Sycamore revenue surges

Sycamore Networks reported 92% more quarterly revenue today than it did a year ago. Its $27.3 million in revenue for its first fiscal quarter of 2006 represents a 48% sequential jump in a sector that is often lumpy quarter-to-quarter. And with $6.9 million net income for the quarter (which ended Oct. 31), Sycamore has also achieved its second consecutive profitable quarter in years.

On today’s conference call, chief executive Dan Smith pointed out that the company is gaining market share—at least according to Ovum-RHK, which declared Sycamore to have become the number-three vendor in the optical crossconnect market in the second quarter. But, as always, he reminded listeners that quarterly revenue fluctuations in this sector are often dictated by the timing of customer deployments. And as such, the company would not provide revenue guidance for the coming quarter.

“This customer set and this application are inherently lumpy,” Smith said. “You either win [a contract] or you lose it.”

In August, the company announced it had been awarded a contract to supply Korean carrier KT with equipment for a nationwide backbone network.

About 80% of Sycamore’s fiscal first-quarter revenue came from products, while the other 20% came from services. Of the company’s 14 paying customers in the quarter, only one did not purchase services. Half of them purchased services only.

Meanwhile, Sycamore continues to evaluate strategic alternatives, which it first announced in August 2004.

During the quarter, it eliminated 18 employees, most of whom held research and development positions.