Oclaro, Inc. (OCLR) reported revenues of $93.6 million in the second quarter of fiscal 2010, up 10% sequentially. The results beat the high end of the management’s updated guidance.
Oclaro Inc. was formed in April 2009 combining Bookham Inc. and Avanex Corporation. Oclaro, a Delaware corporation, designs, manufactures and markets optical components, modules and subsystems that generate, detect, amplify, combine and separate light signals principally for use in high-performance fiber optics communication networks.
Gross margin came in at 27% compared to 26% in the prior quarter. Operating income came in at $1.5 million in the second quarter of fiscal 2010, flat with the prior quarter. Net income came in at $2.1 million compared to break even earnings in the prior quarter. Earnings of one cent per share were in line with the Zacks Consensus Estimate.
Oclaro ended the quarter with cash and equivalents of $51.7 million, up from $48 million at the end of the previous quarter.
In December 2009, Oclaro acquired Xtellus, Inc. and its complete line of Wavelength Select Switching (WSS) products and technology. Xtellus is a leading supplier of Reconfigurable Optical Add/Drop Multiplexer (ROADM) technology and dynamic optical modules for Agile Optical Networking Systems. With this acquisition, Oclaro will have a complete family of WSS−capable of powering ROADM applications over the entire optical network, from the edge to the core.
WSS is one of the fastest growing segments of the optical component market, and management expects the acquisition of Xtellus to play a significant role for growth in future. The acquisition also completes the overall portfolio of product areas required to support Oclaro’s strategic positioning throughout the metro and long haul areas of the telecommunication market.
Going forward, management expects revenues between $97 million and $102 million in the third quarter of fiscal 2010, including approximately $2.0 million to $3.0 million of Xtellus related revenues. Gross margin is projected between 26% and 29%.
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