Q2 FY2026
Filed Aug 12, 2026Allot Announces Second Quarter 2026 Financial Results Raising 2026 revenue guidance to $115–$118 million
Revenue grew 15% year-over-year, SECaaS revenue grew 47%, GAAP and non-GAAP operating results turned profitable, operating cash flow more than doubled, and management raised 2026 revenue guidance to $115–$118 million.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Total revenuesGAAP | $27.7 million | – | 15% |
| SECaaS revenuesother | $9.4 million | – | 47% |
| SECaaS ARRother | $36.1 million | – | 44% |
| GAAP gross profitGAAP | $19.8 million | – | 14% |
| GAAP gross marginGAAP | 71.3% | – | – |
| Non-GAAP gross profitnon-GAAP | $19.9 million | – | 13% |
| Non-GAAP gross marginnon-GAAP | 71.8% | – | – |
| GAAP cost of revenuesGAAP | $7,968 | – | – |
| GAAP research and development costs, netGAAP | $6,991 | – | – |
| GAAP sales and marketingGAAP | $8,042 | – | – |
| GAAP general and administrativeGAAP | $3,637 | – | – |
| GAAP total operating expensesGAAP | $18,670 | – | – |
| Non-GAAP operating expensesnon-GAAP | $17,162 | – | – |
| GAAP operating income (loss)GAAP | $1.1 million | – | – |
| GAAP operating marginGAAP | 4.0% | – | – |
| Non-GAAP operating incomenon-GAAP | $2.7 million | – | – |
| Non-GAAP operating marginnon-GAAP | 9.9% | – | – |
| Financial income, netGAAP | $1,975 | – | – |
| Income tax expensesGAAP | $501 | – | – |
| GAAP net income (loss)GAAP | $2.6 million | – | – |
| GAAP diluted income (loss) per shareGAAP | $0.05 per diluted share | – | – |
| GAAP basic income (loss) per shareGAAP | $0.05 | – | – |
| Non-GAAP net incomenon-GAAP | $4.6 million | – | – |
| Non-GAAP diluted income per sharenon-GAAP | $0.09 per diluted share | – | – |
| Non-GAAP basic income per sharenon-GAAP | $0.09 | – | – |
| Operating cash flowGAAP | $8.5 million | – | – |
| Six-month revenuesGAAP | $54,162 | – | – |
| Six-month GAAP gross profitGAAP | $38,510 | – | – |
| Six-month GAAP operating income (loss)GAAP | $2,627 | – | – |
| Six-month non-GAAP operating incomenon-GAAP | $5,364 | – | – |
| Six-month GAAP net income (loss)GAAP | $4,515 | – | – |
| Six-month non-GAAP net incomenon-GAAP | $7,653 | – | – |
| Six-month net cash provided by operating activitiesGAAP | $19,041 | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Americas revenueManagement cited revenue strength in the North American region. | $8.5 million | – | – |
| EMEA revenueNot provided. | $13.4 million | – | – |
| Asia Pacific revenueNot provided. | $5.8 million | – | – |
| SECaaS (Security as a Service) revenueSECaaS represented 34% of Q2-26 revenues. | $9.4 million | – | 47% |
| Products & Professional Services revenueProducts & Professional Services represented 33% of Q2-26 revenues. | $9.1 million | – | – |
| Support & Maintenance revenueSupport & Maintenance represented 33% of Q2-26 revenues. | $9.2 million | – | – |
2026 outlook
- Revenue$115–$118 million
- NoteSECaaS revenue growth for 2026 to be 40% or more
- Notecontinued improvement in profitability
Capital returns
- On June 23, 2026, the Board of Directors approved a share repurchase program of up to $40 million.
- At the end of the second quarter, the Board of Directors approved a $40 million share repurchase program.
What drove it
- Total revenue increased 15% year-over-year to $27.7 million.
- SECaaS revenue increased 47% year-over-year to $9.4 million and accounted for 34% of Q2-26 revenue.
- June 2026 SECaaS ARR was $36.1 million, up 44% year-over-year.
- Americas revenue was $8.5 million, representing 31% of Q2-26 revenue.
- GAAP operating income was $1.1 million, compared with a GAAP operating loss of $0.4 million in the second quarter of 2025.
- Operating cash flow was $8.5 million, compared with $4.0 million in the second quarter of 2025.
Concerns
- GAAP gross margin was 71.3%, compared with 72.1% in the second quarter of 2025.
- Non-GAAP gross margin was 71.8%, compared with 73.4% in the second quarter of 2025.
- Top 10 customers represented 57% of Q2-26 revenues, compared with 41% in FY 2025 and 43% in FY 2024.
- Trade receivables, net were $25,170 as of June 30, 2026, compared with $17,451 as of December 31, 2025.
- Inventories were $17,497 as of June 30, 2026, compared with $13,180 as of December 31, 2025.
What to watch
- Execution against 2026 revenue guidance of $115–$118 million.
- Management's expectation for SECaaS revenue growth for 2026 of 40% or more.
- Continued improvement in profitability, as stated in the 2026 outlook.
- Deployment of the share repurchase program of up to $40 million.
- The concentration of 57% of Q2-26 revenues among the top 10 customers.
Balance sheet and cash flow
- Cash and cash equivalents, bank deposits, restricted deposits and investments as of June 30, 2026, totaled $107 million, compared with $88 million as of December 31, 2025.
- Cash and cash equivalents were $13,759 as of June 30, 2026, compared with $17,107 as of December 31, 2025.
- Restricted deposit was $3,637 as of June 30, 2026, compared with $3,573 as of December 31, 2025.
- Short-term bank deposits were $31,100 as of June 30, 2026, compared with $15,100 as of December 31, 2025.
- Available-for-sale marketable securities were $57,345 as of June 30, 2026, compared with $48,663 as of December 31, 2025.
- Net cash provided by operating activities was $8,466 for the three months ended June 30, 2026, compared with $3,985 for the three months ended June 30, 2025.
- Net cash used in investing activities was $(7,811) for the three months ended June 30, 2026, compared with net cash provided by investing activities of $6,217 for the three months ended June 30, 2025.
- Cash and cash equivalents at the end of the period were $13,759, compared with $26,943 for the three months ended June 30, 2025.
- Deferred revenues were $45,613 current and $8,334 long-term as of June 30, 2026, compared with $24,700 current and $5,912 long-term as of December 31, 2025.
Analysis
Allot reported a stronger second quarter, with total revenue rising 15% year-over-year to $27.7 million. The principal growth metric was SECaaS revenue, which increased 47% year-over-year to $9.4 million and represented 34% of Q2-26 revenue. SECaaS ARR reached $36.1 million in June 2026, up 44% year-over-year. Management also highlighted North American strength, while the Americas accounted for $8.5 million, or 31%, of quarterly revenue.
Profitability improved materially. GAAP operating income was $1.1 million, compared with a GAAP operating loss of $0.4 million in the second quarter of 2025, while non-GAAP operating income increased to $2.7 million from $1.2 million. GAAP net income was $2.6 million, or $0.05 per diluted share, compared with a net loss of $1.7 million, or $0.04 per diluted share. Non-GAAP net income rose to $4.6 million, or $0.09 per diluted share, from $1.5 million, or $0.03 per diluted share.
The gross-margin trend warrants attention. GAAP gross margin was 71.3%, compared with 72.1% a year earlier, and non-GAAP gross margin was 71.8%, compared with 73.4%. Operating expenses were $18,670 on a GAAP basis, compared with $17,737 in the prior-year quarter. The quarter nevertheless produced positive operating leverage, reflected in the movement to GAAP operating income and a non-GAAP operating margin of 9.9% from 5.0%.
Cash generation strengthened. Operating cash flow was $8.5 million, compared with $4.0 million in the second quarter of 2025. Cash and cash equivalents, bank deposits, restricted deposits and investments totaled $107 million as of June 30, 2026, versus $88 million as of December 31, 2025. Deferred revenues increased to $45,613 current and $8,334 long-term, while trade receivables and inventories also increased from year-end levels.
Management raised 2026 revenue guidance to $115–$118 million and expects SECaaS revenue growth for 2026 of 40% or more, alongside continued improvement in profitability. The Board approved a share repurchase program of up to $40 million on June 23, 2026. Key items to monitor are delivery against the raised outlook, maintenance of SECaaS growth, gross-margin performance, and customer concentration, as the top 10 customers represented 57% of Q2-26 revenue.
Management, verbatim
We are excited to report our fourth consecutive quarter of double-digit growth. I am particularly encouraged by the revenue strength of the North American region this quarter, as I believe that this region has many opportunities to provide us with sustainable long-term growth.
Eyal Harari, CEO of Allot
Following our solid execution and visibility for the remainder of the year, we are raising our 2026 revenue guidance to between $115 million and $118 million, with continued improvement in profitability. We expect our SECaaS revenue growth for 2026 to be 40% or more.
Eyal Harari, CEO of Allot
At the end of the second quarter, our Board of Directors approved a $40 million share repurchase program, reflecting our confidence in Allot’s strategy and financial strength.
Eyal Harari, CEO of Allot
Not in the filing
stated, not guessed- Prior-quarter total revenue, gross profit, gross margin, operating income, net income, EPS, operating cash flow and free cash flow were not reported for Q2 2026.
- Free cash flow was not reported.
- Debt balance as of June 30, 2026 was not reported.
- Dividend amount and dividend declaration were not reported.
- Share repurchases executed during Q2 2026 were not reported.
- Prior 2026 guidance was not provided, so comparison with prior guidance cannot be made.
- Quantified guidance for gross margin, operating expenses, tax rate, EPS and operating cash flow was not provided.
- Year-over-year and quarter-over-quarter changes for geographic revenue, Products & Professional Services revenue, and Support & Maintenance revenue were not reported.
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.