S&P 400 Component
|Headquarters||Hanover, Maryland, United States|
(president and CEO)
|Products||Networking systems and products|
|Revenue||$2.6 billion USD|
|$72.6 million USD|
Number of employees
Ciena Corporation is a United States-based global supplier of telecommunications networking equipment, software, and services. The company was founded in 1992 and is headquartered in Hanover, Maryland.
In late 1994, during the transition of the first high-speed optical backbone from public sector control of the National Science Foundation to private companies, Ciena began working with Sprint – an earlier carrier of Internet traffic – to develop "high-capacity fiber optic transmission systems called dense wave division multiplexing (DWDM)."  The outcome of their effort was the first commercial dense wave division multiplexing system. With it, the capacity increased "Sprint's nationwide, all-digital fiber-optic network by a stunning 1,600 percent." Sprint therefore became the world's largest carrier of Internet traffic. With success from Sprint and others, Ciena's "first-year sales were the highest ever recorded by a start-up."
In February 1997 Ciena pulled off the biggest initial public offering of a startup company ever, with a first-day valuation of $3.4 billion. Subsequently, Goldman Sachs, in a research note, commented on the records set by Ciena: "1) steepest revenue ramp for any company in history, 2) most profitable company ever in its first year of product shipments, and 3) largest market capitalization of any new IPO." By 2001, Ciena had achieved annual revenues of $1.6 billion and a market capitalization of nearly $30 billion.
Despite setbacks along the way, Ciena continued to grow over the next few years, by both introducing new products and by acquiring companies such as Lightera (optical switches) and Omnia (local access equipment). With a broader product line, Ciena's customer base had grown from a small handful to 27 companies as network operators continued building their systems.
In 2000, Ciena announced the MultiWave Metro optical transport solution, which allowed metropolitan area networks to deliver particular frequencies to individual customer premises. By June 2000, Ciena's stock had soared to $120 per share, giving it a market capitalization exceeding $30 billion. Sales of the company's new line of products prompted the investor optimism, though some analysts were beginning to wonder whether the U.S. fiber optic network had been overbuilt. The customer list continued to grow as it approached 50 names.
Market downturn and diversification
During 2001, the telecommunications market went through a severe downturn, and the segment that included Ciena's optical networking equipment fell by nearly 2/3 to $9.1 billion and in 2002, Ciena's revenues had declined 80% to $361 million. To address the firm's challenges, Gary Smith, previously president and head of sales, was named CEO in May 2001, and Patrick Nettles, CEO since 1994, became executive chairman.
Over the next few years, Ciena re-grouped by expanding its product portfolio to include a broader range of advanced networking solutions, including optical switching, new generation hybrid gear and Ethernet technologies.
Ciena accomplished its diversification effort with internal development as well as a series of acquisitions and strategic partnerships. By 2004 Ciena had purchased a total of 11 firms (half prior to the downturn) with an aggregate value of over $3.3 billion. With a broader range of offerings, Ciena was able both to offer its existing customers a wider range of solutions as well as compete for new customers in additional segments and regions.
Ciena's acquisition history
|Company acquired||Closed date||Approximate value|
|TeraXion||Feb 1, 2016||32|
|Cyan||Aug 3, 2015||400|
|Nortel Metro Ethernet Networks||Mar 19, 2010||774|
|World Wide Packets||Mar 3, 2008||296|
|Internet Photonics||May 3, 2004||100|
|Catena Networks||May 3, 2004||314|
|Akara||Sep 3, 2003||46|
|WaveSmith Networks||June 13, 2003||178|
|ONI Systems||June 21, 2002||398|
|Cyras||Mar 29, 2001||1,100|
|Omnia Communications||July 1, 1999||474|
|Lightera Networks||Mar 31, 1999||464|
|Terabit||Apr 22, 1998||12|
|Alta Telecom||Feb 19, 1998||52|
|AstraCom||Dec 17, 1997||13|
- "History of Ciena" (PDF).
- "Ciena Corp Moving HQ to Station Ridge in Hanover". citybizlist Baltimore. citybizlist. Archived from the original on 28 June 2013.
- Anders, George (1998-06-05). "With Ciena, Investors Hit a Jackpot That's One for the Record Books". Wall Street Journal. ISSN 0099-9660. Retrieved 2017-11-13.
- Hecht, Jeff (October 2016). "Boom, Bubble, Bust: The Fiber Optic Mania". Optics and Photonics News: Cover story.
- Mack, Toni (October 6, 1997). "Communications: the Next Wave". Forbes.
- "Newsroom - Press Releases - Ciena". www.ciena.com. Retrieved 25 May 2017.
- "Ciena Corp. built on dreams, risks Decision: Shareholders will vote Friday on the sale of the Linthicum telecommunications company, one of the most successful U.S. start-ups." Retrieved 25 May 2017.
- Henry, Mary (July 30, 1997) Ciena Corporation – Breaking the Bandwidth Barrier, Goldman Sachs U.S. Research Report,
- "Ciena - A network strategy and technology company - Ciena". ciena.com. Retrieved 25 May 2017.
- "History of CIENA Corporation – FundingUniverse". www.fundinguniverse.com. Retrieved 25 May 2017.
- History of Ciena, Ciena Corp., Retrieved Nov. 1, 2013 from Ciena website
- Moritz, Scott (March 7, 2008) Ciena's Secret Weapon: Diversification, Forbes Magazine, Retrieved, Nov. 13, 2013