(JDSU) JDS Uniphase Beats Earnings Estimates

Yesterday, after market close, JDS Uniphase Corp. (JDSU) declared solid financial results for the fourth quarter of fiscal 2012. Both the company’s top- and bottom-line beats the Zacks Consensus Estimates.

Its Optical Networking component sector is highly competitive, with several players such as Finisar Corp. (FNSR), Oplink Communications Inc. (OPLK), and Oclaro Inc. (OCLR), to name a few. Despite competitive threats and macro-economic headwinds, JDS Uniphase’s performance in the quarter was quite commendable.

Quarterly net revenue was $439.3 million, down 7% year over year but surpassed the Zacks Consensus Estimate of $423 million. On a GAAP basis, quarterly net loss was $24.3 million or a loss of 10 cents per share compared with a net income of $9.3 million or 4 cents per share in the year-ago quarter. However, quarterly adjusted (excluding special items) earnings per share were 10 cents, a penny above the Zacks Consensus Estimate.

Adjusted gross margin in the reported quarter was 45% compared with 46.7% in the year-ago quarter. In the fourth quarter, operating expenses were $207.9 million, up 12% from the prior-year quarter. Quarterly adjusted operating margin was 8.7% compared with 12.3% in the year-ago quarter. Total segment operating income in the previous quarter was $38.2 million compared with $58.2 million in the prior-year quarter.

At the end of fiscal 2012, JDS Uniphase had $722.5 million of cash & marketable securities and $445.5 million of outstanding debt on its balance sheet compared with $695.7 million of cash & marketable securities and $285.8 million of outstanding debt on its balance sheet at the end of fiscal 2011.

Debt-to-capitalization ratio at the end of fiscal 2012 was 0.13, compared with 0.21 at the end of fiscal 2011. JDS Uniphase generated $38 million of cash from operations in the previous quarter.

Revenue Segments

In the fourth quarter of fiscal 2012, Communications Test and Measurement segment accounted for $196.2 million of revenue, down 7.1% year over year. Communications and Commercial Optical Products segment generated $185 million, down 8.6% year over year.

Within this segment, Optical Communications revenue was $155.4 million, down 10.9% from the prior-year quarter and Commercial Lasers business revenue was $29.6 million, up 6.5% from the prior-year quarter. Advanced Optical Technologies segment generated the remaining $58.1 million revenue, consistent with the year over year number.

Geographic Segments

In the fourth quarter of fiscal 2012, the Americas segment accounted for 54% of total revenue, the EMEA segment generated 22%, and the remaining 24% came from the Asia-Pacific region.

Future Financial Outlook

For the first quarter of fiscal 2013, management expects the company’s non-GAAP revenue to be within the range of $415 million – $435 million.


We maintain our long-term Neutral recommendation on JDS Uniphase. Currently, it holds a short-term Zacks #4 Rank (Sell).

Read the full analyst report on “JDSU”
Read the full analyst report on “FNSR”
Read the full analyst report on “OPLK”
Read the full analyst report on “OCLR”
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