CIENA CORP

Previous wording

For large portions of fiscal 2021 and fiscal 2022, we received an unprecedented volume of orders for our products and services, which significantly exceeded our revenue and historical order volumes. We believe some portion of these orders reflected customer acceleration of future orders due to a constrained supply environment, as well as orders that were delayed due to the dynamics of the COVID-19 pandemic. Our order volumes began to moderate in the fourth quarter of fiscal 2022, and we experienced order levels below revenue during fiscal 2023 and the first half of fiscal 2024, particularly from our communications service provider customers. Our expected return to more typical order patterns with our communications service provider customers is taking longer than anticipated. We believe this is, in part, due to communications service providers in North America working through relatively high levels of inventory previously acquired, which has been made more difficult due to challenges installing and deploying equipment, including site readiness and access to fiber or other resources. In addition, in certain international geographies, we believe that caution driven by macroeconomic concerns and market-specific issues are contributing to lower-than-expected order volumes from communications service providers. We expect these dynamics with our communications service provider customers to persist during fiscal 2024 and anticipate that any future improvements to these dynamics will be gradual. Notwithstanding these near-term impacts, we continue to believe that certain trends and shifts in business and consumer behaviors, including enterprise and consumer cloud network adoption, 5G, high-definition video, generative AI, and network operator focus on resilience and automation, represent positive, long-term drivers of bandwidth demand and long-term opportunities for our business.

Current wording

For large portions of fiscal 2021 and fiscal 2022, we received an unprecedented volume of orders for our products and services, which significantly exceeded our revenue and historical order volumes. We believe some portion of these orders reflected customer acceleration of future orders due to long lead times during the constrained supply environment of that period, as well as orders that were delayed due to the dynamics of the COVID-19 pandemic. Our order volumes began to moderate in the fourth quarter of fiscal 2022, and we experienced order levels below revenue during fiscal 2023 and the first half of fiscal 2024, particularly from our communications service provider customers. We believe this was, in part, due to communications service providers in North America working through relatively high levels of inventory previously acquired, which has been made more difficult due to challenges installing and deploying equipment, including site readiness and access to fiber or other resources. In addition, in certain international geographies, we believe that caution driven by macroeconomic concerns and market-specific issues contributed to lower-than-expected order volumes from communications service providers. These dynamics have begun to improve, and order levels relative to revenue increased in the third quarter of fiscal 2024 compared to prior quarters in fiscal 2024, in part due to increased bandwidth demand related to generative AI. We continue to expect that improvements to these dynamics will be gradual and will not be linear. Notwithstanding these near-term impacts, we continue to believe that certain trends and shifts in business and consumer behaviors, including enterprise and consumer cloud network adoption, 5G, high-definition video, generative AI, and network operator focus on resilience and automation, represent positive, long-term drivers of bandwidth demand and long-term opportunities for our business.

Previous wording

Historically, a meaningful portion of our quarterly revenue was generated from customer orders received during that same quarter (which we refer to as “book to revenue”) and was therefore less predictable and subject to fluctuation. As a result of elevated order volumes during portions of fiscal 2021 and fiscal 2022, however, our backlog grew from $1.2 billion at the end of fiscal 2020 to $4.2 billion at the end of fiscal 2022. Accordingly, our revenue in recent fiscal years has been more significantly impacted by factors including availability of supply and customer delivery deferrals, as we converted our existing backlog to revenue. As supply chain conditions have improved, and we have been able to increase shipment volumes and reduce lead times, our backlog decreased to $1.9 billion as of the end of the second quarter of fiscal 2024. As backlog consumption reduces and represents a relatively smaller portion of our quarterly revenue, we expect that our reliance upon securing quarterly book to revenue orders will grow, and that increased orders and a return to a more typical composition of our quarterly revenue will be a critical element of any future revenue growth.

Current wording

Historically, a meaningful portion of our quarterly revenue was generated from customer orders received during that same quarter (which we refer to as “book to revenue”) and was therefore less predictable and subject to fluctuation. As a result of elevated order volumes during portions of fiscal 2021 and fiscal 2022, however, our backlog grew from $1.2 billion at the end of fiscal 2020 to $4.2 billion at the end of fiscal 2022. Accordingly, our revenue in recent fiscal years has been more significantly impacted by factors including availability of supply and customer delivery deferrals, as we converted our existing backlog to revenue. As supply chain conditions have improved, and we have been able to increase shipment volumes and reduce lead times, our backlog decreased to $2.1 billion as of the end of the third quarter of fiscal 2024. As backlog consumption reduces and represents a relatively smaller portion of our quarterly revenue, we expect that our reliance upon securing quarterly book to revenue orders will grow, and that increased orders and a return to a more typical composition of our quarterly revenue will be a critical element of any future revenue growth.

Previous wording

The timing, pace, and degree to which we fulfill our backlog will have a significant impact on our revenue and can be affected by factors outside of our control, including customer readiness and willingness to receive shipment against existing orders. During fiscal 2023 and the first half of fiscal 2024, certain customers, including communications service providers and cable and multiservice operators in North America, that had earlier placed significant advanced orders, rescheduled deliveries for a portion of such orders. We believe that this was the result of a number of factors, including the rapid improvement in our delivery lead times as supply chain conditions improved and their capital expenditure and inventory levels. Accordingly, our results for a particular period can be difficult to predict. As a result of these and other factors, the timing of our fulfillment of backlog could cause some volatility in our results of operations and our backlog should not necessarily be viewed as an accurate indicator of revenue for any particular period.

Current wording

The timing, pace, and degree to which we fulfill our backlog will have a significant impact on our revenue and can be affected by factors outside of our control, including customer readiness and willingness to receive shipment against existing orders. During fiscal 2023 and the first nine months of fiscal 2024, certain customers, including communications service providers and cable and multiservice operators in North America, that had earlier placed significant advanced orders, rescheduled deliveries for a portion of such orders. We believe that this was the result of a number of factors, including the rapid improvement in our delivery lead times as supply chain conditions improved, constraints on customer capital expenditures, and high levels of network equipment inventory held by many of our customers. Accordingly, our results for a particular period can be difficult to predict. As a result of these and other factors, the timing of our fulfillment of backlog could cause some volatility in our results of operations and our backlog should not necessarily be viewed as an accurate indicator of revenue for any particular period.

Previous wording

As a result of the factors impacting order volumes and order delivery timing described under “Overview” above, our revenue declined by 19.6% in the second quarter of fiscal 2024 as compared to the second quarter of fiscal 2023, and 11.0% in the first six months of fiscal 2024 as compared to the first six months of fiscal 2023. In addition, during the second quarter and first six months of fiscal 2024, approximately 15.0% of our revenue was non-U.S. Dollar-denominated primarily including sales in Euros, Canadian Dollars, and Indian Rupees. During the second quarter of fiscal 2024 as compared to the second quarter of fiscal 2023, and during the first six months of fiscal 2024 as compared to the first six months of fiscal 2023, the U.S. Dollar fluctuated against these currencies. As a result of these currency fluctuations, our revenue reported in U.S. Dollars was adversely impacted by approximately $0.6 million, or 0.1%, as compared to the second quarter of fiscal 2023, and increased by approximately $5.5 million, or 0.3% as compared to the first six months of fiscal 2023.

Current wording

As a result of the factors impacting order volumes and order delivery timing described under “Overview” above, our revenue declined by 11.8% in the third quarter of fiscal 2024 as compared to the third quarter of fiscal 2023, and 11.2% in the first nine months of fiscal 2024 as compared to the first nine months of fiscal 2023. In addition, during both the third quarter and first nine months of fiscal 2024, approximately 14.4% of our revenue was non-U.S. Dollar-denominated, primarily including sales in Euros, Canadian Dollars, and Indian Rupees. During the third quarter of fiscal 2024 as compared to the third quarter of fiscal 2023, the U.S. Dollar primarily strengthened against these and other currencies. As a result of these currency fluctuations, our revenue reported in U.S. Dollars was adversely impacted by approximately $2.5 million, or 0.3%, as compared to the third quarter of fiscal 2023. During the first nine months of fiscal 2024 as compared to the first nine months of fiscal 2023, the U.S. Dollar fluctuated against these and other currencies, however, there was minimal impact as compared to the first nine months of fiscal 2023.

Previous wording

•Networking Platforms segment revenue decreased by $238.6 million, reflecting product line sales decreases of $224.3 million of our Optical Networking products and $14.3 million of our Routing and Switching products.

Current wording

•Networking Platforms segment revenue decreased by $147.0 million, reflecting product line sales decreases of $112.1 million of our Optical Networking products and $34.9 million of our Routing and Switching products.

Previous wording

◦Optical Networking sales decreased, primarily reflecting sales decreases of $188.1 million of our 6500 Packet-Optical Platform, primarily to communications service providers and enterprise customers, $40.0 million of our Waveserver® modular interconnect system, primarily to cloud providers, and $10.5 million of our 5400 family of Packet-Optical Platforms primarily to communications service providers. These sales decreases were partially offset by a sales increase of $13.2 million of our 6500 Reconfigurable Line System (RLS) products, primarily to enterprise customers and cloud providers partially offset by decreased sales to communications service providers.

Current wording

◦Optical Networking sales decreased, primarily reflecting sales decreases of $110.0 million of our 6500 Packet-Optical Platform, primarily to communications service providers, enterprise customers and cable and multiservice operators, and $59.7 million of our 6500 Reconfigurable Line System (RLS) products, primarily to cloud providers. These sales decreases were partially offset by a sales increase of $41.5 million of our Waveserver® modular interconnect system, primarily to cloud providers and communications service providers. Also partially offsetting the sales decreases were $17.6 million of increased sales primarily of our WaveLogic 5 Nano 100G-400G coherent pluggable transceivers primarily to cloud providers.

Previous wording

◦Routing and Switching sales decreased, primarily reflecting sales decreases of $7.9 million of our 3000 and 5000 families of service delivery and aggregation switches and $4.4 million of our virtualization software, primarily to communications service providers.

Current wording

◦Routing and Switching sales decreased, primarily reflecting a sales decrease of $53.3 million of our 3000 and 5000 families of service delivery and aggregation switches primarily to communications service providers, cable and multiservice operators and enterprise customers, partially offset by a sales increase of $20.2 million of our virtualization software, primarily to communications service providers.

Previous wording

•Platform Software and Services segment revenue increased by $16.0 million, reflecting sales increases of $9.3 million of our software platforms and $6.7 million in our software maintenance services, both primarily for our Navigator NCS software platform.

Current wording

•Platform Software and Services segment revenue increased by $4.3 million, reflecting sales increases of $2.8 million of our software platforms and $1.5 million in our software maintenance services, both primarily for our Navigator NCS domain controller solution software platform.

Previous wording

•Global Services segment revenue increased by $21.2 million, primarily reflecting sales increases of $12.4 million of our installation and deployment services and $10.5 million of our maintenance support and training, partially offset by a sales decrease of $1.7 million of our consulting and network design services.

Current wording

•Global Services segment revenue increased by $4.5 million, primarily reflecting sales increases of $3.4 million of our consulting and network design services and $1.5 million of our maintenance support and training.

Previous wording

•Networking Platforms segment revenue decreased by $286.5 million, reflecting product line sales decreases of $264.1 million of our Optical Networking products and $22.4 million of our Routing and Switching products.

Current wording

•Networking Platforms segment revenue decreased by $433.5 million, reflecting product line sales decreases of $376.2 million of our Optical Networking products and $57.3 million of our Routing and Switching products.

Previous wording

◦Optical Networking sales decreased, primarily reflecting sales decreases of $366.7 million of our 6500

Current wording

◦Optical Networking sales decreased, primarily reflecting sales decreases of $476.7 million of our 6500

Previous wording

Packet-Optical Platform, primarily to communications service providers, enterprise customers, cloud providers and cable and multiservice operators, and $14.3 million of our 5400 family of Packet-Optical Platforms, primarily to communications service providers. These sales decreases were partially offset by sales increases of $86.7 million of our 6500 RLS products, primarily to cloud providers, enterprise customers and cable and multiservice operators, and $24.5 million of our Waveserver® products, primarily to cloud providers and cable and multiservice operators.

Current wording

Packet-Optical Platform, primarily to communications service providers, enterprise customers, cable and multiservice operators, and cloud providers, and $16.2 million of our 5400 family of Packet-Optical Platforms, primarily to communications service providers. These sales decreases were partially offset by sales increases of $65.9 million of our Waveserver® products, primarily to cloud providers and communications service providers and $27.0 million of our 6500 RLS products, primarily to enterprise customers and cable and multiservice operators, partially offset by a sales decrease to communications service providers. Also partially offsetting the sales decreases were $25.5 million of increased sales primarily of our WaveLogic 5 Nano 100G-400G coherent pluggable transceivers primarily to cloud providers.

Previous wording

◦Routing and Switching sales decreased, primarily reflecting a sales decrease of $34.3 million of our virtualization software, primarily to communications service providers. This sales decrease was partially offset by sales increases of $7.1 million of our 8100 Coherent IP networking platforms, primarily to communications service providers and enterprise customers, and $4.6 million of our platform independent software, primarily to communications service providers.

Current wording

◦Routing and Switching sales decreased, primarily reflecting sales decreases of $50.3 million of our 3000 and 5000 families of service delivery and aggregation switches primarily to communications service providers, enterprise customers, and cable and multiservice operators, $14.1 million of our virtualization software, primarily to communications service providers, and $6.6 million of our 8700 Packetwave Platform, primarily to communications service providers. These sales decreases were partially offset by sales increases of $9.0 million of our 8100 Coherent IP networking platforms, primarily to enterprise customers and communications service providers, and $6.4 million of our platform independent software, primarily to communications service providers.

Previous wording

•Platform Software and Services segment revenue increased by $32.3 million, primarily reflecting sales increases of $18.1 million in sales of software platforms and $14.2 million in sales of our software maintenance services, both primarily for our Navigator NCS software platform.

Current wording

•Platform Software and Services segment revenue increased by $36.6 million, reflecting sales increases of $20.9 million in sales of software platforms and $15.7 million in sales of our software maintenance services, both primarily for our Navigator NCS software platform.

Previous wording

•Blue Planet Automation Software and Services segment revenue decreased by $6.1 million reflecting sales decreases of $4.7 million in software platforms and $1.4 million in professional software services, both primarily to communications service providers.

Current wording

•Blue Planet Automation Software and Services segment revenue increased by $5.0 million, primarily reflecting sales increases of $4.0 million in professional software services primarily for our BPI and ROA platforms and $1.0 million in software platforms.

Previous wording

•Global Services segment revenue increased by $6.9 million, primarily reflecting sales increases of $4.3 million of our installation and deployment services and $4.2 million of our maintenance support and training, partially offset by a sales decrease of $1.6 million of our consulting and network design services.

Current wording

•Global Services segment revenue increased by $25.6 million, reflecting sales increases of $12.1 million of our installation and deployment services, $11.9 million of our maintenance support and training and $1.6 million of our consulting and network design services.

Previous wording

Our operating segments engage in business and operations across three geographic regions: the United States, Canada, the Caribbean and Latin America (“Americas”); Europe, Middle East and Africa (“EMEA”); and Asia Pacific, Japan and India (“APAC”). The geographic distribution of our revenue can fluctuate significantly from period to period, and the timing of revenue recognition for large network projects, particularly outside of the United States, can result in large variations in geographic revenue results in any particular period. The decrease in our Americas region revenue for the quarter and six months ended April 27, 2024 was primarily driven by decreased sales in the United States and Canada. The decrease in our APAC region revenue for the quarter and six months ended April 27, 2024 was primarily driven by decreased sales in India and Australia. The decrease in our EMEA region revenue for the quarter April 27, 2024 was primarily driven by decreased sales in France and the Great Britain. The increase in our EMEA region revenue for the six months ended April 27, 2024 was primarily driven by increased sales in the Netherlands.

Current wording

Our operating segments engage in business and operations across three geographic regions: the United States, Canada, the Caribbean and Latin America (“Americas”); Europe, Middle East and Africa (“EMEA”); and Asia Pacific, Japan and India (“APAC”). The geographic distribution of our revenue can fluctuate significantly from period to period, and the timing of revenue recognition for large network projects, particularly outside of the United States, can result in large variations in geographic revenue results in any particular period. The decrease in our Americas region revenue for the quarter and nine months ended July 27, 2024 was primarily driven by decreased sales in the United States and Canada. The decrease in our APAC region revenue for the quarter and nine months ended July 27, 2024 was primarily driven by decreased sales in India and Australia. The decrease in our EMEA region revenue for the quarter ended July 27, 2024 was primarily driven by decreased sales in the Netherlands and Great Britain. The increase in our EMEA region revenue for the nine months ended July 27, 2024 was partially offset by sales decreases in Great Britain and France.

Previous wording

•Americas revenue decreased by $131.5 million, primarily reflecting sales decreases of $143.7 million within our Networking Platforms segment and $1.0 million within our Blue Planet Automation Software and Services segment, partially offset by a sales increase of $13.4 million within our Platform Software and Services. The decrease within our Networking Platforms segment reflects product line sales decreases of $133.8 million of our Optical Networking products and $9.9 million of our Routing and Switching products. The decrease within our Optical Networking product line was primarily related to sales decreases of $99.2 million of our 6500 Packet-Optical Platform, primarily to communications service providers, and $23.0 million of our Waveserver® modular interconnect system, primarily to cloud providers. The decrease within our Routing and Switching product line primarily reflects sales decreases of $5.1 million of our 3000 and 5000 families of service delivery and aggregation switches to enterprise customers and cable and multiservice operators, and $4.4 million of our virtualization software, primarily to communications service providers.

Current wording

•Americas revenue decreased by $30.9 million, primarily reflecting a sales decrease of $41.8 million within our Networking Platforms segment. This sales decrease was offset by sales increases of $4.4 million within our Blue Planet Automation Software and Services segment, $3.4 million within our Global Services segment, and $3.1 million within our Platform Software and Services segment. The decrease within our Networking Platforms segment reflects product line sales decreases of $21.5 million of our Optical Networking products and $20.3 million of our Routing and Switching products. The decrease within our Optical Networking product line was primarily related to sales decreases of $46.5 million of our 6500 Packet-Optical Platform, primarily to communications service providers and cable and multiservice operators, and $37.5 million of our 6500 RLS products, primarily to cloud providers, partially offset by a sales increase of $44.8 million of our Waveserver® modular interconnect system, primarily to cloud providers and communications service providers. Also partially offsetting the sales decreases were $16.7 million of increased sales primarily of our WaveLogic 5 Nano 100G-400G coherent pluggable transceivers primarily to cloud providers. The decrease within our Routing and Switching product line primarily reflects a sales decrease of $40.7 million of our 3000 and 5000 families of service delivery and aggregation switches primarily to communications service providers and enterprise customers, partially offset by a sales increase of $20.2 million of our virtualization software, primarily to communications service providers.

Previous wording

•EMEA revenue decreased by $17.6 million, reflecting sales decreases of $17.3 million within our Networking Platforms segment, $5.0 million within our Blue Planet Software and Services segment and $1.1 million within our Platform Software and Services segment, offset by a sales increase of $5.7 million within our Global Services segment. The decrease within our Networking Platforms segment primarily reflects product line sales decreases of $11.6 million of our Optical Networking product line and $5.7 million of our Routing and Switching products. The decrease within our Optical Networking product line was primarily related to a sales decrease of $21.2 million of our 6500 Packet-Optical Platform, primarily to communications service providers and cable and multiservice operators, and $7.6 million of our Waveserver® products, primarily to communications service providers, partially offset by a sales increase of $17.3 million of our 6500 RLS products, primarily to cloud providers.

Current wording

•EMEA revenue decreased by $17.8 million, primarily reflecting a sales decrease of $27.0 million within our Networking Platforms segment, partially offset by a sales increase of $8.5 million within our Blue Planet Software and Services segment. The decrease within our Networking Platforms segment primarily reflects product line sales decreases of $15.9 million of our Routing and Switching products and $11.1 million of our Optical Networking product line. The decrease within our Routing and Switching product line was primarily related to a sales decrease of $14.8 million of our 3000 and 5000 families of service delivery and aggregation switches to communications service providers and cable and multiservice operators. The decrease within our Optical Networking product line was primarily related to a sales decrease of $17.8 million of our 6500 RLS products, primarily to cloud providers, partially offset by a sales increase of $6.2 million of our Waveserver® products, primarily to communications service providers and cloud providers.

Previous wording

•APAC revenue decreased by $72.7 million, primarily reflecting a sales decrease of $77.6 million within our Networking Platforms segment, partially offset by increased sales of $3.7 million within our Platform Software and Services segment and $1.3 million within our Global Services segment. The decrease within our Networking Platforms segment primarily reflects a product line sales decrease of $78.9 million of Optical Networking products, which primarily reflects a sales decrease of $67.8 million of our 6500 Packet-Optical Platform, primarily to communications service providers.

Current wording

•APAC revenue decreased by $76.9 million, primarily reflecting a sales decrease of $78.3 million within our Networking Platforms segment, partially offset by a sales increase of $1.5 million within our Platform Software and Services segment. The decrease within our Networking Platforms segment primarily reflects a product line sales decrease of $79.5 million of Optical Networking products, which primarily reflects sales decreases of $63.6 million of our 6500 Packet-Optical Platform, primarily to enterprise customers and communications service providers and $9.6 million of our Waveserver® products.

Previous wording

•Americas revenue decreased by $178.4 million, reflecting sales decreases of $203.4 million within our Networking Platforms segment and $2.4 million within our Blue Planet Automation Software and Services segment. These sales decreases were partially offset by sales increases of $22.2 million within our Platform Software and Services segment and $5.2 million within our Global Services segment. Our Networking Platforms segment revenue decrease reflects product line sales decreases of $176.1 million of Optical Networking products and $27.3 million of Routing and Switching products. Our Optical Networking revenue primarily reflects a sales decrease of $235.3 million of our 6500 Packet-Optical Platform, primarily to communications service providers and cloud providers, partially offset by sales increases of $50.9 million of our 6500 RLS products, primarily to cloud providers and enterprise customers, and $16.7 million of our Waveserver® modular interconnect system, primarily to communications service providers. Routing and Switching product line sales primarily reflect a sales decrease of $34.3 million of our virtualization software primarily to communications service providers, partially offset by a sales increase of $7.1 million of our 8100 Coherent IP networking platforms, primarily to communications service providers.

Current wording

•Americas revenue decreased by $209.3 million, reflecting sales decreases of $245.2 million within our Networking Platforms segment. This sales decrease was offset by sales increases of $25.3 million within our Platform Software and Services segment, $8.7 million within our Global Services segment and $1.9 million within our Blue Planet Automation Software and Services segment. Our Networking Platforms segment revenue decrease reflects product line sales decreases of $197.6 million of Optical Networking products and $47.6 million of Routing and Switching products. Our Optical Networking revenue primarily reflects a sales decrease of $281.8 million of our 6500 Packet-Optical Platform, primarily to communications service providers, cloud providers and cable and multiservice operators, partially offset by a sales increase of $61.5 million of our Waveserver® modular interconnect system, primarily to communications service providers and cloud providers. Also partially offsetting the sales decrease were $19.9 million of increased sales primarily of our WaveLogic 5 Nano 100G-400G coherent pluggable transceivers primarily to cloud providers and $13.4 million of increased sales of our 6500 RLS products, primarily to enterprise customers and cable and multiservice operators, partially offset by a sales decrease to communications service providers. Routing and Switching product line sales primarily reflect sales decreases of $42.2 million of our 3000 and 5000 families of service delivery and aggregation switches to communications service providers, cable and multiservice operators and enterprise customers and $14.1 million of our virtualization software primarily to communications service providers, partially offset by a sales increase of $8.9 million of our 8100 Coherent IP networking platforms, primarily to enterprise customers and communications service providers.

Previous wording

•EMEA revenue increased by $37.0 million, reflecting sales increases of $25.2 million within our Networking Platforms segment, $12.8 million within our Global Services segment and $4.3 million within our Platform Software and Services segment. These sales increases were offset by a sales decrease of $5.3 million within our Blue Planet Automation Software and Services segment. Our Networking Platforms segment revenue increase primarily reflects a product line sales increase of $25.2 million of Optical Networking products. Optical Networking revenue primarily reflects sales increases of $30.8 million of our 6500 RLS products primarily to cloud providers and $17.2 million of our Waveserver® products, primarily to cloud providers partially offset by a sales decreases to communication services providers. These sales increases were partially offset by a sales decrease of $23.2 million of our 6500 Packet-Optical Platform, primarily to communications service providers.

Current wording

•EMEA revenue increased by $19.2 million, reflecting sales increases of $13.8 million within our Global Services segment, $4.0 million within our Platform Software and Services segment and $3.2 million within our Blue Planet Automation Software and Services segment. These sales increases were offset by a sales decrease of $1.8 million within our Networking Platforms segment. Our Global Services segment revenue increase primarily reflects sales increases of $7.7 million of our installation and deployment services and $5.3 million of our maintenance support and training.

Previous wording

•APAC revenue decreased by $99.2 million, primarily reflecting a sales decrease of $108.3 million within our Networking Platforms segment. This sales decrease was partially offset by sales increases of $5.8 million within our Platform Software and Services segment and $3.1 million within our Global Services segment. Our Networking Platforms segment revenue decrease primarily reflects a product line sales decrease of $113.2 million of Optical Networking products, including a sales decrease of $108.2 million of our 6500 Packet-Optical Platform, primarily to communications service providers and enterprise customers.

Current wording

•APAC revenue decreased by $176.1 million, primarily reflecting a sales decrease of $186.6 million within our Networking Platforms segment. This sales decrease was partially offset by sales increases of $7.3 million within our Platform Software and Services segment and $3.2 million within our Global Services segment. Our Networking Platforms segment revenue decrease primarily reflects a product line sales decrease of $192.8 million of Optical Networking products, including a sales decrease of $171.9 million of our 6500 Packet-Optical Platform, primarily to communications service providers and enterprise customers.

Previous wording

•Gross profit on products decreased by $107.9 million. Product gross margin decreased by 140 basis points, primarily due to lower manufacturing efficiencies and higher inventory excess and obsolescence costs, partially offset by product cost reductions.

Current wording

•Gross profit on products decreased by $52.3 million. Product gross margin slightly increased by 30 basis points, primarily due to product cost reductions and improved manufacturing efficiencies partially offset by higher inventory excess and obsolescence costs and a higher concentration of lower margin product mix, as described above.

Previous wording

•Gross profit on services increased by $27.9 million. Services gross margin increased by 290 basis points, primarily due to higher margins on Blue Planet software services due to improved efficiencies on delivery. Additionally, margins on deployment services increased due to increased revenue and efficiencies reducing costs.

Current wording

•Gross profit on services increased by $7.3 million. Gross margin increased by 100 basis points, primarily due to improved margins on Blue Planet software services due to improved efficiencies on delivery, partially offset by lower margins on maintenance support and training.

Previous wording

•Gross profit decreased by $88.0 million. Gross margin increased by 80 basis points, primarily due to reduced component costs and improved margins on Blue Planet software, partially offset by higher inventory excess and obsolescence costs and lower manufacturing efficiencies.

Current wording

•Gross profit decreased by $133.0 million. Gross margin increased by 80 basis points, primarily due to product cost reductions, improved manufacturing efficiencies and improved margins on Blue Planet software services, partially offset by higher inventory excess and obsolescence costs and a higher concentration of lower margin “common” equipment and photonic sales.

Previous wording

•Gross profit on products decreased by $115.9 million. Product gross margin slightly increased by 10 basis points, primarily due to reduced component costs and higher software revenue, partially offset by higher inventory excess and obsolescence costs and lower manufacturing efficiencies.

Current wording

•Gross profit on products decreased by $168.3 million. Product gross margin slightly increased by 20 basis points, primarily due to product cost reductions and improved manufacturing efficiencies partially offset by higher inventory excess and obsolescence costs and a higher concentration of lower margin product mix, as described above.

Previous wording

•Gross profit on services increased by $8.8 million. Gross margin increased by 140 basis points, primarily due to increased revenue for Platform software subscription services and higher margins on Blue Planet software services due to improved efficiencies on delivery.

Current wording

•Gross profit on services increased by $35.3 million. Services gross margin increased by 230 basis points, primarily due to improved margins on Blue Planet software services due to improved efficiencies on delivery, partially offset by lower margins on maintenance support and training.

Previous wording

Approximately 50.3% and 49.1% of our operating expense was non-U.S. Dollar-denominated during the second quarter and first six months of fiscal 2024, respectively, including expenses in Canadian Dollars, Indian Rupees, and Euros. During the second quarter of fiscal 2024, as compared to the second quarter of fiscal 2023, and during the firstsix months of fiscal 2024, as compared to the firstsix months of fiscal 2023, the U.S. Dollar fluctuated against these currencies. As a result of these currency fluctuations, our operating expense, net of hedging, reported in U.S. Dollars, was adversely affected by approximately $0.6 million, or 0.1% and $1.5 million, or 0.2%, respectively.

Current wording

Approximately 47.7% and 48.7% of our operating expense was non-U.S. Dollar-denominated during the third quarter and first nine months of fiscal 2024, respectively, primarily including expenses in Canadian Dollars, Indian Rupees, and Euros. During the third quarter of fiscal 2024, as compared to the third quarter of fiscal 2023, the U.S. Dollar strengthened against these and other currencies. As a result of these currency fluctuations, our operating expense, net of hedging, reported in U.S. Dollars, slightly decreased by approximately $1.5 million, or 0.4%, as compared to the third quarter of fiscal 2023. During the first nine months of fiscal 2024 as compared to the first nine months of fiscal 2023 the U.S. Dollar primarily strengthened against these and other currencies, however, net of hedging, there was minimal impact as compared to the first nine months of fiscal 2023.

Previous wording

•Research and development expense increased by $5.4 million, net of hedging. This increase primarily reflects increases in employee-related compensation costs, net of a lower provision associated with our annual cash incentive compensation plan, and facility and information technology costs.

Current wording

•Research and development expense decreased by $0.5 million. This decrease primarily reflects decreases in professional services, partially offset by increases in employee-related compensation costs, net of a lower provision associated with our annual cash incentive compensation plan, prototype expense, and facility and information technology costs.

Previous wording

•Selling and marketing expense decreased by $1.0 million. This decrease primarily reflects decreases in employee-related compensation costs primarily due to lower commission expense and lower provisions associated with our annual cash incentive compensation plan, partially offset by an increase in travel and entertainment costs.

Current wording

•Selling and marketing expense increased by $3.3 million. This increase primarily reflects increases in employee-related compensation costs primarily due to higher commission expense, partially offset by a decrease in travel and entertainment costs.

Previous wording

•Significant asset impairments and restructuring costs reflects actions that we have taken with respect to our operations, global workforce, and facilities as part of a business optimization strategy to improve gross margin, constrain operating expense, redesign certain business processes, and restructure real estate facilities. For more information on our restructuring costs, see Note 4 to our Condensed Consolidated Financial Statements included in Item 1 of Part I of this report.

Current wording

•Significant asset impairments and restructuring costs reflects actions that we have taken with respect to our operations, global workforce, and facilities as part of a business optimization strategy to improve gross margin, constrain operating expense, redesign certain business processes, and restructure real estate facilities.

Previous wording

•Amortization of intangible assets decreased by $1.9 million, primarily reflecting certain intangible assets having reached the end of their economic lives.

Current wording

•Amortization of intangible assets decreased by $2.3 million, primarily reflecting certain intangible assets having reached the end of their economic lives.

Previous wording

•Research and development expense increased by $10.9 million, net of hedging. This increase primarily reflects increases in employee-related compensation costs, net of a lower provision associated with our annual cash incentive compensation plan, facility and information technology costs and higher technology related costs, partially offset by decreased professional services.

Current wording

•Research and development expense increased by $10.4 million, net of hedging. This increase primarily reflects increases in employee-related compensation costs, net of a lower provision associated with our annual cash incentive compensation plan, facility and information technology costs and higher technology related costs, partially offset by decreased professional services.

Previous wording

•Selling and marketing expense increased by $3.3 million. This increase primarily reflects increases in employee-related compensation costs, net of lower commission expense and lower provisions associated with our annual cash incentive compensation plan, and increases in travel and entertainment costs, partially offset by decreased selling and marketing costs.

Current wording

•Selling and marketing expense increased by $6.6 million. This increase primarily reflects increases in employee-related compensation costs and increases in travel and entertainment costs, partially offset by decreased facility and information technology costs and selling and marketing costs.

Previous wording

•General and administrative expense increased by $2.4 million. This increase primarily reflects an increase in employee-related compensation costs, net of a lower provision associated with our annual cash incentive compensation plan and bad debt expense partially offset by a decrease in costs for professional services.

Current wording

•General and administrative expense increased by $11.3 million. This increase primarily reflects increases in legal fees, employee-related compensation costs, net of a lower provision associated with our annual cash incentive compensation plan, facility and information technology costs, and bad debt expense.

Previous wording

•Amortization of intangible assets decreased by $2.1 million, primarily reflecting certain intangible assets having reached the end of their economic lives.

Current wording

•Amortization of intangible assets decreased by $4.4 million, primarily reflecting certain intangible assets having reached the end of their economic lives.

Previous wording

•Interest and other income, net increased by $3.2 million, primarily resulting from higher interest income on our investments partially offset by the impact of foreign exchange rates on assets and liabilities denominated in a currency other than the relevant functional currency, net of hedging activity.

Current wording

•Interest and other income, net increased by $3.8 million, primarily resulting from higher interest income on our investments and the impact of foreign exchange rates on assets and liabilities denominated in a currency other than the relevant functional currency, net of hedging activity.

Previous wording

•Provision for income taxes decreased by $29.0 million, and the effective tax rate for the second quarter of fiscal 2024 was lower than the effective tax rate for the second quarter of fiscal 2023, both primarily due to the decrease in pre-tax book income for the quarter.

Current wording

•Provision for income taxes decreased by $32.5 million, primarily due to the decrease in pre-tax book income for the quarter ended July 27, 2024. The effective tax rate for the third quarter of fiscal 2024 was lower than the effective tax rate for the third quarter of fiscal 2023, primarily due to the reduction in the amount of research and development expenses capitalized with respect to foreign subsidiaries.

Previous wording

•Interest and other income, netdecreased by $18.1 million, primarily resulting from the remeasurement of our previously held investment in Tibit to fair value, in fiscal 2023, which resulted in a gain on our equity investment of $26.5 million and the impact of foreign exchange rates on assets and liabilities denominated in a currency other than the relevant functional currency, net of hedging activity. These decreases were partially offset by higher interest income on our investments.

Current wording

•Interest and other income, netdecreased by $14.3 million, primarily resulting from the remeasurement of our previously held investment in Tibit to fair value, in fiscal 2023, which resulted in a gain on our equity investment of $26.5 million and the impact of foreign exchange rates on assets and liabilities denominated in a currency other than the relevant functional currency, net of hedging activity. These decreases were partially offset by higher interest income on our investments.