Extreme Networks | 8-K: FY2026 Revenue Beats Estimate at USD 1.284 B

Revenue: As of FY2026, the actual value is USD 1.284 B, beating the estimate of USD 1.278 B.

EPS: As of FY2026, the actual value is USD 0.31, beating the estimate of USD 0.2475.

EBIT: As of FY2026, the actual value is USD 61.1 M.

Fiscal Fourth Quarter 2026 Results

Segment Revenue

For the fourth quarter ended June 30, 2026, Extreme Networks, Inc. reported product revenue of $218.5 million and subscription and support revenue of $120.1 million. SaaS Annual Recurring Revenue (ARR) was $244.3 million, marking a 17.7% year-over-year increase and a 3.4% quarter-over-quarter increase.

Gross Margin

GAAP gross margin for the quarter was 62.2%, up from 61.6% in the prior year. Non-GAAP gross margin was 62.7%, compared to 62.3% in the fourth quarter of fiscal 2025.

Operating Margin

GAAP operating profit margin was 6.2%, a significant improvement from a GAAP operating loss margin of -0.4% in the previous year. Non-GAAP operating margin increased to 15.7% from 15.2% year-over-year.

Net Income

GAAP net income for the quarter was $18.0 million, a substantial turnaround from a GAAP net loss of - $7.8 million in the prior year. Non-GAAP net income was $43.4 million, up from $33.5 million in the same period last year.

Share Repurchases

Extreme Networks, Inc. repurchased $25.0 million of its shares during the quarter, acquiring 1.5 million shares at an average price of $16.66 per share.

Fiscal Year 2026 Results

Segment Revenue

For the full fiscal year ended June 30, 2026, product revenue was $809.6 million, and subscription and support revenue was $474.0 million.

Gross Margin

GAAP gross margin for fiscal year 2026 was 61.5%, a decrease from 62.2% in fiscal year 2025. Non-GAAP gross margin was 62.1%, down from 62.9% in the prior fiscal year.

Operating Margin

GAAP operating margin improved to 4.9% for fiscal year 2026, compared to 1.5% in fiscal year 2025. Non-GAAP operating margin increased to 14.8% from 14.2% year-over-year.

Net Income

GAAP net income for fiscal year 2026 was $42.1 million, compared to a GAAP net loss of - $7.5 million in fiscal year 2025. Non-GAAP net income was $143.1 million, up from $112.4 million in the prior fiscal year.

Liquidity and Cash Flow

Cash and Net Cash

Extreme Networks, Inc.’s cash balance at the end of Q4 2026 was $211.8 million, a decrease of $20.0 million from the prior year, with net cash standing at $46.8 million. The company strengthened its financial flexibility by entering into a $500.0 million revolving credit facility on July 29, 2026.

Operating Cash Flow

Cash flow provided by operating activities for Q4 2026 was $72.9 million, and for the full fiscal year 2026, it was $123.2 million.

Free Cash Flow

Total free cash flow for Q4 2026 was $65.3 million, and for the full fiscal year 2026, it was $95.3 million. Capital expenditures for property, equipment, and capitalized software development costs were - $7.6 million in Q4 2026 and - $27.9 million for FY 2026.

Operational Highlights

Extreme Platform ONE accounted for over 30% of subscription bookings in its first year and doubled quarter-over-quarter in Q4 2026. In Fiscal 2026, 187 customers placed orders exceeding one million dollars for Extreme solutions. The company expanded its Wi-Fi 7 Access Point portfolio and secured significant wins, including powering the new Nissan Stadium with Wi-Fi 7 and Multi-Beam Wireless technology, and deploying AI-powered networking solutions for the University of Technology Sydney and a top 10 global retailer in Europe.

Business Outlook

For the first quarter of fiscal 2027, Extreme Networks, Inc. is targeting total net revenue between $334.0 million and $339.0 million, with a non-GAAP operating margin projected at 14.7% to 15.3%. For the full fiscal year 2027, the company anticipates total net revenue to range from $1,380.0 million to $1,400.0 million. The full fiscal year 2027 outlook also projects a non-GAAP operating margin between 16.7% and 17.1%.