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Infinera Corporation Reports Third Quarter 2013 Financial Results

SUNNYVALE, CA -- (Marketwired) -- Oct 23, 2013 -- Infinera Corporation (NASDAQ: INFN), a leader in Intelligent Transport Networks™, today released financial results for the third quarter ended September 28, 2013.

GAAP revenues for the third quarter of 2013 were $142.0 million compared to $138.4 million in the second quarter of 2013 and $112.2 million in the third quarter of 2012.

GAAP gross margin for the third quarter of 2013 was 48% compared to 37% in the second quarter of 2013 and 37% in the third quarter of 2012. GAAP net income for the quarter was $3.3 million, or $0.03 per diluted share, compared to a net loss of $(10.0) million, or $(0.09) per share, in the second quarter of 2013 and a net loss of $(19.1) million, or $(0.17) per share, in the third quarter of 2012.

Non-GAAP gross margin for the third quarter of 2013 was 49% compared to 39% in the second quarter of 2013 and 39% in the third quarter of 2012, excluding non-cash stock-based compensation expenses. Non-GAAP net income for the third quarter of 2013 was $12.8 million, or $0.10 per diluted share excluding non-cash stock-based compensation expenses and the amortization of debt discount on our convertible senior notes. This compared to a non-GAAP net loss of $(1.2) million, or $(0.01) per share, in the second quarter of 2013 and a non-GAAP net loss of $(7.8) million, or $(0.07) per share, in the third quarter of 2012.

Management Commentary

"DTN-X adoption continued to drive strong financial results in the third quarter. We generated solid revenue growth and achieved positive cash flow from operations, with both gross margin and profitability exceeding our expectations," said Tom Fallon, chief executive officer. "During the quarter, we received purchase commitments from five additional customers, including two new to Infinera, bringing our total DTN-X customer count to 39.

"We are seeing growing global demand for Infinera's Intelligent Transport Network and the DTN-X, the only platform available in the market today that offers super-channel scale, converged OTN switching and GMPLS network automation. This interest is across industry segments, including domestic and international Tier 1 carriers, bandwidth wholesalers, cable, and Internet content providers.

"We remain committed to growing our market share and are increasingly confident that over the next 12 to 18 months we will add new strategic accounts while expanding our deployments with existing customers."

Conference Call Information:

Infinera will host a conference call for analysts and investors to discuss its third quarter results and its outlook for the fourth quarter today at 5:00 p.m. Eastern Time (2:00 p.m. Pacific Time). A live webcast of the conference call will also be accessible from the Investor Relations' section of the company's website at www.infinera.com. Following the webcast, an archived version will be available on the website for 90 days. To hear the replay, parties in the United States and Canada should call 1-800-756-6991. International parties can access the replay at 1-203-369-3017.

About Infinera

Infinera is a leader in Intelligent Transport Networks. Intelligent Transport Networks help carriers exploit the increasing demand for cloud-based services and data center connectivity as they advance into the Terabit Era. Infinera is unique in its use of breakthrough semiconductor technology to deliver large scale Photonic Integrated Circuit (PICs) and the application of PICs to vertically integrated optical networking solutions that deliver the industry's only commercially available 500 Gb/s FlexCoherent super-channels. Infinera Intelligent Transport Network solutions include the DTN-X, DTN and ATN platforms. Find more at www.infinera.com.

Forward-Looking Statements

This press release contains certain forward-looking statements based on current expectations, forecasts and assumptions that involve risks and uncertainties. These statements are based on information available to Infinera as of the date hereof and actual results could differ materially from those stated or implied due to risks and uncertainties. Forward-looking statements include statements regarding Infinera's expectations, beliefs, intentions or strategies regarding the future including statements that we are seeing growing global demand for Infinera's Intelligent Transport Network and the DTN-X platform; that the interest in our products is across industry segments, including domestic and international Tier 1 carriers, bandwidth wholesalers, cable, and Internet content providers; and that we remain committed to growing our market share and are increasingly confident that over the next 12 to 18 months we will add new strategic accounts while expanding our deployments with existing customers. Such forward-looking statements can be identified by forward-looking words such as "anticipated," "believed," "could," "estimate," "expect," "intend," "may," "should," "will," and "would" or similar words. The risks and uncertainties that could cause our results to differ materially from those expressed or implied by such forward-looking statements include aggressive business tactics by our competitors, our reliance on single-source suppliers, our ability to protect our intellectual property, claims by others that we infringe their intellectual property, and our ability to respond to rapid technological changes, and other risks that may impact our business are set forth in our annual reports on Form 10-K filed with the Securities and Exchange Commission (SEC) on March 5, 2013, as well as subsequent reports filed with or furnished to the SEC. These reports are available on our website at www.infinera.com and the SEC's website at www.sec.gov. Infinera assumes no obligation to, and does not currently intend to, update any such forward-looking statements.

Use of Non-GAAP Financial Information

In addition to disclosing financial measures prepared in accordance with U.S. Generally Accepted Accounting Principles (GAAP), this press release and the accompanying tables contain certain non-GAAP measures that exclude non-cash stock-based compensation expenses and amortization of debt discount on our convertible senior notes. We believe these adjustments are appropriate to enhance an overall understanding of our underlying financial performance and also our prospects for the future and are considered by management for the purpose of making operational decisions. In addition, these results are the primary indicators management uses as a basis for our planning and forecasting of future periods. The presentation of this additional information is not meant to be considered in isolation or as a substitute for net income (loss), basic and diluted net income (loss) per share, or gross margin prepared in accordance with GAAP. Non-GAAP financial measures are not based on a comprehensive set of accounting rules or principles and are subject to limitations. For a description of these non-GAAP financial measures and a reconciliation to the most directly comparable GAAP financial measures, please see the section titled, "GAAP to Non-GAAP Reconciliations." We anticipate disclosing forward-looking non-GAAP information in our conference call to discuss our third quarter results, including an estimate of non-GAAP earnings for the fourth quarter of 2013 that excludes non-cash stock-based compensation expenses and amortization of debt discount on our convertible senior notes.

A copy of this press release can be found on the Investor Relations' page of Infinera's website at www.infinera.com.

Infinera Corporation and the Infinera logo are trademarks or registered trademarks of Infinera Corporation. All other trademarks used or mentioned herein belong to their respective owners.

                                                                            
                                                                            
                                                                            
Infinera Corporation                                                        
GAAP Condensed Consolidated Statements of Operations                        
(In thousands, except per share data)                                       
(Unaudited)                                                                 
                                  Three Months Ended     Nine Months Ended  
                                 --------------------  -------------------- 
                                 September  September  September  September 
                                  28, 2013   29, 2012   28, 2013   29, 2012 
                                 ---------  ---------  ---------  --------- 
Revenue:                                                                    
  Product                        $ 120,807  $  98,853  $ 348,769  $ 269,087 
  Ratable product and related                                               
   support and services                525        450      1,553      1,504 
  Services                          20,688     12,911     54,708     39,782 
                                 ---------  ---------  ---------  --------- 
    Total revenue                  142,020    112,214    405,030    310,373 
                                                                            
Cost of revenue (1):                                                        
  Cost of product                   66,645     66,510    222,126    181,851 
  Cost of ratable product and                                               
   related supportand services          40        102        204        459 
  Cost of services                   6,964      4,102     19,973     13,762 
                                 ---------  ---------  ---------  --------- 
    Total cost of revenue           73,649     70,714    242,303    196,072 
                                                                            
Gross profit                        68,371     41,500    162,727    114,301 
                                                                            
Operating expenses (1):                                                     
  Research and development          32,528     27,912     93,935     90,573 
  Sales and marketing               17,720     19,285     52,921     55,304 
  General and administrative        11,678     12,508     32,976     35,912 
                                 ---------  ---------  ---------  --------- 
    Total operating expenses        61,926     59,705    179,832    181,789 
                                                                            
Income (loss) from operations        6,445    (18,205)   (17,105)   (67,488)
                                                                            
Other income (expense), net:                                                
  Interest income                      232        175        636        678 
  Interest expense                  (2,578)         -     (3,427)         - 
  Other gain (loss), net:             (444)      (617)      (805)      (892)
                                 ---------  ---------  ---------  --------- 
    Total other income                                                      
     (expense), net                 (2,790)      (442)    (3,596)      (214)
                                                                            
Income (loss) before income                                                 
 taxes                               3,655    (18,647)   (20,701)   (67,702)
Provision for income taxes             308        434      1,240      1,540 
                                 ---------  ---------  ---------  --------- 
Net income (loss)                $   3,347  $ (19,081) $ (21,941) $ (69,242)
                                 =========  =========  =========  ========= 
                                                                            
Net income (loss) per common                                                
 share                                                                      
  Basic                          $    0.03  $   (0.17) $   (0.19) $   (0.63)
                                 =========  =========  =========  ========= 
  Diluted                        $    0.03  $   (0.17) $   (0.19) $   (0.63)
                                 =========  =========  =========  ========= 
                                                                            
Weighted average shares used in                                             
 computing net                                                              
income (loss) per common share                                              
  Basic                            118,740    111,579    116,653    110,216 
                                 =========  =========  =========  ========= 
  Diluted                          124,679    111,579    116,653    110,216 
                                 =========  =========  =========  ========= 
                                                                            
                                                                            
(1) The following table summarizes the effects of stock-based compensation  
    related to employees and non-employees for the three and nine months    
    ended September 28, 2013 and September 29, 2012:                        
                                                                            
                                                                            
                                                                            
                                                                            
                                   Three Months Ended    Nine Months Ended  
                                 --------------------- ---------------------
                                  September  September  September  September
                                  28, 2013   29, 2012   28, 2013   29, 2012 
                                 ---------- ---------- ---------- ----------
Cost of revenue                  $      422 $      683 $    1,382 $    1,975
Research and development              2,434      3,439      8,175     10,454
Sales and marketing                   1,853      2,685      5,659      7,648
General and administration            1,807      2,804      4,167      7,732
                                 ---------- ---------- ---------- ----------
                                      6,516      9,611     19,383     27,809
Cost of revenue - amortization                                              
 from balance sheet*                  1,127      1,706      4,419      3,875
                                 ---------- ---------- ---------- ----------
Total stock-based compensation                                              
 expense                         $    7,643 $   11,317 $   23,802 $   31,684
                                 ========== ========== ========== ==========
                                                                            
* Stock-based compensation expense deferred to inventory and deferred       
  inventory costs in prior periods and recognized in the current period.    
                                                                            
                                                                            
                                                                            
                                                                            
Infinera Corporation                                                        
GAAP to Non-GAAP Reconciliations                                            
(In thousands, except per share data)                                       
(Unaudited)                                                                 
                                                                            
                         Three Months Ended             Nine Months Ended   
                 ----------------------------------  ---------------------- 
                  September   June 29,    September   September   September 
                  28, 2013      2013      29, 2012    28, 2013    29, 2012  
                 ----------  ----------  ----------  ----------  ---------- 
Reconciliation                                                              
 of Gross                                                                   
 Profit:                                                                    
U.S. GAAP as                                                                
 reported        $   68,371  $   51,654  $   41,500  $  162,727  $  114,301 
Stock-based                                                                 
 compensation(1)      1,549       2,164       2,389       5,801       5,850 
                 ----------  ----------  ----------  ----------  ---------- 
Non-GAAP as                                                                 
 adjusted        $   69,920  $   53,818  $   43,889  $  168,528  $  120,151 
                 ==========  ==========  ==========  ==========  ========== 
                                                                            
Reconciliation                                                              
 of Gross                                                                   
 Margin:                                                                    
U.S. GAAP as                                                                
 reported                48%         37%         37%         40%         37%
Stock-based                                                                 
 compensation(1)          1%          2%          2%          2%          2%
                 ----------  ----------  ----------  ----------  ---------- 
Non-GAAP as                                                                 
 adjusted                49%         39%         39%         42%         39%
                 ==========  ==========  ==========  ==========  ========== 
                                                                            
Reconciliation                                                              
 of Income                                                                  
 (Loss)from                                                                 
 Operations:                                                                
U.S. GAAP as                                                                
 reported        $    6,445  $   (8,608) $  (18,205) $  (17,105) $  (67,488)
Stock-based                                                                 
 compensation(1)      7,643       8,184      11,317      23,802      31,684 
                 ----------  ----------  ----------  ----------  ---------- 
Non-GAAP as                                                                 
 adjusted        $   14,088  $     (424) $   (6,888) $    6,697  $  (35,804)
                 ==========  ==========  ==========  ==========  ========== 
                                                                            
Reconciliation                                                              
 of Net Income                                                              
 (Loss):                                                                    
U.S. GAAP as                                                                
 reported        $    3,347  $  (10,009) $  (19,081) $  (21,941) $  (69,242)
Stock-based                                                                 
 compensation(1)      7,643       8,184      11,317      23,802      31,684 
Amortization of                                                             
 debt                                                                       
 discount(2)          1,770         580           -       2,350           - 
                 ----------  ----------  ----------  ----------  ---------- 
Non-GAAP as                                                                 
 adjusted        $   12,760  $   (1,245) $   (7,764) $    4,211  $  (37,558)
                 ==========  ==========  ==========  ==========  ========== 
                                                                            
Net Income                                                                  
 (Loss) per                                                                 
 CommonShare -                                                              
 Basic:                                                                     
U.S. GAAP as                                                                
 reported        $     0.03  $    (0.09) $    (0.17) $    (0.19) $    (0.63)
                 ==========  ==========  ==========  ==========  ========== 
Non-GAAP as                                                                 
 adjusted        $     0.11  $    (0.01) $    (0.07) $     0.04  $    (0.34)
                 ==========  ==========  ==========  ==========  ========== 
                                                                            
Net Income                                                                  
 (Loss) per                                                                 
 CommonShare -                                                              
 Diluted:                                                                   
U.S. GAAP as                                                                
 reported        $     0.03  $    (0.09) $    (0.17) $    (0.19) $    (0.63)
                 ==========  ==========  ==========  ==========  ========== 
Non-GAAP as                                                                 
 adjusted(3)     $     0.10  $    (0.01) $    (0.07) $     0.03  $    (0.34)
                 ==========  ==========  ==========  ==========  ========== 
                                                                            
Weighted average                                                            
 sharesused in                                                              
 computing net                                                              
 income                                                                     
 (loss)per                                                                  
 common share -                                                             
 U.S. GAAP:                                                                 
Basic               118,740     116,911     111,579     116,653     110,216 
                 ==========  ==========  ==========  ==========  ========== 
Diluted             124,679     116,911     111,579     116,653     110,216 
                 ==========  ==========  ==========  ==========  ========== 
                                                                            
Weighted average                                                            
 sharesused in                                                              
 computing net                                                              
 income                                                                     
 (loss)per                                                                  
 common share -                                                             
 Non-GAAP:                                                                  
Basic               118,740     116,911     111,579     116,653     110,216 
                 ==========  ==========  ==========  ==========  ========== 
Diluted(3)          124,679     121,254     113,443     121,178     112,113 
                 ==========  ==========  ==========  ==========  ========== 
                                                                            
                                                                            
(1) Stock-based compensation expense is calculated in accordance with the   
    fair value recognition provisions of Financial Accounting Standards     
    Board Accounting Standards Codification (ASC) Topic 718, Compensation-  
    Stock Compensation effective January 1, 2006. The following table       
    summarizes the effects of stock-based compensation related to employees 
    and non-employees:                                                      
                                                                            
                             Three Months Ended          Nine Months Ended  
                      -------------------------------- ---------------------
                       September  June 29,   September  September  September
                       28, 2013     2013     29, 2012   28, 2013   29, 2012 
                      ---------- ---------- ---------- ---------- ----------
Cost of revenue       $      422 $      474 $      683 $    1,382 $    1,975
Research and                                                                
 development               2,434      2,622      3,439      8,175     10,454
Sales and marketing        1,853      1,807      2,685      5,659      7,648
General and                                                                 
 administration            1,807      1,591      2,804      4,167      7,732
                      ---------- ---------- ---------- ---------- ----------
                           6,516      6,494      9,611     19,383     27,809
Cost of revenue -                                                           
 amortization from                                                          
 balance sheet*            1,127      1,690      1,706      4,419      3,875
                      ---------- ---------- ---------- ---------- ----------
Total stock-based                                                           
 compensation expense $    7,643 $    8,184 $   11,317 $   23,802 $   31,684
                      ========== ========== ========== ========== ==========
                                                                            
 *  Stock-based compensation expense deferred to inventory and deferred     
    inventory costs in prior periods and recognized in the current period.  
                                                                            
(2) Under GAAP, certain convertible debt instruments that may be settled in 
    cash on conversion are required to be separately accounted for as       
    liability (debt) and equity (conversion option) components of the       
    instrument in a manner that reflects the issuer's non-convertible debt  
    borrowing rate. Accordingly, for GAAP purposes, we are required to      
    amortize as a debt discount an amount equal to the fair value of the    
    conversion option that was recorded in equity as interest expense on our
    $150 million 1.75% convertible debt issuance in May 2013 over the term  
    of the notes. These amounts have been adjusted in arriving at our non-  
    GAAP results because management believes that this non-cash expense is  
    not indicative of ongoing operating performance and provides a better   
    indication of our underlying business performance.                      
                                                                            
(3) Diluted shares used to calculate net loss per share on a non-GAAP basis 
    provided for informational purposes only.                               
                                                                            
                                                                            
                                                                            
Infinera Corporation                                                        
Condensed Consolidated Balance Sheets                                       
(In thousands, except par values)                                           
(Unaudited)                                                                 
                                                                            
                                               September 28,   December 29, 
                                                    2013           2012     
                                               -------------  ------------- 
ASSETS                                                                      
                                                                            
Current assets:                                                             
  Cash and cash equivalents                    $     137,629  $     104,666 
  Short-term investments                             151,821         76,146 
  Accounts receivable, net of allowance for                                 
   doubtful accounts of $147 in 2013 and $94                                
   in 2012                                            87,180        107,039 
  Other receivables                                      616          2,909 
  Inventory                                          123,505        127,809 
  Deferred inventory costs                             1,244          1,029 
  Prepaid expenses and other current assets           18,924          9,899 
                                               -------------  ------------- 
    Total current assets                             520,919        429,497 
                                                                            
Property, plant and equipment, net                    79,062         80,343 
Deferred inventory costs, non-current                     19            100 
Long-term investments                                 52,871          2,874 
Cost-method investment                                 9,000          9,000 
Long-term restricted cash                              3,724          3,868 
Deferred tax asset                                         -            805 
Other non-current assets                               5,238          1,683 
                                               -------------  ------------- 
    Total assets                               $     670,833  $     528,170 
                                               =============  ============= 
                                                                            
LIABILITIES AND STOCKHOLDERS' EQUITY                                        
                                                                            
Current liabilities:                                                        
  Accounts payable                             $      29,218  $      61,428 
  Accrued expenses                                    21,290         25,483 
  Accrued compensation and related benefits           24,621         22,325 
  Accrued warranty                                    12,854          7,262 
  Deferred revenue                                    25,202         26,744 
  Deferred tax liability                                   -            805 
                                               -------------  ------------- 
    Total current liabilities                        113,185        144,047 
                                                                            
  Long-term debt                                     107,350              - 
  Accrued warranty, non-current                       10,308          9,220 
  Deferred revenue, non-current                        3,097          3,210 
  Other long-term liabilities                         18,158         15,557 
                                                                            
Commitments and contingencies                                               
                                                                            
Stockholders' equity:                                                       
  Preferred stock, $0.001 par value                                         
    Authorized shares - 25,000 and no shares                                
     issued and outstanding                                -              - 
  Common stock, $0.001 par value                                            
    Authorized shares - 500,000 as of                                       
     September 28, 2013 and December 29, 2012                               
    Issued and outstanding shares - 119,491 as                              
     of September 28, 2013 and 112,461as of                                 
     December 29, 2012                                   119            112 
  Additional paid-in capital                       1,016,397        930,618 
  Accumulated other comprehensive loss                (3,474)        (2,228)
  Accumulated deficit                               (594,307)      (572,366)
                                               -------------  ------------- 
  Total stockholders' equity                         418,735        356,136 
                                               -------------  ------------- 
    Total liabilities and stockholders' equity $     670,833  $     528,170 
                                               =============  ============= 
                                                                            
                                                                            

                                                                            
Infinera Corporation                                                        
Condensed Consolidated Statements of Cash Flows                             
(In thousands)                                                              
(Unaudited)                                                                 
                                                                            
                                                     Nine Months Ended      
                                               ---------------------------- 
                                               September 28,  September 29, 
                                                    2013           2012     
                                               -------------  ------------- 
Cash Flows from Operating Activities:                                       
Net loss                                       $     (21,941) $     (69,242)
Adjustments to reconcile net loss to net                                    
 cashused in operating activities:                                          
  Depreciation and amortization                       18,574         17,274 
  (Recovery of) provision for other                                         
   receivables                                           (88)             - 
  Provision for doubtful accounts                         53             94 
  Amotization of debt discount and issuance                                 
   costs                                               2,552              - 
  Amortization of premium on investments                 870          1,610 
  Stock-based compensation expense                    23,802         31,684 
  Non-cash tax benefit                                     -            (18)
  Other gain                                            (243)          (479)
  Changes in assets and liabilities:                                        
    Accounts receivable                               19,805        (11,021)
    Other receivables                                  2,131         (2,228)
    Inventory                                         (3,603)       (28,774)
    Prepaid expenses and other assets                 (8,398)            33 
    Deferred inventory costs                            (160)         4,877 
    Accounts payable                                 (30,624)        (1,048)
    Accrued liabilities and other expenses             1,640          3,690 
    Deferred revenue                                  (1,655)        (6,683)
    Accrued warranty                                   6,680          2,434 
                                               -------------  ------------- 
      Net cash provided by (used in) operating                              
       activities                                      9,395        (57,797)
                                                                            
Cash Flows from Investing Activities:                                       
  Purchase of available-for-sale investments        (206,528)       (50,134)
  Proceeds from sale of available-for-sale                                  
   investments                                         2,850          6,694 
  Proceeds from maturities and calls of                                     
   investments                                        77,143         95,368 
  Purchase of property and equipment                 (13,605)       (22,238)
  Reimbursement of manufacturing capacity                                   
   advance                                                 -             50 
  Change in restricted cash                              110           (564)
                                               -------------  ------------- 
    Net cash provided by (used in) investing                                
     activities                                     (140,030)        29,176 
                                                                            
Cash Flows from Financing Activities:                                       
  Proceeds from issuance of debt, net                144,469              - 
  Proceeds from issuance of common stock              21,551         11,280 
  Repurchase of common stock                          (1,541)          (875)
                                               -------------  ------------- 
    Net cash provided by financing activities        164,479         10,405 
                                                                            
Effect of exchange rate changes on cash                 (881)           358 
                                                                            
Net change in cash and cash equivalents               32,963        (17,858)
Cash and cash equivalents at beginning of                                   
 period                                              104,666         94,458 
                                               -------------  ------------- 
Cash and cash equivalents at end of period     $     137,629  $      76,600 
                                               =============  ============= 
                                                                            
Supplemental disclosures of cash flow                                       
 information:                                                               
  Cash paid for income taxes                   $       1,536  $         755 
Supplemental schedule of non-cash financing                                 
 activities:                                                                
  Non-cash settlement for manufacturing                                     
   capacity advance                            $           -  $         275 
  Transfer of inventory to fixed assets        $       6,672  $         738 
                                                                            
                                                                            

                                                                            
Infinera Corporation                                                        
Supplemental Financial Information                                          
(Unaudited)                                                                 
                                                                            
                  Q4'11  Q1'12  Q2'12   Q3'12   Q4'12   Q1'13   Q2'13  Q3'13
                 ------ ------ ------- ------- ------- ------- ------ ------
Revenue ($ Mil)  $112.0 $104.7   $93.5  $112.2  $128.1  $124.6 $138.4 $142.0
Gross Margin %                                                              
 (1)                42%    40%     37%     39%     36%     36%    39%    49%
                 ------ ------ ------- ------- ------- ------- ------ ------
Invoiced                                                                    
 Shipment                                                                   
 Composition:                                                               
Domestic %          70%    71%     70%     70%     63%     63%    64%    73%
International %     30%    29%     30%     30%     37%     37%    36%    27%
Largest Customer                                                            
 %                  14%    13%     15%     13%     13%     14% < 10%    17%
                 ------ ------ ------- ------- ------- ------- ------ ------
Cash Related                                                                
 Information:                                                               
Cash from (used                                                             
 in) Operations                                                             
 ($ Mil)         ($5.1) ($5.8) ($22.7) ($29.3)    $8.3 ($21.3)  $17.9  $12.8
Capital                                                                     
 Expenditures ($                                                            
 Mil)             $16.1  $13.6    $6.1    $2.5    $3.2    $4.9   $4.5   $4.2
Depreciation &                                                              
 Amortization ($                                                            
 Mil)              $4.5   $5.5    $5.7    $6.1    $6.4    $6.3   $6.3   $5.9
DSO's                65     57      55      74      76      82     64     56
                 ------ ------ ------- ------- ------- ------- ------ ------
Inventory                                                                   
 Metrics:                                                                   
Raw Materials ($                                                            
 Mil)             $12.1  $15.3   $14.8   $12.4   $13.0   $12.2   $9.8  $12.1
Work in Process                                                             
 ($ Mil)          $37.0  $41.6   $49.4   $59.8   $57.3   $53.1  $41.0  $45.7
Finished Goods                                                              
 ($ Mil)          $39.9  $44.7   $50.9   $46.3   $57.5   $65.7  $70.5  $65.7
                 ------ ------ ------- ------- ------- ------- ------ ------
Total Inventory                                                             
 ($ Mil)          $89.0 $101.6  $115.1  $118.5  $127.8  $131.0 $121.3 $123.5
Inventory Turns                                                             
 (1)                2.9    2.5     2.1     2.3     2.6     2.4    2.8    2.3
                 ------ ------ ------- ------- ------- ------- ------ ------
Worldwide                                                                   
 Headcount        1,181  1,210   1,228   1,235   1,242   1,219  1,238  1,296
                 ------ ------ ------- ------- ------- ------- ------ ------
                                                                            
                                                                            
(1) Amounts reflect non-GAAP results. Non-GAAP adjustments include non-cash 
 stock-based compensation expense.                                          
                                                                            
                                                                            
                                                                            

Contacts:

Media:
Anna Vue 

avue@infinera.com 
Infinera Corporation 
916-595-8157 

Investors/Analysts:
Jenifer Kirtland/Bob Jones 

jkirtland@infinera.com / 
bjones@infinera.com    
Infinera Corporation
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