Harmonic has long had its feet firmly planted in the DOCSIS realm, but CEO Patrick Harshman revealed operators are increasingly looking to its CableOS platform to support both greenfield and “surgical” fiber-to-the-home deployments.
Speaking on the company’s Q1 2022 earnings call, Harshman said adoption of CableOS grew 45% year on year to 77 broadband service providers. The number of broadband modems using the platform doubled to 6.1 million, though Harshman noted this figure only accounts for about 10% of the 60 million modem footprint it stands to address with current customers.
While multi-gigabit DOCSIS-based services “remain the foundation of the business,” Harshman said Harmonic is “increasingly bullish” about adoption of the platform for fiber applications. The company added support for 10-gig EPON and XGS-PON to CableOS in late 2019. It has already launched FTTH with a number of smaller customers and is “making good progress qualifying our solution with Tier 1 accounts,” the CEO stated.
Harshman said operators are using CableOS for two main fiber applications: greenfield deployments and strategic brownfield rollouts designed to defend against overbuilders. “So, this is going after a high-end customers where maybe a fiber offering is needed or use surgically to compete with competitive fiber offerings,” he said of the latter use case.
This week, rival CommScope unveiled its own suite of XGS-PON hardware, software and services to support fiber deployments. But Harshman said Harmonic is confident in its competitive position given it also offers optical line terminals (OLTs) which can be dropped in to existing nodes. Comcast showcased such a capability during a CableLabs event last week, though didn’t mention Harmonic by name.
“So particularly if you're a cable operator who's been deploying DAA [distributed access architecture] for cable initially, whether you intend it to or not, you've already actually deployed a fiber-to-the-home platform through which the software exists centrally and through which you can very easily through plug-in upgrades extend to fiber,” he explained. “We think this is uniquely powerful.”
Financials
Consolidated revenue was up 32% year on year to $147.4 million, with Cable Access segment sales up 97.8% to $81.6 million. Comcast accounted for nearly a third (31%) of overall revenue, with Intelsat (13%) and Vodafone (10%) also contributing a substantial portion. However, the company posted a net loss of $1.5 million, though this was improved from a net loss of $6.1 million the year prior.
CFO Sanjay Kalra noted bookings hit a record $205.5 million in Q1, up 113.4% from Q1 2021. On the Cable Access side of the business, he said Harmonic is seeing “cable operators buying ahead in anticipation of accelerating 2022 and early 2023 broadband network deployments.”