Alex Henderson's questions to INFN leadership • Q4 2023
Question
Asked for a bridge to the 25% EPS growth guidance, the financial drag from accounting issues, the ramp cadence and scope of the new 800G hyperscaler contract, and the economics of managed optical fiber network (MOFN) deals.
Answer
The 25% EPS growth is driven by revenue growth, 200 bps of gross margin expansion, and controlled OpEx. The accounting drag was ~$3M in Q4 and will be similar in Q1. The 800G contract is for 'hundreds of millions' over 3 years starting in 2025, with a fast ramp, and is for pluggables, though Infinera can compete separately for the systems. MOFN deals are structured like traditional large service provider system sales.