Reporting its first quarterly earnings since being acquired by CommScope, Arris said that sales declined across its product sectors.
Network and cloud sales slide 18% to $440 million, with CommScope attributing the decline to a particularly strong first quarter in 2018.
“Networking and Cloud business is experiencing an unusually slow start to the year with cable MSO spending well below seasonal norms,” said CommScope CEO Eddie Edwards to shareholders. “While demand for Arris' HFC products remains solid, shipments of the E6000 are down significantly.”
On the customer premises equipment side, shipments of broadband devices were down 35%. CommScope said that this was the result of production lines moving out of China to get out of the way of tariffs.
Shipments of video set-tops, however, increased 7% year over year.
Arris is the latest seller of cable access network equipment to feel a pinch, as first quarter revenue for all vendors has been slow.
“Interest and distributed access networks remain strong, but industry deployments are still very limited,” Edwards said. “Arris has implemented a very elegant upgrade path with the deployed base of the E6000 routers and HFC fiber nodes, which is though operationally and capital spending efficient.”
Notably, Edwards said Arris is at work on a fully virtualized of Cable Converged Access Platform (CCAP). Currently, Arris’ No. 1 position in CCAP is being challenged by Harmonic and Nokia, which are replacing hardware-driven network infrastructure with software.
“A fully virtualized version of the product is also an option for operators that prefer that path. We feel very good about our position to support the bandwidth needs in the future,” Edwards said.
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