XML 33 R22.htm IDEA: XBRL DOCUMENT v3.21.2

LEASES

9 Months Ended

Jul. 31, 2021

Leases [Abstract]

LEASES

LEASES

Ciena leases over 1.3 million square feet of facilities globally. Ciena’s principal executive offices are located in Hanover, Maryland. Ciena’s largest facilities are research and development centers located in Ottawa, Canada and Gurgaon, India. Ciena also has engineering and/or service delivery facilities located in San Jose, California; Alpharetta, Georgia; Quebec, Canada; and Pune and Bangalore, India. In addition, Ciena leases various smaller offices in regions throughout the world to support sales and services operations. Office facilities are leased under various non-cancelable operating or finance leases. Ciena's current leases have remaining terms that vary up to 11 years. Certain leases provide for options to extend up to ten years and/or options to terminate within five years.

Leases included in the Condensed Consolidated Balance Sheets were as follows (in thousands):

			Classification						As of July 31, 2021			As of October 31, 2020
Operating leases:
Operating ROU assets			Operating right-of-use assets						$	48,937		$	57,026
Operating lease liabilities			Operating lease liabilities and Long-term operating lease liabilities						70,320			80,450
Finance leases:
Buildings, gross			Equipment, building, furniture and fixtures, net						$	75,616		$	70,791
Less: accumulated depreciation			Equipment, building, furniture and fixtures, net						(22,664)			(17,837)
Buildings, net									$	52,952		$	52,954
Finance lease liabilities			Accrued liabilities and other short-term obligations and other long-term obligations						$	66,530		$	64,401

ROU assets that involve subleased or vacant space aggregate to $4.3 million as of July 31, 2021. These assets may become impaired if tenants are unable to service their obligations under the sublease, and/or if the estimates as to occupancy are not realized, either of which may be more likely as COVID-19 impacts evolve.

The components of lease expense included in the Condensed Consolidated Statement of Operations were as follows (in thousands):

									Quarter Ended									Nine Months Ended
									July 31,			August 1,						July 31,			August 1,
			Classification						2021			2020						2021			2020
Operating lease costs			Operating expense						$	4,085		$	4,234					$	12,516		$	13,435
Finance lease cost:
Amortization of finance ROU asset			Operating expense						1,224			1,097						3,580			3,330
Interest on finance lease liabilities			Interest expense						1,243			1,162						3,671			3,574
Total finance lease cost									2,467			2,259						7,251			6,904
Non-capitalized lease cost			Operating expense						216			883						842			2,211
Variable lease cost(1)			Operating expense						1,393			1,265						4,444			3,900
Net lease cost(2)									$	8,161		$	8,641					$	25,053		$	26,450

(1) Variable lease costs include expenses relating to insurance, taxes, maintenance and other costs required by the applicable operating lease. Variable lease costs are determined by whether they are to be included in base rent and if amounts are based on a consumer price index.

(2) Excludes other operating expense of $2.3 million and $2.2 million for the third quarter of fiscal 2021 and 2020, respectively and $7.2 million and $8.7 million for the nine months ended July 31, 2021 and August 1, 2020, respectively, related to amortization of leasehold improvements.

Future minimum lease payments and the present value of minimum lease payments related to operating and finance leases as of July 31, 2021 were as follows (in thousands):

			Operating Leases						Finance Leases						Total
Remaining fiscal 2021			$	5,472					$	8,146					$	13,618
2022			19,862						8,500						28,362
2023			16,087						8,500						24,587
2024			13,768						8,620						22,388
2025			9,437						8,706						18,143
Thereafter			10,272						55,532						65,804
Total lease payments			74,898						98,004						172,902
Less: Imputed interest			(4,578)						(31,474)						(36,052)
Present value of lease liabilities			70,320						66,530						136,850
Less: Current portion of present value of minimum lease payments			(19,085)						(3,395)						(22,480)
Long-term portion of present value of minimum lease payments			$	51,235					$	63,135					$	114,370

The weighted average remaining lease terms and weighted average discount rates for operating and finance leases were as follows:

			As of July 31, 2021			As of October 31, 2020
Weighted-average remaining lease term in years:
Operating leases			4.35			4.87
Finance leases			10.97			11.71
Weighted-average discount rates:
Operating leases			2.75		%	2.82		%
Finance leases			7.56		%	7.56		%

LEASES

LEASES

Ciena leases over 1.3 million square feet of facilities globally. Ciena’s principal executive offices are located in Hanover, Maryland. Ciena’s largest facilities are research and development centers located in Ottawa, Canada and Gurgaon, India. Ciena also has engineering and/or service delivery facilities located in San Jose, California; Alpharetta, Georgia; Quebec, Canada; and Pune and Bangalore, India. In addition, Ciena leases various smaller offices in regions throughout the world to support sales and services operations. Office facilities are leased under various non-cancelable operating or finance leases. Ciena's current leases have remaining terms that vary up to 11 years. Certain leases provide for options to extend up to ten years and/or options to terminate within five years.

Leases included in the Condensed Consolidated Balance Sheets were as follows (in thousands):

			Classification						As of July 31, 2021			As of October 31, 2020
Operating leases:
Operating ROU assets			Operating right-of-use assets						$	48,937		$	57,026
Operating lease liabilities			Operating lease liabilities and Long-term operating lease liabilities						70,320			80,450
Finance leases:
Buildings, gross			Equipment, building, furniture and fixtures, net						$	75,616		$	70,791
Less: accumulated depreciation			Equipment, building, furniture and fixtures, net						(22,664)			(17,837)
Buildings, net									$	52,952		$	52,954
Finance lease liabilities			Accrued liabilities and other short-term obligations and other long-term obligations						$	66,530		$	64,401

ROU assets that involve subleased or vacant space aggregate to $4.3 million as of July 31, 2021. These assets may become impaired if tenants are unable to service their obligations under the sublease, and/or if the estimates as to occupancy are not realized, either of which may be more likely as COVID-19 impacts evolve.

The components of lease expense included in the Condensed Consolidated Statement of Operations were as follows (in thousands):

									Quarter Ended									Nine Months Ended
									July 31,			August 1,						July 31,			August 1,
			Classification						2021			2020						2021			2020
Operating lease costs			Operating expense						$	4,085		$	4,234					$	12,516		$	13,435
Finance lease cost:
Amortization of finance ROU asset			Operating expense						1,224			1,097						3,580			3,330
Interest on finance lease liabilities			Interest expense						1,243			1,162						3,671			3,574
Total finance lease cost									2,467			2,259						7,251			6,904
Non-capitalized lease cost			Operating expense						216			883						842			2,211
Variable lease cost(1)			Operating expense						1,393			1,265						4,444			3,900
Net lease cost(2)									$	8,161		$	8,641					$	25,053		$	26,450

(1) Variable lease costs include expenses relating to insurance, taxes, maintenance and other costs required by the applicable operating lease. Variable lease costs are determined by whether they are to be included in base rent and if amounts are based on a consumer price index.

(2) Excludes other operating expense of $2.3 million and $2.2 million for the third quarter of fiscal 2021 and 2020, respectively and $7.2 million and $8.7 million for the nine months ended July 31, 2021 and August 1, 2020, respectively, related to amortization of leasehold improvements.

Future minimum lease payments and the present value of minimum lease payments related to operating and finance leases as of July 31, 2021 were as follows (in thousands):

			Operating Leases						Finance Leases						Total
Remaining fiscal 2021			$	5,472					$	8,146					$	13,618
2022			19,862						8,500						28,362
2023			16,087						8,500						24,587
2024			13,768						8,620						22,388
2025			9,437						8,706						18,143
Thereafter			10,272						55,532						65,804
Total lease payments			74,898						98,004						172,902
Less: Imputed interest			(4,578)						(31,474)						(36,052)
Present value of lease liabilities			70,320						66,530						136,850
Less: Current portion of present value of minimum lease payments			(19,085)						(3,395)						(22,480)
Long-term portion of present value of minimum lease payments			$	51,235					$	63,135					$	114,370

The weighted average remaining lease terms and weighted average discount rates for operating and finance leases were as follows:

			As of July 31, 2021			As of October 31, 2020
Weighted-average remaining lease term in years:
Operating leases			4.35			4.87
Finance leases			10.97			11.71
Weighted-average discount rates:
Operating leases			2.75		%	2.82		%
Finance leases			7.56		%	7.56		%

X

- References

No definition available.

+ Details

Name:	us-gaap_LeasesAbstract
Namespace Prefix:	us-gaap_
Data Type:	xbrli:stringItemType
Balance Type:	na
Period Type:	duration

X

- Definition

The entire disclosure for finance leases of lessee. Includes, but is not limited to, description of lessee's finance lease and maturity analysis of finance lease liability.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 842
-SubTopic 20
-URI http://asc.fasb.org/subtopic&trid=77888251

+ Details

Name:	us-gaap_LesseeFinanceLeasesTextBlock
Namespace Prefix:	us-gaap_
Data Type:	dtr-types:textBlockItemType
Balance Type:	na
Period Type:	duration

X

- Definition

The entire disclosure for operating leases of lessee. Includes, but is not limited to, description of operating lease and maturity analysis of operating lease liability.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 842
-SubTopic 20
-URI http://asc.fasb.org/subtopic&trid=77888251

+ Details

Name:	us-gaap_LesseeOperatingLeasesTextBlock
Namespace Prefix:	us-gaap_
Data Type:	dtr-types:textBlockItemType
Balance Type:	na
Period Type:	duration