Restructuring Costs

6 Months Ended

May 02, 2020

Restructuring and Related Activities [Abstract]

Restructuring Costs

RESTRUCTURING COSTS

Ciena has undertaken a number of restructuring activities intended to reduce expense and to better align its workforce and costs with market opportunities, product development and business strategies. The following table sets forth the restructuring activity and balance of the restructuring liability accounts, which are included in Accrued liabilities and other short-term obligations on Ciena’s Condensed Consolidated Balance Sheets, for the six months ended May 2, 2020 (in thousands):

	Workforce reduction				Consolidation of excess facilities and other restructuring activities				Total
Balance at November 2, 2019	$	3,983			$	11,160			$	15,143
Charges	4,426			(1)	3,857			(2)	8,283
Adjustments related to ASC 842	—				(11,160		)	(3)	(11,160		)
Cash payments	(5,982		)		(3,857		)		(9,839		)
Balance at May 2, 2020	$	2,427			$	—			$	2,427
Current restructuring liabilities	$	2,427			$	—			$	2,427
Non-current restructuring liabilities	$	—			$	—			$	—

⁽¹⁾ Reflects a global workforce reduction of 86 employees during the six months ended May 2, 2020 as part of a business optimization strategy to improve gross margin, constrain operating expense and redesign certain business processes.

⁽²⁾ Primarily represents variable costs and imputed interest expense related to restructured facilities.

⁽³⁾ Represents restructuring reserve liability recognized as a reduction to Operating right-of-use assets, net in relation to adoption of ASC 842. See Notes 2 and 15 for further discussion.

The following table sets forth the restructuring activity and balance of the restructuring liability accounts, which are included in Accrued liabilities and other short-term obligations on Ciena’s Condensed Consolidated Balance Sheets for the six months ended May 4, 2019 (in thousands):

	Workforce reduction				Consolidation of excess facilities				Total
Balance at November 3, 2018	$	2,108			$	1,739			$	3,847
Charges	5,661			(1)	680			(2)	6,341
Cash payments	(6,667		)		(847		)		(7,514		)
Balance at May 4, 2019	$	1,102			$	1,572			$	2,674
Current restructuring liabilities	$	1,102			$	347			$	1,449
Non-current restructuring liabilities	$	—			$	1,225			$	1,225

⁽¹⁾ Reflects a global workforce reduction of approximately 95 employees during the six months ended May 4, 2019 as part of a business optimization strategy to improve gross margin, constrain operating expense and redesign certain business processes.

⁽²⁾ Reflects unfavorable lease commitments in connection with a portion of the facilities for certain locations in the United States and India where Ciena has vacated unused space.