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A key evolutionary objective for the company has been to successfully transition our customers from legacy products to the next-generation core solutions of the future. In 2013, that strategy proved effective as core solutions grew to 87 percent of company revenue. 

Another evolutionary objective for the company was globalization. While we continued to gain market share with traditional U.S. carrier custom- ers, we also realized significant growth from some of the largest network operators around the world. The U.S. carrier market remained soft throughout the year; however our globalization efforts began to make a meaningful contribution in the second half. This resulted in a 48 percent increase in International 

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For nearly three decades, ADTRAN’s continued evolution has enabled the company to advance in a dynamic and challenging marketplace. 

## EVOLVE 

sales when compared to the second half of 2012. For the full year, international sales were up 24 percent and company revenue came in at $641.7 million, up three percent over the previous year. 

The successful transition of our business has enabled the company to meet the changing needs of our global customer base. As we strengthened our focus on core products, we continued to maintain a strong investment in Research and Development (R&D). This focus on product development enabled us to capitalize in the major product initiatives underway in areas such as Ultra Broadband, IP transition and cloud services. These initiatives represent significant market op- portunities for our company and our industry as a whole and we are positioning the company to remain at the technology forefront as these initiatives evolve. Our R&D investment paid dividends in 2013 as we successfully secured several major market wins in the U.S., Europe and Latin America. It also resulted in several significant new product announcements in 2013, including exciting new gigabit services platforms, the industry’s first advanced services fiber access gateway for Enterprise and mobile connectiv- ity, packet optical solutions for high-capacity access aggregation, expansion of our market-leading Carrier Ethernet portfolio and ProCloud SM , ADTRAN’s first cloud service offering. 

