Ciena CorporationCIEN is witnessing strong demand and a growing backlog, which is providing increased visibility into future revenue. In the second quarter of fiscal 2026, Ciena’s backlog increased by more than $600 million sequentially to $7.7 billion, and the company expects it to exit fiscal 2026 at an even higher level. On the last earnings call, management highlighted that the combination of robust order flows, customer collaboration, a growing services business and high-quality backlog provides an excellent view for fiscal 2027. Importantly, about $6.4 billion of the backlog is hardware, with roughly 80% expected to be delivered over the next 12 months, supporting confidence in how the backlog can translate into revenue.
Looking ahead, Ciena expects demand to remain strong as hyperscalers continue expanding capital expenditures into fiscal 2027 and beyond, with a larger share of spending expected to be directed toward network infrastructure. Service providers are also reinvesting in optical infrastructure, while managed optical fiber networks are creating additional opportunities. Ciena expects these service-provider opportunities to be multiyear and durable.
At the same time, AI-driven requirements for high-capacity, low-latency connectivity are supporting demand across traditional WAN markets and data center-related applications.
New product deployments could further support revenue growth. Ciena’s RLS Hyper-Rail platform has secured its first multi-rail order from a leading hyperscaler, with the deployment expected to begin in fiscal 2027. Management said similar engagements with major hyperscalers and service providers are progressing well, with opportunities expected to provide linear growth over the next few years. Hyper-Rail is also expected to generate a meaningful revenue increase in fiscal 2027.
Ciena expects DCOM to remain a multiyear application, while its Nubis portfolio and other interconnect opportunities are positioned for growth in the coming years. With backlog expected to continue increasing, ongoing customer deployments and multiple product opportunities moving toward broader adoption, Ciena’s current order momentum provides a stronger foundation for revenue visibility into fiscal 2027.
For third-quarter fiscal 2026, management expects revenues of $1.625 billion (+/- $50 million). The company also raised its fiscal 2026 revenue outlook to $6.3 billion (+/-$100 million), representing roughly 32% year-over-year growth at the midpoint.
Taking a Look at CIEN’s Competitors
Arista NetworksANET is well-positioned as cloud, AI and enterprise customers upgrade high-speed Ethernet networks. Demand spans AI fabrics, core data centers, campus and routing, aided by a stronger supply chain and deeper software automation. New AI fabric platforms, including liquid-cooling options and scale-across capabilities, support next-generation AI clusters, while campus recognition shows traction beyond hyperscale cloud. For the third quarter of 2026, management expects revenues to be approximately $3.3 billion, driven by healthy growth momentum and solid demand trends.
Cisco Systems, Inc.CSCO is seeing broad-based demand, with third-quarter fiscal 2026 revenue of $15.8 billion up 12% year over year. Total product orders rose 35% and networking product orders grew more than 50%, helped by a campus refresh and data center switching orders up more than 40%. For the fourth quarter of fiscal 2026, the company expects revenues of $16.7 billion to $16.9 billion. For fiscal 2026, management raised its outlook to revenue of $62.8 billion to $63.0 billion. Cisco also announced a restructuring plan to reallocate resources toward silicon, optics, security and AI, and expects up to $1 billion of pretax charges, including roughly $450 million in the fourth quarter of fiscal 2026, with the remainder in fiscal 2027.
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