ADTRAN (Nasdaq: ADTN) once again rode an ongoing growth curve in Q4 as company sales increased 33 percent to $165 million, up from $124 million in Q4 2009.
The vendor's operating income increased 71 percent to $44 million in Q4 compared to $26 million for Q4 09, while net income increased 93 percent to $35 million for the quarter, compared to $18 million for Q4 2009.
Similar to its Q3 2010 earnings, the drivers of growth in ADTRAN's fourth quarter earnings illustrated strong demand for its broadband access, internetworking and optical networking gear.
Buoyed by sales of its Total Access 5000 platform and Fiber to the X (FTTX) products, ADTRAN's broadband access segment grow 75 percent over Q4 09.
Tom Stanton, Chief Executive Officer and Chairman of the Board for ADTRAN in the earnings call ADTRAN said during yesterday's earnings call that "100 carriers who have selected or are now deploying" the Total Access 5000 platform and that the "Fiber-To-The-Node products continue to show growing acceptance as Carriers continue to invest to upgrade services to their subscribers and migrate their networks to packet based technologies."
However, ADTRAN did see expected losses in Fiber to the Node (FTTN) and traditional HDSL revenue. Fiber to the Node revenue, while up year-over-year, declined sequentially and HDSL revenue was down 16 percent in the quarter.
ADTRAN's carrier division reported a 39 percent rise in sales, while internetworking and optical access segments grew 37 percent and 24 percent over Q4 09, respectively. Stanton attributed optical access division growth "to market share gain and increasing shipments to all major market segments as carriers invested to increase bandwidth for wireless infrastructure."
Although ADTRAN has been gaining traction with Tier 2 and Tier 3 service providers, ADTRAN continues to hold a commanding presence at the three largest U.S. service providers AT&T, Qwest and Verizon. When broken out, AT&T (NYSE: T), Qwest (NYSE: Q) and Verizon (NYSE: VZ) make up 20, 18, and 10 percent of its respective Tier 1 carrier revenues.
Of course, one of the big questions for ADTRAN is what effect will CenturyLink's (NYSE: CTL) acquisition of Qwest, another major ADTRAN customer, if any on future revenue? Prior to being bought by CenturyTel, the former Embarq was also a major ADTRAN customer.
"I will tell you let me just say Centurylink is a very good customer of ours," said Stanton. "We're very hopeful for the future, but I really can't say much more than that."
For more:
- see the release
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