INVENTORIES

3 Months Ended

Jan. 28, 2023

As of the dates indicated, inventories are comprised of the following (in thousands):


	January 28, 2023		October 29, 2022
Raw materials	$	846,564	$	664,916
Work-in-process	18,422		18,232
Finished goods	300,684		258,584
Deferred cost of goods sold	51,319		41,084
Gross inventories	1,216,989		982,816
Reserve for inventory excess and obsolescence	(38,900)		(36,086)
Inventories, net	$	1,178,089	$	946,730

The increase in raw materials inventory is related to the steps Ciena is taking to mitigate the impact of current supply chain constraints in the context of the global market shortage of semiconductor components. Ciena writes down its inventory for estimated obsolescence or unmarketable inventory by an amount equal to the difference between the cost of inventory and the estimated net realizable value based on assumptions about future demand, which are affected by changes in Ciena’s strategic direction, discontinuance of a product or introduction of newer versions of products, declines in the sales of or forecasted demand for certain products, and general market conditions. During the first three months of fiscal 2023, Ciena recorded a provision for inventory excess and obsolescence of $5.5 million, primarily related to a decrease in the forecasted demand for certain Networking Platforms products. Deductions from the provision for excess and obsolete inventory relate primarily to disposal activities.