Adtran confirms Tier 1 operator Gfast rollout is on track, continues NG-PON2 trials

Adtran
Overall, sales were up year over year, to $185.1 million.

Adtran confirmed that a large U.S.-based Tier 1 telco is deploying Gfast. Meantime, its NG-PON2 strategy continues to gain momentum.

While he would not reveal the identity of the customer, Tom Stanton, CEO of Adtran, told investors during its third-quarter conference call that the operator is equipping more of its markets with Gfast-based services.

Tom Stanton, Adtran
Tom Stanton

“We expect that to ramp and they’re just getting out there and trying to move it and get everybody centered,” Stanton said. This award had two facets to it—out of region which is being deployed and an in-region build which we are still in the lab."

Stanton added that "our expectation is we would get out of the lab in the first half of next year” for the in-region leg of the Gfast build out. 

Telcos such as AT&T and CenturyLink have been active on the Gfast front.

AT&T began rolling out Gfast-based services in 22 metro markets across the United States in August, naming eight initial cities that have properties equipped with the hybrid fiber/copper and coax technology.

Several of these cities, including Boston and New York City, are outside of AT&T’s traditional 21-state wireline internet serving area.

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Gfast is currently also on sale to MDUs in parts of 14 other metros with additional deployments planned soon.

Likewise, CenturyLink is continuing to move forward with its own Gfast rollout. In September 2016, CenturyLink installed Gfast in Platteville, Wisconsin, to deliver up to 500 Mbps broadband in 44 MDUs. It is also conducting similar deployments in Minnesota. However, the telco sees the opportunity to use the technology to enhance the reach of its Ethernet service.

Additionally, Adtran is continuing as an active participant in Verizon’s NG-PON2 trials.

“What we have is agreements in hand which allows us to participate in trials as they roll things out, but there’s two of us in the RFP and we’re still going through the lab processes,” Stanton said.  

Here’s a breakdown of Adtran’s key metrics:

Network, Services & Support: In the Network Solutions and Services & Support segments, Adtran reported gains. Network Solutions revenues were $145 million, up year-over-year from $136.2 million, while Services & Support revenues jumped to $39.6 million.

Access, Devices, Legacy: Access & Aggregation and Customer Devices were clearly the star performers with revenues for each segment jumping to $135.9 and $35.5 million, respectively. However, Traditional & Other Products declined as expected to $13.6 million.

Financials: From an overall financial perspective, sales were $185.1 million, up year over year from $168.9 million for the third quarter of 2016.

Net income was $15.9 million compared to $12.4 million for the third quarter of 2016.