INVENTORIES

12 Months Ended

Nov. 01, 2025

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


	November 1, 2025		November 2, 2024
Raw materials	$	593,783	$	542,785
Work-in-process	35,051		32,219
Finished goods	286,050		324,697
Deferred cost of goods sold	40,759		27,902
Gross inventories	955,643		927,603
Reserve for excess and obsolescence	(129,408)		(107,173)
Inventories, net	$	826,235	$	820,430

Ciena estimates future customer demand for its products to determine the appropriate reserve for excess and obsolete inventory. For the periods presented, estimates were based on a combination of customer backlog, historical usage, and forecasted sales, and are inherently subject to uncertainty. These estimates are often impacted by changes in market conditions, declines in customer demand for certain products, discontinuation of certain products or introduction of newer product versions, or changes in strategic direction. Ciena writes down its inventor-y for estimated obsolescence or unmarketable inventory by an amount equal to the difference between the cost of inventory and the estimated net realizable value. Reductions to the reserve relate primarily to the sale of previously reserved items and disposal activities. During fiscal 2025, 2024 and 2023, Ciena recorded a provision for excess and obsolescence of $48.4 million, $77.3 million, and $29.5 million, respectively.

The following table summarizes the activity in Ciena’s reserve for excess and obsolete inventory for the fiscal years indicated (in thousands):


Year Ended	Beginning Balance		Provisions		Disposals		Ending Balance
October 28, 2023	$	36,086	$	29,464	$	15,547	$	50,003
November 2, 2024	$	50,003	$	77,341	$	20,171	$	107,173
November 1, 2025	$	107,173	$	48,424	$	26,189	$	129,408