Ribbon Communications (RBBN) Q3 2026 Earnings Call: Revenue Up 14%, Q4 Guidance Issued
Source Tradingkey
Key Takeaways
- Ribbon Communications reported Q3 2026 revenue of $219 million, up 14% sequentially and 2% year over year, as both operating segments improved from the second quarter.
- Adjusted EBITDA reached $27 million, increasing by $15 million sequentially, while non-GAAP diluted EPS rose to $0.07.
- IP Optical Networks revenue increased 17% sequentially to $96 million, supported by routing products, two new U.S. Tier 2 service provider customers and backlog conversion.
- Cloud & Edge revenue rose 11% sequentially to $123 million. Verizon-related sales were approximately 50% above the first-half quarterly run rate.
- Management guided Q4 2026 revenue to $233 million-$247 million and adjusted EBITDA to $40 million-$47 million, with most of the sequential growth expected from Cloud & Edge.
- Supply constraints could shift $5 million-$10 million of customer demand into the following quarter, while higher component and logistics costs are expected to add approximately $2 million per quarter.
Key Financial Results
| Metric | Q3 2026 | Change / Commentary |
|---|---|---|
| Revenue | $219 million | Up 14% sequentially; up 2% year over year |
| Non-GAAP gross margin | 50.3% | Up 100 bps sequentially; down 230 bps year over year |
| Non-GAAP operating expenses | $88 million | Down $1 million year over year; broadly flat sequentially |
| Adjusted EBITDA | $27 million | Up $15 million sequentially; down $2 million year over year |
| Non-GAAP net income | $12 million | Up $17 million sequentially; up $5 million year over year |
| Non-GAAP diluted EPS | $0.07 | Up $0.10 sequentially; up $0.03 year over year |
| Operating cash flow | $(14) million | Cash use during the quarter |
| Quarter-end cash | $42 million | Included a $15 million revolver draw |
| Net debt leverage | 4.4x | Management expects improvement as EBITDA increases |
Business and Operating Performance
IP Optical Networks
Disclaimer: For information purposes only. Past performance is not indicative of future results.
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