Xtera IPO an Act of Desperation?

November, 2015

Apparently, Xtera Communications’ desire to exit the optical business can no longer be characterized at all as graceful, but as somewhat frantic. There had been speculation in the industry that the supplier had even backed out on the idea of filing the S1, and then afterwards, it cut the terms of the IPO in half. There is no question that IPOs universally have been deferred lately as a result of market instability. Although Xtera has truly compelling technology that amply differentiates itself from other vendors, the lack of a sexy story will not necessarily endear itself to investors. Also, they will probably be wary when it comes to its presently high level of customer concentration. However, if it is able to amply demonstrate a need for its technology by a number of the hyperscale data center players in the foreseeable future, then it may have a shot at attracting at least a...

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