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ADTN expects Q3 2026 revenues of $275M-$295M and a non-GAAP operating margin of 1.5-5.5%.
ADTRAN Holdings, Inc. (ADTN - Free Report) reported strong second-quarter 2026 results, with both top and bottom lines surpassing the Zacks Consensus Estimate.
The company delivered 6.1% year-over-year revenue growth, supported by continued strength in its optical networking business. Expanding customer opportunities and a growing innovation pipeline are expected to support long-term growth.
Net Income
On a GAAP basis, net loss in the June quarter was $10.32 million or a loss of 13 cents per share compared with a net loss of $19.04 million or a loss of 24 cents per share in the prior-year quarter. The narrower loss was attributable to top-line growth.
Excluding non-recurring items, non-GAAP earnings for the reported quarter were $3.41 million or 4 cents per share against a net loss of $0.26 million or near breakeven per share a year ago. The bottom line surpassed the Zacks Consensus Estimate of 3 cents.
ADTRAN Holdings, Inc. Price, Consensus and EPS Surprise
Quarterly total revenues increased to $281.15 million from $265.07 million in the prior-year quarter, driven by solid growth in both the Network Solutions and Services and Support Segment. The top line beat the Zacks Consensus Estimate of $281.1 million.
Network Solutions revenues were $232.9 million compared with $219.5 million in the prior-year quarter, reflecting broad-based growth across the company's networking portfolio. Services and Support revenues were $48.25 million, up from $45.57 million in the year-earlier quarter.
In the second quarter, Subscriber Solutions revenues were $84.53 million compared with $83.76 million in the year-ago quarter. Revenues from Access & Aggregation Solutions were $86.93 million, down 4.7% year over year. Optical Networking Solutions revenues rose to $109.68 million from $90.1 million in the year-ago quarter.
Region-wise, net sales from the United States were $134.4 million, up 11.7% year over year. International revenues totaled $146.73 million, up from $144.73 million in the year-earlier quarter.
Other Details
Non-GAAP gross profit increased to $114.52 million from $109.75 million in the year-ago quarter for respective margins of 40.7% and 41.4%. Non-GAAP operating expenses increased to $103.92 million from $101.71 million in the year-ago quarter. Non-GAAP operating income improved to $10.6 million from $8.03 million in the year-ago quarter for respective margins of 3.8% and 3%.
Cash Flow & Liquidity
In the second quarter, ADTRAN generated $25.92 million of cash from operating activities compared with $32.16 million in the year-earlier quarter. During the first six months of 2026, the company generated $38.59 million in cash compared with $75.34 million in the year-ago period. As of June 30, 2026, the company had $79.24 million in cash and cash equivalents and $23.84 million of non-current lease obligations.
Outlook
For the third quarter of 2026, ADTRAN expects revenues in the range of $275-$295 million. Non-GAAP operating margin is expected to be in the band of 1.5% to 5.5%.
Keysight Technologies, Inc. (KEYS - Free Report) is scheduled to release third-quarter fiscal 2026 earnings on Aug. 18. The Zacks Consensus Estimate for earnings is pegged at $2.46 per share, suggesting growth of 43.02% from the year-ago reported figure.
Keysight has a long-term earnings growth expectation of 19.44%. The company delivered an average earnings surprise of 9.46% in the last four reported quarters.
Analog Devices, Inc. (ADI - Free Report) is set to release third-quarter fiscal 2026 earnings Aug. 19. The Zacks Consensus Estimate for earnings is pegged at $3.33 per share, implying growth of 62.44% from the year-ago reported figure.
Analog Devices has a long-term earnings growth expectation of 31.04%. The company delivered an average earnings surprise of 5.48% in the last four reported quarters.
Applied Materials, Inc. (AMAT - Free Report) is scheduled to release third-quarter fiscal 2026 earnings on Aug. 13. The Zacks Consensus Estimate for earnings is pegged at $3.36 per share, suggesting growth of 35.48% from the year-ago reported figure.
Applied Materials has a long-term earnings growth expectation of 32.44%. The company delivered an average earnings surprise of 6.06% in the last four reported quarters.
View the Zacks #1 Rank List
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ADTRAN Q2 Earnings Beat Estimates on Healthy Revenue Growth
Key Takeaways
ADTRAN Holdings, Inc. (ADTN - Free Report) reported strong second-quarter 2026 results, with both top and bottom lines surpassing the Zacks Consensus Estimate.
The company delivered 6.1% year-over-year revenue growth, supported by continued strength in its optical networking business. Expanding customer opportunities and a growing innovation pipeline are expected to support long-term growth.
Net Income
On a GAAP basis, net loss in the June quarter was $10.32 million or a loss of 13 cents per share compared with a net loss of $19.04 million or a loss of 24 cents per share in the prior-year quarter. The narrower loss was attributable to top-line growth.
Excluding non-recurring items, non-GAAP earnings for the reported quarter were $3.41 million or 4 cents per share against a net loss of $0.26 million or near breakeven per share a year ago. The bottom line surpassed the Zacks Consensus Estimate of 3 cents.
ADTRAN Holdings, Inc. Price, Consensus and EPS Surprise
ADTRAN Holdings, Inc. price-consensus-eps-surprise-chart | ADTRAN Holdings, Inc. Quote
Revenues
Quarterly total revenues increased to $281.15 million from $265.07 million in the prior-year quarter, driven by solid growth in both the Network Solutions and Services and Support Segment. The top line beat the Zacks Consensus Estimate of $281.1 million.
Network Solutions revenues were $232.9 million compared with $219.5 million in the prior-year quarter, reflecting broad-based growth across the company's networking portfolio. Services and Support revenues were $48.25 million, up from $45.57 million in the year-earlier quarter.
In the second quarter, Subscriber Solutions revenues were $84.53 million compared with $83.76 million in the year-ago quarter. Revenues from Access & Aggregation Solutions were $86.93 million, down 4.7% year over year. Optical Networking Solutions revenues rose to $109.68 million from $90.1 million in the year-ago quarter.
Region-wise, net sales from the United States were $134.4 million, up 11.7% year over year. International revenues totaled $146.73 million, up from $144.73 million in the year-earlier quarter.
Other Details
Non-GAAP gross profit increased to $114.52 million from $109.75 million in the year-ago quarter for respective margins of 40.7% and 41.4%. Non-GAAP operating expenses increased to $103.92 million from $101.71 million in the year-ago quarter. Non-GAAP operating income improved to $10.6 million from $8.03 million in the year-ago quarter for respective margins of 3.8% and 3%.
Cash Flow & Liquidity
In the second quarter, ADTRAN generated $25.92 million of cash from operating activities compared with $32.16 million in the year-earlier quarter. During the first six months of 2026, the company generated $38.59 million in cash compared with $75.34 million in the year-ago period. As of June 30, 2026, the company had $79.24 million in cash and cash equivalents and $23.84 million of non-current lease obligations.
Outlook
For the third quarter of 2026, ADTRAN expects revenues in the range of $275-$295 million. Non-GAAP operating margin is expected to be in the band of 1.5% to 5.5%.
Zacks Rank
ADTRAN currently carries a Zacks Rank #4 (Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Upcoming Releases
Keysight Technologies, Inc. (KEYS - Free Report) is scheduled to release third-quarter fiscal 2026 earnings on Aug. 18. The Zacks Consensus Estimate for earnings is pegged at $2.46 per share, suggesting growth of 43.02% from the year-ago reported figure.
Keysight has a long-term earnings growth expectation of 19.44%. The company delivered an average earnings surprise of 9.46% in the last four reported quarters.
Analog Devices, Inc. (ADI - Free Report) is set to release third-quarter fiscal 2026 earnings Aug. 19. The Zacks Consensus Estimate for earnings is pegged at $3.33 per share, implying growth of 62.44% from the year-ago reported figure.
Analog Devices has a long-term earnings growth expectation of 31.04%. The company delivered an average earnings surprise of 5.48% in the last four reported quarters.
Applied Materials, Inc. (AMAT - Free Report) is scheduled to release third-quarter fiscal 2026 earnings on Aug. 13. The Zacks Consensus Estimate for earnings is pegged at $3.36 per share, suggesting growth of 35.48% from the year-ago reported figure.
Applied Materials has a long-term earnings growth expectation of 32.44%. The company delivered an average earnings surprise of 6.06% in the last four reported quarters.