The forward-looking statements in this report are intended to be subject to protection afforded by the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Unless the context requires otherwise, references in this report to “Ciena,” the “Company,” “we,” “us,” and “our” refer to Ciena Corporation and its consolidated subsidiaries.

Previous wording

Our industry has been experiencing unprecedented increases in demand, in particular due to capital expenditures related to AI and other cloud-based applications. As a result, we experienced strong momentum and growth in fiscal 2025 that continued in the first quarter of fiscal 2026. As we grow disproportionately with cloud providers, we are seeing a small number of those customers become a larger portion of our business across multiple revenue segments. Our revenue increased by 33.1% to $1.4 billion in the first quarter of fiscal 2026 as compared to $1.1 billion in the first quarter of fiscal 2025, with orders for our products and services significantly exceeding our revenue. This dynamic, together with an industry-wide constrained supply environment, has resulted in historically high backlog.

Current wording

Our industry has been experiencing unprecedented increases in demand, in particular due to capital expenditures related to AI and other cloud-based applications. As a result, we experienced strong momentum and growth in fiscal 2025 that continued in the first half of fiscal 2026. As our sales to cloud providers grow, we are seeing a small number of those customers become a larger portion of our business across multiple revenue segments. Our revenue increased by 40% to $1.6 billion in the second quarter of fiscal 2026 as compared to $1.1 billion in the second quarter of fiscal 2025, with orders for our products and services significantly exceeding our revenue. This dynamic, together with an industry-wide constrained supply environment, has resulted in historically high backlog.

Previous wording

Our gross margin decreased to 43.8% in the first quarter of fiscal 2026, compared to 44.0% in the first quarter of fiscal 2025, primarily due to lower services gross margin.

Current wording

Our gross margin increased to 44.0% in the second quarter of fiscal 2026, compared to 40.2% in the second quarter of fiscal 2025, primarily due to higher product gross margin associated with cost reduction, pricing optimization, and product mix.

Previous wording

Our operating expense grew from $391.2 million in the first quarter of fiscal 2025 to $436.1 million in the first quarter of fiscal 2026. During the first quarter of fiscal 2026, we invested $221.5 million in research and development activities, an increase of 15% compared to the first quarter of fiscal 2025. We believe that our investment capacity and our efforts to push the pace of innovation are important competitive differentiators in our markets, which requires considerable investment capacity and expenditures. In particular, in an effort to capture certain market opportunities created by the impact of AI on networks, we continued to increase the performance of, and enhance the capabilities for our leading WaveLogic TM coherent modem technology, through which we seek to extend our leadership in optical networking, and leverage it to expand our addressable market, including inside and around the data center.

Current wording

Our operating expense grew from $420 million in the second quarter of fiscal 2025 to $454 million in the second quarter of fiscal 2026. During the second quarter of fiscal 2026, we invested $238 million in research and development activities, an increase of 11% compared to the second quarter of fiscal 2025. We believe that our investment capacity and our efforts to push the pace of innovation are important competitive differentiators in our markets, which requires both investment capacity and expenditures. In particular, in an effort to capture certain market opportunities created by the impact of AI on networks, we continued to increase the performance of and enhance the capabilities for our leading WaveLogic TM coherent modem technology, through which we seek to extend our leadership in optical networking, and leverage it to expand our addressable market, including inside and around the data center.

Previous wording

Our capital allocation strategy is focused on maintaining our significant innovation investment, investing in select transactions, and returning value to stockholders, while preserving our strategic and operational flexibility. We continuously work to improve our cash cycle and evaluate alternatives to manage our capital structure in order to enhance our liquidity. We ended the first quarter of fiscal 2026 with $1.4 billion of cash, cash equivalents, and investments. As of the end of the first quarter of fiscal 2026, cash generated from operations increased to $227.6 million as compared to $103.7 million as of the end of the first quarter of fiscal 2025. Consistent with our capital allocation priorities, during the first quarter of fiscal 2026, we invested $73.9 million in capital purchases, primarily for supply chain equipment and research and development , and $170.6 million to repurchase shares through our share buyback program and for tax withholding purposes associated with employee stock awards.

Current wording

Our capital allocation strategy is focused on maintaining our significant innovation investment, investing in select transactions, and returning value to stockholders, while preserving our strategic and operational flexibility. We continuously work to improve our cash cycle and evaluate alternatives to manage our capital structure in order to enhance our liquidity. We ended the first half of fiscal 2026 with $1.4 billion of cash, cash equivalents, and investments. As of the end of the first half of fiscal 2026, cash generated from operations increased to $487 million as compared to $261 million as of the end of the first half of fiscal 2025. Consistent with our capital allocation priorities, during the first half of fiscal 2026, we invested $115 million in capital purchases, primarily for supply chain equipment and research and development, and $344 million to repurchase shares through our share buyback program and for tax withholding purposes associated with employee stock awards.

Previous wording

As a result of the increased demand described above, our revenue increased by 33.1%, or $354.8 million, in the first quarter of fiscal 2026 as compared to the first quarter of fiscal 2025.

Current wording

As a result of the increased demand described above, our revenue increased by approximately 40%, or $444.9 million, in the second quarter of fiscal 2026 as compared to the second quarter of fiscal 2025, and approximately 36% or $799.6 million, in the six months ended May 2, 2026 as compared to the six months ended May 3, 2025.

Previous wording

•Optical Networking products revenue increased by $295.2 million, primarily driven by increases in sales of our Waveserver® system to service provider and cloud provider customers, and our 6500 Reconfigurable Line Systems (RLS) to cloud provider customers.

Current wording

•Optical Networking products revenue increased by $326.3 million, primarily driven by increases in sales of our Waveserver® system and our 6500 Reconfigurable Line Systems (RLS).

Previous wording

•Routing and Switching products revenue increased by $32.8 million, primarily driven by an increase in sales of our 3000 and 5000 series of service delivery and aggregation platforms, including our out-of-band data center management (DCOM) solution, to cloud provider and service provider customers.

Current wording

•Routing and Switching products revenue increased by $81.5 million, primarily driven by increases in sales of our 3000 and 5000 series of service delivery and aggregation platforms, and our 8100 Coherent IP networking platforms in our out-of-band data center management (DCOM) solution.

Previous wording

•Blue Planet Automation Software and Services segment revenue decreased by $5.6 million, primarily reflecting a sales decrease in our unified assurance and analytics software, partially offset by a sales increase in our inventory management software services.

Current wording

•Blue Planet Automation Software and Services segment revenue decreased by $4.6 million, primarily reflecting a sales decrease in our unified assurance and analytics software.

Previous wording

•Global Services segment revenue increased by $34.1 million, primarily reflecting sales increases in our implementation services and maintenance, support, and learning services.

Current wording

•Global Services segment revenue increased by $33.3 million, primarily reflecting sales increases in our implementation services and maintenance, support, and learning services.

Previous wording

•Platform Software and Services segment revenue decreased by $1.7 million, primarily reflecting a sales decrease of our software consulting services, partially offset by an increase in sales of our Navigator NCS software solution.

Current wording

•Platform Software and Services segment revenue increased by $6.8 million, primarily reflecting a sales increase in our Navigator NCS software solution, partially offset by sales decreases of our software consulting services.

Previous wording

•APAC revenue decreased by $10.5 million, primarily driven by decreased sales in India, primarily to service providers, partially offset by increased sales in Singapore, primarily to cloud providers.

Current wording

•EMEA revenue increased by $4.5 million, primarily driven by increased sales in France, partially offset by decreased sales to cloud provider customers in the Netherlands.

Previous wording

•Americas revenue increased by $322.6 million, primarily driven by increased sales to cloud providers and service providers in the United States.

Current wording

•Americas revenue increased by $691.0 million, primarily driven by increased sales to cloud provider customers and service provider customers in the United States.

Previous wording

•EMEA revenue increased by $42.7 million, primarily driven by increased sales to cloud providers in the Netherlands.

Current wording

•EMEA revenue increased by $47.1 million, primarily driven by increased sales to cloud provider customers in the Netherlands and increased sales in France.

Previous wording

During the first quarter of fiscal 2026, approximately 8.3% of our revenue was non-U.S. Dollar-denominated. During the first quarter of fiscal 2026 as compared to the first quarter of fiscal 2025, the U.S. Dollar generally weakened against other currencies. These currency fluctuations had a positive effect on our revenue reported in U.S. Dollars of approximately $5.0 million, or 0.4%, as compared to the first quarter of fiscal 2025.

Current wording

During both the second quarter and first six months of fiscal 2026, approximately 9% of our revenue was non-U.S. Dollar-denominated. During the second quarter and first six months of fiscal 2026 as compared to the second quarter and first six months of fiscal 2025, the U.S. Dollar generally weakened against other currencies with minimal impact.

Previous wording

Gross margin can fluctuate due to a number of factors, including technology-based price compression, product and service mix, the lifecycle stage of our products and cost reductions.

Current wording

Gross margin can fluctuate due to a number of factors, including technology-based price changes, product and service mix, the lifecycle stage of our products and cost reductions.

Previous wording

•Services gross margin decreased by 420 basis points from the first quarter of fiscal 2025 to the first quarter of fiscal 2026, primarily due to a less favorable services mix, partially offset by improved margins on deployment services.

Current wording

•Services gross margin decreased by 110 basis points, primarily due to a less favorable services mix, partially offset by improved margins on implementation services.

Previous wording

•Research and development expense increased by $28.8 million. Net of hedging, this primarily reflects higher employee headcount and related compensation costs, including our acquisition of Nubis Communications, and professional services expense.

Current wording

•Research and development expense increased by $23.0 million. Net of hedging, this primarily reflects higher employee headcount and related costs, including from our acquisition of Nubis Communications, technology related costs and engineering design and development costs.

Previous wording

•Selling and marketing expense increased by $12.4 million, which primarily reflects increases in employee-related compensation costs.

Current wording

•Selling and marketing expense increased by $10.4 million, which primarily reflects increases in employee-related compensation costs.

Previous wording

•General and administrative expense increased by $5.3 million, which primarily reflects increases in employee-related compensation costs.

Current wording

•General and administrative expense increased by $4.3 million, which primarily reflects increases in employee-related compensation costs.

Previous wording

•Amortization of intangible assets decreased by $1.8 million, primarily reflecting certain intangible assets having reached the end of their economic lives.

Current wording

•Amortization of intangible assets decreased by $2.8 million, primarily reflecting certain intangible assets having reached the end of their economic lives.

Previous wording

During the first quarter of fiscal 2026, approximately 50.6% of our operating expense was non-U.S. Dollar-denominated. During the first quarter of fiscal 2026, as compared to the first quarter of fiscal 2025, the U.S. Dollar generally weakened against other currencies. These currency fluctuations, net of hedging, had the effect of increasing our operating expense by approximately $4.8 million, or 1.1%, as compared to the first quarter of fiscal 2025.

Current wording

During both the second quarter and first six months of fiscal 2026, approximately 50% of our operating expense was non-U.S. Dollar-denominated. During the second quarter and first six months of fiscal 2026, as compared to the second quarter and first six months of fiscal 2025, the U.S. Dollar generally weakened against other currencies. These currency fluctuations, net of hedging, had minimal impact.

Previous wording

•Networking Platforms segment profit increased by $134.5 million, primarily due to higher sales volume and improved gross margin as described above, partially offset by higher research and development costs.

Current wording

•Networking Platforms segment profit increased by $210.1 million, primarily due to higher sales volume and improved gross margin as described above, partially offset by higher research and development costs.

Previous wording

•Global Services segment profit increased by $12.1 million, primarily due to increased sales volume as described above.

Current wording

•Global Services segment profit increased by $12.0 million, primarily due to increased sales volume as described above.

Previous wording

•Platform Software and Services segment profit decreased by $3.7 million, primarily due to lower services sales volume as described above, and increased research and development costs.

Current wording

•Platform Software and Services segment profit increased by $5.7 million, primarily due to higher product sales and slightly higher gross margin, partially offset by lower services sales volume and increased research and development costs.

Previous wording

•Interest and other income, netincreased by $1.4 million, primarily reflecting the impact of foreign exchange rates on assets and liabilities denominated in a currency other than the relevant functional currency, net of hedging activity.

Current wording

•Interest and other income, netincreased by $6.2 million, primarily reflecting the impact of foreign exchange rates on assets and liabilities denominated in a currency other than the relevant functional currency, net of hedging activity.

Previous wording

•Provision for income taxes increased by $6.8 million, primarily due to the increase in pre-tax book income.

Current wording

•Provision for income taxes increased by $2.8 million, primarily due to the increase in pre-tax book income.

Previous wording

•Interest expense decreased by $1.7 million, primarily due to lower interest rates on our floating rate debt, net of hedging activity.

Current wording

•Interest expense decreased by $2.4 million, primarily due to lower interest rates on our floating rate debt, net of hedging activity.

Previous wording

Principal Sources of Liquidity. Our principal sources of liquidity on hand include our cash, cash equivalents, and investments, which, as of January 31, 2026, totaled $1.4 billion, as well as our credit facility (the “Revolving Credit Facility”), to which we and certain of our subsidiaries are parties. The Revolving Credit Facility provides for a total commitment of $300.0 million with a maturity date of October 24, 2028. We principally use the Revolving Credit Facility to support the issuance of letters of credit that arise in the ordinary course of our business and for general corporate purposes. As of January 31, 2026, letters of credit totaling $41.1 million were issued under the Revolving Credit Facility. There were no borrowings outstanding under the Revolving Credit Facility as of January 31, 2026.

Current wording

Principal Sources of Liquidity. Our principal sources of liquidity on hand include our cash, cash equivalents, and investments, which, as of May 2, 2026, totaled $1.4 billion, as well as our credit facility (the “Revolving Credit Facility”), to which we and certain of our subsidiaries are parties. The Revolving Credit Facility provides for a total commitment of $300.0 million with a maturity date of October 24, 2028. We principally use the Revolving Credit Facility to support the issuance of letters of credit that arise in the ordinary course of our business and for general corporate purposes. As of May 2, 2026, letters of credit totaling $39.9 million were issued under the Revolving Credit Facility. There were no borrowings outstanding under the Revolving Credit Facility as of May 2, 2026.

Previous wording

Foreign Liquidity. The amount of cash, cash equivalents and short-term investments held by our foreign subsidiaries was $351.7 million as of January 31, 2026. Approximately $92.3 million of undistributed earnings from these foreign subsidiaries is expected to be repatriated, with any remaining amount continuing to be indefinitely reinvested. A deferred tax liability related to the expected repatriation amount was accrued in fiscal 2023. There are no other significant temporary differences related to our investment in the foreign subsidiaries for which a deferred tax liability has not been recognized.

Current wording

Foreign Liquidity. The amount of cash, cash equivalents and short-term investments held by our foreign subsidiaries was $379.7 million as of May 2, 2026. Approximately $92.3 million of undistributed earnings from these foreign subsidiaries is expected to be repatriated, with any remaining amount continuing to be indefinitely reinvested. A deferred tax liability has been accrued to account for the anticipated repatriation amount. There are no other significant temporary differences related to our investment in the foreign subsidiaries for which a deferred tax liability has not been recognized.

Previous wording

Stock Repurchases. On October 2, 2024, we announced that our Board of Directors authorized a program to repurchase up to $1.0 billion of our common stock, which replaced in its entirety the previous stock repurchase program authorized in fiscal 2022. During the first three months of fiscal 2026, we repurchased $80.5 million of our common stock under the stock repurchase program, and $589.8 million remained under the current repurchase authorization as of January 31, 2026. The amount and timing of any further repurchases under our stock repurchase program are subject to a variety of factors including liquidity, cash flow, stock price, and general business and market conditions. The program may be modified, suspended, or discontinued at any time. During the first quarter of fiscal 2026, we also repurchased $90.1 million of our common stock in settlement of employee tax withholding obligations due upon the vesting of stock unit awards. See Note 15 to our Condensed Consolidated Financial Statements included in Item 1 of Part I of this report as well as “Issuer Purchases of Equity Securities” in Item 2 of Part II of this report.

Current wording

Stock Repurchases. On October 2, 2024, we announced that our Board of Directors authorized a program to repurchase up to $1.0 billion of our common stock, which replaced in its entirety the previous stock repurchase program authorized in fiscal 2022. During the first six months of fiscal 2026, we repurchased $163.7 million of our common stock under the stock repurchase program, and $506.7 million remained under the current repurchase authorization as of May 2, 2026. The amount and timing of any further repurchases under our stock repurchase program are subject to a variety of factors including liquidity, cash flow, stock price, and general business and market conditions. The program may be modified, suspended, or discontinued at any time. During the the first six months of fiscal 2026, we also repurchased $179.4 million of our common stock in settlement of employee tax withholding obligations due upon the vesting of stock unit awards. See Note 15 to our Condensed Consolidated Financial Statements included in Item 1 of Part I of this report as well as “Issuer Purchases of Equity Securities” in Item 2 of Part II of this report.

Previous wording

Cash, cash equivalents and investments increased by $4.4 million during the first three months of fiscal 2026. Cash from operating activities generated $227.6 million, which was partially offset by the following: (i) stock repurchases on vesting of our stock unit awards to employees relating to tax withholding of $90.1 million; (ii) cash used for stock repurchases under our stock repurchase program of $80.5 million; and (iii) cash used to fund our investing activities for capital expenditures totaling $73.9 million. In addition to cash provided by operating activities, proceeds from the issuance of equity under our employee stock purchase plan provided $17.2 million in cash during the three months ended January 31, 2026.

Current wording

Cash, cash equivalents and investments increased by $37.7 million during the first six months of fiscal 2026. Cash from operating activities generated $487.3 million, which was partially offset by the following: (i) stock repurchases on vesting of our stock unit awards to employees relating to tax withholding of $179.4 million; (ii) cash used for stock repurchases under our stock repurchase program of $164.9 million; (iii) cash used to fund our investing activities for capital expenditures totaling $114.9 million; and (iv) cash used for payments on our term loan due October 28, 2030 of$5.8 million. In addition to cash provided by operating activities, proceeds from the issuance of equity under our employee stock purchase plan provided $17.2 million in cash during the six months ended May 2, 2026.

Previous wording

The following sections set forth the components of our $227.6 million of cash provided by operating activities during the first three months of fiscal 2026. Net income (adjusted for non-cash charges) provided cash of $265.3 million, offset by cash used in operating assets and liabilities of $37.7 million.

Current wording

The following sections set forth the components of our $487.3 million of cash provided by operating activities during the first six months of fiscal 2026. Net income (adjusted for non-cash charges) provided cash of $612.0 million, offset by cash used in operating assets and liabilities of $124.7 million.

Previous wording

Operating asset and liability requirements increased by$37.7 million during the period. The following table sets forth the major components of the cash changes in operating assets and liabilities (in thousands):

Current wording

Operating asset and liability requirements increased by$124.7 million during the period. The following table sets forth the major components of the cash changes in operating assets and liabilities (in thousands):

Previous wording

As compared to the end of fiscal 2025, for the first three months of fiscal 2026:

Current wording

As compared to the end of fiscal 2025, for the first six months of fiscal 2026:

Previous wording

•The change in accounts receivable primarily reflects improved cash collections partially offset by increased sales volume;

Current wording

•The change in accounts receivable primarily reflects increased sales volume, partially offset by improved cash collections;

Previous wording

•The change in prepaid expenses and other primarily reflects lower prepaid value-added tax (VAT), lower contract assets for unbilled accounts receivable, and reduced refundable cash advances to a third-party contract manufacturer;

Current wording

•The change in prepaid expenses and other primarily reflects higher refundable cash advances to a third-party contract manufacturer and higher prepaid value-added tax (VAT);

Previous wording

•The change in accounts payable, accruals, and other obligations primarily reflects the timing of payments associated with our annual incentive compensation plan partially offset by the timing of payments for payroll and higher payroll related costs;

Current wording

•The change in accounts payable, accruals, and other obligations primarily reflects the timing of payments associated with our annual incentive compensation plan, partially offset by the timing of payments to suppliers;

Previous wording

(1) Interest on the Refinanced 2030 Term Loan is payable periodically based on the interest period selected for borrowing. The Refinanced 2030 Term Loan bears interest at SOFR for the chosen borrowing period plus a spread of 1.75% subject to a minimum SOFR rate of 0.00%. At the end of the first quarter of fiscal 2026, the interest rate on the Refinanced 2030 Term Loan was 5.43%.

Current wording

(1) Interest on the Refinanced 2030 Term Loan is payable periodically based on the interest period selected for borrowing. The Refinanced 2030 Term Loan bears interest at SOFR for the chosen borrowing period plus a spread of 1.75% subject to a minimum SOFR rate of 0.00%. At the end of the second quarter of fiscal 2026, the interest rate on the Refinanced 2030 Term Loan was 5.41%.

Previous wording

(3) Our interest rate swaps fix the SOFR rate for $350.0 million of our Term Loan at 3.47% through January 2028 and another$350.0 million of our Term Loan at 3.287% through December 2028.

Current wording

(3) Our interest rate swaps fix the SOFR rate for $350.0 million of our Refinanced 2030 Term Loan at 3.47% through January 2028 and another$350.0 million of our Refinanced 2030 Term Loan at 3.287% through December 2028.