Shares of Ciena climbed after the network-equipment supplier reported a jump in revenue as supply-chain challenges improved.
The stock rose 15% to $49.59 in morning trading. So far this year, shares are still down about 3%.
“It is a catch-up quarter from the supply-chain constraints of the previous year,” Chief Executive Gary Smith said in an interview. “We expected it to be strong and it’s playing out that way.”
Revenue for the fiscal third quarter surged 23% to $1.07 billion, topping analysts’ expectations of $1.04 billion.
Adjusted earnings, which strip out stock-based compensation and restructure charges, came to 59 cents a share, above the 51 cents a share expected by analysts, according to a FactSet survey.
Smith said revenue won’t continue to grow at that pace forever as customer orders normalize in response to more supply availability. Still, he said demand remains strong for Ciena’s networking equipment and will likely get a boost over the longer term from the adoption of artificial intelligence, which will push demand for computing and networking power higher.