Thursday, November 4, 2021

Lumentum to acquire NeoPhotonics for $918M amidst strong demand

Lumentum agreed to acquire NeoPhotonics for $16.00 per share in cash, representing a total equity value of approximately $918 million and a premium of approximately 39% to NeoPhotonics' closing stock price on November 3, 2021.

The companies cited significant next-gen 400G+ opportunities as a leading driver for the merger.

NeoPhotonics, which was founded in 1996 and is based in San Jose, is a leading supplier of tunable lasers and optoelectronic components, including devices manufactured in its own Indium Phosphide fabs and combined with electronics using using Advanced Hybrid Photonic Integration techniques. The product portfolio includes coherent components and tunable lasers, coherent transceivers, wavelength management products, as well as fixed wavelength lasers and high speed driver ICs. The company has engineering and manufacturing facilities in Silicon Valley (USA), Japan and Shenzhen, China.

Lumentum said the acquisition strengthens its position in the more than $10 billion market for optical components used in cloud and telecom network infrastructure. 

"With NeoPhotonics, we're making another important investment in better serving our customers and expanding our photonics capabilities at a time when photonics are at the forefront of favorable long-term market trends," said Alan Lowe, Lumentum President and CEO. "At the center of our strategy is a relentless focus on developing a differentiated portfolio with the most innovative products and technology in our industry so that we can help our customers compete and win in their respective markets. Adding NeoPhotonics' differentiated products and technology and innovative R&D team is consistent with this strategy and together, we will better meet the growing need for next generation optical networking solutions."

"Today's announcement is an exciting milestone for NeoPhotonics," said Tim Jenks, NeoPhotonics President, CEO, and Chairman. "The increasing global demand for our ultra-pure light tunable lasers and photonics technologies for speed over distance applications is more apparent than ever, and Lumentum is the ideal partner to serve our customers on a larger scale. Lumentum recognizes the importance of NeoPhotonics' differentiated photonic technology and products, which are well positioned for accelerated growth in the coming years. "

Lumentum intends to finance the transaction through cash from the combined company's balance sheet. Lumentum also noted that it will provide up to $50 million in term loans to NeoPhotonics to fund anticipated growth, which may require increased working capital and manufacturing capacity.

Separately, NeoPhotonics reported Q3 2021 revenue of $83.7 million, at the high end of guidance range, up 29% quarter-over-quarter and down 18% year-over-year. Gross margin was 28.4%, up from 15.2% in the prior quarter.

“With our very strong performance in the third quarter, we have returned to operating profit on a non-GAAP basis, as we forecasted one year ago. Operating income on a GAAP basis was a loss of $1.3 million, a substantial improvement over our second quarter. Our accelerated growth has been driven by products for 400G and above applications, including the initial ramp of 400ZR and related products, adding to our 400G and above suite,” said Tim Jenks, Chairman and CEO of NeoPhotonics.

Lumentum also reported net revenue of 2022 was $448.4 million for its fiscal first quarter ended October 2, 2021, with GAAP net income of $81.5 million, or $1.08 per diluted share. 

"Driven by strong demand, first quarter financial results were above our guidance ranges across all metrics," said Alan Lowe, President and CEO. "Our Industrial and Consumer product lines and our Commercial Lasers segment revenues were ahead of expectations which more than offset the impact of semiconductor shortages in our Telecom and Datacom product lines."

"Looking to the second quarter, demand continues to be strong, particularly in Telecom and Datacom as well as Commercial Lasers, where we expect revenue to grow sequentially. While we are increasing our supply of semiconductors, we expect the gap between demand and supply for our products in the second quarter will be larger than it was in the first quarter, and we have incorporated this in our guidance," added Mr. Lowe.

NeoPhotonics adds tunable, high power FMCW laser

NeoPhotonics announced a new, tunable high power FMCW (frequency-modulated continuous-wave) laser module and high power semiconductor optical amplifier (SOA) chips. Both components are optimized to enable long range automotive lidar and high resolution industrial sensing applications. The FMCW Laser is C-band tunable and can be directly modulated to provide >21dBm (126mW) fiber coupled power and a narrow linewidth FMCW optical signal. The...

NeoPhotonics debuts CFP2-DCO module for 400G ROADMs

NeoPhotonics announced a new, high output power version of its 400G Multi-Rate CFP2-DCO coherent pluggable transceiver with 0 dBm output power and designed to operate in metro, regional and long haul ROADM based optical networks.NeoPhotonics said its new, high output power module is based on its vertically integrated Indium Phosphide technology platform, including its ultra-pure Nano tunable laser and Class 40 Coherent Driver Modulator (CDM) and...

Lumentum intros 400G CFP2-DCO coherent modules, PAM4 DMLs with 2 km reach for 400G+ 

At next week's virtual Optical Fiber Communication Conference (OFC) Lumentum will introduce new 400G CFP2-DCO coherent modules, enhanced PAM4 DMLs with 2 km reach for 400G+ applications, and expanded WSS capabilities.The new high-performance 400G CFP2-DCO coherent transmission modules build on the company's existing its 200G CFP2-DCO coherent pluggable transceiver modules, enabling next-generation data center interconnects (DCI) and metro/regional...

NeoPhotonics ships QSFP-DD and OSFP 400ZR coherent modules

NeoPhotonics announced the general availability of its QSFP-DD and OSFP 400ZR pluggable modules.These products utilize NeoPhotonics Silicon Photonics Coherent Optical Subassembly (COSA) and low power consumption, ultra-narrow linewidth Nano-ITLA tunable laser, combined with the latest generation of 7 nm node DSP, to provide full 400ZR transmission in a standard data center QSFP-DD or OSFP form factor that can be plugged directly into switches and...

NeoPhotonics: Pluggable 400G over 1500 km in a 75 GHz-spaced system

NeoPhotonics demonstrated its Multi-Rate CFP2-DCO coherent pluggable transceivers transmitting at a 400 Gbps data rate over a distance of 1500 km in a 75 GHz-spaced DWDM network. This 1500 km transmission demonstration was carried out on NeoPhotonics Transmission System Testbed using production modules with enhanced firmware and utilized 75 GHz spaced channels taking the adjacent channel crosstalk-induced penalty into account.  The transmission...

NeoPhotonics ships first coherent components for 800G and up

NeoPhotonics announced the first pilot shipments of Class 60 versions of its Coherent Driver-Modulator (CDM) and Intradyne Coherent Receiver (Micro-ICR) designed for the next generation of 96 GBaud and above systems supporting 800G rates.NeoPhotonics said higher symbol rates increase data capacity while maintaining superior optical signal-to-noise ratio (OSNR) and reach performance, thereby enabling the highest speed-over-distance use. These new...

NeoPhotonics: cumulative shipments of 2M lasers for coherent links

NeoPhotonics reported a significant company and industry milestone: shipment of a cumulative total of more than two million of its ultra-narrow linewidth tunable lasers since initiating shipments in 2011.NeoPhotonics began shipping narrow linewidth tunable lasers in 2011 in the Optical Internetworking Forum (OIF) standard ITLA form factor, which was approximately 3 inches long and approximately one inch wide. NeoPhotonics introduced its Micro-ITLA...

Lumentum completes acquisition of Oclaro

As expected, Lumentum closed its acquisition of Oclaro and trading in Oclaro common stock on the NASDAQ Stock Market has ceased. Under the terms of the merger agreement, Oclaro stockholders will receive $5.60 in cash and 0.0636 of a share of Lumentum common stock for each share of Oclaro common stock that is exchanged in accordance with the terms of the merger agreement. Lumentum financed the cash portion of the transaction consideration with cash...

Lumentum Showcases 100G Single Lambda PAM4 EML, 400G

At this week's OFC 2018 in San Diego, Lumentum is conducting 100G single lambda and 400G FR4 demonstrations, as well as showcasing its catalog of optical modules and transceivers. Live 100G Single Lambda Demonstration: Lumentum's 100G single lambda Multi-Source Agreement (MSA) compliant QSFP28 transceiver features PAM4 higher order modulation technology to transmit 100G over a single wavelength, as well as an IEEE compliant CAUI-4 electrical interface....

Intel: For O-RAN and V-RAN, we're ready to deploy at scale

Operators are embracing open RAN and virtual RAN initiatives as a way to deploy 5G networks. Cristina Rodriguez, Vice President of Network Edge and General Manager of the Wireless Access Network Division at Intel, talks about Intel’s RAN journey and what Open RAN can offer operators.

Download the 2021 Open RAN Report here:

HPE: Open RAN must reduce operational complexity

5G will become for the enterprise what 4G was for the consumer. However, this requires a redesign of the core and radio access networks. In this video, Ignacio García-Carrillo, Telco Infrastructure Pre-Sales Leader at Hewlett Packard Enterprise, talks about why the infrastructure matters in an open RAN deployment and how Telcos can succeed in open RAN with HPE’s Open RAN infrastructure approach. 

Download the 2021 Open RAN Report here:

Finland's research net carries 800G over 2000 km with ADVA

The Finnish University and Research Network (FUNET) successfully transmitted a 800 Gbps channel over 2,000 km over its live network using the ADVA FSP 3000 TeraFlex CoreChannel.

The field trial used ADVA’s new CoreChannel sled featuring 140GBd sub-carrier technology and 150GHz channel spacing. ADVA said the trial set a new benchmark for the industry's longest reach for a single-channel 800 Gbps transmisison.

“ADVA’s FSP 3000 TeraFlex CoreChannel at 800 Gbps speed delivered impressive reach during our tests and was stable throughout the month-long test period when we ran it on our nationwide ADVA open line system. The new 800 Gbps channel technology will give us more flexibility to choose optimum modulation per use case to improve spectral efficiency. And, more importantly, it maps efficiently to 400GbE client services,” said Jani Myyry, senior network specialist, CSC/FUNET. 

“This field trial demonstrates that our network can smoothly support future requirements and deliver even more to our users in the Finnish research and education community. It also will strengthen our confidence that the first multi-Terabit services we aim to deliver early next year together with other Nordic research and education networks can be implemented successfully.”

“It’s fantastic to see our FSP 3000 TeraFlex™ with CoreChannel™ sled pass this major test with such flying colors. Even over the FUNET network’s longest distances, the solution surpassed expectations and showed how incredible speeds are now possible at the lowest possible cost per bit per kilometer,” commented Cornelius Fürst, director, product line management, ADVA. “One of the reasons our FSP 3000 TeraFlex™ CoreChannel™ is able to provide such great long-haul performance is that it carries data at 800Gbit/s using a 150GHz window. Not only does this help to reduce complexity and avoid stranded bandwidth, but it also makes the technology future-proof. 150GHz is the channel spacing that offers the best balance between fiber capacity and optical reach. That’s why it’s gaining traction across the industry and why our open FSP 3000 TeraFlex™ CoreChannel™ sled is ready for new innovation further down the line.”

ADVA's CoreChannel transmits 800G over 1,600-km

ADVA introduced its CoreChannel technology with the power to transmit 800 Gbps over more than 1,600 km using 140GBd sub-carrier technology, representing an improvement in reach of over 50% compared with 95GBd technologies.

ADVA says the new CoreChannel sled for FSP 3000 TeraFlex platform is now being trialed by major carriers and R&E network operators. Compatible with deployed infrastructure, the new solution delivers industry-leading SNR requirements making it resilient to transmission impairments. Along with the bandwidth flexibility and fractional QAM capabilities of the TeraFlex terminal, this ensures 800 Gbps transport with highest efficiency, highest performance and lowest cost. Featuring multi-rate client support, the CoreChannel™ sled can transport any mix of 400GbE, 100GbE and 10GbE services, providing customers with flexibility and protecting their investment as they migrate to higher speeds.

“Network operators across the planet have been harnessing our FSP 3000 TeraFlex to unlock the full potential of their fiber assets. Our compact, plug-and-play terminal offers a simple and cost-efficient way to maximize the capacity of optical infrastructure. Today we’re making it even more powerful with the introduction of our CoreChannel™ sled. Customers can now transport data at 400Gbit/s and 800Gbit/s over longer distances than ever before with a solution that delivers the lowest possible cost per bit per kilometer,” said Christoph Glingener, CTO, ADVA. “Our FSP 3000 TeraFlex™ CoreChannel™ technology offers an enormous boost to operators transmitting services across countries and continents. What’s more, long-haul transport with TeraFlex™ CoreChannel™ is even more efficient and reliable thanks to its superior link signal-to-noise (SNR) requirements and higher network performance.”

BT looks toward Openreach FTTP build for growth

BT reported revenue of £10,305m for the half year to 30 September 2021, down 3%; driven by revenue decline in Enterprise and Global, flat in Consumer, and partially offset by growth in Openreach. Adjusted EBITDA amounted to £3,748m, up 1%, with revenue decline more than offset by lower costs from  transformation programmes and tight cost management.

Some highlights:

  • Ten communication providers including Sky and TalkTalk signed up to Equinox, Openreach's national long-term FTTP pricing offer
  • Record Openreach FTTP build in Q2 and footprint now at almost 6m; expected average build costs lowered to £250-£350 per premises passed
  • Openreach delivered strongest ever H1 for repairs on time at 87.1%, with highest proportion of customers back in service within SLA
  • Consumer and Enterprise have now connected over 1m homes and businesses to FTTP
  • FTTP joint venture: with FTTP build costs coming down and take-up ahead of expectations, decided to retain 100% of the project for shareholders and to remain fully focused on driving build and take-up
  • Launched Eagle-i, the company's flagship security platform for predicting and preventing cyber-attacks for enterprises
  • Delivered £1bn of gross annualised savings 18 months early at a cost of £571m
  • Growth in fixed and broadband ARPC from Q1 into Q2 due to our convergence strategy and CPI+ price rise
  • 5G ready customer base over 5.2m

Philip Jansen, Chief Executive, commenting on the results, said

"These results demonstrate an acceleration of pace in the transformation of BT. We are creating a better BT for our customers, the country and our shareholders. We’re going further and faster on the UK’s next generation connectivity; we’re modernising BT and bringing down costs; and we’re reinstating the dividend today, as planned.

"After a record six months, Openreach has now rolled out full fibre broadband to almost 6m premises and continues to lower its build cost. Its three largest customers are signed up to the new pricing offer as we see rapid adoption of what will be the UK’s first nationwide full fibre network spanning 25m premises by 2026. Meanwhile, our 5G network now covers over 40% of the UK's population and we have over 5.2m 5G ready customers. Together, our networks provide our customers with an unrivalled level of connectivity.

"While we are serving our customers better than ever, BT is also changing rapidly internally. We have hit our £1bn cost savings target 18 months early, which allows us to bring forward our FY25 target for £2bn of savings to FY24. This is all part of creating a leaner BT with simplified processes and improved customer experiences.

"BT is on track and with results in-line with our expectations, we are today confirming our financial outlook for FY22 and FY23. Looking further out, as we pass the peak of our fibre build and move towards an all-fibre, all-IP network, we expect a reduction in capex of at least £1bn and lower operating costs of £500m. From these two factors alone, by the end of the decade we expect an expansion of at least £1.5bn in normalised free cash flow compared to FY22, and that's before any benefits from increased revenue and further transformation efficiencies. Our progressive dividend policy will be underpinned by these increased cash flows as we move to sustainable growth going forward."

BT sets 2030 net zero target for its own operations 

BT Group is bringing forward its net zero target from 2045 to 2030 for its own operational emissions and 2040 for its supply chain and customer emissions.BT said it has already has reduced the carbon emissions intensity of its operations by 57% since 2016 and has reduced supply chain emissions by 19% over the same timeframe.In 2020, the company announced that it had completed the switch to 100% renewable electricity worldwide and pledged to transition...

Adam Crozier appointed as Chairman of BT

Adam Crozier will succeed Jan du Plessis as Chairman of BT Group plc with effect from 1 December 2021 when Jan will retire from the BT Board.Crozier is currently Chairman of Whitbread plc, ASOS plc, Kantar Group Limited, as well as a non-executive director of Sony Corporation. Earlier in his career and for over 20 years he was a CEO across four different sectors, most recently as the CEO of ITV plc and before that as CEO of Royal Mail Holdings plc,...

BT begins testing hollow core fibre

BT kicked off trials of hollow core fibre at the BT Labs in Adastral Park, Ipswich, in a collaborative project with Lumenisity, a Southampton University spin out company, and Mavenir.BT researchers are conducting the trials at BT’s research and engineering campus, using a 10-kilometre-long hollow core fibre cable provided by Lumenisity. The new fibre has a hollow, air filled centre that runs the entire length of the cable. It will be used to test...

BT increases FTTP target from 20m to 25m locations by 2027

 BT reported revenue of £21,331m for the full year to 31 March 2021, down 7%, primarily due to the impact of Covid-19 on its consumer and enterprise units, ongoing legacy product declines and divestments, partly offset by higher equipment revenue and Openreach bases in fibre and Ethernet. Adjusted revenue was down 6% in line with expectation for the full year to 31 March 2021. Adjusted EBITDA was £7,415m, down 6% as expected, primarily...

FCC approves Boeing's non-geostationary satellite constellation

The FCC approved a license for The Boeing Company to construct, deploy, and operate a non-geostationary orbit fixed-satellite service system using frequencies in portions of the V-band (the 37.5-40, 40-42, 47.2-50.2 and 50.4-51.4 GHz bands), and to operate inter-satellite links (ISLs) using frequencies in portions of the V-band (65-71 GHz band).  

The FCC also dismissed Boeing’s request to operate ISLs in certain frequency bands that are not allocated internationally for operations of the FSS in the space-to-space direction in the ITU Radio Regulations.

“Advanced satellite broadband services have an important role to play in connecting hard-to-serve communities,” said FCC Chairwoman Jessica Rosenworcel.  “We are committed to a careful and detailed review of all such applications and I thank the International Bureau team for their work completing this first round of NGSO applications.”

MACOM intros Linear Equalizers support 800G

 MACOM Technology Solutions introduced its new high-performance linear equalizer product line for use in Ethernet, InfiniBand and Fibre Channel high speed data internconnect applications. The new product line supports PAM-4 multi-level signal connectivity and builds upon MACOM’s long-standing expertise in equalizers for broadcast video applications. The product line can support 50 Gbps to 800 Gbps data rate applications.

In addition to backplane applications, a linear equalizer can be used by cable manufactures to create an active copper cable to address short distance and high speed connectivity inside the Data Center. Adding linear equalization to a passive copper cable can enable the same copper cable to carry higher data rates for longer distances. MACOM’s new linear equalizer product line can extend a typical copper cable’s performance to 7.5 meters at 56 Gbps and 5 meters at 112 Gbps data rates. Hyperscale cloud and Internet Service Providers may now consider active copper cables as an alternative to passive copper cables or active optical cables.

MACOM’s linear equalizer product line includes:

  • MAEQ-38902 ­- 56 Gbps per lane, 2-channel equalizer
  • MAEQ-38904 - 56 Gbps per lane, 4-channel equalizer
  • MAEQ-39902 - 112 Gbps per lane, 2-channel equalizer
  • MAEQ-39904 - 112 Gbps per lane, 4-channel equalizer

These products support PAM-4 multilevel and NRZ connectivity. Key benefits include low power consumption from a single 3.3V supply, low latency, hardware and microcontroller management modes. The products are suitable for small SFP, QSFP, QSFP-DD and OSFP connector form factors.

Platform9 appoints Bhaskar Gorti as CEO - former Nokia

Platform9, a start-up based in Mountain View, California, appointed Bhaskar Gorti as its new Chief Executive Officer.  Gorti previously served as president of Nokia Software and Chief Digital Officer.

Platform9 is an open distributed cloud service powered by Kubernetes and cloud-native technologies. The company says its service powers 40K+ nodes across private, public, and edge clouds.

“We are excited to have Bhaskar’s experience and leadership in scaling Platform9 to become an iconic cloud computing company,” said Sirish Raghuram, Co-Founder and Founding CEO. “We have proven that instead of locking-in to the public cloud walled gardens, or spending years in time consuming DIY projects, Platform9 offers the only option for innovative enterprises seeking to be cloud-native. Bhaskar strengthens our leadership team with his extensive experience scaling technology businesses and his deep understanding of the challenges that enterprises face in their cloud-native journey.”

“I am delighted to join Platform9 to build the open distributed cloud category with the hyper growth of Platform9,” said Bhaskar Gorti, new CEO of Platform9. “The market opportunity for our products and technologies is extraordinary. Having created a new category, open distributed cloud, we are uniquely positioned to democratize cloud computing. With Platform9, enterprises can reach their cloud-native transformation goals faster and focus on the applications that drive competitive differentiation. I am thoroughly impressed with the passionate team, their mission, and most of all, the culture and values of Platform9.”

MACOM posts revenue of $155M, up 5.4% yoy

MACOM reported Q4 revenue of $155.2 million for its fiscal fourth quarter and fiscal year ended October 1, 2021, an increase of 5.4% compared to $147.2 million in the previous year fiscal fourth quarter and an increase of 1.7% compared to $152.6 million in the prior fiscal quarter. Gross margin was 58.1%, compared to 52.8% in the previous year fiscal fourth quarter and 57.2% in the prior fiscal quarter. Net income was $17.1 million, or $0.24 per diluted share, compared to net income of $17.5 million, or $0.22 per diluted share, in the previous year fiscal fourth quarter.

“We remain focused on growth and profitability as we enter our next fiscal year,” said Stephen G. Daly, President and Chief Executive Officer.