Adtran rides robust broadband access deployment to record Q4 sales

Increasing deployment of broadband access gear, carrier acceptance of professional services help and mobile network upgrades requiring more robust fiber and copper infrastructures were among the factors that helped network equipment vendor Adtran post record sales of more than $165 million for the fourth quarter of 2010. The vendor also saw net income jump 93 percent to almost $37 million for Q4 2010, compared with Q4 2009.

Adtran CEO Tom Stanton said on this morning’s Q4 earnings call that broadband access gear revenues alone grew 75 percent over Q4 2009 on increased deployment of the company’s Total Access 5000 broadband access platform. The company’s carrier networking division overall experienced a 39 percent growth in sales, while its enterprise division also posted strong growth.

“We also benefitted from carriers taking advantage of our professional services group,” Stanton said, adding later, “In 2011, professional services will add incremental revenue growth as more carriers seek to cost-effectively expand their deployments.”

Other sources of sales growth during Q4 included technologies used to increase mobile network bandwidth, such as HDSL, OTN others. Also, fiber-to-the node product sales grew year-over-year both domestically and internationally, Stanton said.

Adtran has many Tier 2 and Tier 3 carrier customers, but larger telcos continue to account for as much as 45 percent of quarterly revenue. Stanton responded to an analyst question about the breakdown by saying the Qwest Communications accounted for 19 percent of revenue during Q4, while 16 percent came from AT&T and 10 percent from Verizon Communications.

Qwest is close to being acquired by growing independent telco giant CenturyLink, but Stanton said Adtran does not currently see any reason for the healthy business relationship to change. “We see no change in behavior, and no reason for a major change in plans,” he said. “To date, we have not seen a slowdown.”