Monday, May 1, 2023

Cogent acquires the legacy Sprint fiber network

Cogent Communications completed its previously announced acquisition of T-Mobile's Wireline Business, which is the legacy Sprint U.S. long-haul network. The deal greatly expands Cogent's network footprint and enables it enter the U.S. market for dark fiber and wavelength services.

Cogent paid $1 as the purchase price, subject to customary adjustments for net debt and net working capital. In addition, Cogent will provide T-Mobile with IP transit services in return for $700 million in contractual monthly payments over 54 months; $350 million will be paid in the first year of the agreement.

The deal includes a North American wholly-owned fiber network spanning approximately 19,000 long-haul route miles and approximately 1,300 metro route miles. The assets also include over 47 data centers or colocation facilities. Key services provided include MPLS (Cogent expects to convert to VPLS and WAN), DIA and Transit, Colocation, and Wavelengths.

Cogent said the deal brings a current customer base who are a fit for Cogent's products and services, and a group of experienced employees with the knowledge and capabilities to execute the company's strategy. The legacy Sprint customer base is approximately 1,400 business enterprises, outside of Cogent’s typical customer profile.

Integration of Cogent’s network with the legacy Sprint Wireline network will substantially expand Cogent’s footprint, as well as adding ownership of 47 new facilities, aggregating to over 1,000,000 square feet.

Cogent also said that it plans to migrate these acquired network assets to its more efficient architecture, supporting IP over DWDM for greater wavelength count and throughput per wavelength. Consolidated routing infrastructure will facilitate higher port densities.

Cogent expects its revenue base will be approximately $1.1 billion, or 180% of Cogent’s current $600 million run rate. The multi- year revenue growth target for Cogent post-closing will be 5-7% annually, with targeted aggregate revenue of over $1.5 billion by 2028.

Arista posts Q1 revenue of $1.351 billion

Citing a recovering supply chain, Arista reported Q1 2023 revenue of $1.351 billion, an increase of 5.9% compared to the fourth quarter of 2022, and an increase of 54.1% from the first quarter of 2022. Non-GAAP net income was $452.5 million, or $1.43 per diluted share, compared to non-GAAP net income of $268.5 million, or $0.84 per diluted share in the first quarter of 2022. Non-GAAP gross margin was 60.3%, compared to non-GAAP gross margin of 61.0% in the fourth quarter of 2022 and 63.9% in the first quarter of 2022.

“Amid macroeconomic uncertainty and a gradually recovering supply chain, Arista continues to bring innovative, leading-edge platforms to market, while delivering superior customer and financial outcomes," said Jayshree Ullal, President and CEO of Arista Networks. “Our Q1 results illustrate this with continued growth in revenue and profits.”

Some notes 

Americas sales were 82.5% for the quarter. International sales were 17.5%, down from 23.5% last quarter.

R&D spending anounted to $164.8 million, or 12.2% of revenue, up from $153.2 million last quarter.

At OFC, Arista previewed its vision for Linear Drive optics for intra and interdata center connectivity at 800 gig and beyond.

Imagia raises seed funding for silicon-based optical lenses

Imagia, a start-up based in Fremont, California, announced the close of a $4.5M seed round for evelopment and initial commercial deployment of the company’s first generation of flat, silicon-based optical lenses.

Imagia said its metalens technology can shrink an entire optical assembly into a planar, wafer-thin device, resulting in a dramatic reduction in size and complexity for optical assemblies. Using the patent-pending approach, Imagia can precisely pattern nanoscale structures directly onto various substrates, creating completely flat metalenses that steer light waves by design, and without the need for traditional curved lenses. The lenses can be square or round, and can be made as small as a single pixel on a digital display.

The metalenses can be built directly on top of CMOS devices like LEDs and image sensors in the same fabrication flow. Target applications include AR/VR headsets.

The funding was led by Gates Frontier and joined by MetaVC Partners and other strategic investors.

“Metamaterials are a true paradigm shift in the way we manipulate light,” says Greg Kress, CEO of Imagia, “akin to the shift from analog to digital computing. Traditional glass lenses have been around for hundreds of years. The inherent constraints of working with these types of lenses result in complex, bulky optical assemblies that require precise mechanical alignments. Imagia changes that approach by building lenses like integrated circuits, something that was not possible until very recently.”

“We are firm believers that the next generation of AR glasses will be powered by this kind of metalens technology,” says David Bonelli, Founder & CEO of Pulsar, the leading AR hardware and optics design firm behind Red6's ATARS and NuEyes's NuLoupes. Pulsar is now working in partnership with Imagia, exploring future applications for metalenses. “Imagia’s metalens technology promises to open up new frontiers in optical design that were previously impossible.”

Lattice Semi posts Q1 revenue of $184 million, up 22%

Lattice Semiconductor, reported Q1 revenue of $184.310 million, up 22% compared to Q1 2022 and 5% compared to Q4 2022, which represented the twelfth consecutive quarter of sequential growth. Gross margin was 70.3%.

Jim Anderson, president and CEO, said, "Our strong growth and customer momentum continued into the first quarter of 2023 with a 22% year-over-year increase in revenue. We drove 55% year-over-year growth in net income on a GAAP basis and 36% on a non-GAAP basis. While we’re not immune to macro-economic challenges impacting the industry, we have Lattice-specific growth drivers, which position us well for long-term growth in our core markets."

Sherri Luther, CFO, said, "Q1 2023 represented our twelfth consecutive quarter of sequential growth, with revenue increasing 5% compared to Q4 2022. We achieved record operating profit of 32% on a GAAP basis and 41% on a non-GAAP basis, and expanded gross margin by 290 basis points on a GAAP basis and 260 basis points on a non-GAAP basis compared to Q1 2022. We also completed the tenth consecutive quarter of our share repurchase program."

FCC issues fines for defaults of winning bids in RDOF auction

The FCC is proposing fines totaling $8.7 million against 22 companies for defaulting on their winning bids in the Rural Digital Opportunity Fund Phase I Auction (Auction 904).

“When the Commission set up this program, it set clear rules of the road to ensure that winning bidders would fulfill their promise to use this funding to build new broadband infrastructure,” said Chairwoman Rosenworcel.  “Not following the rules has consequences.  For those who failed to meet their obligations, today’s action shows the Commission takes seriously its commitment to hold applicants accountable and ensure the integrity of our universal service funding.”

“This enforcement action represents the second group of bidders we have pursued for failing to live up to their obligations,” said FCC Enforcement Bureau Chief, Loyaan A. Egal.  “We will be steadfast in making sure that those who impede the timely deployment of broadband-related infrastructure are held to account.”

Arm files for IPO

Arm submitted a draft registration statement on Form F-1 to the U.S. Securities and Exchange Commission (the “SEC”) relating to the proposed initial public offering of American depositary shares representing its ordinary shares. 

The size and price range for the proposed offering have yet to be determined. The initial public offering is subject to market and other conditions and the completion of the SEC’s review process.