ADTRAN: Q4 earnings up, but predicts Q1 slowdown

Strong growth in broadband access and optical access drove better-than-expected results for ADTRAN in Q4 09.

During the quarter, ADTRAN reported that sales rose 11 percent to $124 million, up from $112 in Q4 08. Operating income increased 22 percent to $26 million versus $21 million in Q4 08. ADTRAN's net income was $18 million, up from $16 million in Q4 08.

"In the fourth quarter, our growth categories demonstrated a strong performance, achieving a 42 percent year over year revenue increase," ADTRAN Chief Executive Officer Tom Stanton said in an earnings release. "Inter-networking revenues achieved a record revenue level growing an impressive 46 percent over the prior year. Broadband access revenues grew 46 percent as we continued to see increasing acceptance of our Carrier Ethernet and Broadband services platforms. Optical access revenues showed continued strength growing 30 percent as carriers increased investment in wireless bandwidth upgrades."

While Stanton believes that the optical access and broadband will continue to be solid performers throughout 2010, Q1 2010 will be a bit of a struggle. After the vendor forecast that there would be decline in Q1 2010 revenue, ADTRAN's shares fell about 4 percent today.  

On the bright side, ADTRAN could ride the oncoming wave of tier 2-3 service provider's broadband stimulus projects that will come online this year. To date, the NTIA and RUS have awarded some of the initial funds in the first round of funding, while the second round winners will be announced next September.

For more:
- see the official release here
- Reuters his this forecast article

Related articles
ADTRAN Q3 09: profits dip, but earnings beat expectations
ADTRAN sees second-quarter profit dip
NTIA, RUS kick off the 2nd broadband stimulus funding round
U.S. Government doles out initial broadband stimulus awards

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