Cover and table of contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

☑						ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934
						For the fiscal year ended			October 28, 2023

OR

☐						TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934
						For the transition period from to

Commission file number 001-36250

Ciena Corporation

(Exact name of registrant as specified in its charter)

Delaware

(State or other jurisdiction of

incorporation or organization)

7035 Ridge Road, Hanover, MD

(Address of principal executive offices)

23-2725311

(I.R.S. Employer

Identification No.)

21076

(Zip Code)

Registrant’s telephone number, including area code: (410**)** 694-5700

Securities registered pursuant to Section 12(b) of the Act:

Title of each class			Trading Symbol(s)			Name of each exchange on which registered
Common Stock, $0.01 par value			CIEN			New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes þ No o

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o No þ

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes þ No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer			☑			Accelerated filer			☐			Non-accelerated filer			☐			Smaller reporting company			☐
																		Emerging growth company			☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☑

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. o

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act) Yes ☐ No þ

The aggregate market value of the registrant’s Common Stock held by non-affiliates of the registrant was approximately $6.8 billion based on the closing price of the Common Stock on the New York Stock Exchange on April 28, 2023.

The number of shares of registrant’s Common Stock outstanding as of December 8, 2023 was 144,830,337.

DOCUMENTS INCORPORATED BY REFERENCE

Part III of the Form 10-K incorporates by reference certain portions of the registrant’s definitive proxy statement for its 2024 Annual Meeting of Stockholders to be filed with the Commission not later than 120 days after the end of the fiscal year covered by this report.

CIENA CORPORATION

ANNUAL REPORT ON FORM 10-K

FOR FISCAL YEAR ENDED OCTOBER 28, 2023

TABLE OF CONTENTS

			Page
PART I
Item 1. Business			5
Item 1A. Risk Factors			23
Item 1B. Unresolved Staff Comments			43
Item 2. Properties			43
Item 3. Legal Proceedings			44
Item 4. Mine Safety Disclosures			44
PART II
Item 5. Market for Registrant’s Common Stock, Related Stockholder Matters and Issuer Purchases of Equity Securities			45
Item 6. [Reserved]			46
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations			47
Item 7A. Quantitative and Qualitative Disclosures about Market Risk			64
Item 8. Financial Statements and Supplementary Data			65
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure			112
Item 9A. Controls and Procedures			113
Item 9B. Other Information			113
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspection			114
PART III
Item 10. Directors, Executive Officers and Corporate Governance			115
Item 11. Executive Compensation			115
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters			115
Item 13. Certain Relationships and Related Transactions, and Director Independence			115
Item 14. Principal Accountant Fees and Services			115
PART IV
Item 15. Exhibits and Financial Statement Schedules			116
Item 16. Form 10-K Summary			116
Signatures			117
Index to Exhibits			118

PART I

Cautionary Note Regarding Forward-Looking Statements

This annual report contains statements that discuss future events or expectations, projections of results of operations or financial condition, changes in the markets for our products and services, trends in our business, business prospects and strategies and other “forward-looking” information. In some cases, you can identify “forward-looking statements” by words like “may,” “will,” “would,” “can,” “should,” “could,” “expects,” “future,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “intends,” “potential,” “projects,” “targets,” or “continue” or the negative of those words and other comparable words. These statements may relate to, among other things, our competitive landscape; market conditions and growth opportunities; factors impacting our industry and markets, including macroeconomic conditions and global supply chain constraints; factors impacting the businesses of network operators, their network architectures and their adoption of next-generation network infrastructures; our strategy, including our research and development, supply chain and go-to-market initiatives and our efforts to increase the reach of our business into new or growing product, customer and geographic markets; our order volumes, backlog and seasonality in our business; expectations for our financial results, revenue, gross margin, operating expense and key operating measures in future periods; the adequacy of our sources of liquidity to satisfy our working capital needs, capital expenditures and other liquidity requirements; cybersecurity events; business initiatives including information technology (“IT”) and environmental, social and governance (“ESG”) initiatives; the impact of changes in tax law and our effective tax rates; and market risks associated with financial instruments and foreign currency exchange rates. These statements are subject to known and unknown risks, uncertainties and other factors, and actual events or results may differ materially from any future results, activity, performance, or achievements expressed or implied by these forward-looking statements, including due to factors such as those set forth below in “Risk Factors Summary.”

For a discussion of additional important factors that could cause actual results to vary materially from those anticipated in the forward-looking statements, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” in this annual report. We operate in a very competitive and dynamic environment and new risks and uncertainties emerge, are identified or become apparent from time to time and therefore may not be identified in this annual report. We cannot predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this annual report. You should be aware that the forward-looking statements contained in this annual report are based on our current views and assumptions. We undertake no obligation to revise or update any forward-looking statements made in this annual report to reflect events or circumstances after the date hereof or to reflect new information or the occurrence of unanticipated events, except as required by law. The forward-looking statements in this annual report are intended to be subject to protection afforded by the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Unless the context requires otherwise, references in this annual report to “Ciena,” the “Company,” “we,” “us” and “our” refer to Ciena Corporation.

Risk Factors Summary

Investing in our securities involves a high degree of risk. The following is a summary of the principal factors that make an investment in our securities speculative or risky, as more fully described below in the section titled “Risk Factors.” This summary should be read in conjunction with the “Risk Factors” section and should not be relied upon as an exhaustive summary of the material risks facing our business. In addition to this summary, you should consider the information set forth in the “Risk Factors” section and the other information contained in this annual report before investing in our securities.

Risks Related to Our Business and Industry

• Our backlog may not be an accurate indicator of the level and timing of our future revenues.

• Our revenue, gross margin and operating results can fluctuate significantly and unpredictably from quarter to quarter.

• Challenges relating to supply chain dynamics, including semiconductor components, could adversely impact our growth, gross margins and financial results.

• A small number of customers account for a significant portion of our revenue. The loss of one or more of these customers or a significant reduction in their spending could have a material adverse effect on our business and results of operations.

• We face intense competition that could hurt our sales and results of operations, and we expect the competitive landscape in which we operate or intend to operate to continue to broaden to include additional solutions providers.

• Investment of research and development resources in communications networking technologies for which there is not an adequate market demand, or failure to invest sufficiently or timely in technologies for which there is high market demand, would adversely affect our revenue and profitability.

• We have no guaranteed purchases and regularly must re-win business for existing customers.

• Network equipment sales often involve lengthy sales cycles and protracted contract negotiations that may require us to agree to commercial terms or conditions that negatively affect pricing, risk allocation, payment and the timing of revenue recognition.

• If we are unable to adapt our business to the consumption models for networking solutions adopted by our customers and to offer attractive solutions across these consumption models, our business, competitive position and results of operations could be adversely affected.

• Our go-to-market activities and the distribution of our WaveLogicTM coherent modem technology within the market for high-performance transceivers/modems could expose us to increased or new forms of competition, or adversely affect our existing systems business and results of operations.

• Accurately matching necessary inventory levels to customer demand within the current environment is challenging, and we may incur additional costs or be required to write off significant inventory that would adversely impact our results of operations.

• If the market for network software does not evolve in the way we anticipate or if customers do not adopt our Blue Planet® Automation Software and Services, we may not be able to monetize these software assets and realize a key part of our business strategy.

• Our exposure to the credit risks of our customers and resellers may make it difficult to collect receivables and could adversely affect our revenue and operating results.

• We may be required to write down the value of certain significant assets, which would adversely affect our operating results.

• Problems affecting the performance, interoperability, reliability or security of our products could damage our business reputation and negatively affect our results of operations.

• Strategic acquisitions and investments could disrupt our operations and may expose us to increased costs and unexpected liabilities.

• Emerging issues related to the development and use of artificial intelligence (AI) could give rise to legal or regulatory action, damage our reputation or otherwise materially harm of our business.

Risks Relating to the Macroeconomic Environment and our Global Presence

• Our business and operating results could be adversely affected by unfavorable changes in macroeconomic and market conditions and reductions in the level of spending by customers in response to these conditions.

• The international scale of our sales and operations exposes us to additional risk and expense that could adversely affect our results of operations.

• Efforts to increase our sales and capture market share in targeted international markets may be unsuccessful.

• We may be adversely affected by fluctuations in currency exchange rates.

Risks Related to Our Operations and Reliance on Third Parties

• We may experience delays in the development and production of our products that may negatively affect our competitive position and business.

• We rely on third-party contract manufacturers, and our business and results of operations may be adversely affected by risks associated with their businesses, financial condition, and the geographies in which they operate.

• Our reliance on third-party component suppliers, including sole and limited source suppliers, exposes our business to additional risk, including risk relating to our suppliers’ businesses and financial position and risks arising as a result of geopolitical events, and could limit our sales, increase our costs and harm our customer relationships.

• We rely on third-party resellers and distribution partners to sell our solutions, and on third-party service partners for installation, maintenance and support functions, and our failure to develop and manage these relationships effectively could adversely affect our business, results of operations, and relationships with our customers.

• We may be exposed to unanticipated risks and additional obligations in connection with our resale of complementary products or technology of other companies.

• Growth of our business is dependent on the proper functioning and scalability of our internal business processes and information systems. Adoption of new systems, modifications or interruptions of services may disrupt our business, processes and internal controls.

• Restructuring activities could disrupt our business and affect our results of operations.

• If we are unable to attract and retain qualified personnel, we may be unable to manage our business effectively.

Risks Related to Intellectual Property, Litigation, Regulation and Government Policy

• Our intellectual property rights may be difficult and costly to enforce.

• We may incur significant costs in response to claims by others that we infringe their intellectual property rights.

• Our products incorporate software and other technology under license from third parties, and our business would be adversely affected if this technology were no longer available to us on commercially reasonable terms.

• Data security breaches and cyber-attacks targeting our enterprise technology environment and assets could compromise our intellectual property, technology or other sensitive information, and cause significant damage to our business, reputation and operational capacity.

• We are a party to legal proceedings, investigations and other claims or disputes, which are costly to defend and, if determined adversely to us, could require us to pay fines or damages, undertake remedial measures, or prevent us from taking certain actions, any of which could adversely affect our business.

• Changes in trade policy, including the imposition of tariffs and other import measures, increased export control and investment restrictions, and efforts to withdraw from or materially modify international trade agreements, as well as other regulatory efforts impacting the import and sale of foreign equipment, may adversely affect our business, operations and financial condition.

• Changes in government regulations affecting the communications and technology industries and the businesses of our customers could harm our prospects and operating results.

• Government regulations related to the environment, climate change and social initiatives could adversely affect our business and operating results.

• Investor and other stakeholder scrutiny related to our environmental, social and governance practices, and our disclosed performance and aspirations for these practices, may increase costs and expose us to numerous risks.

• Changes in tax law or regulation, effective tax rates and other adverse outcomes with taxing authorities could adversely affect our results of operations.

• Failure to maintain effective internal controls over financial reporting could have a material adverse effect on our business, operating results and stock price.

Risks Related to Our Common Stock, Indebtedness and Investments

• Our stock price is volatile.

• Outstanding indebtedness under our senior secured credit facilities and senior unsecured notes may adversely affect our liquidity and results of operations and could limit our business.

• Significant volatility and uncertainty in the capital markets may limit our access to funding on favorable terms or at all.