ADTRAN Holdings, Inc. reports third quarter 2026 financial results
ADTRAN Holdings, Inc. (ADTN) filed an SEC Form 8-K — Results of Operations and Financial Condition. ADTRAN Holdings, Inc. reports third quarter 2026 financial results Huntsville , Alabama, USA. — November 2, 2026 — ADTRAN Holdings, Inc. (NASDAQ: ADTN and FSE: QH9) (“ADTRAN Holdings” “ADTRAN” or the “Company”) today announced its unaudited financial results for the third quarter
How this was made
The 30-second read
Why it matters
The earnings release adds new financial data for ADTN, but the modest growth and loss suggest limited immediate price movement; investors will watch Q4 guidance for signs of improvement.
Market read
ADTN's earnings provide a fresh data point for telecom equipment investors, with limited broader market impact.
What to watch
Potential upside from hyperscale customer growth and IEEPA refunds may improve margins beyond current guidance.
ADTRAN Holdings reported third quarter 2026 revenue of $281.2 million, up 0.6% year-over-year, with a GAAP diluted loss per share of $0.10 and non-GAAP diluted earnings per share of $0.09.
Revenue increased 0.6% year-over-year and the Company returned to non-GAAP profitability, but GAAP operating results remained negative, third-quarter operating cash flow and free cash flow were negative, and fourth-quarter non-GAAP operating-margin guidance of 1.0% to 5.0% reflects supply availability, seasonality and large-project timing.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Total Revenue, three months ended September 30, 2026 (In thousands)GAAP | $281.2M | – | up 0.6% year-over-year |
| Total Revenue, nine months ended September 30, 2026 (In thousands)GAAP | $848.4M | – | – |
| Gross Profit, three months ended September 30, 2026 (In thousands)GAAP | $108.2M | – | – |
| Gross Margin, three months ended September 30, 2026GAAP | 38.5 % | – | – |
| Non-GAAP Gross Profit, three months ended September 30, 2026 (In thousands)non-GAAP | $118.3M | – | – |
| Non-GAAP Gross Margin, three months ended September 30, 2026non-GAAP | 42.1 % | – | – |
| Operating Expenses, three months ended September 30, 2026 (In thousands)GAAP | $109.0M | – | – |
| Non-GAAP Operating Expenses, three months ended September 30, 2026 (In thousands)non-GAAP | $104.2M | – | – |
| Operating Loss, three months ended September 30, 2026 (In thousands)GAAP | −$754K | – | – |
| Operating Margin, three months ended September 30, 2026GAAP | -0.3 % | – | – |
| Non-GAAP Operating Income, three months ended September 30, 2026 (In thousands)non-GAAP | $14.08M | – | – |
| Non-GAAP Operating Margin, three months ended September 30, 2026non-GAAP | 5.0 % | – | – |
| Net Loss, three months ended September 30, 2026 (In thousands)GAAP | −$7.14M | – | – |
| Net Loss attributable to ADTRAN Holdings, Inc., three months ended September 30, 2026 (In thousands)GAAP | −$9.23M | – | – |
| Non-GAAP Net Income attributable to ADTRAN Holdings, Inc., three months ended September 30, 2026 (In thousands)non-GAAP | $6.12M | – | – |
| Loss per common share attributable to ADTRAN Holdings, Inc. – diluted, three months ended September 30, 2026GAAP | $ (0.10 ) | – | – |
| Non-GAAP Earnings per common share attributable to ADTRAN – diluted, three months ended September 30, 2026non-GAAP | $ 0.09 | – | – |
| Net cash (used in) provided by operating activities, three months ended September 30, 2026 (In thousands)GAAP | −$24.47M | – | – |
| Free cash flow, three months ended September 30, 2026 (In thousands)non-GAAP | −$39.39M | – | – |
| Net cash provided by operating activities, nine months ended September 30, 2026 (In thousands)GAAP | $14.12M | – | – |
| Free cash flow, nine months ended September 30, 2026 (In thousands)non-GAAP | −$33.98M | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Network Solutions, three months ended September 30, 2026 (In thousands)No segment-specific driver was reported. | $231.2M | – | – |
| Services & Support, three months ended September 30, 2026 (In thousands)No segment-specific driver was reported. | $49.95M | – | – |
| Network Solutions, nine months ended September 30, 2026 (In thousands)No segment-specific driver was reported. | $702.1M | – | – |
| Services & Support, nine months ended September 30, 2026 (In thousands)No segment-specific driver was reported. | $146.3M | – | – |
Amounts quoted below without a unit are in thousands, as in the filing’s tables. Per-share figures are as printed.
fourth quarter of 2026 outlook
- Revenue$272.0 million to $292.0 million
- NoteNon-GAAP operating margin is expected to be within a range of 1.0% to 5.0% reflecting historical seasonality, availability of supply and timing of large customer projects.
Capital returns
- Redemption of redeemable non-controlling interest: $ (31,902 ) for the nine months ended September 30, 2026 (In thousands).
- Payment of annual recurring compensation to non-controlling interest: $ (8,881 ) for the nine months ended September 30, 2026 (In thousands).
What drove it
- Continued growth in optical networking.
- Increasing growth with hyperscale customers.
- The rapid expansion of AI infrastructure is reshaping network investment priorities, including cloud infrastructure and traditional service provider markets.
- Non-GAAP gross margin included benefit of approximately 200 basis points from IEEPA refunds.
Concerns
- Third quarter revenue came in slightly below the midpoint of the Company's guidance range.
- Management cited a challenging supply environment and supply and cost pressures.
- GAAP operating margin was -0.3 % and GAAP diluted loss per share was $ (0.10 ).
- Net cash used in operating activities was $ (24,470 ) and free cash flow was $ (39,386 ) for the three months ended September 30, 2026, in thousands.
- The filing identifies risks related to indebtedness, ability to generate cash, credit-agreement covenants, convertible notes, DPLTA payment obligations, inventory practices, material weaknesses in internal control over financial reporting, tariffs and international operations.
What to watch
- Revenue execution within the fourth-quarter 2026 guidance range of $272.0 million to $292.0 million.
- Whether non-GAAP operating margin is within the fourth-quarter 2026 guidance range of 1.0% to 5.0%.
- Availability of supply, supply and cost pressures, historical seasonality and timing of large customer projects.
- Optical networking and hyperscale customer growth.
- Cash generation following third-quarter net cash used in operating activities of $ (24,470 ) and free cash flow of $ (39,386 ), in thousands.
Balance sheet and cash flow
- Cash and cash equivalents: $ 64,627 as of September 30, 2026 (In thousands); $ 95,696 as of December 31, 2025.
- Restricted cash: $ 7,097 as of September 30, 2026 (In thousands); — as of December 31, 2025.
- Cash, cash equivalents and restricted cash, end of period: $ 71,724 for the nine months ended September 30, 2026 (In thousands); $ 101,229 for the nine months ended September 30, 2025.
- Inventory, net: $ 227,369 as of September 30, 2026 (In thousands); $ 215,736 as of December 31, 2025.
- Accounts receivable, net: $ 235,081 as of September 30, 2026 (In thousands); $ 210,687 as of December 31, 2025.
- Non-current revolving credit agreement: $ 82,961 as of September 30, 2026 (In thousands); $ 25,000 as of December 31, 2025.
- Non-current convertible senior notes, net of debt issuance costs: $ 194,223 as of September 30, 2026 (In thousands); $ 193,038 as of December 31, 2025.
- Purchases of property, plant and equipment and developed technologies: $ (14,916 ) for the three months ended September 30, 2026 (In thousands); $ (48,093 ) for the nine months ended September 30, 2026 (In thousands).
- Net cash provided by operating activities: $ 14,115 for the nine months ended September 30, 2026 (In thousands); $ 87,529 for the nine months ended September 30, 2025.
- Net cash used in investing activities: $ (47,594 ) for the nine months ended September 30, 2026 (In thousands); $ (49,147 ) for the nine months ended September 30, 2025.
- Net cash provided by financing activities: $ 13,072 for the nine months ended September 30, 2026 (In thousands); net cash used in financing activities of $ (18,046 ) for the nine months ended September 30, 2025.
Analysis
ADTRAN reported third-quarter revenue of $281.2 million, up 0.6% year-over-year. The revenue result was slightly below the midpoint of the Company's guidance range, according to management. Network Solutions revenue was $ 231,222 and Services & Support revenue was $ 49,945, each reported in thousands. Management identified continued optical-networking growth and increasing growth with hyperscale customers as favorable developments, while also citing a challenging supply environment.
Margins improved sequentially in several reported measures but remained under pressure on a GAAP basis. GAAP gross margin was 38.5 %, compared with 37.0 % in the preceding quarter and 38.3 % in the prior-year quarter. Non-GAAP gross margin was 42.1 %, equal to the prior-year quarter and above 40.7 % in the prior quarter. The Company stated that non-GAAP gross margin included benefit of approximately 200 basis points from IEEPA refunds. GAAP operating margin was -0.3 %, while non-GAAP operating margin was 5.0 %.
The Company reported a GAAP operating loss of $ (754 ) and a GAAP net loss attributable to ADTRAN Holdings, Inc. of $ (9,228 ), each in thousands. GAAP diluted loss per share was $ (0.10 ). On a non-GAAP basis, operating income was $ 14,084, net income attributable to ADTRAN Holdings, Inc. was $ 6,119, and diluted earnings per share was $ 0.09, each with the applicable figures reported in the filing. The difference between GAAP and non-GAAP results included acquisition-related expenses, amortizations and adjustments, stock-based compensation, deferred compensation adjustments and business transformation costs.
Cash conversion was the main weakness in the reported quarter. Net cash used in operating activities was $ (24,470 ) and non-GAAP free cash flow was $ (39,386 ), both in thousands. For the nine months ended September 30, 2026, net cash provided by operating activities was $ 14,115 and non-GAAP free cash flow was $ (33,978 ), in thousands. Cash, cash equivalents and restricted cash were $ 71,724 at September 30, 2026, while non-current revolving credit agreement borrowings were $ 82,961 and non-current convertible senior notes, net of debt issuance costs, were $ 194,223, each in thousands.
For the fourth quarter of 2026, ADTRAN guided revenue to $272.0 million to $292.0 million and non-GAAP operating margin to 1.0% to 5.0%. The outlook explicitly reflects historical seasonality, availability of supply and timing of large customer projects. The guide places execution on supply conditions, project timing, demand from optical networking and hyperscale customers, and the Company's stated objective of converting revenue opportunities into profitability and cash generation.
Management, verbatim
Third quarter revenue came in slightly below the midpoint of our guidance range as we continued to navigate a challenging supply environment. Despite these pressures, we saw encouraging developments across the business, including continued growth in optical networking and increasing growth with hyperscale customers. The rapid expansion of AI infrastructure is reshaping network investment priorities, creating opportunities for ADTRAN not only in cloud infrastructure but also across our traditional service provider markets.
Tom Stanton, Chairman and Chief Executive Officer
Looking ahead, we see significant opportunities to build on this momentum as customers invest in network capacity, performance and security. Our focus is on addressing the supply and cost pressures affecting our business, maintaining financial discipline and translating these opportunities into stronger revenue growth, profitability and cash generation.
Tom Stanton, Chairman and Chief Executive Officer
Not in the filing
stated, not guessed- Previous-release outlook was not provided, so comparison of actual third-quarter 2026 results with prior guidance is unavailable.
- Fourth-quarter 2026 GAAP revenue growth, GAAP gross margin, GAAP operating margin, operating expenses and tax-rate guidance were not provided.
- Segment-specific year-over-year and quarter-over-quarter percentage changes were not provided.
- Third-quarter 2026 dividend and share-repurchase activity were not provided.
- A total debt figure was not provided.
- Third-quarter 2026 GAAP tax rate was not provided.
Written by an AI language model from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure is checked against the filing text, and a metric the filing does not print, or whose value, prior period and change do not add up, is dropped from the metrics. The model can still misread a table, in the metrics or in the text, so check a number in the filing before you rely on it. Consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.
Background
ADTN's Q3 2026 earnings release includes both GAAP and non-GAAP metrics, a slight revenue increase, and forward-looking guidance for Q4.
Ticker impact
ADTN reported Q3 2026 results with revenue of $281.2M, a 0.6% YoY increase and GAAP loss per share of $0.10, plus Q4 guidance of $272M-$292M revenue.
likely modest pressure as investors digest the slight revenue miss and loss, with potential support if Q4 guidance is viewed as stable.
Earnings are the first disclosure of the quarter, providing new data but the scale is modest for a small-cap; guidance is flat, so traders may hold or trim positions.
Market effects
Provides a data point for the networking equipment sector, indicating modest demand amid supply constraints.
Limited to U.S. small-cap investors focused on telecom infrastructure.
Low, as the company is a niche player without broad market influence.
Counterpoint
If the AI infrastructure expansion accelerates faster than expected, the guidance could be an underestimate, offering upside.
Key entities
- ExecutiveTom Stanton
Chairman and CEO of ADTN, provided commentary on results and outlook.
