Ciena Corporation (CIEN) Discusses Financial Objectives, Margin Improvement and Demand Acceleration in Optical Systems Prepared Remarks Transcript

Ciena Corporation ( CIEN ) Discusses Financial Objectives, Margin Improvement and Demand Acceleration in Optical Systems September 15, 2026 8:00 PM EDT Company Participants Marc Graff - Senior VP & CFO Presentation Marc Graff Senior VP & CFO Hello, everyone, and thank you for joining. This is Marc Graff, Ciena's Chief Financial Officer. Today, I'll update you on the journey we've been on for the past few years, the amazing results we've achieved and our plans and financial objectives through 2029. It was a little more than a year ago when Ciena laid out its near-term financial goals, namely structurally improving gross margins, driving towards world-class working capital and having a focused capital allocation strategy. I'm happy to report we've made excellent progress against all 3 of these objectives as they have been the core on delivering the fundamentals for Ciena's business model. You've seen gross margins improve by over 200 basis points year-on-year through an aggressive cost reduction program, pricing actions and accretive product mix. These dynamics are sustainable and have reset our gross margin base to solidly mid-40s. Our working capital management has been a focus not only for financial hygiene, but also to power the growth of the company. We have the resources to fund our growth over the long term and to ensure that our capital is deployed to meet growing customer needs while reinforcing efficiencies such as cash conversion cycles. Lastly, we have a disciplined capital allocation framework that focuses on investing in our current leadership portfolio as its top priority and maintaining an eye to inorganic opportunities as our second priority. Being the only pure-play optical systems and interconnect solution provider and a leader in the industry is the result of decades of deliberate investment decisions, trade-offs and execution to meet this extraordinary market opportunity. Lastly, when