Key Takeaways

  • Former Intel executive Marc Graff will receive a $1.9 million cash bonus when he takes over as the top finance role at high-speed optical networking company Ciena, effective August 1, the company disclosed in a securities filing on Thursday.
  • Graff, who most recently served as CFO of semiconductor company Altera, will also receive a one-time replacement equity grant with a target delivery value of $10.4 million. According to the filing, the two compensation items are intended to "partially make up for certain near-term cash and equity incentives and certain long-term equity incentives that Graff is forfeiting by resigning from his previous employer." A quarter of the equity will vest one year after he assumes the CFO role, with the remainder vesting in installments over three years.
  • Graff will succeed 18-year company veteran James Moylan, the Hanover, Maryland-based company said in a press release.

Deep Dive

Moylan, who announced his retirement intention last September, will remain until August 28 to assist with a smooth transition, the company said.

"Over the past 18 years and an incredible 70 earnings calls, Jim has been an excellent partner and member of our executive team, making numerous significant contributions to our business growth and performance," CEO Gary Smith said of Moylan's CFO tenure during the company's most recent earnings call on June 5.

Before joining Altera, where he became its finance chief in January 2024, Graff spent 26 years at software giant Intel, serving as corporate vice president, CFO and COO of the Data Platforms Group, and vice president and head of Financial Planning and Analysis, according to his LinkedIn profile.

In addition to the $1.9 million cash bonus and the one-time equity grant, Graff will receive an annual base salary of $650,000 as Ciena's CFO, according to the filing with the U.S. Securities and Exchange Commission. He will also be eligible for an annual target bonus opportunity equal to 100% of his base salary. The company said that in fiscal 2026, Graff will also receive an equity award with a target delivery value of $3.9 million.

The CFO transition comes as the optical networking company seeks to capitalize on growth in data center and cloud spending driven by the artificial intelligence boom. In the second quarter of fiscal 2025, which ended May 3, Ciena's net revenue grew nearly 24% year over year to $1.1 billion—with revenue from cloud service providers being a "key driver," CEO Smith said on the company's earnings call. According to results released June 5, Ciena posted GAAP net income of $9 million for the quarter, compared with a net loss of $16.8 million in the same period last year.

The company achieved record direct cloud service provider revenue in the second quarter, with that segment accounting for 38% of total revenue, Smith said in the call transcript. These results "truly highlight the acceleration of AI infrastructure investment and our leadership in meeting that demand," Smith said, noting that three of the top five customers in the quarter were cloud service providers, underscoring their continued investment in AI infrastructure and network expansion.

Data center capital expenditures surged 53% to $134 billion in the first three months of this year, according to a survey by Dell'Oro Research Group, as reported by CIO Dive, a sister publication of CFO Dive. Growth was driven primarily by "hyperscale cloud providers' spending on AI infrastructure," with AWS, Google, Meta, and Microsoft—the four companies with the largest cloud footprints—accounting for 44% of first-quarter spending in that sector.

However, even as Ciena seeks to capitalize on the spending growth, the optical networking supplier also faced headwinds in the second quarter from a changing tariff environment. CFO Moylan said on the earnings call that amid a "dynamic" tariff environment, combined with Ciena's need to adjust its billing and customer systems, the company "absorbed the net impact in the quarter, resulting in a mid-single-digit million-dollar hit to our bottom line."

The company did not immediately respond to a request for comment.