HUNTSVILLE, Ala. -- ADTRAN Holdings, Inc. (NASDAQ: ADTN and FSE: QH9) (“ADTRAN Holdings” “ADTRAN” or the “Company”) today announced its unaudited financial results for the third quarter ended September 30, 2026.

Revenue: $281.2 million, up 0.6 % year-over-year. GAAP gross margin of 38.5%; non-GAAP gross margin of 42.1%, including benefit of approximately 200 basis points from IEEPA 1 refunds. GAAP operating margin of -0.3 %; non-GAAP operating margin of 5.0%. Net cash used in operating activities of $24.5 million. GAAP diluted loss per share of $0.10; non-GAAP diluted earnings per share of $0.09. Cash, cash equivalents and restricted cash of $71.7 million.

ADTRAN Holdings Chairman and Chief Executive Officer Tom Stanton stated, “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.”

“Looking ahead, we see significant opportunities to build on this momentum as customers invest in network capacity, performance and security,” Stanton continued. “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.”

Business outlook2

For the fourth quarter of 2026, the Company expects revenue to be within a range of $272.0 million to $292.0 million. Non-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.

1International Emergency Economic Powers Act

2 Non-GAAP operating margin (which is calculated as non-GAAP operating income (loss) divided by revenue) is a non-GAAP financial measure. The Company has provided guidance for its fourth quarter 2026 non-GAAP operating margin. This measure excludes from the corresponding GAAP financial measure the effect of adjustments as described below. The Company has not provided a reconciliation of such non-GAAP guidance to guidance presented on a GAAP basis because it cannot predict and quantify without unreasonable effort all of the adjustments that may occur during the period due to the difficulty of predicting the timing and amounts of various items within a reasonable range. In particular, non-GAAP operating margin excludes certain items, such as acquisition related expenses, amortization and adjustments, stock-based compensation expense, deferred compensation adjustments, professional fees and other expenses, amortization of pension actuarial losses, the tax effect of these adjustments to net loss and purchases of property, plant and equipment, and developed technologies, that the Company is unable to quantitatively predict. Depending on the materiality of these items, they could have a significant impact on the Company's GAAP financial results.