INVENTORIES

6 Months Ended

Apr. 29, 2023

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


	April 29, 2023		October 29, 2022
Raw materials	$	753,374	$	664,916
Work-in-process	20,927		18,232
Finished goods	307,997		258,584
Deferred cost of goods sold	58,060		41,084
Gross inventories	1,140,358		982,816
Reserve for inventory excess and obsolescence	(42,266)		(36,086)
Inventories, net	$	1,098,092	$	946,730

The increase in raw materials inventory is related to the steps Ciena has been taking to mitigate the impact on its customers and business of supply chain constraints in recent periods and a 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 six months of fiscal 2023, Ciena recorded a provision for inventory excess and obsolescence of $12.7 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.