Tellabs announced Wednesday that it had signed a multiyear agreement with Beijing Bell Telecommunications Equipment Manufacturing to sell its latest switching technology in China.
Ahead of the announcement, Tellabs (Nasdaq: TLAB) closed up $1.13 to $56.69.
Company officials said the agreement covers the purchase, sale and support for its SALIX 7000 next-generation switching systems. The first SALIX 7000 switching systems have already been shipped to China and will begin extensive trials this month.
SALIX 7000 products enable service providers to integrate local, long-distance, wireless and data services with telecommunications networks.
"This agreement forms the framework for our expansion in the rapidly growing telecommunications market in China," said Dan Simpkins, vice president and general manager of Tellabs' SALIX switching group, in a prepared release.
In its latest quarter, Tellabs beat the Street when it returned a profit of 47 cents a share on sales of $870.6 million.
First Call Corp. consensus expects it to earn 56 cents a share in the fourth quarter and $2.17 a share in the fiscal year.
Tellabs shares raced up to a 52-week high of $77.25 last November and fell to a low of $37.63 in October.
Twenty-two of the 24 analysts following the stock maintain either a "buy" or "strong buy" recommendation.
Reuters contributed to this report.