XML 21 R10.htm IDEA: XBRL DOCUMENT v3.21.1
Revenue
 6 Months Ended
May 01, 2021
Revenue from Contract with Customer [Abstract]  
Revenue REVENUE
Disaggregation of Revenue

Ciena’s disaggregated revenue represents similar groups that depict the nature, amount, and timing of revenue and cash flows for Ciena’s various offerings. The sales cycle, contractual obligations, customer requirements, and go-to-market strategies may differ for each of its product lines, resulting in different economic risk profiles for each line. Effective as of the beginning of fiscal 2021, Ciena renamed its “Packet Networking” product line to “Routing and Switching.” This change, affecting only the presentation of such information, was made on a prospective basis and does not impact comparability of previous financial results. References to prior reported “Packet Networking” product line have been changed herein to“Routing and Switching.”

The tables below set forth Ciena’s disaggregated revenue for the respective periods (in thousands):
Quarter Ended May 1, 2021
Networking PlatformsPlatform Software and ServicesBlue Planet Automation Software and ServicesGlobal ServicesTotal
Product lines:
Converged Packet Optical
$573,657 $— $— $— $573,657 
Routing and Switching63,628 — — — 63,628 
Platform Software and Services
— 56,688 — — 56,688 
Blue Planet Automation Software and Services
— — 23,958 — 23,958 
Maintenance Support and Training
— — — 70,418 70,418 
Installation and Deployment
— — — 37,999 37,999 
Consulting and Network Design
— — — 7,579 7,579 
Total revenue by product line
$637,285 $56,688 $23,958 $115,996 $833,927 
Timing of revenue recognition:
Products and services at a point in time
$637,285 $20,765 $10,765 $1,411 $670,226 
Services transferred over time
— 35,923 13,193 114,585 163,701 
Total revenue by timing of revenue recognition
$637,285 $56,688 $23,958 $115,996 $833,927 

Quarter Ended May 2, 2020
Networking PlatformsPlatform Software and ServicesBlue Planet Automation Software and ServicesGlobal ServicesTotal
Product lines:
Converged Packet Optical
$654,294 $— $— $— $654,294 
Routing and Switching64,167 — — — 64,167 
Platform Software and Services
— 44,985 — — 44,985 
Blue Planet Automation Software and Services
— — 15,017 — 15,017 
Maintenance Support and Training
— — — 71,479 71,479 
Installation and Deployment
— — — 34,242 34,242 
Consulting and Network Design
— — — 9,869 9,869 
Total revenue by product line
$718,461 $44,985 $15,017 $115,590 $894,053 
Timing of revenue recognition:
Products and services at a point in time
$718,461 $16,978 $4,745 $4,677 $744,861 
Services transferred over time
— 28,007 10,272 110,913 149,192 
Total revenue by timing of revenue recognition
$718,461 $44,985 $15,017 $115,590 $894,053 
Six Months Ended May 1, 2021
Networking PlatformsPlatform Software and ServicesBlue Planet Automation Software and ServicesGlobal ServicesTotal
Product lines:
Converged Packet Optical
$1,085,981 $— $— $— $1,085,981 
Routing and Switching127,934 — — — 127,934 
Platform Software and Services
— 106,527 — — 106,527 
Blue Planet Automation Software and Services
— — 40,892 — 40,892 
Maintenance Support and Training
— — — 138,049 138,049 
Installation and Deployment
— — — 77,610 77,610 
Consulting and Network Design
— — — 14,064 14,064 
Total revenue by product line
$1,213,915 $106,527 $40,892 $229,723 $1,591,057 
Timing of revenue recognition:
Products and services at a point in time
$1,213,915 $36,828 $15,939 $3,268 $1,269,950 
Services transferred over time
— 69,699 24,953 226,455 321,107 
Total revenue by timing of revenue recognition
$1,213,915 $106,527 $40,892 $229,723 $1,591,057 

Six Months Ended May 2, 2020
Networking PlatformsPlatform Software and ServicesBlue Planet Automation Software and ServicesGlobal ServicesTotal
Product lines:
Converged Packet Optical
$1,245,844 $— $— $— $1,245,844 
Routing Switching131,675 — — — 131,675 
Platform Software and Services
— 96,873 — — 96,873 
Blue Planet Automation Software and Services
— — 30,482 — 30,482 
Maintenance Support and Training
— — — 133,271 133,271 
Installation and Deployment
— — — 69,196 69,196 
Consulting and Network Design
— — — 19,624 19,624 
Total revenue by product line
$1,377,519 $96,873 $30,482 $222,091 $1,726,965 
Timing of revenue recognition:
Products and services at a point in time
$1,377,519 $30,092 $8,481 $8,874 $1,424,966 
Services transferred over time
— 66,781 22,001 213,217 301,999 
Total revenue by timing of revenue recognition
$1,377,519 $96,873 $30,482 $222,091 $1,726,965 

Ciena reflects its sales geographically around the following markets: (i) Americas; (ii) Europe, Middle East and Africa (“EMEA”); and (iii) Asia Pacific, Japan and India (“APAC”). Americas includes activities in North America and South America. Within each geographic area, Ciena maintains specific teams or personnel that focus on a particular region, country, customer or market vertical. These teams include sales management, account salespersons and sales engineers, as well as services professionals and commercial management personnel. The following table reflects Ciena’s geographic distribution of revenue based principally on the relevant location for Ciena’s delivery of products and performance of services.
For the periods below, Ciena’s geographic distribution of revenue was as follows (in thousands):
Quarter EndedSix Months Ended
May 1,May 2,May 1,May 2,
2021202020212020
Geographic distribution:
Americas
$587,475 $650,381 $1,084,086 $1,224,385 
EMEA
155,054 141,431 310,472 271,396 
APAC
91,398 102,241 196,499 231,184 
Total revenue by geographic distribution
$833,927 $894,053 $1,591,057 $1,726,965 
Ciena’s revenue includes $518.6 million and $598.4 million of United States revenue for the second quarter of fiscal 2021 and 2020, respectively. For the six months ended May 1, 2021 and May 2, 2020, United States revenue was $1.0 billion and $1.1 billion, respectively. No other country accounted for 10% or more of total revenue for the periods presented above.
For the periods below, the only customers that accounted for at least 10% of Ciena’s revenue were as follows (in thousands):
Quarter EndedSix Months Ended
 May 1,May 2,May 1,May 2,
 2021202020212020
AT&T$125,138 $105,630 $193,941 $189,640 
Verizonn/an/an/a203,630 
Total$125,138 $105,630 $193,941 $393,270 
n/aDenotes revenue representing less than 10% of total revenue for the period
The customers identified above purchased products and services from each of Ciena’s operating segments.

•Networking Platforms revenue reflects sales of Ciena’s Converged Packet Optical and Routing and Switching product lines.
◦Converged Packet Optical - includes the 6500 Packet-Optical Platform, the Waveserver® stackable interconnect system, the 6500 Reconfigurable Line System (RLS) and the 5400 family of Packet-Optical Platforms. This product line also includes sales of the Z-Series Packet-Optical Platform.
◦Routing and Switching - includes the 3000 family of service delivery switches and service aggregation switches and the 5000 family of service aggregation switches. This product line also includes the 8700 Packetwave Platform, the Ethernet packet configuration for the 5410 Service Aggregation Switch, and the 6500 Packet Transport System (PTS), which combines packet switching, control plane operation, and integrated optics.
The Networking Platforms segment also includes sales of operating system software and enhanced software features embedded in each of the product lines above. Revenue from this segment is included in product revenue on the Condensed Consolidated Statements of Operations. Operating system software and enhanced software features embedded in Ciena hardware are each considered distinct performance obligations for which the revenue is generally recognized upfront at a point in time upon transfer of control.

•Platform Software and Services provides analytics, data, and planning tools to assist customers in managing Ciena’s Networking Platforms products in their networks. Ciena’s platform software includes its Manage, Control and Plan (MCP) domain controller solution, OneControl Unified Management System, as well as planning tools and a number of legacy software solutions that support Ciena’s installed base of network solutions. Platform software-related services revenue includes sales of subscription, installation, support, and consulting services related to Ciena’s software platforms, operating system software and enhanced software features embedded in each of the Networking Platforms product lines above. Revenue from the software portion of this segment is included in product revenue on the Condensed Consolidated Statements of Operations. Revenue from services portions of this segment is included in services revenue on the Condensed Consolidated Statements of Operations.

•Blue Planet® Automation Software and Services is a comprehensive, micro-services, standards-based open software suite, together with related services, that enables customers to implement large-scale software and IT-led operations support system (OSS) transformations by transforming legacy networks into “service ready” networks, accelerating the creation, delivery and lifecycle management of new, cloud-based services. Ciena’s Blue Planet Automation Platform
includes multi-domain service orchestration (MDSO), inventory management (BPI), route optimization and analysis (ROA), network function virtualization orchestration (NFVO), and unified assurance and analytics (UAA). Services revenue includes sales of subscription, installation, support, consulting and design services related to Ciena’s Blue Planet Automation Platform. Revenue from the software portion of this segment is included in product revenue on the Condensed Consolidated Statements of Operations. Revenue from services portions of this segment is included in services revenue on the Condensed Consolidated Statements of Operations.

Ciena’s software platform revenue typically reflects either perpetual or term-based software licenses, and these sales are considered distinct performance obligations where revenue is generally recognized upfront at a point in time upon transfer of control. Revenue from software subscription and support is recognized ratably over the period during which the services are performed. Revenue from professional services for solution customization, software and solution support services, consulting and design, and build-operate-transfer services relating to Ciena’s software offerings is recognized over time with Ciena applying the input method to determine the amount of revenue to be recognized in a given period.

•Global Services revenue reflects sales of a broad range of Ciena’s services for maintenance support and training, installation and deployment, and consulting and network design activities. Revenue from this segment is included in services revenue on the Condensed Consolidated Statements of Operations.
Ciena’s Global Services are considered a distinct performance obligation where revenue is generally recognized over     time. Revenue from maintenance support is recognized ratably over the period during which the services are performed. Revenue from installation and deployment services and consulting and network design services is recognized over time with Ciena applying the input method to determine the amount of revenue to be recognized in a given period. Revenue from training services is generally recognized at a point in time upon completion of the service.

Contract Balances

The following table provides information about receivables, contract assets and contract liabilities (deferred revenue) from contracts with customers (in thousands):
Balance at May 1, 2021Balance at October 31, 2020
Accounts receivable, net$716,779 $719,405 
Contract assets for unbilled accounts receivable, net$81,437 $85,843 
Deferred revenue$204,299 $158,363 

Ciena’s contract assets represent unbilled accounts receivable, net where transfer of a product or service has occurred but invoicing is conditional upon completion of future performance obligations. These amounts are primarily related to installation and deployment and professional services arrangements where transfer of control has occurred, but Ciena has not yet invoiced the customer. Contract assets are included in prepaid expenses and other current assets in the Condensed Consolidated Balance Sheets. See Note 11 below.

Contract liabilities consist of deferred revenue and represent advanced payments against non-cancelable customer orders received prior to revenue recognition. Ciena recognized approximately $78.0 million and $76.5 million of revenue during the first six months of fiscal 2021 and 2020, respectively, that was included in the deferred revenue balance as of October 31, 2020 and November 2, 2019, respectively. Revenue recognized due to changes in transaction price from performance obligations satisfied or partially satisfied in previous periods was immaterial during the six months ended May 1, 2021 and May 2, 2020.

Capitalized Contract Acquisition Costs

Capitalized contract acquisition costs consist of deferred sales commissions, were $18.4 million and $15.3 million as of May 1, 2021 and October 31, 2020, respectively, and were included in prepaid expenses and other and other long-term assets. The amortization expense associated with these costs was $10.7 million and $10.1 million during the first six months of fiscal 2021 and 2020, respectively, and was included in sales and marketing expense.

Remaining Performance Obligations

Remaining Performance Obligations (“RPO”) are comprised of non-cancelable customer purchase orders for products and services that are awaiting transfer of control for revenue recognition under the applicable contract terms. As of May 1, 2021, the
aggregate amount of RPO was $1.4 billion. As of May 1, 2021, Ciena expects approximately 83% of the RPO to be recognized as revenue within the next twelve months.