CANADIAN EMERGENCY WAGE SUBSIDY

9 Months Ended

Jul. 31, 2021

Unusual or Infrequent Items, or Both [Abstract]

In April 2020, the Canadian government introduced the Canada Emergency Wage Subsidy (“CEWS”) to help employers offset a portion of their employee wages for a limited period in response to the COVID-19 outbreak, retroactive to March 15, 2020. The CEWS program has been extended through October 23, 2021. The subsidy covers employers of all sizes and across all sectors.

Ciena accounts for proceeds from government grants as a reduction of expense when there is reasonable assurance that Ciena has met the required conditions associated with the grant and that grant proceeds will be received. Grant benefits are recorded to the particular line item of the Condensed Consolidated Statement of Operations to which the grant activity relates. Amounts from the CEWS program positively impacted our operating expense and measures of profit in the third quarter of fiscal 2021 and nine months ended July 31, 2021. For the third quarter of fiscal 2021, Ciena recorded CEWS benefits of CAD$1.1 million ($0.8 million), net of certain fees. For the nine months ended July 31, 2021, Ciena recorded a CAD$52.2 million ($41.3 million) benefit, net of certain fees, related to CEWS for claim periods beginning March 15, 2020, including CAD$43.9 million ($35.2 million) related to employee wages during fiscal 2020. As of July 31, 2021, amounts receivable from this subsidy were CAD$1.5 million ($1.2 million).

The following table summarizes CEWS for the periods indicated (in thousands):


	Quarter Ended				Nine Months Ended
	July 31,		August 1,		July 31,		August 1,
	2021		2020		2021		2020
Product	$	94	$	—	$	4,283	$	—
Service	47		—		2,667		—
CEWS benefit in cost of goods sold	141		—		6,950		—
Research and development	596		—		29,519		—
Sales and marketing	53		—		2,604		—
General and administrative	46		—		2,207		—
CEWS benefit in operating expense	695		—		34,330		—
Total CEWS benefit	$	836	$	—	$	41,280	$	—