Indian Telecom Operators Moved Much Faster to Mitigate Their Exposure to Huawei

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Ciena, an American company engaged in telecommunications networking equipment and software services on Thursday said that the Indian telecom operators “moved much faster” in reducing their exposure to Huawei. The development was shared by Gary Smith, president and CEO of Ciena in the fourth quarter earnings call. Smith said that the telecom operators in India have 25% to 30% of their total infrastructure with Huawei. However, Smith said that the Indian telecom operators “more aggressively” have been trying to reduce their exposure to Huawei “than the European carriers.”

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Ciena Bullish on the Indian Market

The CEO of Ciena said that the company has already witnessed the telecom operators in India “really mitigate their exposure to Huawei” with Ciena winning “some of that business.”

“And then there’s really sort of two to three carriers there,” Smith said in the fourth quarter earnings call. “The third carrier is very dependent on Huawei, and they’re all making plans to migrate away from that. Always takes longer than you think, but we’re actually quite bullish around the India market as we move forward into the second half of 2021 and into 2022.”

Smith said that Ciena in the past few quarters “won business specifically around the Huawei replacement” but that the company has not “deployed” its products.

“We’ve seen some of that migration away from Huawei in India more aggressively than we’ve seen it in Europe,” Smith said in the fourth quarter earnings call. “It’s moving and decisions are being made now by all of these carriers around mitigating their exposure to Huawei. Some have more exposure than others, but those decisions are being made.”

Huawei Situation Not a “New Dynamic” to Ciena

The company on Thursday reported US$828.5 million revenue in its fourth quarter for the period ended October 31, 2020, as compared to US$968 million in the 2019 fourth quarter. Ciena recorded US$65 million as net income in its 2020 fiscal fourth quarter as compared to US$80.3 million in the same period in the previous year.