Ciena's backlog hits $7B, driven by AI data center demand, signaling strong growth despite high valuation.

Ciena Corporation, a leading provider of optical networking equipment, saw its backlog rise sharply to $7 billion in Q1 from $5 billion last quarter and under $3 billion in 2023. This surge is fueled by growing demand from hyperscalers expanding AI data centers, positioning Ciena as a key player in AI infrastructure. Despite a high forward price-to-earnings ratio of 120x, the company is rated a buy due to strong industry trends and rapid backlog conversion. However, the focus on hyperscalers brings higher risk and customer concentration, but also offers significant long-term growth potential.