Ciena Stock Drops Over 19% Despite $1.64 EPS, 40% Revenue Growth
CIEN•Analyst firm Raymond James reiterated an Outperform rating for Ciena and raised its price target from $320 to $530, reflecting growing long-term confidence. Despite $1.64 adjusted EPS and 40% revenue growth to $1.57 billion, the stock plunged over 19%, its biggest one-day drop since January 2025.
1. Second-Quarter Earnings Beat
Ciena reported adjusted earnings of $1.64 per share, topping the consensus estimate of $1.46, while revenue rose 40% year-over-year to $1.57 billion, driven by strong demand for networking equipment and software services.
2. Analyst Rating and Price Target Increase
Raymond James maintained an Outperform rating and increased its price target from $320 to $530, also advising existing shareholders to hold, signaling confidence in Ciena’s strategic positioning and long-term growth prospects.
3. Market Reaction
Despite robust financial results, the stock fell more than 19%, marking its largest one-day decline since January 2025, as investors had expected a larger beat-and-raise and stronger AI-related growth catalysts.
4. Outlook and Guidance
Ciena raised its fiscal 2026 revenue outlook to $6.3 billion and projected third-quarter revenue of approximately $1.625 billion, underscoring continued growth but falling short of very high investor expectations.
