Ciena

History

Ciena was founded by David Huber, Kevin Kimberlin, and Optelecom to find ways to increase the capacity to design optical networking tech anagogic communication. In 1994, Sevin Rosen invested $3.3 million in Ciena's Series A Venture financing.

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 marketing 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.

"The network specialist"

In late 2004 Ciena refreshed its branding with the tag-line "the network specialist" to reflect additional capabilities in optical transport and switching. Ciena's diversification strategy and numerous acquisitions were accompanied by its ability to integrate new products and technology advances. This success was in contrast to many of its rivals, such as Nortel, Alcatel Lucent and others that struggled.

Ciena's acquisition history

In 2010, Ciena bought from Nortel Networks its optical networking and Carrier Ethernet business for $774 million. This acquisition doubled Ciena's size and increased its customer base to over 1000.

On May 4, 2015 Ciena announced a definitive agreement to acquire Cyan. The Cyan acquisition was completed on August 3, 2015