Harmonic Inc. Aktienkurs
📊 Peer Group
📈 Was ist das?
Die Peer Group sind die Unternehmen mit dem ähnlichsten Geschäftsmodell. Sie dienen als Vergleichsmaßstab, um eine Aktie einzuordnen.
🧮 Wie wird sie ausgewählt?
Nach Ähnlichkeit des Geschäftsmodells, also Unternehmen aus derselben Branche, mit vergleichbaren Produkten und einer ähnlichen Kundengruppe. Nur so vergleichst du Äpfel mit Äpfeln.
🏛️ Wofür ist sie wichtig?
Ob eine Aktie günstig oder teuer ist, lässt sich am ehesten im Vergleich beurteilen. Ein KGV von 18 oder ein EV/FCF von 20 wirkt je nach Maßstab günstig oder teuer. Die Peer Group liefert dabei den treffsichersten Maßstab: Unternehmen mit ähnlichem Geschäftsmodell, die denselben Bedingungen unterliegen.
🎯 Was bedeutet das für Anleger?
Liegt eine Kennzahl unter dem Peer-Durchschnitt, ist die Aktie relativ günstiger bewertet, über dem Durchschnitt entsprechend teurer. Ein Abschlag zur Peer Group kann eine Chance sein, aber auch einen Grund haben (zum Beispiel geringeres Wachstum). Der Vergleich ist ein Startpunkt, kein Urteil.
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📘 Marktkapitalisierung
📈 Was ist das?
Die Marktkapitalisierung zeigt, wie viel ein Unternehmen laut Börse aktuell wert ist.
🧮 Wie wird es berechnet?
🏛️ Wofür ist es wichtig?
Sie hilft Unternehmen in Größenklassen (Large, Mid, Small Cap) einzuordnen und gibt Hinweise auf Marktmacht und Stabilität.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Große Unternehmen gelten als stabiler, zahlen oft Dividenden, wachsen aber langsamer.
- Kleine Firmen können stärker wachsen, sind aber schwankungsanfälliger.
- Die Marktkapitalisierung ist ein guter Indikator für Unternehmensgröße, aber kein Maß für Unter- oder Überbewertung.
📘 Enterprise Value (Unternehmenswert)
📈 Was ist das?
Der Enterprise Value (EV) zeigt, was ein Unternehmen tatsächlich kostet, wenn man es komplett übernehmen würde – inklusive Schulden und abzüglich Cash.
🧮 Wie wird es berechnet?
(= Marktkapitalisierung + Nettoverschuldung)
🏛️ Wofür ist es wichtig?
Der EV ist eine realistischere Bewertungsbasis als die Marktkapitalisierung, da er die Kapitalstruktur berücksichtigt. Er ist Grundlage für Kennzahlen wie EV/FCF oder EV/Sales.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Der Enterprise Value zeigt, was ein Unternehmen tatsächlich wert ist – unabhängig davon, wie es finanziert ist.
- Er ist besonders wichtig für professionelle Investoren, da er eine objektivere Grundlage für Bewertungsvergleiche bietet als die Marktkapitalisierung allein.
- Ein Unternehmen mit hoher Verschuldung erscheint im EV teurer, eines mit viel Cash günstiger – auch wenn sie an der Börse gleich viel wert sind.
📘 Nettoverschuldung
📈 Was ist das?
Die Nettoverschuldung zeigt, wie viele Schulden nach Abzug des verfügbaren Cashs tatsächlich verbleiben.
🧮 Wie wird es berechnet?
🏛️ Wofür ist es wichtig?
Sie zeigt, wie stark ein Unternehmen von Fremdkapital abhängig ist – und wie gut es in der Lage ist, seine Schulden kurzfristig zu bedienen.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Eine niedrige oder negative Nettoverschuldung bedeutet hohe finanzielle Stabilität.
- Unternehmen mit viel Cash und geringer Verschuldung sind besser gerüstet für Krisen.
- Eine hohe Nettoverschuldung erhöht das Risiko – besonders bei steigenden Zinsen oder konjunkturellen Schwächen.
📘 Cash
📈 Was ist das?
Der Cashbestand zeigt, wie viele liquide Mittel einem Unternehmen sofort zur Verfügung stehen.
🧮 Wie wird es berechnet?
🏛️ Wofür ist es wichtig?
Er gibt Auskunft über die finanzielle Flexibilität: Ein hoher Cashbestand ermöglicht Investitionen, Rückkäufe oder Krisenresistenz.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Ein hoher Cashbestand zeigt finanzielle Stärke und Handlungsspielraum.
- Cash kann für Investitionen, Schuldentilgung oder Aktienrückkäufe genutzt werden.
- Allerdings: Zu viel ungenutztes Kapital kann auch auf mangelnde Investitionsideen hinweisen.
📘 Anzahl ausstehender Aktien
📈 Was ist das?
Die Anzahl ausstehender Aktien gibt an, wie viele Aktien eines Unternehmens aktuell im Umlauf sind und von Investoren gehalten werden.
🧮 Wie wird es berechnet?
🏛️ Wofür ist es wichtig?
Sie ist die Grundlage für viele Kennzahlen wie Gewinn je Aktie (EPS), Marktkapitalisierung oder KGV.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Je weniger Aktien im Umlauf sind, desto höher fällt z. B. der Gewinn je Aktie aus – wichtig für Bewertung und Dividendenrendite.
- Aktienrückkäufe verringern die Anzahl ausstehender Aktien – und steigern den Wert je Aktie.
- Kapitalerhöhungen haben den gegenteiligen Effekt: mehr Aktien → Verwässerung der bestehenden Anteile.
📘 Kurs-Gewinn-Verhältnis (KGV)
📈 Was ist das?
Das KGV zeigt, wie oft der Gewinn pro Aktie im aktuellen Aktienkurs enthalten ist – also wie „teuer“ eine Aktie im Verhältnis zum Gewinn ist.
🧮 Wie wird es berechnet?
🏛️ Wofür ist es wichtig?
Das KGV gehört zu den bekanntesten Bewertungskennzahlen. Es hilft Anlegern einzuschätzen, ob eine Aktie im Vergleich zu ihrem Gewinn eher günstig oder teuer erscheint.
🧮 Berechnung
📊 KGV (TTM) = bezogen auf den Gewinn der letzten 12 Monate (Trailing Twelve Months):🎯 Was bedeutet das für Anleger?
- Ein niedriges KGV kann auf eine günstige Bewertung hindeuten – oder auf Probleme im Geschäftsmodell.
- Ein hohes KGV kann Wachstumserwartungen widerspiegeln – oder eine überbewertete Aktie.
📘 Kurs-Umsatz-Verhältnis (KUV)
📈 Was ist das?
Das KUV zeigt, wie viel Anleger für 1 € Umsatz eines Unternehmens zahlen – unabhängig vom Gewinn.
🧮 Wie wird es berechnet?
🏛️ Wofür ist es wichtig?
Das KUV ist besonders bei wachstumsstarken oder noch nicht profitablen Unternehmen hilfreich. Es zeigt, wie hoch der Umsatz an der Börse bewertet wird.
🧮 Berechnung
Marktkapitalisierung = 1,21 Mrd. $ | Umsatz (TTM) = 416,94 Mio. $
Marktkapitalisierung = 1,21 Mrd. $ | Umsatz erwartet = 527,93 Mio. $
🎯 Was bedeutet das für Anleger?
- Ein niedriges KUV kann auf Unterbewertung hindeuten – oder auf schwache Margen.
- Ein hohes KUV kann hohe Erwartungen widerspiegeln – oder übermäßigen Optimismus.
- Besonders sinnvoll bei Wachstumsunternehmen, bei denen der Gewinn oder Free Cashflow (noch) keine Aussagekraft hat.
📘 Unternehmenswert zu Umsatz (EV/Sales)
📈 Was ist das?
EV/Sales zeigt, wie viel Anleger für 1 € Umsatz eines Unternehmens zahlen, wenn man auch Schulden und Cash berücksichtigt – es ist eine kapitalstrukturbereinigte Version des KUV.
🧮 Wie wird es berechnet?
🏛️ Wofür ist es wichtig?
Diese Kennzahl eignet sich besonders für den Vergleich von Unternehmen mit unterschiedlicher Verschuldung – sie zeigt, wie teuer ein Unternehmen tatsächlich im Verhältnis zum Umsatz ist.
🧮 Berechnung
Enterprise Value = 1,09 Mrd. $ | Umsatz (TTM) = 416,94 Mio. $
Enterprise Value = 1,09 Mrd. $ | Umsatz erwartet = 527,93 Mio. $
🎯 Was bedeutet das für Anleger?
- EV/Sales ist neutral gegenüber der Kapitalstruktur und eignet sich gut für Unternehmensvergleiche.
- Ein niedriges Verhältnis kann auf eine günstig bewertete Aktie hindeuten – ein hohes Verhältnis auf hohe Erwartungen oder Überbewertung.
- Besonders nützlich bei wachstumsstarken, noch nicht profitablen Firmen.
📘 Unternehmenswert zu Free Cashflow (EV/FCF)
📈 Was ist das?
EV/FCF zeigt, wie viele Jahre es dauern würde, bis ein Unternehmen seinen Unternehmenswert durch freien Cashflow „zurückverdient”.
🧮 Wie wird es berechnet?
🏛️ Wofür ist es wichtig?
Diese Kennzahl hilft, Unternehmen auf Basis ihrer tatsächlichen Cash-Erträge zu bewerten – unabhängig von Bilanzierungsregeln oder buchhalterischem Gewinn.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Ein niedriges EV/FCF deutet auf eine günstige Bewertung bei starker Cashgenerierung hin.
- Ein hohes EV/FCF kann entweder auf Optimismus oder auf temporär schwachen Cashflow hindeuten.
- Besonders hilfreich bei reifen, profitablen Unternehmen mit stabilen Cashflows.
📘 Kurs-Buchwert-Verhältnis (KBV)
📈 Was ist das?
Das KBV zeigt, wie hoch der Marktwert eines Unternehmens im Verhältnis zu seinem bilanziellen Eigenkapital ist.
🧮 Wie wird es berechnet?
🏛️ Wofür ist es wichtig?
Das KBV ist besonders bei Substanzwerten (z. B. Banken, Industrie) relevant. Es hilft Anlegern zu erkennen, ob ein Unternehmen unter oder über seinem buchhalterischen Vermögen bewertet ist.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Ein KBV unter 1 kann auf Unterbewertung oder schwache Rentabilität hindeuten.
- Ein KBV über 1 zeigt, dass der Markt dem Unternehmen Mehrwert über den Buchwert hinaus zuschreibt (z. B. Marken, Patente, Wachstum).
- Das KBV eignet sich besonders gut für Unternehmen mit stabilen, materiellen Vermögenswerten.
📘 Eigenkapitalquote
📈 Was ist das?
Die Eigenkapitalquote zeigt, wie hoch der Anteil des Eigenkapitals an der Bilanzsumme eines Unternehmens ist – also wie stark es sich aus eigenen Mitteln finanziert.
🧮 Wie wird es berechnet?
🏛️ Wofür ist es wichtig?
Eine hohe Eigenkapitalquote steht für finanzielle Stabilität, Krisenfestigkeit und gute Bonität. Sie ist besonders relevant bei der Beurteilung der Verschuldung.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Eine hohe Eigenkapitalquote signalisiert finanzielle Stabilität – besonders in Krisenzeiten.
- Ein niedriger Wert kann auf ein höheres Risiko oder eine aggressive Verschuldung hinweisen.
- Wichtig: Die Eigenkapitalquote sollte immer gemeinsam mit der Eigenkapitalrendite betrachtet werden. Nur so lässt sich beurteilen, ob ein Unternehmen nicht nur solide, sondern auch effizient wirtschaftet.
📘 Eigenkapitalrendite (ROE)
📈 Was ist das?
Die Eigenkapitalrendite zeigt, wie effizient ein Unternehmen mit dem Kapital seiner Aktionäre arbeitet – also wie viel Gewinn es pro Euro Eigenkapital erwirtschaftet.
🧮 Wie wird es berechnet?
🏛️ Wofür ist es wichtig?
Die Eigenkapitalrendite ist eine zentrale Rentabilitätskennzahl. Sie hilft Anlegern zu erkennen, ob das Unternehmen eine attraktive Verzinsung auf das eingesetzte Eigenkapital erwirtschaftet.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Eine hohe Eigenkapitalrendite spricht für ein starkes, effizientes Geschäftsmodell.
- Besonders interessant ist sie bei kapitalintensiven Firmen oder solchen mit hoher Eigenkapitalquote.
- Wichtig: Ein sehr hoher ROE kann auch auf hohe Schulden hinweisen – daher sollte sie immer im Kontext mit der Eigenkapitalquote betrachtet werden.
📘 Return on Capital Employed (ROCE)
📈 Was ist das?
ROCE misst die Gesamtrentabilität eines Unternehmens – also wie effizient es das eingesetzte Kapital (Eigen- und Fremdkapital) zur Gewinnerzielung nutzt.
🧮 Wie wird es berechnet?
Das eingesetzte Kapital ist das gesamte betriebsnotwendige Kapital, unabhängig von der Finanzierungsquelle.
🏛️ Wofür ist es wichtig?
ROCE eignet sich besonders gut für den Vergleich unterschiedlich finanzierter Unternehmen. Es zeigt, wie effektiv ein Unternehmen Kapital investiert – unabhängig von der Kapitalstruktur.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Ein hoher ROCE zeigt, dass ein Unternehmen sein Kapital effizient einsetzt – unabhängig davon, ob es durch Eigen- oder Fremdkapital finanziert ist.
- Je höher der ROCE im Vergleich zu ähnlichen Unternehmen, desto mehr Wert schafft das Unternehmen mit seinem investierten Kapital.
- Besonders wichtig ist der ROCE bei Firmen mit hohen Investitionen – z. B. in Industrie, Energie oder Infrastruktur.
📘 Return on Invested Capital (ROIC)
📈 Was ist das?
ROIC zeigt, wie effizient ein Unternehmen das Kapital investiert, das langfristig im operativen Geschäft gebunden ist – unabhängig davon, ob es aus Eigen- oder Fremdkapital stammt.
🧮 Wie wird es berechnet?
- NOPAT = „Net Operating Profit After Taxes“
- Investiertes Kapital = operatives Vermögen abzüglich nicht-verzinster Schulden
🏛️ Wofür ist es wichtig?
ROIC ist eine der präzisesten Kennzahlen zur Bewertung der Kapitalrendite – besonders im Vergleich zur Eigenkapitalrendite, weil es Verzerrungen durch Schulden vermeidet. Er zeigt, ob ein Unternehmen Mehrwert für alle Kapitalgeber schafft.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Ein hoher ROIC zeigt, wie gut ein Unternehmen mit dem tatsächlich investierten (betriebsnotwendigen) Kapital wirtschaftet.
- Im Unterschied zu ROCE wird nur Kapital betrachtet, das wirklich zur Finanzierung operativer Aktivitäten dient – und verzinst werden muss.
- Besonders hilfreich, um die Kapitalrendite von Unternehmen mit viel „überschüssigem“ Kapital oder zinsfreien Verbindlichkeiten realistisch zu vergleichen.
📘 Verschuldungsgrad (Leverage Ratio)
📈 Was ist das?
Der Verschuldungsgrad zeigt, wie stark ein Unternehmen durch verzinsliche Schulden (z. B. Kredite und Anleihen) im Verhältnis zum Eigenkapital finanziert ist.
🧮 Wie wird es berechnet?
🏛️ Wofür ist es wichtig?
Die Kennzahl hilft, das finanzielle Risiko und die Abhängigkeit von Fremdkapital zu beurteilen. Ein hoher Verschuldungsgrad kann die Eigenkapitalrendite steigern – birgt aber auch erhöhte Risiken bei Zinsanstiegen oder Liquiditätsengpässen.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Ein niedriger Verschuldungsgrad steht für finanzielle Stabilität und Unabhängigkeit.
- Ein hoher Wert kann auf erhöhte Risiken hinweisen – insbesondere bei schwankenden Zinsen oder konjunkturellen Schwächen.
- Wichtig: Immer im Kontext zur Branche und Kapitalintensität bewerten.
📘 Umsatz
📈 Was ist das?
Der Umsatz zeigt, wie viel ein Unternehmen insgesamt mit seinen Produkten und Dienstleistungen verdient – also den Bruttoerlös vor Abzug von Kosten.
🧮 Wie wird es berechnet?
🏛️ Wofür ist es wichtig?
Der Umsatz ist eine der zentralen Kennzahlen zur Einschätzung der Unternehmensgröße, Marktstellung und Wachstumskraft.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Ein wachsender Umsatz zeigt eine steigende Nachfrage und kann ein guter Frühindikator für Gewinnsteigerungen sein.
- Vergleiche von aktuellem und erwartetem Umsatz geben Hinweise auf das Marktumfeld und Analystenerwartungen.
- Wichtig: Starker Umsatz allein genügt nicht – auch Margen und Profitabilität zählen.
📘 EBITDA
📈 Was ist das?
EBITDA steht für „Earnings Before Interest, Taxes, Depreciation and Amortization“ – also Gewinn vor Zinsen, Steuern und Abschreibungen. Es zeigt das operative Ergebnis eines Unternehmens, bereinigt um bilanztechnische und finanzierungsbedingte Effekte.
🧮 Wie wird es berechnet?
🏛️ Wofür ist es wichtig?
EBITDA ist eine verbreitete Kennzahl zur Beurteilung der operativen Leistungsfähigkeit – insbesondere bei kapitalintensiven Unternehmen oder im internationalen Vergleich.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Ein hohes oder wachsendes EBITDA spricht für starke operative Erträge – unabhängig von Bilanzierung oder Steuerlast.
- EBITDA ist besonders nützlich, um Unternehmen branchenübergreifend zu vergleichen.
- Wichtig: EBITDA ist keine offizielle Gewinnkennzahl – Abschreibungen und Finanzierungskosten werden ausgeklammert.
📘 EBIT
📈 Was ist das?
EBIT steht für „Earnings Before Interest and Taxes“ – also Gewinn vor Zinsen und Steuern. Es zeigt das operative Ergebnis eines Unternehmens nach Abschreibungen, aber vor Finanzierungs- und Steueraufwand.
🧮 Wie wird es berechnet?
🏛️ Wofür ist es wichtig?
EBIT ist eine zentrale Kennzahl zur Beurteilung der Profitabilität aus dem Kerngeschäft – unabhängig von Kapitalstruktur oder Steuersystem.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Ein hohes EBIT deutet auf ein profitables Kerngeschäft hin – vor Zinslasten oder steuerlichen Effekten.
- Es erlaubt objektivere Vergleiche zwischen Unternehmen mit unterschiedlicher Finanzierung.
- Im Vergleich mit EBITDA zeigt EBIT bereits den Einfluss von Abschreibungen auf das operative Ergebnis.
📘 Nettogewinn
📈 Was ist das?
Der Nettogewinn ist der verbleibende Jahresüberschuss (oder -fehlbetrag) eines Unternehmens – nach Abzug aller Kosten, Steuern, Zinsen und Abschreibungen
🧮 Wie wird es berechnet?
🏛️ Wofür ist es wichtig?
Der Nettogewinn ist die zentrale Erfolgskennzahl – er zeigt, wie profitabel ein Unternehmen nach allen Kosten tatsächlich arbeitet.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Ein steigender Nettogewinn zeigt, dass das Unternehmen effizient wirtschaftet – trotz aller Kosten.
- Die Entwicklung des Gewinns beeinflusst z. B. direkt das KGV und weitere Kennzahlen.
- Im Zeitverlauf lässt sich ablesen, wie stabil und profitabel ein Geschäftsmodell wirklich ist.
📘 Free Cashflow (FCF)
📈 Was ist das?
Der Free Cashflow gibt Aufschluss über die echte finanzielle Stärke eines Unternehmens – unabhängig von Bilanzierungsregeln. Er zeigt, wie viel Spielraum für Dividenden, Aktienrückkäufe oder Schuldenabbau besteht.
🧮 Wie wird es berechnet?
🏛️ Wofür ist es wichtig?
FCF reflects a company’s real financial strength – regardless of accounting profits. It shows how much flexibility a company has for dividends, share buybacks, or debt reduction.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Ein hoher Free Cashflow bedeutet, dass ein Unternehmen echte Finanzkraft besitzt – unabhängig vom bilanzierten Gewinn.
- Er ist oft die solideste Grundlage für nachhaltige Dividenden und Aktienrückkäufe.
- Sinkender FCF kann ein Warnsignal sein – auch wenn der Gewinn stabil aussieht.
📘 Umsatzwachstum
📈 Was ist das?
Das Umsatzwachstum zeigt, wie stark sich die Erlöse eines Unternehmens im Vergleich zum Vorjahr verändert haben – tatsächlich (TTM) und auf Prognosebasis (erwartet).
🧮 Wie wird es berechnet?
Erwartet = (Umsatz erwartet ÷ Umsatz Vorjahr − 1) × 100
Erwartetes Wachstum basiert auf Analystenschätzungen für das laufende Geschäftsjahr.
🏛️ Wofür ist es wichtig?
Ein wachsender Umsatz ist ein zentrales Signal für steigende Nachfrage, Geschäftsausweitung und Marktanteilsgewinne – besonders bei Wachstumsunternehmen.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Wachstum ist der Motor langfristiger Wertsteigerung – besonders bei Technologie- und Wachstumsaktien.
- Wichtig ist nicht nur das aktuelle Wachstum, sondern auch dessen Nachhaltigkeit.
- Prognosen zeigen, ob Analysten weiteres Potenzial erwarten – oder eine Verlangsamung.
📘 EBITDA-Wachstum
📈 Was ist das?
Das EBITDA-Wachstum zeigt, wie stark das operative Ergebnis eines Unternehmens vor Zinsen, Steuern und Abschreibungen im Vergleich zum Vorjahr gestiegen oder gesunken ist.
🧮 Wie wird es berechnet?
Erwartet = (erwartetes EBITDA ÷ EBITDA Vorjahr − 1) × 100
Erwartetes Wachstum basiert auf Analystenschätzungen für das laufende Geschäftsjahr.
🏛️ Wofür ist es wichtig?
Ein steigendes EBITDA ist ein Zeichen für verbesserte operative Ertragskraft – unabhängig von Finanzierungsstruktur oder Abschreibungen.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Starkes EBITDA-Wachstum signalisiert operative Effizienz und Skalierung – besonders relevant in Wachstumsphasen.
- EBITDA-Wachstum ist ein Frühindikator für Margen- und Gewinnentwicklung – sollte aber stets im Zusammenhang mit Umsatz und EBIT betrachtet werden.
📘 EBIT Wachstum
📈 Was ist das?
Das EBIT-Wachstum zeigt, wie stark das operative Ergebnis eines Unternehmens (nach Abschreibungen, aber vor Zinsen und Steuern) im Vergleich zum Vorjahr gewachsen ist.
🧮 Wie wird es berechnet?
Erwartet = (erwartetes EBIT ÷ EBIT Vorjahr − 1) × 100
Erwartetes Wachstum basiert auf Analystenschätzungen für das laufende Geschäftsjahr.
🏛️ Wofür ist es wichtig?
Das EBIT-Wachstum ist ein direkter Indikator für die wirtschaftliche Entwicklung des operativen Geschäfts – unter Berücksichtigung der Kapitalintensität (Abschreibungen).
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Steigendes EBIT signalisiert wachsende operative Rentabilität – auch unter Berücksichtigung von Abschreibungen.
- Das EBIT-Wachstum ist ein wichtiges Maß zur Beurteilung von Geschäftsmodellen mit hohen Investitionskosten.
- Im Zusammenspiel mit Umsatz- und EBITDA-Wachstum ergibt sich ein umfassendes Bild zur operativen Entwicklung.
📘 Nettogewinn-Wachstum
📈 Was ist das?
Das Nettogewinn-Wachstum zeigt, wie stark der Jahresüberschuss eines Unternehmens gegenüber dem Vorjahr gestiegen oder gesunken ist – sowohl tatsächlich (TTM) als auch auf Basis von Prognosen (erwartet).
🧮 Wie wird es berechnet?
Erwartet = (erwarteter Nettogewinn ÷ Nettogewinn Vorjahr − 1) × 100
Der erwartete Wert basiert auf Analystenschätzungen für das laufende Geschäftsjahr.
🏛️ Wofür ist es wichtig?
Der Gewinn ist die entscheidende Ergebnisgröße für ein Unternehmen. Ein wachsender Nettogewinn deutet auf steigende Effizienz, stabile Kostenkontrolle und nachhaltige Ertragskraft hin.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Wachsender Nettogewinn stärkt die Bewertung, Dividendenfähigkeit und Kursfantasie.
- Stagnierender oder rückläufiger Gewinn trotz Umsatzwachstum kann auf Margendruck hinweisen.
📘 Free Cashflow-Wachstum
📈 Was ist das?
Das Free-Cashflow-Wachstum zeigt, wie sich der freie Mittelzufluss eines Unternehmens im Vergleich zum Vorjahr verändert hat – also der Betrag, der nach allen operativen Ausgaben und Investitionen übrig bleibt.
🧮 Wie wird es berechnet?
🏛️ Wofür ist es wichtig?
Free Cashflow ist der echte, verfügbare Geldzufluss. Wachstum in diesem Bereich ist ein Zeichen für finanzielle Stärke und steigende Flexibilität bei Dividenden, Rückkäufen oder Investitionen.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Sinkender Free Cashflow kann auf steigende Investitionen, höhere Kosten oder stagnierende operative Erträge hindeuten.
- Besonders bei Dividendenwerten ist das FCF-Wachstum wichtig – denn Dividenden werden letztlich aus dem verfügbaren Cash gezahlt.
- Ein negativer Trend sollte genauer analysiert werden – er ist nicht zwangsläufig schlecht, aber potenziell ein Warnsignal.
📘 Bruttomarge
📈 Was ist das?
Die Bruttomarge zeigt, wie viel vom Umsatz nach Abzug der direkten Herstellungskosten (Material, Produktion) als Bruttogewinn übrig bleibt – also der „Rohgewinn“ eines Unternehmens.
🧮 Wie wird es berechnet?
Auch: Bruttomarge = Bruttogewinn ÷ Umsatz × 100
🏛️ Wofür ist es wichtig?
Die Bruttomarge gibt Aufschluss über die Profitabilität eines Produkts oder Geschäftsmodells vor Fixkosten, Steuern und Zinsen. Sie zeigt, wie effizient ein Unternehmen produzieren oder einkaufen kann.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Eine hohe Bruttomarge deutet auf starke Preissetzungsmacht und effiziente Herstellung hin.
- Sinkende Bruttomargen können auf Kostensteigerungen oder Preisdruck hindeuten.
- Besonders im Vergleich zu Wettbewerbern liefert die Bruttomarge wertvolle Einblicke in die Geschäftsqualität.
📘 EBITDA-Marge
📈 Was ist das?
Die EBITDA-Marge zeigt, wie viel vom Umsatz als operativer Gewinn vor Zinsen, Steuern und Abschreibungen (EBITDA) übrig bleibt. Sie misst die operative Effizienz – ohne Verzerrungen durch Finanzierung oder Buchwerte.
🧮 Wie wird es berechnet?
🏛️ Wofür ist es wichtig?
Die EBITDA-Marge hilft zu verstehen, wie viel operativer Gewinn ein Unternehmen aus jedem Euro Umsatz erzielt – unabhängig von Kapitalstruktur oder steuerlichem Umfeld.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Eine hohe EBITDA-Marge zeigt starke operative Ertragskraft – unabhängig von Bilanzierungseffekten.
- Die Marge ermöglicht gute Vergleiche zwischen Unternehmen und Branchen.
- Ein stabiler oder wachsender Wert kann auf effiziente Kostenkontrolle und Skalierbarkeit hindeuten.
📘 EBIT-Marge
📈 Was ist das?
Die EBIT-Marge zeigt, wie viel Prozent des Umsatzes als operativer Gewinn nach Abschreibungen, aber vor Zinsen und Steuern übrig bleiben.
🧮 Wie wird es berechnet?
🏛️ Wofür ist es wichtig?
Die EBIT-Marge misst die operative Ertragskraft eines Unternehmens unter Berücksichtigung der Kapitalintensität (z. B. Maschinen, Anlagen). Sie eignet sich gut zum Vergleich von Geschäftsmodellen mit unterschiedlich hohen Abschreibungen.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Eine hohe EBIT-Marge zeigt, dass ein Unternehmen auch nach Abschreibungen effizient arbeitet.
- Sie ist besonders relevant in kapitalintensiven Branchen.
- Langfristig stabile oder steigende Margen sind ein Zeichen wirtschaftlicher Stärke und Preissetzungsmacht.
📘 Nettomarge
📈 Was ist das?
Die Nettomarge zeigt, wie viel vom Umsatz am Ende als „Reingewinn“ übrig bleibt – also nach Abzug aller Kosten, Zinsen, Steuern und Abschreibungen.
🧮 Wie wird es berechnet?
🏛️ Wofür ist es wichtig?
Die Nettomarge gibt an, wie effizient ein Unternehmen über alle Stufen hinweg wirtschaftet. Sie zeigt, wie viel Gewinn tatsächlich je Euro Umsatz übrig bleibt.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Eine hohe Nettomarge zeigt, dass ein Unternehmen nicht nur operativ stark ist, sondern auch seine Finanzierung und Steuerbelastung im Griff hat.
- Vergleiche mit Wettbewerbern geben Einblicke in die wirtschaftliche Qualität.
- Sinkende Nettomargen trotz Umsatzwachstum können ein Warnsignal sein – etwa für steigende Kosten oder sinkende Effizienz.
📘 Free Cashflow Marge
📈 Was ist das?
Die Free-Cashflow-Marge zeigt, wie viel vom Umsatz nach Abzug aller operativen Ausgaben und Investitionen tatsächlich als freier Mittelzufluss übrig bleibt.
🧮 Wie wird es berechnet?
🏛️ Wofür ist es wichtig?
Diese Marge misst die echte Liquidität, die ein Unternehmen erwirtschaftet – unabhängig von Bilanzierungsregeln oder Abschreibungen. Sie ist besonders relevant für Dividenden, Rückkäufe und Investitionen.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Eine hohe Free-Cashflow-Marge zeigt, dass ein Unternehmen nachhaltig liquide Mittel erwirtschaftet.
- Sie ist ein starkes Signal für finanzielle Stabilität und Ausschüttungspotenzial.
- Wichtig ist der langfristige Trend – sinkende Werte können auf steigende Investitionen oder rückläufige operative Effizienz hindeuten.
📘 Ergebnis je Aktie (EPS)
📈 Was ist das?
Das Ergebnis je Aktie (EPS) zeigt, wie viel Gewinn auf eine einzelne Aktie entfällt – und ist eine der wichtigsten Kennzahlen zur Bewertung von Unternehmen.
🧮 Wie wird es berechnet?
Die verwässerte Aktienanzahl berücksichtigt auch potenzielle neue Aktien, etwa durch Optionen, Wandelanleihen oder andere Umtauschrechte.
🏛️ Wofür ist es wichtig?
EPS bildet die Basis für viele Bewertungskennzahlen wie KGV, PEG oder Payout Ratio. Es macht den Gewinn für Aktionäre vergleichbar – unabhängig von der Unternehmensgröße.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- EPS hilft, die Profitabilität pro Aktie zu erfassen – und ist besonders wichtig im Zeitvergleich oder im Vergleich mit Analystenschätzungen.
- Steigendes EPS kann ein Zeichen für stabiles Wachstum oder Aktienrückkäufe sein.
- Wichtig: Verwende verwässertes EPS für realistische Bewertungen – besonders bei stark aktienbasierten Vergütungssystemen.
📘 Free Cashflow je Aktie (FCF je Aktie)
📈 Was ist das?
Der Free Cashflow je Aktie zeigt, wie viel freier Mittelzufluss einem Unternehmen pro Aktie zur Verfügung steht – nach Investitionen, aber vor Dividenden oder Schuldentilgung.
🧮 Wie wird es berechnet?
🏛️ Wofür ist es wichtig?
Der FCF je Aktie zeigt, wie viel liquide Mittel pro Aktie tatsächlich im Unternehmen verbleiben – wichtig für Dividenden, Aktienrückkäufe oder Schuldentilgung. Im Gegensatz zum Gewinn ist er schwerer manipulierbar und daher besonders aussagekräftig.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Ein hoher Free Cashflow je Aktie ist ein Zeichen für hohe finanzielle Flexibilität.
- Er zeigt, wie viel Kapital ein Unternehmen effektiv einsetzen oder ausschütten kann.
- Besonders relevant für dividendenstarke Unternehmen oder solche mit starker Kapitalrendite.
📘 Short Interest
📈 Was ist das?
Short Interest zeigt, wie viele Aktien eines Unternehmens aktuell leerverkauft wurden – also von Investoren geliehen und verkauft, in der Erwartung fallender Kurse.
🧮 Wie wird es berechnet?
Der Wert zeigt den Anteil der Aktien, der aktuell auf fallende Kurse spekuliert wird.
🏛️ Wofür ist es wichtig?
Short Interest dient als Stimmungsindikator: Ein hoher Wert deutet auf Skepsis oder negative Erwartungen gegenüber dem Unternehmen hin – kann aber auch zu einem „Short Squeeze“ führen, wenn der Kurs plötzlich steigt.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Ein niedriger Short Interest deutet auf Vertrauen in das Unternehmen hin.
- Ein hoher Wert kann ein Warnsignal sein – oder eine Chance, wenn sich die Stimmung dreht.
- Besonders spannend in volatilen Märkten oder vor wichtigen Quartalszahlen.
📘 Employees
📈 Was ist das?
Die Mitarbeiteranzahl zeigt, wie viele Personen ein Unternehmen weltweit beschäftigt – ein Indikator für Größe, Struktur und Geschäftsmodell.
🧮 Wie wird es berechnet?
🏛️ Wofür ist es wichtig?
Sie hilft bei der Einschätzung von Skaleneffekten, Effizienz und Personalkosten. Zusammen mit Umsatz und Gewinn lassen sich Kennzahlen wie Produktivität je Mitarbeiter ableiten.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Viele Mitarbeiter bedeuten große operative Komplexität – aber auch hohes Umsatzpotenzial.
- Produktivität je Mitarbeiter ist ein wichtiger Indikator für Effizienz.
- Besonders spannend bei stark wachsenden Tech- oder Industrieunternehmen.
📘 Umsatz je Mitarbeiter
📈 Was ist das?
Der Umsatz je Mitarbeiter zeigt, wie viel Erlös ein Unternehmen durchschnittlich pro Beschäftigtem erwirtschaftet – eine Kennzahl für Effizienz und Produktivität.
🧮 Wie wird es berechnet?
Die Mitarbeiterzahl stammt in der Regel aus dem letzten verfügbaren Jahresbericht.
🏛️ Wofür ist es wichtig?
Diese Kennzahl hilft, Geschäftsmodelle zu vergleichen – insbesondere zwischen arbeitsintensiven und technologiegetriebenen Unternehmen. Ein hoher Wert deutet auf Automatisierung, Effizienz oder hohen Wertschöpfungsanteil hin.
🧮 Berechnung
🎯 Was bedeutet das für Anleger?
- Ein hoher Umsatz je Mitarbeiter spricht für ein skalierbares und margenstarkes Geschäftsmodell.
- Ein niedriger Wert kann auf arbeitsintensive Prozesse oder geringere Wertschöpfung hinweisen.
- Besonders hilfreich beim Vergleich von Tech- vs. Industrieunternehmen.
Harmonic Inc. Aktie Analyse
Analystenmeinungen
13 Analysten haben eine Harmonic Inc. Prognose abgegeben:
Analystenmeinungen
13 Analysten haben eine Harmonic Inc. Prognose abgegeben:
Harmonic Inc. Events
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Harmonic Inc. — Analyst/Investor Day - Harmonic Inc.
1. Management Discussion
All right. Good morning, and welcome to Harmonic's 2026 Investor Day. I'm Walter Jankovic, Chief Financial Officer. For you all that are joining us here in New York and over the webcast. Thanks for being with us. Today is a special and exciting day for us. It's been 12 years since we've done an in-person Investor Day. But more exciting, this is the first time as the new Harmonic, a pure-play broadband company with a larger market opportunity, a sharper strategy and a growth framework that we are really excited to talk to you about today.
Today, you're going to hear from our leadership team. Nimrod will walk us through vision and strategy. Asaf and Yaniv will talk about the markets we serve today and the markets we'll serve in the future. I'll provide a brief financial overview, and then Jeff will host a customer panel, and then we'll wrap it up with a Q&A. Some housekeeping. We're going to make forward-looking statements today. Actuals may materially differ. Therefore, please review our SEC filings for risk factors.
Now with that, I would like to introduce our President and Chief Executive Officer, Nimrod Ben-Natan.
Thanks, Walter, and thanks, everybody, for joining us here today and online. October next month, 30 years ago, I joined Harmonic. Quite a journey. But when I look back, what I really see is a series of transformations that we've gone through. We started as an analog optics company. We transitioned into digital video. We were at the forefront of that. We moved the industry to high definition digital ad insertion and more recently, the transition to -- or the transformation to virtualized broadband access. And today, we're excited to talk to you about the new Harmonic and the road ahead.
So let's jump right into it. Many of you really know us about what we do in cable. You may remember, we started with CableOS and the leadership that we've got in the DOCSIS cable market. Today, we are really going to talk about the broader vision of how we see the opportunity ahead. In cable, we're expanding -- the market is expanding, and we're as well with fiber-to-the-home. Lots of cable operators are doing fiber for edge-out, for new development and surgically in competitive markets and MDUs. And I'm excited to share with you that this year in 2026, we're going to end the year with $70 million of revenue just in this category.
With the momentum that we have, with the maturity of the product line, we feel ready to go after the broader opportunity of the telco fiber. Same technology, a different customer base, but we are at a point where we are really ready to tackle that market. We announced last week our SensAI, which is our intelligence platform to serve the broadband operators, cable and telco, DOCSIS and fiber to really address the opportunity, which is kind of the toughest challenge that they have right now to maintain customer satisfaction, reduce churn while maintaining their operating cost. Another very interesting development in the market related to the fiber technology is a new market, we call it PON beyond fiber-to-the-home, which is using the PON technology in data center markets and in the enterprise market to really connect devices in data center. You've got tens of thousands of devices to manage what's called out-of-band management. And in the enterprise market, this is an alternative to a point-to-point Ethernet. Very interesting market that the market started to follow, and we will talk more about that.
So that's kind of rounding up the connectivity, cable, fiber markets as well as the intelligence. So the wheel is effectively complete, but there is one other thing that is very interesting that we started to focus on, which is really the edge compute opportunity in the AI market. And this is really a very interesting opportunity where both cable and telco are going through the modernization of their architecture where they free up a lot of space across their network, facilities that used to be central offices or cable hubs with legacy equipment now become empty. They have power, they've got space, they've got fiber connectivity, and they have very strategic location in the network, milliseconds away from businesses and customers. We're not the first to talk about that.
I think last week at Goldman Sachs, Verizon talked about that. Charter talked about that the other day. What we really want to do in this market, which we have not sized yet is really enable that through the longer tail of customers and the opportunity, and we will talk more about that, is really how to leverage cOS as an orchestration platform and help customers to bring that to the edge of the network. And when we look at the opportunity, we see clearly the connectivity is the biggest market opportunity, about $5.4 billion, including cable -- fiber and cable, telco as well as the PON in the data center and enterprise, and we will break that down as we go through the day today. The intelligence opportunity, as we define it, a market between $1 billion and $2 billion and yet to be sized opportunity across the edge AI compute.
So by 2030, we see an opportunity of about $7 billion ahead of us. So when we look into the future, one of the things that we believe is that everything that we see AI today that is generated in data centers will get experienced, consume and experience in the home, obviously, on the go, but when you go home, you offload into your Wi-Fi and lots of connected devices will evolve with the way we see AI, agentic AI, everything that is every day we read about will clearly change the way the network is performing. We will really change the shape of the network. We see growing demand for intelligence, and we see growing demand for fiber, both in cable and clearly, as we go into the telco market. And we talked about the compute opportunity, which, again, is an opportunity in development. And really, what we want to achieve is to be the broadband platform of this transformation across the connectivity, the intelligence and the compute based on the cOS platform.
And you know what, this is not the first time that we do identify an opportunity and work towards bringing that to market. Quite often, we do it in collaboration with key customers. So we've called it before the way we did it about 10 years ago with the virtualization of the broadband cable. We really pioneered that. We identified the opportunity, and we executed on that. And we did it even before with the -- those of you who remember the Edge QAM market that enabled video-on-demand over cable networks. I think this will be a good opportunity to hear from one of our customers, how is it to collaborate and partner with Harmonic?
The partnership that we have with Harmonic [ HIRO ] is strategic and critical to everything that we want to do going forward. My name is Elad Nafshi. I am the Executive Vice President and Chief Network Officer for Comcast. 2018, we really started to partner together on creating the blueprint for how do we, as an industry, scale broadband services into the future, and that led to the creation of the DAA distributed access architecture and the vCMTS, the virtualized CMTS project, which we've been working on with Harmonic ever since.
We have been operating as one company, and we have been innovating as one company for the past 8, 9 years. And we wouldn't have not been able to deliver this much innovation in such a short period of time without that complete partnership. Well, about 4 years ago, we were able to be recognized with a technical Emmy award that we were very happy to jointly receive both Comcast and Harmonic for the creation of the DAA architecture and the vCMTS. And that just signifies just how critical and how transformational this relationship has been to the industry with DOCSIS 4.0 FDX rolling out across our footprint, delivering multi-gig symmetrical services in great scale, and we're super excited with our accomplishments.
We're just getting started. How do we continue to scale seamless fiber delivery and continue to grow the network at the scale that we are. We're adding 1.2 million homes to our network today. All of that is fed with our joint development, our DAA platform. And we're very, very excited to do even more. We connect 65 million homes. We serve 39 different states. Our network is huge. It's over 1 million miles of fiber and cable. And how we bring all of that together and leverage the technology that we're inventing for the industry in order to deliver even faster, even more reliable and even more scalable services is what this partnership is about. It's what we've delivered over the course of the last 8 years and is what I cannot wait to continue to expand across the footprint.
Thanks, Comcast. Thanks, Elad. When I took over about 2 years ago, the CEO position, we set 4 strategic imperatives for the business that we kept updating you on the progress diversification, leading the DOCSIS market on cable, growing the fiber and getting into the intelligence. And I'm happy to update, while this is not a victory, this is a great milestone to indicate. We've grown the diversification percentage of what we call rest-of-market customers from 20% to 37%. We continued the leadership on the DOCSIS market. We have the 90-plus percent market share, and we were the first to introduce the unified architecture. We've got JR from Mediacom on the customer panel here, and he will talk more about that.
On the fiber, I'm very excited with the update we're sharing with you today on the revenue. We will achieve $70 million in 2026 on that product line. Number of customers have grown. And on the intelligence, we gave you updates along the way, elements of the solution like the Beacon and the Amply. We got more than 30 customers now using the technology. And last week, we announced the SensAI, which is our intelligence platform, a very comprehensive intelligence platform, and we're going to expand on that in more details. And that execution got reflected on the financial performance. We achieved record revenue, record backlog. We executed on the share buyback and with the sale of the video, we are in a good position to keep funding our growth initiatives as we execute on that.
So when we look at the market itself, hyper competitive. It used to be cable fiber, there is a fixed wireless, there is satellite. And every day, there is kind of reports on how challenging this is for the customers. I think the key point here to remember is that broadband operators are doing a really good job in converging services. Just the other day, one operator introduced a new security capability into their Wi-Fi at home. They do the wireless -- mobile wireless, and they will expand the portfolio of capabilities. All of that is running on the same broadband infrastructure. And that broadband infrastructure is changing. There is way more upstream. Latency is very important. And as we look into the future, the number of what we used to call connected devices that we just kind of connected -- got connected over the Wi-Fi now will become AI speakers. They will communicate back and forth. Every camera will talk back and forth over the network to get, like, AI guidance on what to do.
So when you look at all of that, we believe that the broadband industry will continue preparing for the AI era. We see that across cable. You got to go high split and beyond. You got to take care of your low latency kind of capabilities across the network end-to-end and fiber will do 10G and even 50 gig, which is becoming available. And at the same time, heavily invest in automating the network, making sure you address the customer experience, quality of experience, while managing your operating costs, which is really where SensAI is targeting.
So when we go back to the core platform, what we introduced 10 years ago as a virtual CMTS was effectively a platform with an application that is doing virtual CMTS. And there was a forward-looking about what the platform will be able to do over time. And in fact, other than being a mission-critical platform that can work in a high availability mode, what we really designed back then is an edge compute platform that can evolve over time. And indeed, when we introduced fiber, it was yet another application on the same platform. As we go after the telco market, we bring a couple of differentiating capabilities such as the Open ONT architecture, which is not easy to achieve, and I think it's becoming very critical today, especially with supply chain and memory costs. You really want to have a choice of supply.
And unlike the DOCSIS market, which is well defined, you've got CableLabs, the market of fiber is more open. So maintaining that interoperability is not easy. We bring our advanced, hardened remote OLTs into that market. We do have a differentiated 50-gig road map, and we have new provisioning capabilities that we bring and complete our fiber-to-the-home capability. Asaf will talk more about the opportunity beyond fiber-to-the-home and the data center management and the enterprise market.
Intelligence is a big topic. And really the strategy that we have is to bring something that can work across any network, not exclusive to cable; it's applicable equally to fiber-to-the-home, and it can work even if we don't provide the access network. It can work with others in a multi-vendor environment, and we will explain that in more details what exactly we do that and how do we achieve that. And really, the goal is to achieve reduction of churn while lowering the cost. And we'll talk more, although this is in development stages, but we clearly see an opportunity for this edge AI inference, leveraging the space and power that got freed up in conjunction with our orchestration capabilities.
I did have 2 asterisks on this previous slide, which is really a tuck-in, very focused acquisition that we did of a company called Int6 based in Brazil, very focused on the Brazilian and Latin America market. They serve about 7 million subscribers, 40 customers. What's unique about what they do, they work in a multi-vendor environment, and they really help both our fiber complete our provisioning and management capabilities. And on the intelligence SensAI, they really give us actionable workflows and working across multi-vendor environment to really allow us to bring intelligence not only to where cOS is deployed.
So in summary, 3 engines. Connectivity is clearly the core market. DOCSIS will continue to be a major engine for us, expanding on the remote OLT, getting in a serious way into the telco market. And then the intelligence, the $1 billion to $2 billion market, we'll talk more about that and the upside with the Edge AI. A total opportunity that is way bigger than what we're addressing today. And as we go through the day today, Asaf and Yaniv will expand on these engines.
So with that, I will introduce Asaf Matatyaou, our SVP of Product, to talk about the connectivity. Asaf?
Thanks, Nimrod. Good morning, everyone. A little bit about me first. I started my career in data about 30 years ago as well, not at Harmonic, but a different company. And back then, there was dial-up. And what we were trying to do is provide an always-on connection and the speeds weren't fast, but it was an exciting time going from dial-up and having always on. And now obviously, we look at that as something that's a utility, something that's always there, something that everybody expects. I'm excited about what's next, even more so today because back then, it was purpose-built, it was focused. It didn't have the upside. It didn't have the opportunity, the growth potential of what our vision for broadband is.
The build -- what we built our connectivity platform on and what Nimrod just shared with you as a foundation of connectivity into intelligence and then ultimately into compute. So as you heard from Elad, we're only at the start. We're only at our beginning of where we go, and we've planted those seeds, and we're going to watch them grow. Two connectivity types before we go further. DOCSIS, for the folks who don't know what that is, the first 3 letters say it all, data over cable. It's basically broadband over the coax cable that exists in people's homes. And PON, it's the fiber equivalent. It's fiber that leaves the facility and splits passively to many homes.
Let's start with DOCSIS. It's a market we lead, and it's the footprint that pays for everything after that. All right. It's a stronger click. Okay. So if we look at the market, and we'll go from the market and dive deep into a few different segments here within DOCSIS and how we grow that. We look at where we started a decade ago. If I recall a decade ago, the market was filled with legacy CMTSs. And the transition we've seen over the past decade is as legacy CMTS has diminished, what's replaced it is the virtualized CMTS, the DAA approach that we've seen. And if we look at the transition, not only is the market growing between '26 and 2030, but we also see that the larger portion of it is going to be vCMTS and DAA. In fact, $9 out of every $10 being spent in 2030 will be in this architecture that we pioneered and we led.
Our credibility is, well, we started this about a decade ago. We own over 90% of the vCMTS market share. 60% of the DAA footprint and over 160 operators globally and expanding. We feel very confident with the ability to understand what's necessary to continue to execute in this marketplace after all we created the category, we hold it, and we continue to raise the bar. We'll talk a little bit more about that in a couple of slides.
Let's look at the vCMTS portion and the decade of value it's delivered. So a decade ago, I'll just share with you a story. A decade ago, when folks wanted more speeds, what they had to do was either replace their chassis or replace their LAN cards. Not only was this operationally disruptive, it was also a purchasing event. Every time somebody wanted to replace their LAN card with a different one, there was a chance to upgrade their CMTS to something else. We've replaced that. No longer is the core. Now that it's software, it's all software upgrades. And the proof is that 100% of the operators who've migrated to cOS over the last 10 years have stayed on cOS, all through software upgrade. It's a very exciting opportunity for them to be able to deliver actually more speeds, more capabilities, all on the same software and platform that transitions with them as their subscribers need more services, faster services, lower lag services and the connectivity they expect.
We'll talk a little bit more about what that buys them going forward. But the fact is that once that software and the solution is there, the opportunity is to connect fiber to use it for edge compute. This decade of leadership has led us to a compounding effect of opportunity, the 90% of vCMTS deployment in that footprint, the 350,000 connected devices that grow every day and the operators that we continue to expand globally in every sort of footprint you can imagine. What's left to transition is very exciting as well. From the operators that already worked with us to the prospects that we're working with, there's 75% cable modems out there that will be transitioning to DAA and virtualization over the next few years. Each DOCSIS generation that we've talked about renews itself on this core as a software upgrade rather than replacing it. That was transformational for the industry and something that we've seen with over 8 generations of Intel servers in the industry.
One of the key reasons the cOS core is a durable investment is the pace of our differentiated software. And in fact, it's one of the reasons I joined Harmonic 15 years ago. When I joined, I was inspired by the culture. I joined, I met with Nimrod and other folks, and that culture continues to define us. We are not standing still, okay? It's always what's next. What can we do to advance? And as you've heard, we were #1 in edge QAMs and we're #1 in the cable broadband industry today. That's not enough. We need to continue growing and pushing and delivering better and faster connectivity as subscribers expect that, differentiated services, better quality of experience, putting the intelligence layer on top that Yaniv will talk about and then augmenting that with the compute opportunity that's in front of us in the world of AI.
Most recently, just to give you an example of some of the quality of experience advancements that we provide, all through software, faster speeds, software upgrade, simpler operations with PTP-less software upgrade, lower lag software upgrade. Improved quality of experience is incredibly important to retain subscribers on the network. Going from ideation to production is simply a matter of waiting for the next release a quarter away. No longer are you waiting for a hardware cycle. We move from ideation to production. We have sprints that are 2 weeks long and in some cases, 1 week long. We go incredibly fast, and we work with our customers to make sure we understand what they need to be successful and deliver that. What also is important in software is to continue in the scope of sustainability.
As you deliver more, you want to be able to free also free space and free power. No longer was it double the speed, double the facilities. We've actually reduced that dramatically, up to 70% less power consumption relative to the older legacy technology. But when you compare ourselves versus ourselves a decade apart, we're actually 85% less watts per gigabit, less power against ourselves a decade later because of our software advancements. Some of our customers report up to 95% spend -- sorry, 95% space savings. That's important. Unique capabilities we've added in software that I just want to talk about briefly that really -- the effect is the result is happier subscribers, better NPS and higher QoE. Beacon ISM adapts dynamically to plant conditions, less tickets -- less trouble tickets, less truck rolls, less OpEx for service providers.
Pathfinder, this delivers software that adapts to an individual's home. PTP-less, being able to deploy DAA simply and quickly, more cost effectively, giving higher network reliability, incredibly important. And L4S, really cutting working latency where it matters the most, video calls, gaming and cloud soon enough with AI. So QoE is one in software, and that's where we continue to differentiate. We continue to raise the bar every single quarter.
Let's look at a case study. We'll be focusing on Mediacom's transition to DOCSIS 4.0. We started on this path with Mediacom about a year ago. And in fact, if you remember at DC last year, the TechExpo, there were Congress people coming to the show floor. They were excited to see symmetric multi-gigabit speeds practically and easily deployed on existing infrastructure. Symmetric with no new hub space is what I should say as well. The outdoor platform you see here today is actually right over there as well. I encourage you to go look at it as well. It's actually configured in the same way. It's called the platform because, in fact, you can configure it in so many different ways with different modules to adapt to different footprints out there.
Over here, we're talking about DOCSIS 4.0. And it was 1.8 gigahertz. It was delivering, I think, 8 gig down by about 3 gig up to some subscribers, and it was able to do that on that PTP-less network we talked about, which simplified the deployment and accelerated it. The ability to put in a fiber module in there, in this case, a remote switch, a Jetty, provides the ability to tactically deploy fiber when it's needed. This is incredibly important. After folks came to our booth a year ago, that built the momentum. This is simple. This is easy. This is possible. It's available. And we see that momentum building in our ability to deploy DOCSIS 4.0 with other operators around the world. Thank you, JR, for your partnership and collaboration. We truly appreciate it. And this truly matters when you think about the footprint of cOS, we already have deployed with 9 out of the 10 largest U.S. operators in cOS. This opportunity, it's right in front of them.
I'm going to transition now to our fiber and PON section. And a few years ago, we recognized we needed a more complete portfolio that's end-to-end. We've made the investments and we've executed. And we're counting the results as Nimrod has shared over the past few quarters. And let me share with you a little bit about our expanded portfolio as well as different market segments that we'll be focusing on. The 3 segments within fiber that we'll be looking at is fiber and cable, where we're already the vCMTS in the facility, the telco FTTH segment and PON beyond FTTH. It's important to look at this as an opportunity that leverages these opportunities in segments off of the same software and the same base of investment that we've made.
There's a lot of growth in fiber and cable as well as PON beyond FTTH over the next few years. And as you can see, the telco fiber-to-the-home segment is already quite large. All the same software that we're looking at will connect to a breadth of and variety of OLT devices that these investments that we've made will come to fruition.
Let's look at that portfolio. Two years ago, when we started looking at this segment, we really focused about fiber in the cable space. And that really took off. That was successful. And we used our Fin pluggable. So if you start in the far right corner, you'll think about the Fin plugging into maybe a DOCSIS node. One of our customers actually called it a unicorn at the time because they didn't think it was possible to have DOCSIS and fiber being fed by the same platform. Once we did that and that was successful, we built dedicated modules, whether it was a remote switch, a remote OLT different enclosure types, small compact form factors, ones that are specialized for MDUs, one that are a little bit larger like the Ripple that houses multiple modules.
We look at remote switches like the Jetty-3 expanding to help consolidate and have more fiber out there, saving fiber and giving longer reach. And our 50G Pier-2, which is over there as well, showing you the expanded portfolio we have, basically any form factor for every [ PON generation ] as well as the opportunity to expand this for other sorts of footprints. Let's talk a little bit about that. We've actually used PON as a backhaul to connect to a DOCSIS customer. That's an opportunity with the pluggable that goes in. Let's think about MDUs with our SeaStar, which allows us to address low-density MDU markets in the most cost-effective way.
And let's look at the advancements we've made because even if you are on a fiber network, there are power outages in different regions of the world. How can you support making fiber even more resilient? With our Oyster+ right over there, we're able to do so. Every one of these elements in our portfolio has a lead customer is differentiated and will be successful. Whether it's urban, rural, fiber pockets, high or low density, we have a portfolio and the software is versatile for every architecture.
Now let's look at that first segment we talked about, the cable segment for fiber. This is our tailwind. It's not a threat. When people ask fiber or DOCSIS, we say both. When you have a cable segment that has a transition and ability to move over customers and subscribers to fiber, you want to make sure you do it in the least disruptive way, making sure you retain those subscribers, minimizing churn. This is exactly what we do with our software. 10 years ago, a little bit more than that, we had the idea that our platform, it wasn't just the vCMTS. It was a platform with an application on top, and we actually looked at having other applications served by the same software. And that's what we did. And over time, we've been able to connect many ONUs and OLTs and fiber subscribers out there, especially on the cable footprint. So 1 platform, 2 access networks fed by the exact same infrastructure. And DAA allows that to happen.
The transition is accelerating and whatever pace service providers take, we're there to assist with that. So you got your cable modems out there and as they transition to fiber, it's just a simple configuration on a piece of software. Our advantage right now is that we're already in those facilities. our software is already running there. It's as simple as plugging in a Fin and configuring that fiber. It's really hard to replicate that. And the reason that is, is you need to have that footprint. Our footprint is in over 90%. That's where we're already there. So the transition to fiber in the most cost-effective time-to-market way is to stay on cOS. So DOCSIS or fiber, the same platform is the one that powers cable's network evolution.
Let's look at an example of exactly that, what izzi in Mexico has done to unlock a national HFC to PON migration. If you look at the diagram, they already had an existing trunk, and they really leveraged that and their fiber assets by just expanding that fiber to the home. Allowing DOCSIS subscribers to migrate with the minimum disruption out there using the exact platform that you see over there, our Oyster with our Pearl inside. This allowed them to expand their network and allow whether it's GPON or XGS or Combo PON, be able to serve those fiber opportunities in front of them. They're the largest operator in Mexico, and it's an example of other FTTH migrations that we anticipate others will make as well.
We're going to hear exactly that from Carlos Eduardo, just -- here we go.
We moved from a traditional supplier or partner to a more strategic kind of partnership. My name is Carlos Eduardo. So I'm a General Video Director for izzi. We are the largest cable company in Mexico, transitioning from cable to fiber these days. In order to update our network, we decided to find a technology that could support that transition and evolution for our network. So and relying on this partnership with Harmonic, we decided to pick one of the greatest technology you guys have to offer. So what we are doing, not building or rebuilding our network from the scratch, but we are reusing part of all the work done and the infrastructure done for the cable network, but complementing with some equipments and transitioning from the cable footprint to a more FTTH or fiber-to-the-home deployment.
I think the main differentiator from Harmonic and the other guys from the pack is this capacity to understand our needs and come with a solution that fits exactly to what we're looking for. So we're not only talking about high tech, we're not talking about a single solution, but we're talking about the architecture itself. So the izzi view for the future is to become more than just a cable network operator to become a telco operator. This network reconstruction and rebuild the network to be 100% fiber-based. Harmonic is key for our success in such a thing because we believe you guys have the right technology, you have the right people and you have the right solution. And yes, so I'm 100% confident that -- so you'll be the right company to help us achieve our goals.
Thank you to izzi and Carlos for the wonderful video. Let's look at our big telco market segment now. And we believe that the investments we made in our portfolio will allow us to disrupt and compete and differentiate. The demand is real. We know subscribers are moving to fiber over time. And we believe we can differentiate with Open ONT, our hardened DNA, things what we built our enclosures since the '80s and our differentiated 50G. Out of a $2.8 billion market, we see that growth in the 50G spend, and we'll be there ready as that market takes off. We also have the Pier-2 over there to show you exactly what that 50G platform looks like.
One of the things we talked about that enables us to succeed in this telco marketplace is our ability to do Open ONT. So I wanted to focus a little bit about some of the differentiators. So our software connects to a wide breadth of devices that we talked about, shelves, switches and modules, all delivering fiber. And this Open ONT culture that we have is the ability to connect any ONT, any vendor, and we have over 20 vendors and over 75 qualified interops. This is incredibly important as we try to unlock the vendor bundled and bookended solutions that are out there. Keep in mind that the rising memory prices out there put the most pressure on CPE devices like ONTs. Operators need to have the ability to choose the right CPE for their business and the ability for us to have Open ONT gives them that opportunity of diversity and supply chain.
When you look at this, this software and our connectivity allows telcos to have every PON generation, every form factor every service connected to our software and our broad set of devices. The last segment I'm going to focus on is the PON beyond FTTH segment. And there's no better place to be than to differentiate in a new segment that is growing. Where it is today is just as a start. We didn't create the category, but we know we have the ingredients, the devices, the software, the solutions in place to be successful here.
Let me describe a little bit. In the data center today, as Nimrod mentioned, is the connectivity and the management to those devices that's out there. If you're doing point-to-point Ethernet, there's a lot of wiring, there's a lot of active switches. There's a lot of OpEx associated with that if you think about data centers that are thousands and thousands of rack. The opportunity and the value of having PON in the data center is fewer devices, less power and longer reach for out-of-band management. The same value holds true for enterprise. If you think about WeWork, in fact, Nimrod shared with me a video when he was walking through a WeWork and all the cables above them, and we both looked at that and said, "Wow, this is a great opportunity for new enterprises. If they had PON in the enterprise, how much less wiring would they have? How much less gear would they have?"
This is the exact same software, the exact same differentiated solutions that we have that we ship today that would serve those 2 opportunities. This is a new fiber segment with dramatic growth, and we're confident we can differentiate as we move forward. Let me leave you with this, okay? The connectivity that we've built is a foundation for the future. We'll talk a little bit more about that after Yaniv shares with you about our intelligence. And it's -- I'm excited for what the future holds.
So I'll now hand it over to Yaniv, who will share with you our intelligence layer.
Thanks, Asaf. Good morning. You've been hearing this morning from both Nimrod and Asaf about our accomplishments so far. What I'm here to talk about is what's coming next. And I'm not only excited about what's coming, I'm actually really excited about what we're already doing. We see a $1 billion opportunity that is already coming into focus. And in the next few minutes, I'm going to talk to you about the market, how we're addressing it. And in fact, share with you 2 incredible stories about one operator in Alaska that implemented our platform and is seeing the benefits in the field already and another one in the Southern East part of the United States, that show us how are we going to scale.
So I'm really excited about what I'm about to share with you. So let's talk about it by talking about the market, the opportunities. But first, let's start about talking about the challenges. An operator, it's not a secret. Broadband operators needs to do more with the same revenue. They are facing a competitive landscape like nowhere before. They first need to secure their base. And what's winning is reliability and not speed. At the same time, due to this competitive landscape, they are locking their subscriber to multi-year contracts, which put even more pressure on their ARPU. And they need to grow. They're investing in DOCSIS, in fiber, they're making acquisitions, and every one of them is adding more and more tools that they need to buy, pay and manage in order to operate those networks.
And of course, customer expectation is only increasing. with more and more devices to manage. And as Nimrod pointed, those devices need broadband connectivity, not just to show you the time, but in order to operate and reason. So with more network to operate, higher expectation to meet, all of that with the same revenue. So what is the solution? It's a vendor-agnostic intelligent operation platform that will help operators increase reliability, all of that without adding cost and in fact, even reducing cost.
So let's talk how big it is. We see a $1 billion to $2 billion market that is priced per subscriber against cost we are saving. We looked at it from 3 different directions. First one is an independent market research that was done by Mason -- Analysys Mason that put the AIOps software at about $2.2 billion annually, excluding Tier 1s. We also looked at the savings that broadband operators can get from an AIOps platform, and we see a minimum of a $1 billion market for us. That's down from $72 billion annual OpEx and the saving from an intelligent platform. And of course, there is the lifetime value of a subscriber that is staying with you and not churning. All of that puts the intelligent market into a $1 billion to $2 billion opportunity that we are unlocking that we price per subscriber annually against cost that we're saving.
So let's talk about what we built. SensAI is a broadband intelligent fabric. It's a vendor-agnostic, network-agnostic that starts with data collection. We collect data from your -- from the entire footprint, starting from the back office, the different network elements of the broadband, all the way to the equipment inside the customer home. And then we build the first intelligent layer, what we call the network graph. That's the layer that provide the context, provide the connectivity between different elements and different department, that's define what is the customer? What is the service? What's the SLA and the constraint we need to meet. Of course, there are the different tools, tools that people are using today to operate and manage their broadband network, either DOCSIS or fiber.
And then the Agentic systems. Those are the 7 agents that are working 24/7 without sleeping, without eating. And as you can see, they are mimicking the different departments at the operator. We have a subscriber care agent that has a 360 view of the subscriber that helps the customer support representative, the network operator agent, the field ops agent that helps the field engineer that goes to the right place and fix the right issue. Daily intelligent that look at trends, long-term trends and moving operators from being reactive to proactive. Planning agent, provisioning and maintenance, all of that fitting with an Open API, the existing customer application that every operator is using.
We don't pretend that operators will want to see another UI, although we have a beautiful UI that you can see. But we assume that operators want to keep using their own application. We're just making them smarter. And we have a video to show you how it works.
[Presentation]
So that's SensAI. So you may think, okay, Yaniv, everybody is talking about AI these days, right? Everybody is presenting his own platform. So why customers choose you? And you're right. Customers are taking meetings today with every company that talks about AI. They are taking meetings with what we call the generalist AI who build beautiful platform, but they don't speak broadband. They take meetings with the equipment manufacturer vendors that build AI platform, but in their own silo. And of course, in the AI era, what we call the honeymoon era of AI, everybody is building his own application. Some of them tried, most of them has not succeeded to do that. And when we come and present SensAI, what they really love about that, that it's coming from us, a company that understands broadband, that has the experience in broadband, that understand fiber, that understand DOCSIS. They love the fact that it's multi-vendor that we are agnostic to what system we operate and manage.
We build a platform that is hardened. We have experience in building cloud for more than a decade. What they really like is the fact that every deployment we have in SensAI, the rest of the footprint is learning from it and it's becoming more and more intelligent. As we identified signature and issues in one operator, it trickles down to everybody else. And we can do that, thanks to a very special team that we established what we call forward deploy engineering. Those are the engineers that rolls in the truck with the field operation. They are sitting and listening to customer call to understand the challenges and coding and improving the product on the fly, just to show you the type of velocity we're talking about here.
So let's tell you the first story about GCI in Alaska. GCI is the largest broadband operator in Alaska. And they started to implement our platform a few months ago. We help them with their NOC operation that sees identify issue and escalate internally or to another agent that helps the field team to identify what are the tickets that they have. And as you can see, hundreds of tickets. SensAI identified and opened hundreds of field issue tickets. However, it's intelligent enough to also prioritize them based on severity. And you can see the number of trucks that you actually need to dispatch are a few dozen.
To tell you more about that, let's hear from Troy Goldie, the CTO of GCI.
Having those tool sets that allow us to be more proactive to allow us to have an infrastructure that can self-heal with auto tech dispatch gets us to the point where our customer experience is actually realized. Time to task has to be first and foremost, the ability for a system to direct a technician where to go and what to do. It helps us with the time to task reduction, but then also the real-time validation that, that task has been completed successfully, enables us to have a repeat ticket percentage that is drastically less than what it exists of today because we get the systematic validation that the network is where we want it to be versus it's been fixed at that moment, but then it's brought back out at some point in the future.
So our repeat rate will absolutely decrease utilizing the system that you've delivered for us. Harmonic is a true partner at the working level at the strategic level at the business level. We're able to have open and honest conversations about performance levels, performance levels, both on the GCI side and in the Harmonic side so that we can then fail fast, resolve and implement those fixes that are required. We're already starting to talk about where that broadband component can even extend into the home, where we can ensure that the customer experiences everywhere from their PC, their TV through the Wi-Fi into the modem and back into the network such that Harmonic is part of the entire customer experience that we can then deliver a differentiated experience in this [ manner ].
Great. Next, a different story. Hotwire Communications that I'm proud to say that today, Hotwire can find and identify its service degradation issue before customers are actually calling them. And what I really like about Hotwire that, first of all, it's a pure PON customer, 100% fiber. And second, none of the equipment they deploy is with the Harmonic platform. So 100% non-Harmonic, and I know Jeff is working very hard to change that as well, by the way. So what they're doing, detecting the problem, and it's been a journey, learning and we're now in the process to automate things, making it the path to autonomous network.
One example that I love to share with you today is the fact that SensAI identified a service degradation realized that it had nothing to do with the infrastructure, not the PON network, not the ONT itself, not the Wi-Fi and identified as a video degradation issue that required some CDN configuration, which fixed the video problem, okay? So without understanding the network graph, without understanding the topology, this will take weeks, if not months, to find that.
And let me hand it over to Pragash, the CTO of Hotwire, to tell you more about that.
The work that Harmonic and Hotwire is doing together, I believe this is going to break some barriers and introduce something that we never thought of. Pragash Pillai, CTO of Hotwire Communications. I've been in telecom for about 27 years now. We've been working with Harmonic for a few good months now. We are ready to kind of deploy the solution in production part of the SensAI product. What we're looking at doing with the solution is gathering all the data and telemetry about our customer and providing insight either to customer or to us. In a quick example use case, we found customer with 1 access point with 70 over devices connected to that access point.
So there's 2 problems we can solve there. First, we can solve the technical problem. Second, this is an upsell opportunity for us to improve those customer experience by having the whole home connected. In a traditional way, typically, we try to run databases to crunch the data. It takes days, it takes weeks to get to the information that we want. With AI and the ability to structure the data with advanced data lake house platform, we can get to the answer much, much faster. That is what I think going to drive our industry further.
If you look at Hotwire history, 20 years ago, when our CEO started fiber, nobody was doing fiber infrastructure. We're the first one. Hotwire was one of the first fiber company out there in the U.S. And now we're looking at network intelligence, AIOps, I hope when we get a few years forward, we look back, we say Harmonic and Hotwire kind of pioneered this AIOps approach that everybody else is leveraging. We value the partnership with Harmonic and look forward for the future.
So how we're going to go after this market? How we are going after this market is, first, land the base of customers, win new operators and also sell more services. So what do I mean by land the base? Today, we have more than 160 customers that are already using our first-generation cloud. And the idea is we are upgoing and upgrading them to the SensAI experience. As we win more and more operators on cOS as well as non-Harmonic customers, we are going and offering them our intelligent platform. And that opens also an opportunity for new business services for us.
Now that we have SensAI, we can offer a NOC as a service or operating the service for the customers. So what's that doing for us? It's actually enhancing our recurring software revenue stream. But furthermore, it's diversifying our customer base. So we've talked about the second engine. That's the intelligent platform. Asaf talked to you about connectivity, our first engine with our beautiful software and hardware products and solution we developed for cable and telco in order to accelerate their deployment. With SensAI, we're bringing the intelligence to operate those network in a much more cost-efficient way and in a smart way.
And with that, I'll hand it back to Asaf to tell you one more thing. Thanks. Asaf?
I'm back. hope you didn't miss me too much. Thanks, Yaniv. Let's talk about the third layer, the third engine, the compute side of this. We spent time on the connectivity layer sharing with you the footprint that we freed up at the different facilities. Let me walk you through a story of what that means.
So if you think about the simple diagram of the head and the hub and the homes that are connected today, and if you think back to the integrated equipment that was there, the purpose-built chassis; with cOS, we talked about the free space and the power that becomes available now. In some cases, some operators do hub consolidations. In other cases, those hubs exist. And the cOS and the RF gear that pushed out into the network DAA, there's an opportunity there.
And we're all familiar with physical AI. Some analysts point out to over 100 million robots by 2030, all kinds of different humanoids, cameras and sensors, physical AI. Imagine the challenge they're going to have when they need the latency, the predictability to run mission-critical operations and services for all those different opportunities that they have to service their purpose and their mission for their companies.
We can connect our existing infrastructure with that free space on the GPUs. So the opportunity that we've built with our orchestration, the free space that we've enabled now can be used. And we've already done it. We're actually in development now where the GPUs and the different types of compute can leverage the platform. The platform is there, the ability to connect it to GPUs and to run local tokens through that or to do it in a very intelligent way. It's a very exciting opportunity.
When you look at other opportunities as well to connect cell towers, backhaul, all in the same fiber; this will give the performance, the expected -- that the operators already have for their existing subscribers to connect all these things. And we look at all the different opportunities for those different facilities, thousands in the network, and we'll show you a little picture of what that actually means.
And the modernization we sell free -- sorry, the modernization we sell free the space and the power that Edge AI inference for all these physical AI needs. We call this cOS Edge AI.
This is a real map of North America, obviously, with the different sites that we have today and in the future, thousands of sites. Globally, it's even larger. And if you think about that, that's where cOS runs. And if you think about the diagram of the transition for other facilities that we showed a few slides ago, the opportunity is there.
This is an example, just to put pictures -- words to pictures of a site with over 20 racks of equipment, which have been reduced to 1 rack. It just gives a real perspective on how much space and power is available. So the free space is already there. Our customers own that, and our software is already in it.
So we look forward to expanding on this over the -- in the near future and providing you more information. And it's now time for me to hand it over to Walter, who will provide you our financial overview.
All right. Thank you, Asaf. A lot of excitement in terms of the addressable market. So today, what I'm going to focus on is talking a little bit about how we're thinking about growth, considering all of these new opportunities and expanding markets available to us. But before I do that, let me just start in terms of what we have delivered over the last several years.
When you think about our midpoint of guidance for FY '26, we've delivered a 19% CAGR growth rate on revenue over that period of time. I'll address 2025. It was a down year for the industry. We had identified that prior to the start of 2025 in that with DOCSIS 4.0, operators were pausing decisions in terms of investment. And we had said at that time, we expected a rebound in 2026, and that's what we're seeing.
We expect growth for this year year-over-year on revenue to be 43%. If you look at the purple line, that's our rest of market non-top 2 customers. And you can see the increase in revenue year-over-year for '26, we're expecting rest of market to grow by over 50%.
And if you look back 2 years ago, it's more than doubled. That's been a priority. You heard that from Nimrod earlier, and the team has continued to improve, and there's still more work to be done, and I'll talk about that. From an operating margin standpoint, based on our guidance for this year, we'll achieve 20% plus operating margin based on the business model that we have.
So the key message is we've held our share. You heard that from Asaf earlier. And the only deltas are market timing in terms of the investment, in terms of the modernization of these networks. Since I talked about 2026, I want to take the opportunity to reaffirm our guidance that we provided back on August 12 for Q3 of this year as well as full year 2026.
Now this is the slide that Nimrod showed earlier. And it's so important, I wanted to bring it up again because it really signals how we look at the market and the expanding addressable markets in terms of additional adjacent markets that we're focused on. So as Nimrod mentioned earlier, we're traditionally known for the cable access market, which is $1.3 billion. And obviously, today from the discussions, that's a much larger available market that we are now targeting.
The key point that I want to make before I jump to the next slide is really how we're thinking about the growth, what we're including in our growth rates and what we're excluding at this point in our growth rate. I'll share with you our 3-year view of our growth rate in terms of CAGR and then walk you through what is included and what's upside based on all the presentations today.
So when we look at the midpoint of our guidance for 2026, we see 10% to 13% CAGR over the next 3 years. Let me be clear. That's a floor in terms of our business, and I'm going to walk you through and give you additional color in terms of what is upside to that number based on the discussions that we've had so far today. So I'll go category by category.
In DOCSIS, we're assuming the market is going to be flat from where we are today after peaking in '27, '28. Now you saw in a Asaf's chart earlier that the market view is that it will still continue to grow. However, we're going to be conservative in our assumption around DOCSIS.
In cable access fiber, we're assuming a 40% CAGR over that 3-year horizon. You heard of the progress we're making already. We've disclosed that in prior calls in terms of the wins and the momentum building in that area.
In telco, fiber-to-the-home, you heard Asaf talk about our diversified portfolio in terms of our differentiated portfolio. What we're building into the growth rate is a 40% CAGR from where we are today. But let me be clear, we are not including 50-gig PON or any Tier 1 wins in our base CAGR that I'm showing here.
And the reason being is you saw in Asaf's chart that 50 gig, we're expecting that market to start forming in '28 and '29, but we're going to be conservative because we have seen market transitions that take longer in time. So that is not included in our base growth model. PON beyond fiber-to-the-home data center enterprise, that's all upside to the model.
In terms of intelligence platform that Yaniv walked through, our expectations is to grow that at 100% plus CAGR a year over this 3-year period. Now the more important metric that we're leaving you with today is that we expect that portfolio to be 10% of our revenue over this 3-year horizon.
And then finally, on Edge AI compute, that's still to be determined, as we talked about earlier. And therefore, that would be upside to the actual model. So in summary, we're setting a floor of 10% to 13% growth with significant upside, as I've walked you through and giving you the color so you can understand how we're looking at the market opportunity for the company.
I'll make it very explicit just to make sure we -- that I covered it off clearly is that there's four key upsides. We're working on those today. You heard from Yaniv in terms of our 50-gig PON. We're making those investments in a differentiated solution that will be available in '27, but we're not including the revenue in terms of the CAGR rate that we're showing you over the 3-year period. But the key message is we're funding these investments organically.
Now it's more than just building a bigger business. It's building a more durable business. And speaking with many of you, both our analysts as well as our investors over the last couple of years, top of mind is always customer concentration, lumpy revenue. And from our plans today and what we've shared with you, we see the opportunity to build a more durable business.
First of all, from a rest-of-market standpoint, we want to increase to 55% to 60%, and we see that in the 3-year horizon window from the 40% we were at today. Recurring revenue, bumping that up to 22% to 25% of total revenue, and that will include the intelligence platform that we highlighted at 10% of total revenue. And then finally, with regards to operating margin, 20% plus is our view.
And let me say two things. One is we're already doing that in 2026. But the key point I want to leave you with here today is that those organic investments that we're talking about from a product, from a go-to-market standpoint is factored into our thinking in terms of ability to execute on this plan and continue to deliver 20% plus operating margins. So the key point here is we're building a more diversified, a more recurring business with more growth vectors for upside.
Let me just finish here, talk a little bit about our capacity and our ability to execute on our capital allocation priorities.
With the sale of the Video business, it's put us in a great position in terms of financial flexibility. We have over $300 million in liquidity as of the end of last quarter. We expect to continue driving strong free cash flow over the next 3 years. And with the record backlog that we have, we have confidence to commit our capital.
You've heard us talk about these priorities previously. In the organic area, the one that is new is the funding of these investments for the expanded market opportunities in addition to investing in the ramp-up of our business, including the purchase of inventory to secure supply and to be ready for customer demand.
Return of capital, we've executed $122 million of our $200 million program. We've set a floor that we'll buy at least enough to offset equity compensation, and we'll look to do more.
And then finally, on M&A, we've been very consistent with our comments on M&A. If we can see an opportunity that will accelerate our strategy or derisk it, we will prudently look at those options. And right now, we're holding cash as we assess options. But I want to be clear, we're already moving in terms of our organic plan to drive the growth into these markets that we've talked about today.
So the net, just to summarize, we've set a floor in terms of growth rate. We've talked about where the significant upside is to those growth rates even within this 3-year period. And we've talked about the capital that we have and the team to go and execute on all of this.
And so from my perspective, we see profitable growth, we see a lot of upside potential in the business. And that's all great. But what really gives me confidence about the future is about what customers are saying to us.
Recently, we were at a fiber trade show where we were presenting some of our new products, including our hardened fiber products, and we were discussing use cases in suburbs, rural settings. And the customer stopped us and said, "I can use this in high-density areas in cities. I'm paying a ton of money for putting my fiber equipment in leased facilities and those leased facility costs are increasing dramatically. I can take that out of there and leverage your solution to remove those costs."
I think that's a great example of the versatility we have in our portfolio in terms of our differentiated portfolio and the ability for customers to unlock value with that portfolio that we have out there today.
So with that said, I would like to transition it over to Jeff to introduce the customer panel and go from there. Thank you.
Thank you so much, Walter. Good morning, everyone. My name is Jeff Glahn, and I'm the Senior Vice President of Sales here at Harmonic. Today, we've got a great treat for everyone. This morning, you've heard from Nimrod, you've heard from Asaf, you heard from Yaniv on our vision, our mission, our technology and innovation.
And now for the most exciting part, we're going to talk to some operators, our customers of ours that are using all these innovations not only to help their networks today and build -- optimize their networks and drive smarter and more intelligent networks, but also how they plan to work with Harmonic well into the future.
With that, I'd like to invite the panel to the stage. A round applause, please. Please have a seat. Let's start with some introductions. Next to me, we have the Chief Operating Officer of Bluepeak, Cash Hagen. Next to Cash, we've got Eric Svenson, VP of Engineering Operations and Technology at Armstrong. And on the end, we've got J.R. Walden, Chief Technology Officer of Mediacom. Welcome to the panel.
First question we have on is fiber migration. We talked a lot about fiber today, and I wanted to talk with the panel here about the journey of the panel, the journey to fiber, excuse me. Many of you are on different journeys on the different paths, and I wanted to start with Cash to talk about fiber migration. Our teams are doing a lot of great work together, Cash. I'd love to get your insights on fiber migration today and what your plans are for the future.
Sure. And we're on a shot clock here, and we are all appropriately verbose, as we decided. So we'll keep it short. But just by way of backdrop, Bluepeak as a service provider, operate in 8 states, High Plains, Midwest and into the South, about a 70-30 split of pure-play fiber-to-the-home, fiber-to-the-premise, fiber to the business and traditional HFC.
We have been on the journey of greenfield fiber launches now for the last, call it, 5 years. We operate in 80 distinct cities. Of those, call it, 30 of those are greenfield fiber-to-the-home cities that have been built within the last 4.5 or so years. So lots of activity just in a pure-play fiber way.
On the HFC side of our business, we, like many -- DOCSIS is evolutionary, not revolutionary, and we have followed the same path as many of our peer groups have with DOCSIS. And we started off on the path to DOCSIS 4.0 a handful of years ago, I would say, and did quite well in partnering with Harmonic on that.
And then we took a bit of a pivot within the last, I don't know, a year or so, and those were some fun conversations. Obviously, these are capital-intensive networks, as you all in the room certainly know. And the pivot was not to -- not in a negative way about HFC or DOCSIS and really had nothing to do with that as a technology medium. It was bang for the buck value creation for us as a service provider and made a decision in, call it, 80% to 90% of our traditional HFC footprint.
We will not go down the DOCSIS 4.0 upgrade path, and we will instead overbuild ourselves effectively. These are all competitive markets. There are other providers there. There are some that have been more aggressive on their own fiber plans. And it was a pretty big shift for us.
Where we were at, at the time with Harmonic, [ why ] and Jeff and team said, well, how about this? And it was effectively kind of repurposing a lot of the technology that we had learned a lot about with the products that are all sitting over here and to be able to do it.
And one of the real benefits in that strategy was optionality. It's really a key point of we have a DOCSIS network. We have large HFC networks that have been out there for 100 years. And the ability to offer fiber-to-the-prem services within the same footprint is incredibly valuable. And that was a unique kind of delivery option that Harmonic provided versus your traditional kind of telco, more telco-oriented fiber-to-the-home vendor partners.
And that was a pivot. It was a big one, 100% privately funded. We are a provider that we have not taken any BEAD funding, any other state or Fed funding. So it was a big decision to do that on a -- from a cost per passing standpoint to do that. We have a roughly 4-year plan. We started really first kind of shovel in the ground was in, call it, March of this year. And we'll have overbuilt roughly, call it, 30,000 passings by the end of this year.
And over the course of the next 3 years, about 90% of that traditional HFC footprint will be fiber overbuilt. So exciting, lots of work. Not rocket science hard, but incredibly hard to do what we are doing.
Excellent, Cash. Our teams are doing exceptional work together and looking forward to a bright future. Next up, Eric Svenson, we are at Armstrong and Harmonic, a little bit of a different point in the journey, more emerging. Could you please tell us a little bit about the work that our teams are working on together?
Yes, absolutely. So we first started looking at Harmonic when we were looking to upgrade our HFC network, our traditional broadband network. And a lot of the presentations earlier talked about the space, power of all the traditional CMTSs that were in our facilities and looking to modernize that as well as bring new and faster speeds to our customers to be able to compete.
So the start of the journey was looking at how can we upgrade our network and work together and work on that long-term vision because at Armstrong, we are focused on fiber and delivering fiber, but we also need to upgrade and leverage what we have in our existing HFC footprint.
So working together, yes, we were able to deploy the Harmonic solution and be able to upgrade and get similar to the fiber speeds with gig symmetrical services that we could provide our customer and looking to do actually multi-gig solutions with that.
And someone mentioned, Asaf mentioned before, the unicorn. Well, it really is because on our path, we do see doing HFC and to what Cash said, but eventually get to fiber and having the same housing, the same equipment, the same management plane to be able to transition to that fiber space long term really simplifies that journey for Armstrong.
And that's really been important to us and really appreciate the partnership and kind of understanding what our needs were and helping us on that long-term plan and evolution. So we appreciate that.
Yes. We love the partnership and looking forward to the future, Eric. Switching gears. We're going to talk about DOCSIS 4.0. J.R., you were a bit of a celebrity at last year's SCTE in Washington, D.C. I know you made some -- a friend -- Senator made friends with you quickly, the state of Illinois. Would love to hear J.R. about your journey on DOCSIS 4.0, the work we're doing together and what do you see for the future?
Yes. So we're -- Mediacom is also, like some of the others up here, a rural market cable company, lower density spread across 22 states. We have 3.1 million homes that are fed with HSC today. And we wanted to find a path to bring higher capacity to those customers, but maybe more importantly, higher reliability and more network intelligence into those homes. And we felt like we needed to do it really quickly, right? And that was one of the things that really attracted us to the -- or kept us attracted to the DOCSIS road map.
So of our 3.1 million homes, we've already upgraded north of 650,000 to multi-gig symmetrical services. If we had adopted a fiber-to-the-home first strategy, overbuild strategy, we don't think we would have gotten to nearly that many homes. And we're north of 700 nodes now deployed with, I'll call, full unified DOCSIS 4.0. So those homes all have a capacity north of 9 gigs down, which is frankly, faster than our 10-gig XGS-PON goes in other markets.
And yes, so -- and being a rural market cable company, Senator Duckworth came by and was very excited that we were deploying, of course, in her state of Illinois. But also, I think there is a lot of concern among politicians and others and maybe appropriately so, that they don't want a new digital divide or a continued digital divide.
And so we see a lot of representatives from states that have a significant rural market concerned about whether the next generations of technologies and the capabilities that AI and other things will bring to the country leave out a certain portion of their constituents. And so being a rural market company, these technologies deploy exceptionally well in the densities that we are at. And like I said, they're very quick to market.
And the other two highlights I just give, we absolutely run fiber-to-the-home markets as well and running XGS-PON. And I can tell you, an upgraded DOCSIS network is every bit as reliable as a PON network, at least the way we see it and monitor. So we're very excited about that.
And the upgrade process is very customer-friendly and that we're the incumbent Internet provider, broadband provider. We have the majority of the penetration. And all of our existing customers, they can keep their CPE, they can keep their current connections. We don't have to swap anything.
It's only if they want to take one of the new capabilities and new speeds that are going to be -- that are being enabled with these upgrades, then we can swap it. But for a lot of the customers on day 1, they like to hear about investment in the community. But as long as that investment doesn't disadvantage them today with what they're doing, and that's a great part of that technology.
That's great, J.R. And we're proud of the partnership, and we're proud to partner with someone who's visionary in this business as you and the Mediacom team. Cash, you talked a lot about fiber, but I understand your strategy is a hybrid approach with a bit of fiber and DOCSIS 4. Would you mind telling us a little bit about that?
Yes, 100%. It's interesting. It's a bit of a religious debate, right, or philosophical debate, fiber over here or HSC over here, one's good, one's bad. And at the end of the day, we've all been around a very long time, and that is certainly not the case. There are situational reasons why it may be a pure-play fiber or it may be upgraded HFC.
I have lots of conversations with our Board and our investment group on DOCSIS. And there are times where it comes with -- there's a negative association, not with DOCSIS, but maybe with the coax cable. And -- but a lot of education on really where DOCSIS is at today, and it's the point that J.R. just made, customer experience, reliability of service, products offered.
I mean, in today's DOCSIS is far and away different than anything where we have been. And again, it's an evolutionary path. So we -- I don't see a scenario where we'll ever have one or the other, it's going to be a combination of. I think we talked about it briefly in one of the presentations.
There are certain use cases -- MDUs are a good example of a use case, where HFC and the utilization of the internal wiring inside of an MDU, where HFC is very critical because you may not physically be able to get fiber to the unit, costs, operational complexity or other where in most buildings, certainly in the United States, there is coax that had been prewired when that facility was constructed.
So to be able to utilize that and again, the technology is sitting on that table over there, your fiber in, but still DOCSIS kind of within is a very critical part of our go-forward plan.
A balanced approach. I think many operators are looking at that, and it's an interesting word. Next topic is AI, a bit of a hot topic these days. Enormous attention across the board. Network operators are looking at, as Yaniv described, everything from homegrown to what do we do? Love your insights on the panel here. Where do you see AI creating the most measurable value in broadband operations? And we're going to start with Eric.
Yes, absolutely. So I think the most important for us is the customer experience, what is that customer's experience using our services? And it's interesting. There's -- some customers, they may have some issues that are totally fixable, but they're not even calling us up. So being able to leverage a platform like Sense AI to really know what's happening in the network.
And it's not as simple as just one location. We have to look at what's happening in our hub sites, what's happening in our networks. You heard the example of pointing out the CDN problem. Collecting all that data, we have access to all that data at different points in the network to understand what's happening. But to be able to put it together, we weren't able to do that before these AI capabilities were there. So that's really important.
And another thing is as we're -- whether it's someone calling into the call center or someone in the field looking into something, to be able to present to that agent or that rep in the field to better understand what's happening, we're able to identify issues faster as well as be able to get out there and fix things faster.
We're not all grace with lovely days outside. Folks are out in the rain up in the bucket truck in inclement weather. So to be able to identify faster and rather than kind of drive to different locations and find out what's happening, to be able to really put the pinpoint on where the issue is and target that to resolve the issue and best serve the customer, that's really the thing that drives and excites me towards these opportunities that are out there now.
Great insights. AI is a mission, a game changer in AI operations. That's interesting. Excellent. J.R., how about you?
Yes. I think Eric has still probably the #1 or #2 answer. But there are more. I mean there's a lot of things to be delivered. So let me hit on one, I think, is also add some value. Designing networks is a lot about balancing the capability and performance of the network against the reliability of the network. And often, it's a sliding scale, right? You become more reliable by sort of backing off from the edge capabilities of the technology.
And I think when you have large, diverse multistate, multi-technology networks, you pick a sweet spot someplace and you visit it every once in a while, but you're not visiting it in real time. It's just not practical. And AI really changes that for us, right? We can -- we see so much from the monitoring telemetry of the network, we know the impact that, that has. But when you have to equate that over tens of thousands of nodes and service groups.
The AI can come in and say, okay, great. Yes, while we're getting things fixed, and that's a great thing and improving the network; we can adjust the capability of the network and we can -- and sort of the fundamental engineering of the network to slide it more towards reliability, for example.
We don't need maximum performance probably 20 out of 24 hours of the day. And even if we are at that point where we want maximum performance, offline doesn't -- is far worse than a little bit slower, but fully functional, right? So you want to be able to adjust that slider in real-time.
And always -- the way we look at it, reliability has to be #1, performance is #2. And we want both at all times. But being able to adjust in real-time really gives us a lot of capabilities that -- and to manage that network and engineer that network in a way we -- it's hard to do today.
Excellent share. Subscriber experience is everything. That's excellent. Cash, how about you?
Now that they've stole all over, there's probably not a topic that I've spent personally more time on in educating and learning and talking about than AI, right? There's all the buzz associated with it. And really, my view is it's not just AI, there's a whole umbrella of this kind of technology enablement, systems, platforms, processes, how we operate the business under that umbrella. AI is a component of that.
And what I talk a lot about, we just got to run the railroad better. We got to be smarter, we got to be better, faster, cheaper, more efficient. We can't just throw more bodies at -- as our businesses scale, it's like hard things to do, but there is volume of work, and we got to be more efficient in how we do that work.
And we've all been around a long time, and customer care reps are great, [indiscernible] techs are great and field techs are great, but they're not always great. And to have technology platforms that help them, that educate them, to help our customers and do as much as we possibly can hands off. And I know there's a lot of debate on digital assistance or AI call center reps and how people react and respond to that. It's a lot of fun.
If anybody wants to listen to some recorded phone calls on a Saturday night and how people engage with that and then fine-tuning that to make it -- but it's all about just delivering a better and cheaper experience through technology means and smart kind of implementation of AI.
It's not to take over the world because we very much believe human in the loop, AI is where we are and where we need to be to help us and to enable us to do better, faster, cheaper and more efficient.
This is great. A lot of optimism on the stage. And I think this panel is a great barometer for our industry and their insights as well. Excellent. Question, over the next 5 years, where do you -- what are you prioritizing as your network investments? And what's driving those decisions? We're going to start down at the end with J.R.
Yes. So we're really prioritizing our investments on experiential type things, right? And I know we're doing a lot of upgrades. And so you might argue, well, that's really about adding capacity. But we really look at it as the experience, right? We need -- and it's a lot about the reliability. It's a lot about having the network capabilities allow us to roll out new products, new capabilities very quickly.
And look, we're happy to have more capacity as well, but that wasn't the principal driver for it. We would have picked different technologies if that was the most important thing. We're constantly reminded, and it's maybe the hardest thing for a CTO, customers don't buy technology. Politicians get excited about technology and engineers get excited about technologies. Customers buy experience.
If you're investing in experience, you will win. And if you're investing in technology, you will not. This broadband business is a great business. There's a lot of people who want a piece of the pie. And we think that investing in the experience is the way to go.
Excellent, J.R. Thank you. I got some great notes for our final question at the end. Cash, insights?
Yes. I mean I think similar, we talked about just from an upgrade standpoint, but there is an aspect of ours return on invested capital. We're spending a lot of money. This is a capital-intensive business as everybody certainly knows, what do we get from that? And our prioritization isn't about upgrading networks for the sake of being cool or because that's where the industry is going. We need to keep pace and all these are competitive markets.
I think every market of any size and maybe some smaller than that will have competitive providers. In fact, I just think that is the world that we are going to live in and delivering solutions and investing in solutions that do improve the customer experience because as J.R. said, they are not buying technology in a very hypercompetitive space. And again, back to -- we got to run the railroad as efficiently as we possibly can and protect every dollar of investment and measure the return.
Excellent. We've got time for one last question. And J.R., you made a comment, customers buy experience. So why Harmonic? Why do you all buy from Harmonic? Why do you choose to partner with Harmonic? Eric, why don't you start out?
Yes. So I think Harmonic has been an easy company to deal with. And I think the innovation and the collaboration are really what are key. So I feel like when I'm going to work on a project or have a problem to solve that Harmonic is there to help us and great portfolio of products and really willing to listen to us and understand our needs.
And you see that in the development of your platforms, that innovation coming through in the partnership of working together on how do we solve the problems that service providers are facing today. So it's been a good relationship. Support is always key, making sure that when there are things that happen, we have support to take care of it. So yes, it's really been a successful relationship.
Thank you, Eric. J.R.?
Well, I'd often like to say we buy on technology, then relationship and then price. And I think, look, you guys have the right technology for us at the right time. So kudos to your development team. That wasn't so much a partnership as it really was you guys had, I think, good vision and invested in the right place, and we're appropriately rewarded for that. That's part of what brought us to the tent.
And then now that we're here, we really appreciate the ability to work together on some of the technologies, right? We're a rural market mid-tier cable company, and our needs are not radically different, but at least somewhat different from our bigger brothers. And it's appropriate that you're going after that business, and we certainly need their dollars helping to feed the R&D.
But we need partners who can listen to what some of the smaller providers and not just smaller, just the type of markets we operate in, there are some needs that are slightly different than the big ones. And we need some flexibility there, and you guys have been very flexible.
Well, thank you, J.R. And Cash?
Yes. I mean, short and sweet, I think it's you and a lot of the people in this room and a lot of people that are not here, [ Nimrod ], 30 years later, a lot of tenure. You guys are operators, you're a technologist, your operators, you understand the business, you understand the landscape, where we've been, where we're going to. You have an eye towards the future at times that we don't because we're waking up every day running a business.
I don't often have time to think about in 10 years from now where we're going to be and having a partner that is thinking about that, but how to help us get there. Again, it's not just about the best tech that doesn't always win. It is how that works in our ecosystem.
And I think you guys are certainly an exception in a really evolving industry that we've all seen lots of change and you stay true to who you are and what you are and what you're focused on, and that comes through at every level of your engagement with, I think, our respective companies. It's not just the senior team, it's those -- there's a [ give a ship ] factor in your team and taking care of our business and ultimately taking care of our customers. We appreciate that.
Well, Cash, Eric, J.R., thank you for giving us the opportunity to earn your business every day, and we love the partnership. Round of applause for our panelists here. Thank you all very, very much. Excellent. I'd like to hand it over to our Chief Financial Officer, Walter Jankovic.
Thank you, Jeff, and thanks to our customers or the customer panel that was terrific, very insightful. We're going to have the management team come up and do a Q&A session for our sell-side analysts. And it looks like we're right on time here to take your questions. [Operator Instructions] One other point just for everybody in the room and over the webcast is that we will put the recording as well as the slides up on our Investor Relations website subsequent to the event, okay?
Oh yes, we are ready. The team is here. Simon, go ahead.
2. Question Answer
Simon Leopold with Raymond James. I appreciate it. I hadn't realized that 12 years went by that fast. It's been a blur. I wanted to first ask about the expansion into the -- addressing the telco opportunities.
And this, I think, is for Walter in terms of the expenses associated with sales and marketing and maybe for Nimrod, the aspect related to strategy in terms of getting the right people and the kinds of relationships. So that would be a change. So even if the same headcount, maybe different people. Then I've got a quick follow-up.
Okay. Certainly, I can kick it off. Just in terms of the expenses, we think about our operating model, and I mentioned it when we were setting up some of our longer-term targets, I think really the key element is that we are planning in terms of what is it going to take to go to market with regards to Tier 1 telcos.
And so as we model out different scenarios for the company and evaluate it. It's something that we want to get started on immediately in terms of developing that, especially with the transition to 50 gig being kind of a pivot point in terms of that overall transition.
So we are thinking about that in terms of building it into our model. And that's why I gave the comments I did today in terms of what our operating model still looks like as we go through a phase of investment to not only that market but others as well.
Yes. And in terms of the go-to-market expertise, I think we have a growing percentage of them that are not coming from pure cable, whether it's vendors that are known to be pure telco. And I think over time, you see the technology is changing in a way that these guys can move from one vendor to the other.
So I think this is a capability that we already have some of that, and we're going to expand that with Jeff's leadership. I think that engaging with these customers is not something new for us. I think Tier 1 is a different ballgame, but it's not yet what we're kind of targeting initially. As we make progress, and we think we've got a differentiated 50-gig story, we will certainly go up the value chain of customers, and we'll build up the capability.
And then just as a follow-up, this longer term around the opportunity of edge compute, I want to make sure I understand it. It sounds to me similar to what some of the accelerator vendors have talked about in this concept of AI-RAN, so the idea that you can put compute in the edge of the radio network in mobile. And I think what you're articulating is we could do the same thing with broadband solutions.
So first, am I understanding it correctly and drawing an appropriate parallel? And if so, what do you envision as the timing for that market to really develop?
So conceptually, it's exactly that. I think the difference is that putting GPU compute in a cell tower is much more challenging to put that in a facility that has power and space and potentially even more power from the local power network. So conceptually, yes.
In terms of timeline, we did not invent the category. Some others are doing that. I think that it will take some time to not only develop the technology itself, AI is available everywhere. I think this is more of an edge inference.
Sometimes it's not about the quantity and the capacity of hundreds of thousands of GPUs, it's more about what's really important to be at the edge. You clearly have the GPUs, XPUs, there is kind of new technology that is being introduced as well as well as what exactly is the role that we're going to be taking.
Clearly, we see the orchestration opportunity, but there is also the opportunity to cross connect a lot of these smaller facilities into more of a marketplace, if you will, especially within kind of a state or kind of a wide area network.
So it's in development. I think others are looking at that. I think Tier 1s are looking at this. We see an opportunity with a longer tail of customers to really aggregate them customers that cannot spend their in-house R&D to do that, we're going to aggregate that for all of them together.
Walter, thank you. You gave a number for recurring revenue in 3 years, 20%, 25%. Level set with where we are today in recurring revenue.
Yes, certainly. Today's level is in the lower teens and factors in predominantly support contracts. Now we do have a cloud offering. You heard from Yaniv, we are selling our services on the platform. So that is part of that recurring number as well. And so the movement from where we are today to where we're headed in that 3-year horizon is really the bring up of a broader intelligence platform that's driving that addition in recurring revenue.
Okay. And then one more level set. Asaf, when you talked about 75% of the market for the cable modems you're addressing. Is that within the 160 customers you have today? Or are you saying you basically today own the market and the future is beyond that in these other opportunities we talked about today?
Yes. Thanks for the question. So what I'm saying in that graph is that there are today approximately 190 million modems, of which 48 million of them are operating with cOS today. And the opportunity remaining is for the remaining cable modems that exist in the world to transition to cOS over time. Some of them with our existing customers who are rolling out cOS and some with new prospects. So it's a broadband subscriber count.
I would add that some of those cable modems will transition to fiber under the cable fiber segment that we talked about. And for us, that's just a simple configuration, as I mentioned, connected all to the same software.
Tim Long at Barclays. Two as well, if I could. First, can you guys give us any updates on BEAD program and what you're seeing from federal funding from your operator customers?
And then second, I wanted to dig a little bit more into the intelligence business kind of similar to Simon's question. Can you talk a little bit about go-to-market for that? It's obviously going to be a little bit different. And maybe, Walter, how are you looking at kind of incentive programs for some of these higher-value margin accretive and recurring revenue types of businesses?
So on the BEAD, number one, we do have a product ready for that made in America. Number two, our hardened architecture and the different form factors that we have, in fact, is very cost competitive for the rural market. Sometimes you get a remote village that really -- all it needs is 1 or 2 ports. So you can really put a big chassis. Our architecture is a perfect fit for that.
Comcast is one of the biggest beneficiaries or targets to go after the BEAD and they use our solution. The timing, I mean, we gave up on the politics. The timing is unclear. So it's not really a near-term revenue that we're counting on. If and when that will go forward, I think we're in a great position.
And then just on the go-to-market, maybe I'll hand it over to Yaniv to take a moment to explain the kind of go-to-market plan, and then I'll come back to your final question.
Yes, sure. So when it comes to go-to-market, we're talking about sales, marketing that we already have in place. Thanks to Jeff's preemptive, we already have those people in place as well as collaboration between sales and R&D that I already explained about how we work together in order to not just sell it, but also to implement that in a very efficient way.
It's a significant -- as we went through it, Yaniv presented today, it's a significant opportunity for us. And Jeff's already bringing in resources like from an overlay standpoint that are experts at selling this type of solution out there in the marketplace and helping to up-level the team for this type of sale and obviously, to accelerate it as well.
In terms of any specific compensation plans around that, we're developing that with the factors of we've got overlay sales teams involved in order to help us drive faster with the customers that we engage across the globe and ones that we want to engage with, with regards to the solution because you had heard earlier, this is applicable across cable. It's applicable with the host telco market.
On the R&D side, how should we should be thinking about cOS and your DAA nodes and where those are in development relative to your road map? We didn't hear a whole lot about that today. So I assume that development is slowing down, allowing you to invest more in Sense AI and some of these other opportunities. Can you maybe expand on that idea? -- there's always maintenance and things you got to do, but we didn't hear anything about DOCSIS 4. or anything like this.
Yes. So we don't break down the way we invest in different categories. There are clearly maintenance requirements and a few other areas that we have to complete, but we're certainly over the hump.
Okay. Great. Maybe a follow-up, Walter. You've had a couple of years' experience now in fiber. Can you update us on where kind of your thoughts are around profitability around selling fiber versus HFC? Any updated thoughts there?
Well, I think it comes back to the value that we're providing in the marketplace. You saw some of the examples today in terms of the differentiated portfolio and creating value for customers. The customers see the value, the economics of that value.
And so I will pivot to that as being one of the key drivers as we talked about how large fiber is expected to be this year. Nimrod had it in one of the slides. And when we look at those solutions, and you heard from some of the customers talking about them specifically, it's about the value that we're driving into the market.
Great. Maybe one last one, if I can squeeze it in on edge compute and Edge AI. Where do you see your insertion in the value chain there kind of at the OS layer as an orchestrator? Or any thoughts there around?
I think the orchestration for sure. We see a couple of other layers on top of that. But I think it's still in development stages. I think it's subject to what exact compute and the use cases of the compute.
George Notter from Wolfe Research. I guess I was just curious about just the R&D investment here. You guys are in the high teens in terms of quarterly R&D investment. And I'm just thinking about the other competitor in the marketplace that's done a lot of this intelligence stuff is it would be a company Calix.
They did a lot of development around Calix Cloud and Agentic and -- but they did this spread out over many, many years. I think for Calix, it was a 5- to 10-year development to come to market with that product. And they were also fairly R&D constrained.
And I'm just thinking about, again, do you have enough resources R&D-wise to get all this done and support the existing product portfolio? And I know you guys are also committing to a 20% operating margin, so that's another constraint on all this. I guess I'm just trying to understand that do we have enough resource here to get all this done?
Yes. Thank you for the question, George. We're doing it today in terms of building out the solution. You heard earlier in terms of this isn't what we plan to do. We're doing it today. So it's a great point to say, do we have enough? We've been putting resources on this for some time now in order to develop the overall solution.
And when we look forward in terms of our modeling of what we will continue to need because obviously, it's a continuation of R&D support as you span out, but also go-to-market investments that need to be made, we feel we can work within our envelope.
Okay. We've got a minute left here. A couple of minutes.
George has a follow-up. Here we go.
Yes. Sorry, just as a follow-up. For the intelligence product and the initial customers that you guys have, I'm just curious how much -- any sense for what pricing looks like there? Anything you can share? Is that -- I assume it's obviously on a per month basis, per subscriber basis, I would guess. But is that $1 a month? Is it $0.50? Is it $5? Any sense for where that shakes out? And what's reasonable there?
Yes. I don't think we'll give a precise number around it, but it is based on subscriber. So as Yaniv presented earlier on one of the slides, and we've looked at various different models.
We've worked with outside companies as well, looking at -- because other people have done other things like this in terms of these recurring models and Yaniv and the team have taken some good feedback from external sources in terms of value created, how these models look to bring them into our commercial model in terms of what we will charge customers for that service and value.
Okay. I think we hit the zero on the clock. So I think we're going to wrap it up.
Yes. Well, thanks again for joining us today here and remotely. We covered a lot. We truly believe that the broadband network will have to keep up with what we see out there on AI. There is a ton that is being invested on data centers that will have to get consumed, and that's going to challenge the network.
We did go through the two engines. Connectivity is expanding. The opportunity is expanding. In cable, we see a lot of fiber, and we see the opportunity to go to telco, and we even see a bigger market for the same technology. We talked about the PON beyond fiber-to-the-home. We're super excited about the intelligence opportunity we're entering into. We think we bring a differentiated kind of vision and architecture.
And by the way, George, I think we also do spend a lot of tokens to make up for time. So I think whoever started later could actually speed up because we don't only develop AI, we also use AI for the development. And finally, the compute is intriguing. It's in development. We're going to keep focusing on this because we think it can make a difference, and we're going to update you as we make progress.
Thank you very much again. And thank you for the amazing work that the team here did on the back office preparation here. Yaniv, Jeff, Asaf, Walter. Thank you again.
And we've got the demos here for the folks that have joined us here in New York. So please take a minute break. I know it was a long presentation. So take a bit of a break, and then we'll reconvene here, and we're available. Management is available.
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Harmonic Inc. — Analyst/Investor Day - Harmonic Inc.
Investor Day: Harmonic präsentiert cOS‑Plattform, neues SensAI‑AIOps, Ausbau in Fiber/PON und erste Schritte Richtung Edge‑AI mit Kundenreferenzen.
🎯 Kernbotschaft
- Positionierung: Harmonic tritt als reines Breitband‑Unternehmen mit drei Wachstums‑Engines auf: Connectivity (DOCSIS/PON), Intelligence (SensAI AIOps) und Edge‑Compute (Edge‑AI‑Inference).
- Marktgröße: Management sieht ein adressierbares Volumen bis 2030 von ~$7 Mrd. (Kabel+Telco+PON+Intelligence) und erwartet Diversifizierung weg von Top‑Kunden.
🚀 Strategische Highlights
- Telco‑Einstieg: Angriff auf Fiber‑to‑the‑Home (FTTH) mit Open‑ONT‑Interoperabilität, gehärteten Remote‑OLT/50G‑Roadmap und modularen Formfaktoren.
- SensAI: Vendor‑agnostische AIOps‑Plattform zur Fehlererkennung, Priorisierung und Automatisierung; frühe Referenzen (GCI, Hotwire) und NOC‑/Service‑Ambitionen.
- Edge‑Compute: Nutzung von freigewordener Rack‑Fläche/Leistung in Hubs für lokale KI‑Inference; Orchestrierungsrolle über cOS (Plattform für virtualisierte Breitband‑Zugangsnetze).
🆕 Neue Informationen
- Produkt‑Launch: SensAI offiziell angekündigt; bereits in Pilot/Frühproduktionen bei mehreren Betreibern.
- Kurzfristiges Momentum: Erwartete Fiber‑Umsätze von $70 Mio. in 2026; Rekord‑Backlog und >$300 Mio. Liquidität nach Verkauf des Video‑Geschäfts.
- Guidance‑Rahmen: Management bestätigt FY‑26‑Guidance, legt Floor von 10–13% CAGR für die nächsten 3 Jahre fest; 10% des Umsatzes soll aus Intelligence stammen.
❓ Fragen der Analysten
- Go‑to‑Market: Analysten fragten nach Sales/Marketing‑Aufbau für Tier‑1‑Telcos; Management plant gezielte Ressourcen, will aber konservativ bleiben.
- Monetarisierung: SensAI‑Preismodell ist subscriber‑basiert, aber konkrete Tarifdetails wurden nicht offengelegt.
- Unsicherheiten: Timing für 50G‑PON, Edge‑Compute‑Einsatz und BEAD‑Förderungen blieb vage; R&D‑Kapazität vs. Margenziel (≥20% OpMargin) wurde diskutiert.
⚡ Bottom Line
- Implikation: Investor Day skizziert plausiblen Wachstumspfad durch Produktdiversifikation und Software‑Recurring‑Anteile; Basis‑CAGR konservativ, Upside groß, wenn 50G‑PON, PON‑beyond‑FTTH und Edge‑AI kommerzialisierbar sind. Hauptrisiken: Time‑to‑market, Telco‑Wins und transparente SensAI‑Monetarisierung.
Harmonic Inc. — Q2 2026 Earnings Call
1. Management Discussion
Thank you. Welcome to the second quarter, 2026, Harmonic's earnings conference call. My name is Lisa and I will be your operator for today's call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there'll be a question and answer session. To ask a question during the session, you need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To answer your question, please press star one one again.
I would now like to turn the call over to David Hanover, Investor Relations.
David, you may begin. Thank you, operator. Hello, everyone. And thank you for joining us today for Harmonic's second quarter, 2026 financial results conference call. With me today are Nimrod Ben-Natan, President and CEO, and Walter Jankovich, Chief Financial Officer. Before we begin, I'd like to point out that in addition to the audio portion of the webcast, we have also provided slides for this webcast, which you may view by going to our webcast on our Investor Relations website. Now turning to slide two. During this call, we will provide projections and other forward-looking statements regarding future events or future financial performance of the company. Such statements are only current expectations and actual events or results may differ materially. We refer you to documents harmonically filed with the SEC, including our most recent 10Q and 10K reports and the forward-looking statements section of today's preliminary results press release.
These documents identify important risk factors which can cause actual results to differ materially from those contained in our projected results. projections or forward-looking statements. And please note that unless otherwise indicated, the financial metrics we provide you on this call are determined on a non-GAAP basis. These metrics together with corresponding GAAP numbers and a reconciliation to GAAP are contained in today's press release, which we have posted on our website and filed with the SEC on Form 8-K. We will also discuss historical, financial, and other statistical information regarding our business and operation, and some of this information is included in the press release. The remainder of the information will be available on a recorded version of this call or on our website. And now I'll turn the call over to our CEO, Nimrod Ben-Matan.
Thanks, David, and welcome everyone to our second quarter of 2026 earnings score. U2 was another strong quarter both financially and in terms of the progress we've made on our strategic imperatives. We saw continued strengths in rest of market demand, an accelerating pace of fiber deployments, and encouraging results from our new intelligence layer. In June, we completed the sale of our video business, marking the completion of our transformation to a pure play broadband company. With the momentum and improved visibility we achieved in the first half of the year, we are once again raising our full year 2026 broadband revenue outlook. Driving this momentum is an important theme we have been building toward for several years. Operators no longer have to settle the network architectures question before they can move forward. because our Converge COS platform supports all access architectures, DOCSIS 3.1+, DOCSIS 4.0, distributed, centralized, and fiber.
Operators are deploying COS knowing it will evolve as their priorities do. from more to an accelerated fiber overlay over time. This is more important than ever for operators, as network traffic is not just growing, it is changing shape. Open Vault's latest data show upstream traffic now growing more than three times faster than downstream. The third consecutive year, that gap has widened. AI pushes the same way. Agents and connected devices fill traffic upstream and run around the clock, not just at the evening peak, which is what legacy broadband networks were engineered around. The critical constraint is upstream capacity, and there is more than one way to relieve it. DOCSIS 4.0, a high split upgrade or fiber.
The unique strength of our platform is that it enables all of these options with the same software, at the same time. Cable One's CEO captured this well at the independent show in July, describing network topology as the biggest question broadband operators face and saying his plan is to trial DOCSIS 3.1 splits, DOCSIS 3.1+, DOCSIS 4.0, and fiber side by side. available and deployed with COS today, making this entire evaluation possible with a single platform. This flexibility matters more than ever as legacy platforms are both constrained on upstream capacity and approaching the end of their youthful life. For a growing number of global operators, those legacy systems are an increasing security and maintenance liability. As they weigh their options, COS and Harmonic are uniquely positioned as the platform and company enabling them to modernize across current and future architectures. This is the dynamic that is now driving our market momentum worldwide. Turning to our financial results highlights on slide 5, Q2 revenue grew 54% year over year to $133.5 million, above the high end of our guidance and our strongest second quarter ever.
Rest of market revenue grew 44% year over year to to nearly $50 million. Looking at the six month end of July 3rd, this revenue surpassed $100 million, approximately 60% higher than in the first half of last year. Bookings were again strong in the quarter reaching $144 million, led by rest of market, which represented approximately 60% of total bookings in the quarter. Also, we exited the quarter with backlog and deferred revenue of $588 million. This continues. to improve our visibility and it is a key reason we are raising our full year outlook. Rest of market continued in the quarter. Momentum continued in the quarter, and behind the revenue is an expanding base of customers.
Our deployed COS footprint now includes 161 customers serving 48.2 million CPE devices. Blue Peak is a good illustration of why operators are choosing us, and it goes directly to the theme I opened with. Two years ago, they selected our distributed access platform to expand their DOCSIS network. Partway through, their strategy evolved and they began overbuilding parts of their footprint with fiber. In the words of their Vice President of Technology and Engineering, Eric Fliegel, because of the platform they had already deployed, they were able to quickly make a technology shift utilized the same housing, the same infrastructure, the same backhaul, and start deploying XGS PON very quickly. Today, they decide service area by service area, where to run DOCSIS and where to run FIBER. That is the pattern we are seeing repeatedly.
Operators start with one use case and expand over time across DOCSIS and or FIBER and increasingly add network intelligence, which I will come back to shortly. And they do it by leveraging the COS platform underneath. Fiber momentum continued to build, with Q2 setting a record rest of market fiber bookings. Deployments are ramping alongside the bookings. Star, our MDU optical node, went live at DNA Finland, the European operator behind the sizeable booking we highlighted last quarter. They are now bringing multi-gigabit service into apartment buildings that were previously uneconomic to upgrade by reusing the existing in-building network. We are also seeing fiber used in ways that extend our market beyond residential broadband.
Inter Venezuela, the largest private ISP in the country, is building a nationwide XGS phone service on our platform for mobile backhaul, using fiber as carrier infrastructure for operators preparing for 5G. The new product portfolio we previewed at FiberConnect last quarter is already converting to orders. We secured our first multimillion-dollar order for the Perl One XL and Oyster Plus, which together deliver high port density and keep service running through extended power outages. of downtime in outdoor deployments. Their outdoor design lets operators keep the street cabinet all together. to keep the street cabinet altogether, consolidating that capacity into one compact, power-protected device that deploys faster, costs less to install, and takes up far less space in the communities they serve. Together, our record fiber bookings, expanding portfolio, and converged architecture position us to keep gaining share as operators look for more flexible, reliable, and cost-effective ways to expand fiber. The DOCSIS 4.0 ecosystem took an important step forward. In June, cable modems from six suppliers across two chipset vendors cleared the first CableLabs interoperability milestone on the path to DOCSIS 4.0 certification.
With multi-vendor modem supply now coming into place, operators can move ahead. on DOCSIS 4.0 with greater confidence. We are shipping unified DOCSIS 4.0 nodes in volume across a broad range of customers as they ramp their upgrades. We also want a new DOCSIS 4.0 customer in Europe during the quarter. With DOCSIS 4.0, operators can deliver fiber-like upstream speeds over the plan they already have, which is what an AI era applications increasingly demand. Turning to our new intelligence area, we continue to see adoption buildings. Beacon is now live with approximately 20 customers. and our broader intelligence platform is expanding, with newer offerings now running with about 10 operators. Early deployments continue to show significant value, including a reduction in subscribers calls to service providers by more than 30%, as we discussed last quarter. which extends real-time visibility into the amplifier plant is now in beta with several operators running with amplifiers from two different vendors.
That matters as many operators run multi-vendor amplifier strategy for supply chain flexibility and assurance. A recent Deloro report projects that nearly 10 million of the amplifiers deployed in the industry's current upgrade cycle will be smart amplifiers. In other words, the outside plant is being instrumented by the upgrade cycle itself, generating the kind of granular real-time data our intelligence layer is built to use. That is a significant expansion of the opportunity ahead of us. outcomes and our customer first approach show up in how our customers rate us. Our customer NPS reached 87 in the second quarter. Turning to slide six, stepping back, there are four things driving the growth of Harmonic. And during the second quarter, we made significant progress on each of them.
First, the access and fiber on a single converged architecture, which is increasingly why operators select us in the first place. Second, a global base. that global customer base that keeps widening beyond our largest accounts. Third, new intelligence products and services where adoption is building across our customer base. And fourth, operating leverage which is increasingly visible in our financial performance. We are looking forward to sharing more with you at our upcoming Investor Day on September 15th, including our updated view of the market opportunity, our longer-term strategy, and growth plans. much more on the intelligence opportunity. I hope many of you will be able to join us. That concludes my opening remarks. With that, I will turn the call over to Walter to walk you through our financials in more detail.
Thanks Nimrod and thank you all for joining us today. Before I discuss our quarterly results and outlook, I'd like to remind everyone the financial results I'll be referring to on this call are provided on a non-GAAP basis. As David mentioned earlier, our Q2 press release and earnings presentation include reconciliations of our non-GAAP to GAAP financial measures. Both of these are available on our website. As previously announced, we completed the sale of our video business to Mediakind on June 16th of this year. Proceeds from the sale were $137.9 million paid at closing, subject to final post-closing adjustments under the terms of the APA. As a result, we Harmonic now operates as a pure play broadband company with a single reportable segment, broadband.
With this context, I'm pleased to report that our strong business momentum continued into the second quarter, with broadband revenue increasing 54% year over year, including 44% growth in rest of market. In addition, we had strong quarterly bookings and once again closed the quarter with record backlog and deferred revenue. Notably, approximately 60% of bookings in the quarter came from the rest of market where book to bill was well over 1.5. Given these results and leading indicators, we are once again raising our full-year guidance, with broadband revenue now expected at $505 to $525 million, up from our prior range of $475 to $495 million. I'll provide a more detailed breakout of our guidance shortly. Let's move to slide eight, where we have the financial highlights for the quarter. Broadband revenue was $133.5 million, well above our guidance range of $115 to $125 million.
Gross margin for the quarter was 53%, consisting with our guidance, and the net unrecovered memory cost impact remained well below $1 million. Operating expenses were higher this quarter, mainly due to company incentive-based accruals tied to our improved full year 2026 financial performance forecast. And moving to the bottom line, EPS was 21 cents, again, above our guidance range of 15 to 19 cents. And operating profit was 31.3 million, exceeding our guidance of 23 to 28 million. These results include $2.3 million in stranded costs related to the video business sale. Revenue upside was broad-based and included a number of rest-of-market customers ramping their deployments during the quarter. In Q2, two customers each accounted for more than 10% of revenue, together representing 63% of total revenue.
Our Q2 rest of market revenue showed very strong year-over-year growth of 44%, representing 37% of total revenue, underscoring our progress in expansion. expanding our customer diversification. As a reminder, rest of market revenue describes all revenue that is not from our two largest customers as measured by subscriber count. Turning to slide 9, you can see our balance sheet and cash flow highlights. The closing of the video transaction gave our already healthy balance sheet a strong capital infusion, bringing cash and cash equivalents to 231.9M at quarter end. That inflow throw the sequential change in cash partially offset by negative free cash flow of 7M dollars the quarter which was primarily due to an increase in memory inventory as we took early delivery to secure supply for growth. DSO at the end of Q2 was 61 compared to 62 in Q1-26 and 72 in Q2-25. We expect DSO to trend back to the low 70s going forward based on our customer mix.
Inventory increased 15.3 million in the quarter, and our days inventory on hand increased to 95 days from 80 days last quarter. overall book to bill was 1.1 in Q2, with rest of market significantly above 1 as previously mentioned. At the end of Q2, broadband backlog and deferred revenue reached a record $587.6 million, up 71% year-over-year, of which 73% is expected to convert to revenue within the next 12 months. This gives us increased visibility for the remainder of 2026 and into 2027. As shown on slide 10, we believe we have ample liquidity to support our capital allocation priorities with $232 million in cash and an $85 million undrawn credit facility. This significant increase in cash gives us the financial flexibility to execute our capital allocation. application plan. Our capital application priorities remain unchanged. invest in organic growth and diversification, return capital to our shareholders, and pursue strategic M&A to further enhance growth and diversification in our business. In line with our first key priority, we plan to keep investing in organic growth.
This will increase our inventory over the next several quarters, including advancing memory purchases to secure supply. As discussed on prior calls, these organic broadband opportunities are in both our intelligence platform and fiber portfolio. Under our current $200 million share repurchase program, to date we have already repurchased $122 million of our outstanding shares. We did not repurchase shares during the second quarter. As we stated previously, we expect to fund ongoing repurchases through both current cash and strong free cash flow generation over the next several years, with a minimum goal of purchasing enough shares each year to offset any dilution from equity compensation awards. In addition, with the substantial cash infusion from the sale of video, we are well positioned to explore additional inorganic growth opportunities that would further diversify our business and accelerate our growth strategy. Turning to guidance on slide 11, here we provide our continuing operations non-GAAP financial guidance for Q3 26 and full year 26, which reflects our raised full year outlook.
We continue to take a measured approach to guidance for both revenue and margins. We believe this is prudent given external factors such as the situation in the Middle East and secondarily, component supply dynamics and pricing. Our full year margin guidance incorporates the current market pricing for memory. Let me walk you through our guidance. For Q3 26, we expect to deliver broadband revenue between 125 and 135 million, gross margins between 51 and 52%, reflecting the elevated memory costs, operating profit between 23 and 28 million, and EPS of between 15 and 15. and 19 cents. As our guidance shows, we expect strong year-over-year revenue growth in 2-3. Q3 operating profit includes approximately $2.3 million in stranded costs.
For the full year 2026, we expect broadband revenue between 505 and 525 million, up 30 million or 6.2% from the midpoint of our prior guidance. gross margins between 51 and 52 percent, and improvement over prior guidance based on customer mix and the mitigation of supply chain impacts. operating profit between 99 and 111 million, and EPS between 67 and 75 cents, up approximately nine cents or 14.5% from the midpoint of our prior guidance. As we noted last quarter, we have built approximately $3 million per quarter into our second half guidance for the net increased memory costs that are not expected to be passed on. Our team has done a terrific job securing memory supply for the rest of 2026 and into 2027. Additionally, full-year broadband operating profit includes approximately $10 million in stranded costs. And to reiterate what we said last quarter, we continue to believe approximately 30% of these stranded costs are temporary and will be eliminated within one year of the video sale closing. Please note that our expected non-GAAP tax rate for full year 26 has been reduced to 23% from 24.5% previously, reflecting our updated view of profitability. In summary, in the second quarter, we delivered results that once again significantly exceeded our expectations with broadband revenue growing 54% year over year.
Our record broadband backlog and deferred revenue and supply availability give us increased visibility, enabling us to raise our full year guidance. With the sale of our video business now behind us, we are well positioned, focused, and have considerable capital to further accelerate our growth in the rapidly growing broadband sector.
Thank you. Any last remarks before we open up the call for questions? Thanks, Walter. To close, Q2 was a strong quarter across virtually every measure, our strongest second quarter ever on revenue, continued strengths in rest of market growth, a faster pace of fiber deployment, and wider adoption of our intelligence portfolio. We are raising our outlook for the second time this year as the visibility we have built supports it. Operators keep choosing Harmonic for the same reason. Harmonic lets them evolve their network without regrettable spend. We will have a great deal more to say about where that leads at the upcoming Investor Day next month. That concludes our prepared remarks. Walter and I are now happy to take your questions.
Thank you. As a reminder, if you would like to ask a question, please press Star 11 on your telephone. You will hear that automated message advising your hand is raised. To remove yourself, press Star 11 again. We also ask that you wait for your name and company to be announced before proceeding with your question. One moment while we compile the Q&A roster. Our first question will be coming from the line of Victor Chills, Raymond James.
Hi guys, this is Victor in for Simon. Thanks for taking the question. Can you just provide some color around the demand dynamics from the rest of the market? Are we seeing an inflection here now where smaller regional MSOs are starting to follow through with the Comcast Charter Upgrade Playbook? And, you know, In addition, are these still kind of lab trials or are we seeing, you know, the first phases of their actual upgrades now? Yes.
Victor, let me take that. So as we previously discussed, this is a growing list of customers, many of which we announced last year and early this year. This is... way past the lab trials. This is ramping deployments across the board. And as much as we talked about DOCSIS 4.0, we also see customers that are doing what's called the DOCSIS 3.1 plus, kind of the extended version of DOCSIS and Fiber. So it's really across the board, all the use cases that we have. And it's really coming, as you indicated, outside.
of the top two customers. Great. And just a quick follow-up. What percentage of the rest of the market would you say in your estimation has kind of started ramping now and started full-on deploying for these upgrades?.
It's a growing percentage of the rest of the market. We never broke it down. exactly and not all of them are at the same stage. Clearly some of them are further along than others. But it's certainly a growing percentage that we see out there and there is more to come. As there is a longer list of customers that are either making a decision or made a decision and are going through the different stages in the lab testing field trial before they ramp up. So what you see every quarter is a growing blend of those that are ramping up, those that are just starting, and behind the scene as we keep announcing new wins, these are kind of opportunities and customers that are coming up to speed with their rollouts.
That's very helpful. Thank you very much. And just to add to Nimrod's comments around the rest of market, that revenue is well diversified across a broad set of customers. So to Nimrod's point, more customers are coming on board. And therefore, when you look at the makeup of that revenue, it is well diversified across many customers.
Thank you. That's very helpful. Thank you. One moment for the next question. Our next question is coming from the line of Steven Fringle of Rosenblatt Securities. You may proceed. Stephen, your line is open. Good afternoon. Thank you.
Can we just talk in general about what's the potential for these intelligence platforms in terms of, you know, kind of raising the recurring revenue portion of your business? Is this something that could be material in two or three years, or is it going to take longer than that for...
for this stream of revenue to build up? It will certainly be material for what we report today on recurring revenue. It will also be very sticky to the service that we provide. We think it's going to take time and we plan on sharing more details on what exactly we do there and kind of what's the the road ahead but We certainly see that as a growing in an area that will be material to our recurring revenue kind of category that we report and for the overall business.
Okay, and you've done a great job battling rising memory costs, which seem to be really impacting. everyone, can you do you think you can keep this up throughout this year and into next year? Or do you think that you just got ahead of your growth curve this year, which bought you some cushion?.
Steve, it's Walter. So first of all, with regards to memory, we've already procured all the memory that we need for FY26. And our team's done a good job kind of early days when this was becoming an issue to front run and get supply. And so now you're seeing in the second half, some of that supply from a cost standpoint, obviously, is reflecting closer to the market price of that product as we are. already procured it and you mentioned I mentioned during the opening remarks that we built in about $3,000,000 per quarter in terms of the impact of the memory costs. And so that's where it's increasing and that's reflected now into the memory and sorry into the gross. margin guidance that we've provided for Q3 as well as the full year. And so yes, the team's done a great job. We've mitigated certain risks and today you saw in our guidance for the full year, we actually raised our gross margin guidance.
for that period. Great, I'll jump back in the queue, thank you.
Okay, thanks, Steve. Thank you. If you would like to ask a question, please press star 11 on your telephone. One moment for the next question. And our question is coming from the line of Ryan Coons of Needham & Company. Please go ahead.
Great, thanks for the question. I'm going to ask a little bit about rest of market, maybe in a different angle here. ONE, ANY COLOR ON DIFFERENT GEOGRAPHIES RELATIVE TO REST OF MARKET TRACTION AND ADOPTION? AND SECONDLY, ARE THERE ANY PARTICULAR UNLOCKS THAT YOU'VE ACHIEVED TO ALLOW THEM TO OPERATIONALIZE VIRTUAL CNTS AND DAA, WHICH HAS BEEN GOING ON FOR MANY YEARS OF STRUGGLES?.
about that? Yes. So, on the first question, you know, clearly majority of the businesses in North America, although you have to look at Canada and Mexico separately, we've got customers in both. There are a growing number of opportunities that we've either announced or in the pipeline in both Latin America, Asia, and a sizeable number of opportunities in Europe. So when you think about rest of market, if you exclude the top two and you kind of look at the mix, there is definitely a bigger contribution coming outside of North America. your second question. Look, it took a while. Obviously, it's Kind of a distributed architecture, but I think we we did a good job over the years to simplify that and train our customers. We got great experts helping our customers with with services and you know the one thing I can say even though our has all the bells and whistles of Kubernetes and kind of a scale out microservices architectures. Our customers do not have to know all of that when they operate our platform. They really look at that as an appliance.
So I think this is clearly not kind of a headwind to our business growth at the moment from a.
kind of a complexity of deployment point of view. Super helpful. And then maybe on the cost side, as it relates to solutions and your requirements to deliver servers and networking and other parts of the complete solution, I'M SURE YOU'RE SEEING SOME COST PRESSURES THERE. COST PRESSURES THERE. ARE YOU SEEING ANY OF THOSE BEING impediments to your customers deployments relative to just raw raw hardware costs for off-the-shelf private cloud the short answer is no but I'm going to let Walter expand on that.
Yes, I think from anything that we provide as you know from a third party in terms of switches and servers, we mentioned it during the last quarter's call that that is one of the things that we do for some of our rest of market customers. We procure those items as well. Obviously, the prices of those items. Those have gone up and impact customers out there, but from the perspective of its materiality to our business, it's very small. And so far, we really haven't seen any impact from a supply standpoint. It's more around the price of these items.
Terrific. Thanks, guys. And maybe if I can squeeze one more in, a question about the fiber market, how you think about that, how you're thinking about bead and any catalyst out there that you think would shift cable operators to more aggressively rehab coax.
versus upgraded fiber from your perspective? Yes, so let me start, and then Walter will chime in on the beads, Bubba. So, we do see cable operators do fiber, but Very few are doing wholesale overbuild of themselves. They will do everything to grow fiber to address MDUs or certain applications, but some of them, and I did mention Blue Peak as an example, will do an overbuild and that's the beauty of our platform that it lets them kind of make the transition in a very seamless way. We expect over the next couple of years, Some will be more aggressive, some less about this migration. And this is clearly something that we see as a great opportunity for our business being a converged platform. We also think that our fiber portfolio is very attractive for the broader fiber. market outside of cable. I did mention the win that we had with the new Pearl XL that has this unique power protection capabilities.
This is going for the broader fiber market, not specific to cable. And it really provides a significant value for those that are doing these deployments relative to the traditional street cabinet architecture, etc. So we're excited about what we have and expecting to keep growing this business. Walter, please address the bead question.
Certainly. So Ryan, Bede in terms of our guidance, it's a modest part of our overall revenue guidance. I think we've mentioned previously that we've received orders and are ready to ship out in terms of Bede product, in terms of having the supply chain all set up. As Nimrod pointed out, you know, we've got some very unique products for that market in terms of ruggedized OLT type of infrastructure, which is playing really well into that market. So right now, it's moving as planned. It's not a significant part of our guidance this year.
A couple guys, really appreciate it. . Brian. I appreciate it.
Thank you. And this concludes today's Q&A session. I would now like to turn the call back to Nimrod for closing remarks. Please go ahead.
We appreciate your continued interest in Harmonic and look forward to updating you on our focus in the near future.
Thank you all for joining the call. Have a good day. This concludes today's conference call. Thank you so much for joining. You may now disconnect.
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Harmonic Inc. — Q2 2026 Earnings Call
Harmonic Inc. — Q2 2026 Earnings Call
Starkes Q2: Umsatz und Backlog deutlich über Erwartungen, Management hebt Jahresprognose an und betont Konvergenz von DOCSIS, Fiber und Intelligence.
📊 Quartal auf einen Blick
- Umsatz: $133,5 Mio. (+54% YoY; über dem oberen Guidance-Ende)
- Bookings / Backlog: Bookings $144 Mio.; Backlog & Deferred Revenue $587,6–588 Mio. (↑71% YoY)
- Rest of market: Revenue ~ $50 Mio. (+44% YoY); ~60% der Quartals-Bookings
- Profitabilität: Bruttomarge 53%; Betriebsergebnis $31,3 Mio.; GAAP-freier EPS $0,21
- Liquidität: Cash $231,9 Mio.; ungenutzte Kreditlinie $85 Mio.
🎯 Was das Management sagt
- Repositionierung: Verkauf der Video-Sparte abgeschlossen — nun reines Broadband-Unternehmen.
- Konvergente Plattform: COS-Plattform unterstützt DOCSIS 3.1+, DOCSIS 4.0 und Fiber parallel; erlaubt schrittweise Migration ohne „regrettable spend“.
- Produkt-Schwerpunkte: Starkes Momentum bei Fiber (Rekord-Rest-of-market-Fiber-Bookings) und Aufbau der Intelligence-Sparte (Beacon live bei ~20 Kunden).
🔭 Ausblick & Guidance
- Jahresumsatz: Broadband-Guide erhöht auf $505–525 Mio. (vorher $475–495 Mio.)
- Q3-Guidance: Umsatz $125–135 Mio.; Bruttomarge 51–52%; EPS $0,15–0,19; Q3 enthält ~$2,3 Mio. stranded costs
- Operatives: Jahresbetriebsergebnis $99–111 Mio.; EPS $0,67–0,75; full-year stranded costs ~ $10 Mio.; ~30% davon temporär
- Risiken: Geopolitik (Nahost), Komponentenpreise und Supply-Chain; Management hat $3 Mio./Quartal für nicht weitergebbare Memory-Mehrkosten einkalkuliert
❓ Fragen der Analysten
- Rest-of-market-Traction: Management: nicht mehr nur Trials — viele regionale MSOs sind in Ramp-Phase; Anteil wächst, Diversifikation nimmt zu.
- Intelligence-Revenue: Beacon und weitere Angebote sollen wiederkehrende, sticky Umsätze bringen; Management erwartet Materialität über mehrere Jahre.
- Memory & Kosten: Firma hat Memory für 2026 vorab gesichert; Auswirkungen in Guidance eingepreist, Beschaffungsstrategie mindert kurzfristige Lieferrisiken.
- Fiber / „Bede“-Produkte: Fiber-Portfolio und ruggedisierte OLT‑ähnliche Produkte adressieren MDU und Carrier-Use‑Cases; aktuell noch moderater Anteil am Guidance.
⚡ Bottom Line
- Kurzfassung: Q2 bestätigt strategischen Pivot: stärkeres Wachstum außerhalb der Top‑Kunden, starkes Backlog und höhere Jahresprognose. Kerntreiber sind die konvergente COS‑Plattform, beschleunigte Fiber‑Bestellungen und aufkommende Intelligence‑Services. Investoren erhalten bessere Sichtbarkeit, aber kurzfriste Risiken bleiben Memory‑Kosten und geopolitische Unsicherheiten.
Harmonic Inc. — Q1 2026 Earnings Call
1. Management Discussion
Welcome to the First Quarter 2026 Harmonic Earnings Conference Call. My name is Lisa, and I will be your operator for today's call. [Operator Instructions] Also please be advised that today's conference is being recorded.
I would now like to turn the call over to David Hanover, Investor Relations. David, you may begin.
Thank you, operator. Hello, everyone, and thank you for joining us today for Harmonic's First Quarter 2026 Financial Results Conference Call. With me today are Nimrod Ben-Natan, President and CEO; and Walter Jankovic, Chief Financial Officer.
Before we begin, I'd like to point out that in addition to the audio portion of the webcast, we've also provided slides for this webcast, which you may view by going to our webcast on our Investor Relations website. Now turning to Slide 2. During this call, we will provide projections and other forward-looking statements regarding future events or future financial performance of the company.
Such statements are only current expectations, and actual events or results may differ materially. We refer you to the documents Harmonic filed with the SEC, including our most recent 10-Q and 10-K reports and the forward-looking statements section of today's preliminary results press release.
These documents identify important risk factors, which can cause actual results to differ materially from those contained in our projections or forward-looking statements. And please note that unless otherwise indicated, the financial metrics we provide you on this call are determined on a non-GAAP basis. These metrics, together with corresponding GAAP numbers and a reconciliation to GAAP are contained in today's press release, which we have posted on our website and filed with the SEC on Form 8-K.
We will also discuss historical financial and other statistical information regarding our business and operation, and some of this information is included in the press release. The remainder of the information will be available on a recorded version of this call on our website. And now
I'll turn the call over to our CEO, Nimrod Ben-Natan. Nimrod?
Thanks, David, and welcome, everyone, to our first quarter 2026 earnings call. Q1 marked a strong start to the year and validated the strategy we outlined last quarter. We executed effectively across the business with continued strength in rest of market demand.
And with our progress to date, we are entering the remainder of the year with improved visibility. Reflecting this momentum, we are raising our full year 2026 broadband revenue outlook. In addition to our strong financial results, this quarter also highlights our progress in expanding Harmonic's growth profile.
In a world where AI is making broadband capacity and quality of service even more essential, we are building a uniquely focused broadband company with multiple growth drivers, sustained leadership in DOCSIS, accelerating momentum in fiber, increasing global market share and growing intelligence layer that enables new high-value services for our customers.
Turning to Slide 4. Let's look at some of the highlights for the quarter. Q1 broadband revenue rose 43% year-over-year to $121.7 million. A large part of this was from rest of market, which represented 42% of that total. an important indicator of our progress in broadening and diversifying our business. Bookings were also strong in the quarter, driving an 87% increase year-over-year in backlog and deferred revenue.
Again, this bolsters our visibility, giving us the confidence to raise our full year outlook. We also continued returning capital to our shareholders, repurchasing approximately 4.2 million shares for $43 million during the quarter. Finally, I want to mention that the pending sale of our video business remains on track to close in the second quarter, positioning Harmonic as a more focused broadband company going forward.
The key highlight in the first quarter was the continued acceleration of our rest of market business with year-over-year revenue growth well above our long-term growth target. Beyond the increased revenue contribution, this performance demonstrates the expanding global adoption of the Harmonic platform across a broader range of industry operators.
Our deployed cOS base now includes 150 customers serving 45.7 million CPE devices. We continue to see expansion within our Tier 1 accounts alongside new customer wins, reinforcing our leadership position in the market. We added several new customers in the first quarter, including 2 recent wins that illustrate the market traction we are experiencing.
First, KBRO selected Harmonic's fiber on-demand solution to drive fiber deeper into its network in Taiwan. Second, Vyve Broadband selected our platform to modernize its network across its U.S. footprint with a clear path for broadband and for DOCSIS and fiber convergence. These wins reflect a broader market trend that plays directly to Harmonic's strengths.
Operators are increasingly seeking a platform that can start with a specific use case and expand over time across DOCSIS, fiber and autonomous network intelligence. Fiber is becoming an important growth driver for Harmonic. Over the past year, fiber products represented more than 14% of our appliance and integration revenue, and we expect this contribution to continue growing.
In the first quarter, we secured multiple new fiber wins, including with international providers while also expanding deployments with our largest Tier 1 fiber customers. We're also seeing traction with SeaStar, our MDU optical node, including a sizable Q1 booking with a leading European broadband operator.
At next week's Fiber Connect conference, we will introduce new outside plant innovations, including the Pearl-1XL and Jetty-3, designed to improve deployment efficiency, deliver industry-leading port density, extend network reach, enhance resilience and simplify operations. These solutions enhance our ability to serve rural MDU and lower density fiber opportunities where deployments, cost and operational complexity are critical factors.
Together, our growing fiber traction, expanding portfolio and converged cOS architecture position Harmonic to gain share as operators look for more flexible and cost-effective ways to expand fiber broadband. Our Unified DOCSIS 4.0 strategy also continues to gain commercial traction. During the first quarter, we expanded our DOCSIS 4.0 customer base with new wins while advancing deployments with existing customers.
At the same time, we have continued building a solid pipeline for additional opportunities. DOCSIS 4.0 is increasingly about more than extending the network to 1.8 gigahertz or delivering faster downstream speeds. We are seeing operators use DOCSIS 4.0 to increase upstream capacity while they continue densifying their network and optimizing existing infrastructure.
With upstream traffic growing rapidly, including approximately 20% annually at one of our leading North American operators, our unified DOCSIS 4.0 solution gives operators a flexible path to higher multi-gigabit upstream performance, whether through full 1.8 gigahertz upgrades, reclaiming spectrum from legacy QAM video, increasing node density or other capital-efficient approaches.
As I mentioned, operators are looking for platforms that let them use DOCSIS and fiber together. A recent Light Reading interview with Optimum provides a compelling illustration of this approach. In their West Virginia deployment built on Harmonic's cOS broadband platform, Optimum is leveraging virtualization to modernize HFC infrastructure and consolidate headend facilities by 50%.
As their team noted, the architecture enables them to simultaneously deliver XGS-PON and DOCSIS off of the same node, allowing them to build where demand dictates rather than overbuilding to every location. This is precisely the unique value of Harmonic's converged architecture, one platform, multiple access technologies and more capital-efficient choices for operators.
Operators are increasingly focused on business outcomes rather than speed alone, a shift that plays directly to Harmonic's strengths. Harmonic is uniquely positioned here because our virtualized platform sees the network in real time across the core, the edge and the subscriber experience. Our relatively new Beacon and Pathfinder solutions already help operators maximize network performance while reducing both truck rolls and customer calls.
Early deployments are showing tangible value, including a measured reduction of more than 30% in customer calls following Beacon enablement. The newest addition to our intelligent portfolio is Amply, a multi-vendor amplifier management software solution that extends our network visibility into a part of the network where we have not traditionally played.
Built on a unique combination of Harmonic cOS platform intelligence, Beacon Speed maximizer and orchestration capabilities, Amply helps operators identify and address sources of network interference faster and more effectively. Amply maps the Amplifier network uses AI-driven analysis to pinpoint where issues are coming from and helps direct field technicians with precise actionable instructions, including the location and likely cause of the problem.
It can also apply mitigation techniques to protect the subscriber experience while repairs are underway. We believe this can significantly reduce repair time and field operation costs, creating meaningful opportunity for measurable OpEx savings while improving network reliability and subscriber experience. We will be showcasing Amply at the upcoming ANGA show in Germany. Our customer momentum is increasingly tied to measurable outcomes.
One of our leading customers recently stated publicly that they are improving reliability across the network, are pleased with the results where upgrades have been completed and are seeing measurable progress in NPS. These outcomes are showing up in our customer scores. Our own customer NPS reached 85 in the first quarter, up from 82 at year-end 2025, reflecting the execution, partnership and trust we have built with operators undertaking strategic multiyear network transformations.
Turning to Slide 5. As presented during the last earnings call, the market opportunity ahead of us remains substantial. According to Dell'Oro's recent outlook, the cable serviceable addressable market is expected to grow to more than $1.1 billion by 2030. The fiber addressable exceeds $2.6 billion, and our share in that market is growing.
On top of this, network intelligence and associated autonomous AI-driven operations uniquely made possible through our virtualized core represent an incremental addressable opportunity and an important new growth vector for Harmonic. We believe longer-term industry investment in broadband technology will not be defined by one upgrade cycle.
Rather, we see ongoing reinforcing phases of modernization, DOCSIS 4.0 and upstream capacity expansion followed by network densification, AI-powered autonomous operations, targeted fiber expansion and broader migration to fiber as new demand and economics support it. The multiyear evolution will drive more capacity, automation and intelligence at every layer of the network and more opportunity for providers of the enabling technology.
Because Harmonic spans DOCSIS fiber and increasingly intelligent services, we believe we are best positioned to capture market share and create value across multiple investment phases and cycles. Turning to Slide 6. Our long-term strategy remains centered on 4 priorities. First, we are extending our leadership in DOCSIS while accelerating our global fiber position through our converged cOS architecture.
This allows operators to modernize with greater flexibility across DOCSIS fiber and future access upgrades. Second, we are increasing customer diversification. The strong rest of market growth we achieved in the first quarter demonstrates meaningful progress towards broadening our revenue base beyond our largest customers.
Third, we are leading with intelligence. Our cloud-native architecture and real-time telemetry give us a unique foundation for proactive operation, automated troubleshooting, improved customer outcomes and new recurring revenue opportunities. Fourth, we are driving operating leverage as we simplify our cost structure and become a pure-play broadband business.
Together, these priorities are designed to expand our addressable market, diversify our revenue mix and improve our long-term operating margin profile. This is where Harmonic's differentiation becomes clear. We help operators modernize faster with greater flexibility and lower operational complexity.
Turning to Slide 7. We are becoming a focused and well-rounded broadband company with leadership in virtualized DOCSIS, growing momentum in fiber and differentiated intelligence layer that helps operators improve reliability, automate operations and deliver better subscriber experiences. The pending sale of our video business will further sharpen our strategic focus, simplify our operating model and provide additional capital to support our growth strategy.
We will remain disciplined in capital allocation, investing organically, returning capital where appropriate and considering selective inorganic opportunities where they accelerate diversification or advance our platform. That concludes my opening remarks.
With that, I will turn the call over to Walter to walk you through our financials in more detail.
Thanks, Nimrod, and thank you all for joining us today. Before I discuss our quarterly results and outlook, I'd like to remind everyone the financial results I'll be referring to on this call are provided on a non-GAAP basis. As David mentioned earlier, our Q1 press release and earnings presentation include reconciliations of our non-GAAP to GAAP financial measures.
Both of these are available on our website. As previously announced, we are in the process of selling our video business to MediaKind. As a result, this segment has been classified as held for sale and reported as discontinued operations. Unless otherwise noted, all results discussed today relate to continuing operations.
The transaction is progressing as planned and remains on track to close in the second quarter of this year, subject to customary closing conditions. With that context, I'm pleased to report that we had a strong start to the year with Q1 revenue and earnings that exceeded the high end of our guidance range, including 43% year-over-year growth in broadband revenue and 78% growth in rest of market revenue.
In addition, we had solid quarterly bookings and ended with record backlog and deferred revenue. This gives us greater visibility and added confidence in our 2026 trajectory and combined with the Unified DOCSIS 4.0 ramps, large customer deployment plans and accelerating rest of market adoption will help drive strong broadband revenue growth throughout the course of this year.
Given our continued momentum, we are raising our full year broadband revenue guidance to $475 million to $495 million, up from our prior range of $440 million to $480 million. I'll provide a more detailed breakout of our guidance shortly.
Let's move on to Slide 9. Here are the financial highlights for the quarter. Continuing operations broadband revenue was $121.7 million, above our guidance range of $100 million to $105 million. EPS was $0.17, also above our guidance range of $0.11 to $0.12, and operating profit was $26 million, exceeding our guidance of $18 million to $20 million. These results include $2.3 million in stranded costs related to the pending video business sale.
The revenue upside was across multiple customers and accelerated service deployments. In Q1, 2 customers each accounted for more than 10% of revenue, together representing 58% of total revenue. As a reminder, this metric now reflects our broadband business only as we've reclassified video as discontinued operations.
Our Q1 rest of market revenue showed very strong year-over-year growth of 78%, representing 42% of total revenue, underscoring our progress in expanding our customer diversification. As a reminder, rest of market revenue describes all revenue that is not from our 2 largest customers as measured by subscriber count.
Turning to Slide 10. You can see our balance sheet and cash flow highlights. Our balance sheet remains strong with $109 million of cash and cash equivalents as of quarter end. The sequential change in cash was mainly related to share repurchases, partially offset by positive free cash flow generated in the quarter. During the quarter, we generated free cash flow of $30.3 million, while we repurchased $43 million in stock.
DSO at the end of Q1 was 62 compared to 79 in Q4 '25 and 63 in Q1 '25. The sequential decrease was due to strong collections and timing of sales in the quarter. We expect DSO to trend back to the mid- to high 70s going forward based on our customer mix. Inventory increased $3.4 million in the quarter, and our days inventory on hand fell to 80 days from 83 days last quarter.
Our overall book-to-bill was 1.0 in Q1 with rest of market meaningfully above 1. At the end of Q1, broadband backlog and deferred revenue reached a record $582.1 million, up 87% year-over-year. Of that, 60% is expected to convert to revenue within the next 12 months. This provides us with increased visibility for the remainder of 2026.
As shown on Slide 11, we believe we have ample liquidity to support our capital allocation priorities with $109 million in cash and $82 million undrawn credit facility and expected net proceeds from the planned video sale an all-cash transaction valued at approximately $145 million before adjustments, taxes and fees.
Additionally, we continue to anticipate a meaningful reduction in our cash income taxes in 2026 due to the passage of the BBBA as well as the impact of Section 174 R&D adjustments. All of this should substantially enhance our capital allocation flexibility.
Even as we transform to a pure-play broadband company, our capital priorities remain unchanged: invest in organic growth and diversification, return capital to our shareholders and pursue strategic M&A to further enhance growth and diversification in our broadband business. Aligned with our first key priority, we expect to increase our inventory over the next several quarters to support our anticipated growth, including advancing memory purchases to secure supply for the remainder of the year.
We are also investing in additional organic broadband opportunities in both our services business and fiber portfolio, as Nimrod mentioned in his prepared remarks. Under our current $200 million share repurchase program, to date, we have already repurchased $122 million of our outstanding shares, including $43 million in Q1 2026.
As we stated previously, we expect to fund ongoing repurchases through strong free cash flow generation over the next several years with a minimum goal of purchasing enough shares each year to offset any dilution from equity compensation awards. In addition, the expected substantial cash infusion from the sale of Video will also position us well to explore additional opportunities, including inorganic options to further diversify and grow our broadband business.
Turning to guidance on Slide 12. We provide our continuing operations non-GAAP financial guidance for Q2 and full year 2026, reflecting our raised full year '26 outlook. As a reminder, beginning last quarter, the company began providing guidance on an adjusted operating profit before tax basis rather than on an adjusted EBITDA basis.
We continue to take a prudent and measured approach on both revenue and margins, considering factors such as current memory chip and other component pricing and supply dynamics and the situation in the Middle East. Built into our full year margin guidance is the current market pricing expected for memory.
Now let me walk you through the guidance. For Q2 2026, we expect Broadband to deliver revenue between $115 million and $125 million, gross margins between 52% and 53% due to product mix, operating profit between $23 million and $28 million and EPS of between $0.15 and $0.19. As our guidance shows, we expect strong year-over-year broadband revenue growth in Q2 2026 and a better-than-expected first half of '26.
Our broadband gross margin guidance includes an estimated tariff impact of less than $1 million based on the currently announced tariff rates and exemptions. Operating profit includes stranded costs of approximately $2.3 million. For the full year 2026, we expect Broadband to generate revenue between $475 million and $495 million, up $25 million or 5.4% from the midpoint of our prior guidance.
Gross margins between 50% and 51.5%, declining from Q1 levels due to elevated memory costs and new product ramps, operating profit between $87 million and $101 million and EPS between $0.57 and $0.67, up roughly $0.07 or 13.8% from the midpoint of our prior guidance. This full year broadband gross margin guidance includes an estimated tariff impact of approximately $2.3 million, while operating profit includes stranded costs of approximately $10 million.
As mentioned last quarter, we continue to believe roughly 30% of these stranded costs are temporary and will be removed within 1 year following the closing of the Video sale. Our non-GAAP tax rate for full year '26 remains at 24.5% and reflects the higher expected U.S. mix of business in our continuing operations. In summary, in the first quarter, we delivered results that significantly exceeded our expectations with broadband revenue growing 43% year-over-year, driven by outstanding rest of market adoption.
Our record broadband backlog and deferred revenue provide us with increased visibility, enabling us to raise our guidance for the year. As expected, we are now seeing tailwinds from both our rest of market customers as they ramp and our top 2 customers positioning us for strong growth this year. We're also excited about the pending sale of our video business. This transformational transaction will streamline our operations, strengthen our balance sheet and allow us to focus entirely on our fast-growing broadband business.
As a more focused organization, we'll be well positioned to accelerate our growth and diversification across broadband, both in DOCSIS and fiber-to-the-home, capitalizing on the growing TAM in these markets. Thank you for your attention.
And now I'll turn it back to Nimrod for closing remarks before we open up the call for questions.
Thanks, Walter. In closing, the first quarter was a strong start to the year. Our results clearly validate the success of our strategy and execution. Our broadband business is growing. Our customer base is diversified and our platform is becoming increasingly attractive to operators as they modernize their networks.
As we complete the sale of our video business and becoming a pure-play broadband company, we entered the rest of 2026 with strong momentum, growing visibility and confidence in our long-term trajectory.
That concludes our prepared remarks. Walter and I are now happy to take your questions.
[Operator Instructions] And the first question that we have today is coming from the line of Ryan Koontz of Needham & Company.
2. Question Answer
Congrats on the great results and have a particular question around rest of market. I mean I think we all understand kind of the trajectory of your 2 large programs, but it really sounds like you're -- you've seen some unlocking there of the rest of market.
And maybe can you maybe step back and think about what do you think are the triggers that start to unlock that for you this year for rest of market? Is it purely just DOCSIS 4? Or are there kind of other elements here, maybe even beyond what Harmonic provides that have been helpful to get this market moving?
Yes. So it's obviously DOCSIS 4 fiber and any DOCSIS migration to a virtualized platform. We have started to win more, I would say, in the last 18 months.
And -- it takes time to fully integrate and start ramping, and we clearly see that in the revenue right now. We announced a couple of wins last year and prior to that, and you start seeing that showing up in the revenue. So I think it's across the board, and it's really a result of wins that we've seen previously.
Yes, it's exciting, Nimrod. And maybe one for Walter here. On the supply chain side, I hear you on memory. Can you quantify what that memory impact is? It sounds like your second half margins will come down a bit.
I assume that's on mix, other things like software sales as well that might weigh on that. And then with regards to other supply issues, are you more concerned about getting supply of kind of high-end TSMC built silicon than you were a few months ago? Or do you feel pretty comfortable there, Walter?
Ryan, so a few things with regards to, first of all, the margin profile, and then I'll talk about the supply chain specifically. So correct, in terms of second half impact, similar to what we said in the prior earnings call, we see about a net impact of about $6 million related to memory. So that's the net impact that is impacting the second half.
The other factor on more of the second half is with regards to product ramps. We're going through a number of product ramps -- and as typical with any new products being introduced, there is a period of time before you get up to your targeted margins with regards to those specific products. So that explains the bridge in terms of the margin profile as we enter into the second half.
In terms of other commodities from a supply chain perspective, I think you've probably heard from others also in the market, CPUs, PCBs, aluminum, they are all things that are coming up on the radar. And that's why we're being prudent with regards to our guidance as we look through the supply chain. Right now, from a memory standpoint, we have most of the memory we need to fulfill the guidance that we've provided today.
With regards to other products, you probably heard with regards to switches and servers, which we sell as part of the cOS solution to rest of market customers that purchase those third-party products. Some of those are in more of a constrained mode and create some caution in regards to availability of those products.
Those are not material to us, but nonetheless, we do sell those through to our rest of market customers. And then the final point with regards to key silicon for us, we continue and have pipelined aggressively our key silicon and therefore, that is not a concern at this point.
Our next question will be coming from the line of Simon Neopold of Raymond James.
Just maybe a quick clarification, if we could. Could you give us the detailed contribution of the top 2 customers, the percent for each of those? And then I've got a follow-up.
Yes. So with regards to the top 2, our 58% in our Q will provide the breakout. They both contributed very meaningful in the quarter.
Okay. And if we look at the guidance here, we obviously know Q1, we have the guidance for Q2. this implies roughly no sequential growth in the remaining quarters. So roughly $122 million per quarter, if we consider what you just delivered, what you're suggesting for June.
Now obviously, there could be variation. But essentially, there's no seasonality. And I'm trying to figure out whether to think of this as a year with some pull forward or whether to think of it as conservatism. So if you could help us in terms of understanding the messaging when the outlook looks like it's essentially calling for flat through the year.
Yes. Certainly, Simon. So first of all, as I mentioned in the prepared remarks, we are being prudent, conservative in terms of the full year view of the business. Obviously, there's a lot going on out there in the macroeconomic environment.
You've got the situation in the Middle East, but you also have constraints that have appeared with regards to the AI supply chain that has impacts across broader organizations, including ourselves.
So a lot has happened over the last 90 days. I presume a lot will happen over the next 90 days. So we're being careful about making sure that our supply is tied up with -- to the revenue that, in fact, we're committing.
This has nothing to do with customer demand. our customer demand, as you heard today in terms of our Q1 and what we're expecting for the year continues to be very strong. The momentum in rest of market in terms of deployments is all going better than expected when we were here 90 days ago.
Walter, you want to address the pooling, Q1, Q2?
Q1, Q2, I mean, in terms of the profiling of the business, I'd say that Q1 was strong. We had a number -- across a number of customers, orders that had dropped in for the quarter as well on one particular deployment, the deployment was just going faster than anticipated. And therefore, you're getting this kind of profiling where Q2 in terms of our guidance is sequentially flat. But if you look at it year-over-year, it's still very strong growth to the profile.
And our next question will be coming from the line of Steven Frankel of Rosenblatt Securities.
Let me follow up on that last question and try to get a little more. So this unlocking of customers, is that coming also with kind of a faster ramp than you had been discussing with them further? Or do we just kind of got everybody off the starting line now and those ramps will vary in how they play out over the next 12 to 18 months?
So first of all, it varies by customer subject to their ecosystem. It's going according to the plan. It's simply that we're seeing that right now. So there is no change or no acceleration relative to what we thought previously.
Okay. And where should we think of fiber as a percentage of your business kind of exiting this year?
We're not going to guide specifically on the fiber piece. We provided the metric today to provide some color in terms of fiber over the trailing 4 quarters in terms of how much of that consists of our business, the 14% metric we provided.
I mean, as Nimrod mentioned, we continue to build on more customer momentum as we increase our wins in that particular area, and we expect it to continue to grow as a revenue dollar amount. It just all depends on the mix in any given quarter. So it will move and ebb and flow depending on each quarter.
So we expect that to grow. The other thing that we stated in the past is that one of the complexities here is how to count what is fiber versus not as our converged platform has a lot of shared elements.
What we talk about here is the direct fiber element. So it does not include elements that are shared across the 2 like the nodes or even the compute that we put at the edge of the network. But in any case, we expect that to continue growing.
Okay. And going back to the earlier comment about server availability, kind of what percent of your business is tied to customers that typically have that kind of pass-through revenue?
It's only in the rest of market environment. And out of that part, what would you say, Nimrod, like maybe half of them are buying through us.
Yes. Yes.
Our next question is coming from the line of George Notter of Wolfe Research.
Just on the previous question, I think you said half of customers buy from you. Do you have a sense for how much revenue that would contribute? Is this 5%, 10% of revenue? What are we talking about? Just out of curiosity.
George, it's not material. So that would be much, much less than 10%, probably less than 5%.
By the way, George, I think the challenge on the one hand, you can look at margin, but availability is also a key factor. If customers do not get their servers, then deployment gets delayed. So it's crazy what's going on out there, but we work closely with our customers to make sure that we can help them if this is something that we provide or we follow carefully their supply situation, but it's clearly a critical element for a deployment.
Got it. Okay. Makes a lot of sense. And then just shifting gears a bit. Obviously, the video business is going to close soon. You talked about the potential to do M&A. And could you just go back through like what sorts of opportunities you're looking for? What makes sense for Harmonic?
It's kind of interesting because one of your competitors, Vecima also is narrowing down their business. They've also made similar comments. I guess maybe there's a broader question here and just how do you see the consolidation of the space? Do you see it consolidating? What's the bigger thought?
I think we talked about that previously. Our priorities are to go through whatever will help our diversification, growth in fiber and the whole space of what we call intelligence. We feel fairly good in our market position in cable and DOCSIS.
But I think beyond that, it's really looking into specific opportunities that will also have high level of synergy with who we are and what we do. It's not just about bundling products or companies. It's really about creating something that will add value to our customers and to the platform that we bring to the market.
[Operator Instructions] And the next question will be coming from the line of Tim Savageaux of Northland Capital Markets.
Congrats on the results. I guess the first question, you noted the very strong growth in rest of market in Q1. And I guess my first question would be, as you look at your revised guidance, what sort of rest of market growth is implied in there relative to what I think is your kind of 30% plus baseline? And I'll follow up.
Yes. Tim, it's Walter. So what I would say without -- we're not going to guide necessarily each category of customer. We're off to a strong start in Q1 for rest of market. What we communicated last time was that we look at that 30% as kind of a multiyear target for us.
And obviously, we've got wind to our back based on where we are today. So I think some of the guide up is related to that, but I'm not going to specify with a specific growth range for rest of market on its own.
Okay. Fair enough. And then Nimrod, I think somewhere along the line, you talked about a global customer base. However, your business is pretty U.S.-centric or America-centric, I guess, at this point. I wonder what sort of opportunities you have there to grow internationally.
I imagine your footprint of wins, and I don't know where the global cable number stands right now. But I imagine your footprint of wins is not 87% U.S. in terms of subscriber count, but maybe it is. So any comment there would be welcome. And just the overall question about growing outside the Americas and what sort of opportunity. Where could you take that number?
Yes. The -- one of the new customers we announced this quarter, KBRO is in Taiwan. So even in Asia, we've got some pockets where we think what we provide is attractive. we had a couple of wins on fiber and DOCSIS in Europe. We try to get the most of what we can get outside of the U.S. as well as in Latin America.
Clearly, the cable is fairly big in North America, and that will remain a big area of focus for us, the top 2 customers and the longer tail of other customers as we go through the multiple cycles and stages of upgrading these networks with 4.0 and later on going into densifying these networks, overlaying our intelligence services and going through the fiber optionality, the fiber on-demand, which is also kind of an area where we see a lot of traction.
So we try to get fair share of what we can see outside of the North America, but North America will certainly stay a big part of our revenue.
Thank you. That concludes today's Q&A session. I would like to go ahead and turn the call over to Nimrod for closing remarks. Please go ahead.
We appreciate your continued interest in Harmonic and look forward to updating you on our progress in the future. Thank you all for joining the call. Have a good day.
This concludes today's program, and thank you so much for joining. You may now disconnect.
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Harmonic Inc. — Q1 2026 Earnings Call
Harmonic Inc. — Q1 2026 Earnings Call
Starkes Q1: Broadband-Umsatz steigt +43% YoY, Guidance für 2026 erhöht; Video-Verkauf in Q2 erwartet.
📊 Quartal auf einen Blick
- Umsatz (Broadband): $121,7M (+43% YoY; über Guidance $100–105M).
- Backlog: $582,1M (+87% YoY); ~60% erwartete Konversion innerhalb 12 Monaten.
- Ergebnis: EPS $0,17 (non‑GAAP; Beat vs. $0,11–0,12 Guidance); Operatives Ergebnis $26M.
- Liquidität: $109M Cash; Free Cash Flow $30,3M; Q1-Share‑Buybacks $43M (4,2M Aktien; bisher $122M von $200M Programm).
- Rest‑of‑Market: 42% des Umsatzes; Rest‑of‑Market‑Wachstum +78% YoY.
🎯 Was das Management sagt
- Fokus: Harmonic wird zu einem reinen Breitband‑Anbieter (Verkauf Video an MediaKind), Kapital soll Wachstum und Diversifikation stützen.
- Plattformstrategie: Konvergente cOS‑Plattform (konvergente Softwareplattform für DOCSIS und Fiber) plus Unified DOCSIS 4.0 treiben Marktanteilsgewinn und Cross‑Sell.
- Intelligenzlayer: Beacon, Pathfinder, Amply (AI‑gestützte Netz‑Tools) liefern messbare Opex‑Vorteile (z.B. -30% Kundenanrufe) und verbessern NPS (Q1 NPS 85).
🔭 Ausblick & Guidance
- FY2026 (Broadband): $475–495M, erhöht von $440–480M; EPS $0,57–0,67; Operatives Ergebnis $87–101M.
- Q2 2026: Revenue $115–125M; Bruttomarge 52–53%; Operatives Ergebnis $23–28M; EPS $0,15–0,19.
- Risiken & Annahmen: Erhöhter Memory‑Aufwand (netto ~ $6M Einfluss H2), Tarife ~ $2,3M JAHR, stranded costs ~ $10M FY (Q1: $2,3M); Video‑Verkauf erwartete Bruttoerlöse ~$145M, Closing in Q2 geplant.
❓ Fragen der Analysten
- Rest‑of‑Market‑Treiber: Management sieht Unlock durch DOCSIS 4.0, Virtualisierung und vorherige Vertragsgewinne; Ramp‑Tempo variiert nach Kunde.
- Lieferkette: Memory als größter Einfluss (netto ~$6M H2), Server/Switch‑Verfügbarkeit erwähnt, aber Beitrag <5% und kein kritischer Engpass.
- Konzentrations‑/Profilierungseffekt: Top‑2 Kunden machten 58% des Q1‑Umsatzes; Guidance bewusst konservativ, um Supply‑Risiken und geopolitische Unsicherheiten zu adressieren.
⚡ Bottom Line
- Implikation: Operative Dynamik und Rekord‑Backlog stärken die mittelfristige Wachstumsstory; erhöhte Guidance und Video‑Verkauf erhöhen strategische Klarheit und Kapitalspielraum.
- Risiken: Kurzfristige Margenbelastung durch Memory, Lieferketten‑Unwägbarkeiten und Umsatzkonzentration bleiben relevante Beobachtungspunkte für Aktionäre.
Harmonic Inc. — Q4 2025 Earnings Call
1. Management Discussion
Welcome to the Fourth Quarter and Full Year 2025 Harmonic Earnings Conference Call. My name is Michelle, and I'll be your operator for today's call. [Operator Instructions] Please note that this conference is being recorded.
I will now turn the call over to David Hanover, Investor Relations. David, you may begin.
Thank you, operator. Hello, everyone, and thank you for joining us today for Harmonic's Fourth Quarter and Full Year 2025 Financial Results Conference Call. With me today are Nimrod Ben-Natan, President and CEO; and Walter Jankovic, Chief Financial Officer. Before we begin, I'd like to point out that in addition to the audio portion of the webcast, we've also provided slides for this webcast, which you may view by going to our webcast on our Investor Relations website.
Now turning to Slide 2. During this call, we will provide projections and other forward-looking statements regarding future events or future financial performance of the company. Such statements are only current expectations and actual events or results may differ materially. We refer you to documents Harmonic files with the SEC, including our most recent 10-Q and 10-K reports in the forward-looking statements section of today's preliminary results press release. These documents identify important risk factors, which can cause actual results to differ materially from those contained in our projections or forward-looking statements.
And please note that unless otherwise indicated, the financial metrics we provide you on this call are determined on a non-GAAP basis. These metrics, together with corresponding GAAP numbers and a reconciliation to GAAP are contained in today's press release, which we have posted on our website and filed with the SEC on Form 8-K. We will also discuss historical financial and other statistical information regarding our business and operation, and some of this information is included in the press release. The remainder of the information will be available on a recorded version of this call or on our website.
And now I'll turn the call over to our CEO, Nimrod Ben-Natan. Nimrod?
Thanks, David, and welcome, everyone, to our fourth quarter and full year 2025 earnings call. We delivered a strong fourth quarter, reflecting accelerating momentum across our broadband business. This is our first earnings call following the announcement of the pending sale of our Video business to MediaKind. This is a decisive step that will push our growth strategy forward and transform us into what I call the new Harmonic, a pure-play broadband leader. This transaction will simplify our operating model and align all of our resources to unlock growth opportunities in the expanding broadband infrastructure market. With the Video sale expected to close in the second quarter of 2026, all financial and operating results I discuss today reflect our continuing operations, meaning our core broadband business.
Turning to Slide 4. Broadband revenue for the quarter was $98.2 million, representing 9% sequential growth and coming in above the high end of guidance. In addition, we delivered record quarterly bookings of $346.9 million, driving a 3.5 book-to-bill ratio. These bookings were fueled by several multiyear contracts, reinforcing both revenue resiliency and long-term customer commitment to our platform, alongside record diversified rest-of-world bookings that will support growth in 2026 and beyond. All of this drove backlog and deferred revenue to $573.8 million at year-end, up 73% year-over-year. The current portion of this alone was $307 million, more than double last year's level, giving us strong visibility and confidence as we enter 2026.
In addition to our core Broadband business, our Video business, now classified as discontinued operations, exceeded our expectations in the fourth quarter, both in terms of revenue and profitability. The planned sale of this business to MediaKind for approximately $145 million in cash remains on track. In addition to the strategic benefits, this transaction further enhances our balance sheet and supports a disciplined capital allocation framework focused on investing in growth, maintaining financial flexibility and building long-term shareholder value.
A defining theme of 2025 and one that accelerated meaningfully in the fourth quarter is the diversification and expansion of our customer base beyond our 2 largest North American accounts. Rest-of-World revenue, which excludes revenue from these 2 large customers grew 33% year-over-year in the fourth quarter. This now represents 41% of total broadband revenue, a meaningful shift in our revenue mix, underscoring the continuing momentum of our diversification initiatives. We delivered record Rest-of-World bookings in the fourth quarter, reflecting growing adoption of our platform globally and increasing confidence from operators investing in multiyear network modernization.
For example, together with Norman Engineering, our longest-standing partner in Europe, we recently marked 20 successful DOCSIS and fiber deployments across the region, including with operators in Austria and Germany. We also announced that Telia, the second largest telecom operator in Norway, is modernizing its broadband network using our virtualized cOS platform in a distributed access architecture.
What is very important here is that we are not just seeing one-off wins. Rather, these recent deployments are the result of expanding platform relationships. Customers typically start with an initial deployment such as DOCSIS. And as they standardize on our platform and services, they grow their footprint and expand across our portfolio, adding fiber and our intelligence-driven cloud capabilities.
Our fiber business continues to scale rapidly and is an increasingly important growth driver with strong revenue growth in the fourth quarter and for the full year. We are seeing growing fiber wins with both telco and cable operators in North America and internationally. A major highlight is our expanding collaboration with izzi, the largest MSO in Mexico. izzi has selected our COS platform and remote OLT solutions to power a strategic fiber broadband expansion across its network. This multiyear deployment leverages our open ONT strategy, lowering izzi's total cost of ownership while accelerating their fiber rollouts. It is a strong example of how our platform simplifies large-scale fiber transitions.
Enabling our fiber market momentum are several new fiber product innovations. We recently introduced a new pluggable combo OLT option, which is particularly attractive for operators executing surgical footprint expansions and serving rural markets in a highly cost-effective way. What is particularly compelling and a key differentiator for Harmonic is how fiber and DOCSIS converge within our cloud-native architecture, allowing operators to efficiently manage both technologies through a unified platform, simplifying operations and lowering total cost of ownership across their entire access networks.
Our Unified DOCSIS 4.0 strategy continues to gain traction as the ecosystem matures and operators' confidence builds. Major operators are advancing DOCSIS 4.0 road maps and reporting tangible operating benefits from network upgrades, including fewer service calls and faster repair times. We successfully completed a DOCSIS 4.0 field validation with Vodafone Germany, further reinforcing the maturity of the technology and our leadership in this space. Unified DOCSIS 4.0 node shipments are now ramping with initial deliveries this quarter. We are transitioning from field trials and early deployments to scale commercial deployments, marking an important inflection point for this cycle.
Looking ahead, operators are increasingly seeking platforms that help them anticipate issues, optimize performance and reduce operational friction, ultimately lowering operating expenses and improving competitiveness. This creates an extraordinary opportunity for Harmonic to leverage the unique data available through our virtualized cloud platform and provide innovative new intelligence-driven operational solutions.
Following the successful introduction of Beacon and Pathfinder, which help customers maximize the speed performance of their networks while minimizing truck rolls, we have introduced new subscriber experience detection capabilities that can identify and mitigate network issues before they generate support calls, directly helping operators reduce churn and lower operating costs. Over time, we expect continued development of this intelligence layer to increase recurring revenue, deepen customer integration, improve margins and expand our addressable market into AI-enabled operations beyond access infrastructure.
Turning to Slide 5. Network investment is no longer just about speed. It is about measurable business outcomes. A large North American operator recently highlighted significant reductions in service costs and faster mean time to repair in areas where next-generation DOCSIS 4.0 technology has been deployed. These improvements translate directly into lower operating costs and higher subscriber satisfaction. When operators invest in network quality, the returns show up in reduced churn, stronger loyalty and improved competitive position. Our own commitment to customer success is reflected in our world-class Net Promoter Score of 82 as measured at the end of 2025, underscoring the trust operators place in our platform and our team. Customer success is the foundation of our growth model.
Moving to Slide 6. Harmonic wins because we enable operators to scale bandwidth faster, more cost effectively and with improved subscriber satisfaction. Our differentiation is built on technology leadership, speed of execution, improving customer network reliability and solutions that drive lower total cost of ownership. We now have 146 COS deployments in production, serving more than 41 million cable modems and ONUs worldwide. At this scale, the gap between Harmonic and the rest of the market is no longer incremental. It is structural. Our platform brings a decade of production maturity, proven operational consistency and unmatched scale in virtualized broadband and a wealth of real-time network data that is now beginning to be exploited. This is why leading cable and now telco operators are standardizing on Harmonic as they modernize their networks and why we believe there are so many compelling growth opportunities still in front of us.
Moving to Slide 7. The broadband market opportunity ahead of us is substantial. According to Dell'Oro, the cable serviceable addressable market is expected to grow from approximately $510 million in 2025 to over $1.1 billion by 2030. What's driving this is that across the industry, broadband operators are accelerating network modernization as data consumption continues to rise at a rapid pace. AI-powered applications, immersive content experiences and multi-gigabit services are driving sustained bandwidth growth and placing increasing performance demands on broadband networks. This investment cycle is not driven by speed alone. Operators are increasingly focused on quality of experience, churn reduction and operating efficiency.
Network capability has become a direct driver of customer satisfaction, application adoption and long-term competitiveness. Our share positions remain strong in virtual CMTS, RPDs and remote OLTs with meaningful room to expand. In fiber, the addressable market exceeds $2.6 billion and represents a significant opportunity where our share is growing. Importantly, these market figures exclude the AI operation and tools market, which represents an additional growth vector we have begun to actively target.
Turning to Slide 8. Our long-term strategy centers on 4 priorities: first, expanding our market leadership in DOCSIS through continued innovation in COS, remote devices, outdoor nodes and recurring services while accelerating our fiber position with both cable and telco operators globally. Our objective is not simply participation, but category leadership across access architectures, driven by continued investment in innovation and differentiated capabilities.
Second, increasing customer diversification. We are targeting sustained Rest-of-World growth of 30% or more annually, expanding beyond our largest North American customers and building a broader, more balanced global revenue base. Third, driving software and cloud differentiation. Our cloud-native architecture and intelligent automation capabilities create opportunities to expand recurring revenue, deepen platform integration and build long-term customer relationships. And fourth, maintaining operational and cost discipline. As a pure-play broadband company, we are simplifying our cost structure and positioning the business to generate meaningful operating leverage as revenue scales. Together, these priorities are designed to expand our addressable market, increase revenue durability and improve our long-term margin profile.
Moving to Slide 9. As we enter 2026, Harmonic is well positioned as a focused pure-play broadband innovator, providing market-leading DOCSIS and fiber-to-the-home solutions augmented by an intelligence-driven software layer for automation and subscriber experience to operators worldwide. With the sale of our Video business, we are transitioning to a company fully dedicated to the growing broadband market. This sharpens our strategic focus, simplifies our operating model to a single go-to-market motion and product road map and improves our ability to generate long-term operating leverage as we scale.
The transaction also provides us with a significant capital infusion with a stronger balance sheet and incremental cash. We are positioned to invest in organic innovation, expand into adjacent broadband opportunities and pursue disciplined inorganic expansion where it accelerates diversification and market leadership. We believe this combination, leadership in DOCSIS, expanding presence in fiber and a growing intelligence-driven software capability positions Harmonic for accelerated growth and improved long-term operating margins.
With that, I will turn the call over to Walter to walk through our financials in more detail.
Thanks, Nimrod, and thank you all for joining us today. Before I discuss our quarterly results and outlook, I'd like to remind everyone that financial results I'll be referring to on this call are provided on a non-GAAP basis. As David mentioned earlier, our Q4 press release and earnings presentation include reconciliations of our non-GAAP to GAAP financial measures. Both of these are available on our website. As previously announced, we are in the process of selling our Video business to MediaKind. As a result, this segment is classified as held for sale and reported as discontinued operations.
Unless otherwise noted, all results discussed today relate to continuing operations. We've also provided historical information for continuing operations to support your financial modeling and prior period comparisons. The transaction remains on track to close in the second quarter of this year, subject to customary conditions, including the completion of the required consultation with the French Employee Works Council.
We closed the year with exceptionally strong quarterly broadband bookings, driving a 3.5 book-to-bill ratio for the quarter and a significant year-over-year increase in backlog. This robust backlog enhances our visibility for 2026 and combined with Unified DOCSIS 4.0 ramps, large customer deployment plans and accelerating rest of world adoption will help drive strong broadband revenue growth throughout the course of this year.
On Slide 11, you'll find some of the financial highlights for the quarter. For total company results, including Video discontinued operations, revenue was $157.3 million, EPS was $0.14 and adjusted EBITDA was $23.8 million, all well above our Q4 guidance. For continuing operations, fourth quarter broadband revenue was $98.2 million, above our $85 million to $95 million guidance range with adjusted EBITDA of $12.1 million and EPS of $0.06. These results include $3 million in stranded costs related to the pending Video business sale. The revenue upside reflected strong bookings and service deployments in the quarter.
For the fourth quarter, we had one customer representing greater than 10% of total revenue, which accounted for 53% of total revenue. To remind everyone, this metric is now based on continuing operations, which is only our Broadband business. Our Q4 Rest-of-World revenue showed strong year-over-year growth of 33%, representing 41% of total revenue, underscoring our customer diversification progress. As a reminder, Rest-of-World revenue describes all revenue that is not from our largest 2 customers as measured by subscriber count. Starting with next quarter's results, we will refer to Rest-of-World as Rest-of-Market as this name more accurately reflects the grouping of these customers, which can be in any region, including the U.S. Recurring revenue reflected in the services and SaaS revenue line item made up 16% of our total continuing operations or broadband revenue.
Moving on to Slide 12. You'll find our fiscal year 2025 actual results. For the total company, net revenue was $570.8 million with a gross margin of 55.8%, adjusted EBITDA of $83.8 million and EPS of $0.47. Continuing operations generated $360.5 million in revenue, a 48.7% gross margin, adjusted EBITDA of $47.3 million and EPS of $0.23. These results include a $2.3 million tariff impact and approximately $9 million of stranded costs related to the pending Video sale.
Turning to Slide 13. You can see our balance sheet and cash flow highlights for continuing operations. Our balance sheet remains strong with $124.1 million of cash and cash equivalents at year-end. The sequential change in cash was mainly attributed to positive free cash flow in the quarter, offset by share repurchases. Free cash flow during the fourth quarter was $9.6 million. For the full year, we increased cash by $22.6 million while also repurchasing $79 million in stock during the year.
We generated $97 million in free cash flow, which was an increase of $44 million from the prior year, demonstrating strong profitability and cash generation even amid a broadband industry transition to DOCSIS 4.0. Furthermore, given our expectations for progressive and significant full year broadband revenue growth in 2026, we are confident in our ability to expand profit margins and generate free cash flow considering the high operating leverage we have already shown in broadband.
DSO at the end of Q4 was 79 compared to 61 in Q3 '25 and 76 in Q4 '24. The sequential increase was due to a large number of shipments that took place earlier in the third quarter. We expect DSO to trend in the high 70s going forward based on our customer mix. Inventory decreased $1 million in the quarter, and our days inventory on hand fell to 83 days from 91 days last quarter. Q4 bookings reached a record $346.9 million, nearly matching all of total broadband revenue for full year 2025, resulting in a 3.5 book-to-bill ratio. At the end of Q4, total backlog and deferred revenue was $573.8 million, up 73% year-over-year. Of that, $307 million or 53.5% is expected to convert to revenue within the next 12 months, an increase of 110% year-over-year. This provides us excellent visibility for 2026 growth.
As shown on Slide 14, we believe we have ample liquidity to support our capital allocation priorities with $124 million in cash and $82 million undrawn credit facility and expected net proceeds from the planned Video sale. Additionally, we continue to anticipate a meaningful reduction in our cash income taxes in 2026 due to the passage of the One Big Beautiful Bill Act as well as the impact of Section 174 R&D adjustments. All of this should substantially enhance our capital allocation flexibility.
Even as we transform to a pure-play broadband company, our capital priorities remain unchanged: investing in organic growth and diversification, returning capital to our shareholders and pursuing strategic M&A to further enhance growth and diversification in our broadband business. Aligned with our first key priority, we expect to increase our inventory over the next several quarters to support our anticipated growth, including advancing memory purchases to secure supply. We also expect to invest in additional organic broadband opportunities in both our services business and fiber portfolio.
Under our expanded $200 million share repurchase program, to date, we have already repurchased $101 million of our common shares, including $13.3 million in Q4 2025 and an additional $21.8 million post year-end. As we stated previously, we expect to fund ongoing repurchases through the strong free cash flow generation over the next several years. In addition, we expect to realize a substantial cash infusion from the sale of Video. This will also position us well to explore additional opportunities, including inorganic options to further diversify and grow our broadband business.
Now I would like to briefly discuss stranded costs on Slide 15. These are shared corporate and infrastructure expenses previously allocated across both Broadband and Video that will now reside in continuing operations. We anticipate approximately $10 million in stranded costs for 2026, including $3 million in public company costs. We believe roughly 30% of these are temporary costs and will be removed within 1 year following the closing of the Video sale.
Turning to guidance on Slide 16. We lay out our continuing operations non-GAAP financial guidance for Q1 2026 and full year 2026, and we have included an FY 2026 EPS bridge to assist in comparing our continuing operations results to the previous combined Broadband and Video results. Please note, beginning this period, the company will provide guidance on adjusted operating profit before tax basis rather than on an adjusted EBITDA basis. This change reflects our view that operating profit is the more commonly used profitability measure in this industry and provides a more complete and transparent view of our underlying operating performance. Given the company's limited capital expenditures and low depreciation and amortization, the difference between the 2 metrics is minimal.
With our 2026 guidance, we're taking a prudent and measured approach on both revenue and margins, considering factors such as the current memory chip pricing and supply dynamics. Built into our full year margin guidance is the current market pricing expected for memory. Now let me walk you through the guidance. For Q1 2026, we expect broadband to deliver revenue between $100 million to $105 million, gross margins between 54% to 55% due to favorable product mix, operating profit between $18 million to $20 million and EPS of $0.11 to $0.12.
As our guidance shows, we expect modest sequential broadband revenue growth in Q1 2026 versus Q4 2025, with momentum building considerably as we move throughout 2026. Our Broadband gross margin guidance includes an estimated tariff impact of less than $1 million based on the currently announced tariff rates and exemptions. Operating profit includes stranded costs of approximately $2 million.
For the full year 2026, we expect broadband to generate revenue between $440 million to $480 million, gross margins between 51% to 53%, declining from the Q1 levels due to product mix and surging memory costs as they flow into shipments after the Q1 time frame, operating profit between $74 million to $99 million and EPS of $0.46 to $0.63. This full year Broadband gross margin guidance includes an estimated tariff impact of approximately $4 million, while operating profit includes stranded costs of approximately $10 million.
Our non-GAAP tax rate in Q1 and full year 2026 is now 24.5% and reflects the higher expected U.S. mix of business in our continuing operations. Regarding the previously mentioned EPS bridge, Video, which, as a reminder, is now classified as discontinued operations, contributed $0.24 in EPS in 2025. Also, in 2026, continuing operations includes $10 million of stranded costs and EPS impact of $0.07. These items provide a bridge to prior total company EPS results and expectations.
On Slide 17, we provide some historical context to our continuing operations and our full year 2026 guidance. Revenues are forecasted to grow quite strongly in 2026 between 22% and 33% due to the extremely strong bookings we saw in Q4, combined with Unified DOCSIS 4.0 ramps, large customer deployment plans and Rest-of-Market adoption. 2026 gross margin is projected to increase several hundred basis points due to cOS mix, offset partially by expected higher memory costs.
Operating expenses increased primarily due to expanded portfolio investments and the impact of foreign exchange. Again, you can see here our record backlog and deferred revenue level as compared to prior years, which positions us well for growth in 2026 and beyond. We ended the year with strong performance in Broadband and Video, exceeding our expectations. Record Broadband bookings provide excellent visibility for the coming year and revenue resiliency over the long term.
As we finish 2025, we are now seeing DOCSIS 4.0 transitions evolve from headwinds to tailwinds, positioning us for accelerated growth as deployments ramp. The Video sale will streamline our operations, strengthen our balance sheet and allow us to focus entirely on our fast-growing broadband business. This will position us well for accelerating our growth and diversification across broadband, both in DOCSIS and fiber-to-the-home to take full advantage of the growing available market.
With broadband, with robust demand, strong cash generation and expanding operating leverage, we are confident in our ability to deliver sustained revenue growth, margin expansion and continued strong free cash flow in 2026 and beyond.
Thank you for your attention. And now I'll turn it back to Nimrod for closing remarks before we open up the call for questions.
Thanks, Walter. To summarize, our broadband business delivered a strong finish to 2025. Record bookings and substantial backlog growth provide clear visibility into 2026 and beyond. With the pending sale of our Video business, we are well placed to capitalize on this industry's growth as a pure-play leader in the broadband deployment space. Our converged DOCSIS and fiber architecture is proven at scale, enabling operators to deliver multi-gigabit services with higher quality of experience and lower cost of ownership.
Fiber continues to accelerate as a major growth engine and Unified DOCSIS 4.0 is transitioning from trials to commercial scale. At the same time, our intelligence-driven software capabilities are expanding our differentiation and extending our addressable market. Supported by strong rest of world momentum and a more diversified customer base, Harmonic will lead the next phase of broadband networks modernization. These dynamics give us confidence in our long-term growth trajectory as DOCSIS 4.0 and fiber deployment scale through 2026 and beyond.
That concludes our prepared remarks. Walter and I are now happy to take your questions.
[Operator Instructions] And our first question comes from Simon Leopold with Raymond James.
2. Question Answer
I want to start out with how you're thinking about the customer mix for the full year 2026 in that I assume there are a number of moving parts, and it's intriguing to see the rest of world customers getting as big as they did this quarter. So it's a positive, but I imagine we should not make the assumption that they remain at 40% of revenue for the full year. So I'd love to get your thoughts on how 2026 assumptions might be broken down by major customers versus rest-of-world.
Simon, it's Walter. Maybe I'll address that here first. So with regards to 2026, the comments we made today around Rest-of-World and the expected continued growth at 30% plus is one of the factors in looking at the absolute growth of that contingent of customers. Obviously, from quarter-to-quarter, depending on what the largest customers spend, the percent will vary. However, over the long term, with the expectation around this year's growth and continued growth in rest of market customers, we expect that metric to continue moving north. However, as you look at quarter-to-quarter, you will see it move up and down based on what the other customers are doing in terms of the larger customers.
Okay. And you've given us quarterly guidance, full year guidance on gross margin. I just want to sort of do a sanity check on my arithmetic in that it sounds like you're expecting some COGS hit from memory to basically start contributing in the second quarter. My rough estimate is something like 300 basis points, which sounds similar to what we've heard from others. But is that kind of the right magnitude of how to think about it?
Here's what we've assumed based on the very dynamic situation around memory pricing today. We've built in around a net $6 million impact as a result of the pricing that we see today. We have committed orders out there for the supply that we need in 2026. And the pricing on that is generally fixed to some degree, it could move. So we've built in a certain factor there in terms of the margin impact solely from the price element of memory. And as I mentioned, we have already have committed all of the supply we need for 2026.
Now one of the factors beyond margin that I would like to highlight and mention, and it kind of reflects back to the comments I made with regards to the full year guidance and being prudent about it is that there's always risk that some of those deliveries that are committed get delayed, which could impact your timing of your revenue or there could be impacts to our customers' ecosystem from other products out there that could have a knock-on or indirect effect on delivery schedules later in the year.
So that's why we've taken a more prudent view of our guidance for the full year. But specifically with regards to the pricing of memory, we've got a pretty good handle of where it is right now, and we've built that in based on looking at the net impact. And when I say net on the $6 million, it's net of what we expect from customer recoveries in terms of additional price adders.
Maybe one last value that maybe you've given us and I haven't found it yet. But I'm just trying to figure out in 2025, what would be the sort of other customers, Rest-of-World customers' Broadband purchases. So we know total company. I'm trying to figure out what they did in the Broadband segment.
For -- yes...
I think you can -- $130 million and a change.
$130 million. Yes, that's right.
$138 million.
$138 million as compared to 2024 at just under $95 million.
Our next question comes from Ryan Koontz with Needham & Company.
Nice quarter and outlook, guys. With regards to the big bookings step-up you saw here in Q4, maybe can you discuss customer behaviors there that drove kind of change in behavior and a little bit about the composition there as it relates to maybe the difference between your larger customers and some of your rest of market customers within that backlog?
Ryan, it's Walter. Yes. Maybe I'll kick it off and Nimrod can add some more color to it. But just in terms of the bookings there in Q4, the way I would categorize it, it was very strong in rest of world. So the dynamics of both larger customers as well as the rest of world were strong. We had some bookings that are multiyear bookings included in there, but you have the current metric there as well in terms of how much of that backlog is going to be -- expected to be turned into revenue over the next 12 months. And certainly, customers are putting their orders in sooner. We're getting more visibility, and we're pushing our teams to get that level of visibility so that way we can ensure that we're ordering appropriately in terms of getting our supply chain ready for the growth.
Great. And maybe a follow-up, if I could, on the margin outlook within Broadband. What do you -- what's your perspective there on kind of increasing mix of software? Is that one of the tailwinds you're seeing as it relates to the step-up in gross margins for '26?
Yes, Ryan, absolutely, it is the step-up of the cOS mix for 2026, which is helping to drive that. Obviously, we're scaling up and also scaling broader customer set. So those are all things that are tailwinds. One of the headwinds, as explained on the prior question with regards to memory, that's a headwind for us in terms -- and has been factored into the overall margin guide.
And maybe one more comment on the licenses. Historically, we had quarters in which we delivered more hardware versus software. And one of the indicators you see now is increase in our connected modems and ONU. When customers are connecting subscribers, this is typically when there is more cOS licenses being recognized.
And is that a factor of -- what's driving that higher connectivity rate? Is it just customer rollout? Or is there some changing behavior?
Yes. It's a ramp-up of production. Sometimes it takes longer to go through integration phase. We announced quite a few new customers over the course of '25. So as we get into end of '25 and '26, you see more of them starting to connect subscribers.
Our next question comes from George Notter with Wolfe Research.
This is Taran on for George. I just want to confirm, you said $6 million in cost net of pricing actions, correct? And if so, what sort of pricing actions do you guys plan on taking with your customers?
Well, it's -- Taran, it's Walter here. Specifically, the net is, as you -- just to confirm the number, it's $6 million net that we've built in there. And the pricing actions have to do with certain products that obviously have higher memory content in it and rolling out those actions. I won't get specific about the nature of those, but obviously, this is a significant impact across the industries, and it's impacting a lot of different vendors out there. So I'm sure you've heard very similar from them as well.
And our next question comes from Steven Frankel with Rosenblatt Securities.
I wonder if you might characterize the bookings in the quarter. How significant was that ROW contribution to the total? Or did you also have significant bookings from your 2 key customers in Q4?
Steve, it's Walter. It was a mix of both, to be honest, well spread out between larger customers as well as Rest-of-World. And you saw today in our commentary in terms of the expectations of Rest-of-World growth at 30% plus. So that's helping us have the level of visibility and confidence around that continued growth trajectory.
Okay. And then on memory, maybe in these products that are more memory intense, typically, what percent of the BOM does memory represent?
As compared to other products in the industry outside of what we specifically do, I think we'd fall in the category of the lower end of the spectrum as compared to high memory count. Like, for example, if you look at CPE type of equipment, customer prem equipment, modems, that would have a much higher memory content BOM in the product versus the products we do. But nonetheless, it does have an impact, and that's why we made the comments we did.
Okay. And one more quick one. In the revenue breakdown of SaaS and service, if you look at that $58 million in '25, could you give us a rough idea of what maintenance was of the $58 million?
It was the large majority in terms of SLA contracts, but included in there under the SaaS umbrella are the features and functionality that we're also selling out to customers and very much a focused area of growth. And Nimrod mentioned it earlier in his opening remarks in regards to investments we're making around tools and the intelligence on the network. So maybe, Nimrod, you'd like to comment further on that.
So that's a component of that. It's a growing component, and we expect that to grow into '26 and beyond. And that's also an area of an investment, whether organic or inorganic. We see that as, number one, very critical for our customers. Number two, very beneficial for our business given the recurring nature of that.
And were any of the multiyear agreements you talked about in the quarter kind of more software focused on these new value-added offerings? Or are these new customers that are securing a multiyear view into nodes and associated software?
There was a mix in the booking. There was a mix of hardware and software as well as our tools. When we publicly talk about tools and more recently, intelligence, these are kind of the categories that we talked about. There was a mix of all of the above.
I'm showing no further questions at this time. I'd like to turn the call back over to Nimrod for any further remarks.
Thank you. We appreciate your continued interest in Harmonic and look forward to updating you on our progress in the future. Thank you all for joining the call. Have a good day.
Thank you for your participation. You may now disconnect. Good day.
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Harmonic Inc. — Q4 2025 Earnings Call
Harmonic Inc. — Q4 2025 Earnings Call
📊 Quartal auf einen Blick
- Broadband-Umsatz: $98,2M im Q4 (9% seq.), über dem Guidance-High-End; Zahlen für laufendes Geschäft (continuing operations).
- Bookings: Rekord $346,9M; Book-to-bill 3,5, zeigt starke Auftragsdynamik.
- Backlog: $573,8M Ende Jahr (+73% YoY), $307M (53,5%) erwartete Umwandlung in 12 Monaten.
- Geographische Diversifikation: Rest-of-World-Umsatz +33% YoY und 41% des Broadband-Umsatzes.
- Profitabilität: Continuing ops Q4 adjusted EBITDA $12,1M, EPS $0,06; Gesamtkonzern Q4 Umsatz $157,3M.
🎯 Was das Management sagt
- Portfoliofokus: Verkauf der Video-Sparte an MediaKind (~$145M) erwartet Q2 2026; Ziel: reines Broadband‑Unternehmen.
- Wachstumsstrategie: Ausbau von DOCSIS (Data Over Cable Service Interface Specification) und Fiber‑Lösungen, mehr Rest‑of‑Market‑Kunden statt Konzentration auf 2 Großkunden.
- Produkt & Software: Skalierung von Unified DOCSIS 4.0, neue Fiber‑Produkte (pluggable OLT) und KI/Intelligence‑Tools (Beacon, Pathfinder, Subscriber‑Detection) zur Erhöhung wiederkehrender Umsätze.
🔭 Ausblick & Guidance
- Q1 2026: Broadband‑Umsatz $100–105M; Gross Margin 54–55%; Operating Profit $18–20M; EPS $0,11–0,12 (non‑GAAP).
- FY 2026: Broadband‑Umsatz $440–480M (+22–33% vs. 2025), Gross Margin 51–53%, Operating Profit $74–99M, EPS $0,46–0,63.
- Risiken & Annahmen: Netto‑Memory‑Kostenwirkung ~$6M eingeplant, Tariff‑Impact ~$4M FY, stranded costs ~ $10M FY; Steuerquote non‑GAAP 24,5%.
- Methodikwechsel: Guidance künftig auf Basis Adjusted Operating Profit statt Adjusted EBITDA.
❓ Fragen der Analysten
- Kundendemix: Nachfrage, ob Rest‑of‑World‑Anteil nachhaltig bleibt; Management erwartet langfristigen Aufwärtstrend, aber Quartals‑Schwankungen möglich.
- Memory‑Preise: Umfang und Timing der Margenwirkung (Netto $6M) sowie angedachte Preisweitergaben an Kunden; Management gab keine Details zu konkreten Pricing‑Maßnahmen.
- Bookings & Recurring: Nachfrage nach Zusammensetzung der Q4‑Bookings (Großkunden vs. ROW) und Anteil von SaaS/Services; Antwort: Mischung aus Hardware, Software und Tools, SaaS/Wartung wachsend; DSO und Liefer‑Timing als operative Risiken genannt.
⚡ Bottom Line
- Implikation: Starke Q4‑Bookings und ein erheblich gestiegener Backlog geben klare Sicht auf 2026; Verkauf der Video‑Sparte schärft Fokus und Bilanz. Margen verbessern sich durch Software‑Mix, gleichzeitig drücken Memory‑Kosten und Übergangskosten kurzfristig. Aktionäre profitieren von klarer Wachstumsstory, müssen aber Execution, Kundenkonzentration und Memory‑Preisentwicklung beobachten.
Harmonic Inc. — Barclays 23rd Annual Global Technology Conference
1. Question Answer
Hello, Everybody. Thanks for joining. Tim Long, Barclays IT hardware comm equipment analyst. Happy to start this session on Harmonic. Walter, thanks for coming. Appreciate it.
Thanks for having me.
A lot of news recently. So we have some things to talk about here.
Absolutely. It's been full week.
Yes, yes. So maybe we'll start off on the Video business. Maybe talk a little bit high level about -- I mean, obviously, this was a process that was looked at a year or 2 ago, didn't materialize. Now it did. So just kind of walk us through the logic behind the deal.
Yes, certainly. Yes, back in November of 2023, we had kicked off a strategic review of the Video business. At that time, we exited out of that process back in the spring of 2024, and we had looked at selling that business. And at that point in time, we did not find an appropriate buyer that we felt we could execute and close a deal on. After that process, we actually went forward and restructured the business. We got the business performing quite strongly and consistently over the last 18 months. Obviously, folks saw the performance of the Video business, both the video SaaS as well as the appliance side of the business and saw that strong performance.
And very recently, we had MediaKind approach us and put an offer in front of us that we felt was compelling, compelling to us, our shareholders, but also our customers and our employees. MediaKind is a video infrastructure and cloud streaming organization and are focused entirely on video. And now with the Harmonic Video piece, they'll be very much #1 in the industry as an agnostic provider of video streaming services and infrastructure in that market.
So we think it's great for employees, great for customers as well because we want to ensure our customers are well supported and that, that technology is continued to invest in. From the Harmonic standpoint, we have, for quite a while now, stated that our focus is on taking advantage and growing the broadband business with our clear market leadership position in virtualized CMTS in terms of the DOCSIS environment as well as on fiber. And so we want to take advantage and even further accelerate that growth.
So now as a pure-play broadband provider in terms of the company's focus, we can now go and focus in on continuing to grow that business, looking to leverage the installed base that we're building up across all of our customer set. And I think that's really exciting for the company as well with the capital infusion, it allows us a little more flexibility, both to invest in that business as well as to return capital to shareholders.
Okay. Great. Was MediaKind involved in the process the prior time or didn't really...
Well our prior process was public.
Yes.
So we opened it up to everybody in terms of looking at the business and determining who was all interested. Obviously, they are a big player in this market as well and no doubt follow us very closely.
Yes. Okay. And was there -- I mean, Video businesses, but you had the streaming part and the appliance part. Was there a thought in the first process or this time around to sell them discretely? Or did it make more sense for them to be packaged?
Well, this time, it was -- we were approached for the entire business. I think you've heard us over the last few quarters talk about hybrid solutions and video, where we've got a lot of customers that are acquiring appliance technology, leveraging that in certain parts of their network and then doing cloud streaming as well. So we've seen more and more customers approach us that want to use both. And so I think from a customer standpoint, the assets belong together. Could we have dissected them? Certainly, if that made sense, we would have went through and did that. But there's definitely a lot of commonality across the technology stack, but also across the customer base as well.
Right. Okay. And then I think you mentioned this, but the R&D and products pretty separate from what you do on the cable and broadband side. So I assume from a organizational structure and a finance standpoint, it's quite easy to -- it's not that complicated to divest this business.
Certainly, we've run both businesses independently across sales, R&D, everything segregated from that perspective. From a corporate infrastructure, IT infrastructure perspective, there's things we need to take care of in terms of splitting up the business. So that part of it has some complexities, and that's why when we announced the deal, we said it will take -- we expect to close it in the first half of '26 because there are certain things and processes we need to go through in addition to the France works council consultation process, which is a process takes some time as well as some other steps. It's going to take several months before we're ready to close the transaction.
Okay. Great. Maybe let's pivot over to the broadband business. Maybe talk a little bit about timing for DOCSIS 4.0 and kind of what you're seeing from customers and readiness to keep moving down the technology.
Sure. Absolutely. About a year ago, we had indicated to the market that Unified 4.0 DOCSIS was going to become available for all customers in the market, not just a few customers. And at that time, we had indicated that in 2025, that was going to be a headwind for us. But our expectation at that point was that there was going to be a rebound in 2026 as the technology gets out to that wider set of customers. And that's, in fact, what's happening right now is we're seeing the readiness there. We're seeing a lot of customers. And when we talk about our rest of world customers, it's the non-top 2. It's everybody, excluding the top 2, Comcast and Charter. And so as we had indicated previously, we felt that the technology will be ready, customers will have had an opportunity to try it out as well as some key final components of the ecosystem to make sure that it's ready for a launch through 2026.
And so we're seeing that as readiness for the broad market. Obviously, there are certain customers like Comcast who gone 4.0 FDX. And we had indicated back early this year that as part of their rollout, they need these brilliant amplifiers. And so now those amplifiers are available at scale in the market. And so that's a key element of the ecosystem continuing to push out DOCSIS 4.0 in terms of rollouts in the marketplace.
Okay. Obviously, the broadband business, you have some customer concentration. There's been, let's say, lumpiness to it. The acceleration next year, I mean, it seems like all the technology components that you're looking at are lining up for next year to see acceleration. What kind of visibility do you have into the 2 large customers in their ability to and desire to move aggressively?
Well, we're now in December. So there's a level of visibility in terms of expectation, forecast, et cetera, for the following year. I think you've seen, in our results, the level of spend with Comcast because we indicate every quarter, at least at the total company level, the percent of sales related to Comcast.
I think with Charter, they've publicly talked about their -- what they call the Step 2 DAA plan. That's the part that relates to our spend and that they're underway now in terms of moving forward with that upgrade across their network. So that is something that's starting that will take a certain period of time to go and accomplish. And then we've talked a lot about this year about the new wins we've had in other customers beyond those top 2 that are going to be tailwinds for us as we go into 2026.
We've had certain publicly announced wins with folks like Mediacom and Mediacom has publicly talked about their network and their DOCSIS 4.0 rollout. So there's some real key things that are happening that give us visibility towards 2026. We also recently had a press release with Comcast specifically talking about our partnership with them in fiber. And specifically, as Comcast goes out every year and rolls out to more than 1 million new homes passed, we're providing that solution. And that's another proof point of where our fiber solution really plays in well with our current set of customers, with the cable operators as they look to expand into new regions, but also eventually migrate down the road in the years to come to fiber.
Our solution plays very well there in terms of our software architecture, in terms of the orchestration as well as the nodes that we have out in the field, coupled with the fiber optionality to either do DOCSIS or to drop in an OLT and do fiber-to-the-home. So we're really excited about that because it not only talks about our excitement around 2026 or the indication, but really over the longer-term period in terms of how we're working with customers in terms of their longer-term network spend.
Yes. I was going to ask about that your fiber at Comcast, maybe how material do you think that can be? What kind of ramp are you expecting? And is this the type of win that could scale that business further and be a good reference design for other larger players?
Absolutely, yes, in terms of being a reference to other operators out there, and we've gotten traction with a lot of cable operators in terms of fiber optionality and their plans down the road in terms of what they're going to do from a fiber perspective. I think the scale, it's already adding revenue in 2025. We expect that to grow further in 2026. And it's just part of that envelope of spend. As you think of any operator out there, they're going to spend a certain amount every year in their plans of CapEx. And for a cable operator, that might be, hey, I'm going to spend this much on DOCSIS, I'm going to spend this much on fiber. The good news for us is we've got our hands on both.
Okay. And getting fiber into maybe traditional telcos that are more fiber, how could that develop?
That's an expansion of TAM for us. So once you break out of the cable operator spend and you start looking over at the telco, that spend is significantly higher. And our focus initially has been more around the Tier 2, Tier 3 type of customers in the telco space. And we've come out there with a differentiated solution, still leveraging our core capabilities around the -- our COS platform, the software orchestration platform, but also with the flexibility of devices and form factors out in the environment in OLT to ensure that we can fit into various different use cases for telcos.
One of the -- couple of the differentiating factors for us. First of all, we're open ONU. So you don't have to use the same provider for the ONU that you use for the OLT. And so that allows customers to have more flexibility. The second element is that we've also introduced recently a product called SeaStar back in the spring of this year, and it's for low-density MDUs. It's to service a specific use case that's challenging today for telcos based on the economics of putting in a solution in a low-density MDU.
And that product is getting a lot of traction, a lot of customers asking for demo kits of that product. And we see that as another beachhead for us in terms of getting more penetration into the telco market. And I think with the deal we announced earlier this week in terms of our sale of -- our pending sale of the Video business, that's just going to give us more capital to go out there and hit some of those TAM expansion areas more significantly. That's one area we're going to focus on, is fiber.
The other area is with regards to our installed base as we look at other things that we can do for our customers as we've got the orchestration software with COS. There's also tools. We call them tools. They're like cloud services, where we can help our customers in terms of operating their network and actioning their network. And that's really an exciting area for us. We demonstrated some of our capabilities at the recent SCTE conference in terms of the cable show there. And so that's another area of investment for us where we could see building up more of a recurring revenue stream.
Okay. Great. Maybe talk about like BEAD and what you're seeing there? And do you see any other federal impacted stimulus that could help or hurt maybe given what's going on with shutdown and DOGE. What's your view on BEAD specifically, but anything else to help the customer base fund a lot of these upgrades?
Well, certainly, BEAD is a program that's going to help fund development of networks. Rural, I think one of the areas that was in question was, is it going to be more fiber? There was some discussion about satellite. So far, and I'm sure you've all seen what's out there in the marketplace, it looks like fiber is still going to be a big part of that. And when people are given the choice, building a fiber infrastructure seems real future-proof, right, for speeds and capabilities. And so that looks like it's moving along.
In our plans for next year, that's not really factored in. We see it more of an upside. Obviously, we're encouraged to be working very closely with Comcast in terms of what I talked about earlier, and we stand ready. We are set up with BEAD compliant solutions so we can take advantage of the opportunities that are going to be ahead of us. But I think that's more of a late '26, '27 story. But it looks like it's going to happen out in the marketplace, and we want to be a benefactor of it.
Okay. I think last quarter, you also talked about some new business with Charter kind of expanding their product set with them. Maybe walk us through that. And do we think your second customer can ramp? You have a lot of concentration with Comcast now. What's the outlook for the second customer? And particularly, will it be aided by newer programs with them?
Yes, certainly. We originally announced our deal with Charter in the spring of 2023 in terms of the upgrade and then moving to our virtualized platform. The announcement we made at our last earnings call, the press release that came out the same day was around an expanded relationship with them. And so this is across our COS platform that it will cover their entire subscriber base as well as tools. So when we say tools, we're talking about the cloud services. We're talking about some of the feature sets that we're putting in to our software as a kind of an add-on service. So that's across the entire portfolio. It's an expanded offering. So we're really excited about that.
The other element was the 4.0 RPDs in terms of the next-generation product that's going out to them. So obviously, they have a plan. They've talked about that publicly in terms of how long to upgrade their network. So certainly, that's in our view in terms of going forward. But the other part about concentration is all the other customers that we've announced and won and some of the more recent ones over the last few quarters and as we see their plans for 2026 and beyond. And they're just getting started.
So you had customer 1, early adopter and pioneer. You've got other large customers coming on board and now upgrading. And then you've got all these other, what we call rest of world, non-top 2 customers that are just going from this point forward. So this is multiyear in terms of upgrade of networks. I think the OBBBA impact in terms of cash savings, in terms of the taxes is going to weigh in over the next few years as well with our customers and their ability to invest in their networks, but they need to invest to be competitive.
They've got -- if you're in cable, you've got the fiber providers, you've got fixed wireless access providers competing. So there's a lot of competition out there to upgrade speed, latency, quality of service to customers, that's why folks must upgrade their networks. And we're seeing all of that coming into our purview as we had expected it, and it's kind of playing out as we had expected.
Okay. And then when you talk about these other operators out -- rest of the world, I think there was a time you would give like an installed base of the cable subs. So when you kind of add them up, how do they scale relative to the big 2 that you currently have?
Well, certainly, once you -- if you look at the list of subscribers across all MSOs across the world, once you get past the first couple, then it drops down and then you've got this long tail of Tier 2s and Tier 3s as well in the fold. We've won over 140 customers that are on our platform and are ramping up. And so when we look at how much of the whole world, like we had a metric that we've quoted before, excluding China, is about 180 million [indiscernible] out there. And you think about the top 2 cable operators, over 60 million.
So there's a lot of other customers that make up the rest of the market. And obviously, with 140 customers, we've won a lot of customers, won a lot of the market. And it's just a matter of the upgrade cycle, the number of years for them to upgrade their networks, and that's kind of what's driving that growth, but also reducing our concentration over time. But we'll make no bones about it. The top 2 customers, we're in a very good position with, and therefore, they will still have a considerable amount of spend with.
Okay. You mentioned this early on about you get some capital infused from the sale. Obviously, the concentration is going to be very high, particularly with Comcast. Maybe touch on when you're looking at the business, ex the Video portion, you have a little bit more capital to invest, and we should be going to an accelerating growth year. So talk a little bit about margin structure, and I think you have the nodes versus license payments and mix. So maybe walk us through the moving parts there.
Sure. Last couple of quarters, we've commented during our earnings call that the mix of hardware versus our COS licenses has been high. And therefore, the margins have been in the ranges and specifically in broadband here. As we move forward and we're adding more customers, and customers are upgrading, the mix of the business, we expect to move a little more favorably towards licenses. And therefore, our targeted margin structure is to be above 50%. I mean that's been our target. We've talked about that previously. And that's why the last couple of earnings calls, we've actually called out that the mix of the nodes versus the COS licenses has been a little bit higher.
Now this year, at least for the back half of the year, we've also been impacted because of the tariffs, but that's a 1% impact, 100 basis points impact. So it's not that significant, and we're living with that, and that's kind of built into our expectations going forward. But definitely, as we see more customers coming on the platform, you've got SLAs that become recurring revenue for us. And then also, we talked a little bit about tools and our cloud services, building up some recurring revenue streams as well. So thinking longer term in terms of what does this business look like beyond the initial deployments that we're seeing out there in the field today.
Okay. Maybe just one last one. If you could talk a little bit about capital return framework. You've been buying back stock. Will there be M&A opportunities? You have more cash, you will have more cash soon. So how does that evolve after the deal?
Yes, certainly. Even before the deal, we're in a really strong position in terms of our liquidity, in terms of our expectations based on what we've won, what we see ahead of us in terms of free cash flow over the next 3 years or longer. And then with the impact of the cash tax savings from OBBBA as well as other things that impact how we handle R&D, we saw a lot of cash to be able to facilitate all our capital allocation priorities. Obviously, with this week's deal that we announced, that's just going to infuse even more cash into the company. And so our general allocation priorities have been to continue growing the business organically.
Now they'll be all focused around broadband going forward and scaling up that business. And there's things we can do organically. We already see opportunities to do more for our customers. So that's one avenue of expansion. The other thing from an investment standpoint, and that could be organic or inorganic, is to look at other capabilities in our wheelhouse that are going to be very complementary to what we do for our customers. And then other areas that will improve our -- or lower down our concentration, impact fiber in terms of our fiber solutions.
So those now, obviously, we can open the aperture up a little bit, but we're still going to be prudent about what we do in terms of anything from an acquisition standpoint. And then obviously, the third element of it is around the buyback program. We have a $200 million share repurchase program. We've executed, this year, $66 million at the end -- to the end of Q3 of this year, and we're in a great position to continue on that -- executing on that program. So I think we're in a great position to hit it on all of those different priorities as we move forward.
Okay. Great. I think we're close to bumping up against time. So Walter, really appreciate the time.
Fantastic. Thanks for having us.
2 days for you, [indiscernible].
Yes, absolutely. Thank you.
Thank you very much.
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Harmonic Inc. — Barclays 23rd Annual Global Technology Conference
🎯 Kernbotschaft
- Kern: Harmonic verkauft das gesamte Video‑Geschäft an MediaKind; Closing erwartet in der ersten Hälfte 2026 (u.a. abhängig von der französischen Betriebsrats‑Konsultation). Nach dem Deal ist Harmonic ein reiner Breitband‑(broadband) Anbieter mit zusätzlichem Kapital für Investitionen in DOCSIS (Data Over Cable Service Interface Specification) 4.0, Fiber‑Ausbau und Kapitalrückführungen.
⚡ Strategische Highlights
- Fokus: Klare Neuausrichtung auf virtualisierte CMTS und Fiber‑Optionalität; COS‑Orchestrierung (Cloud‑Orchestration‑Software) als Plattform für wiederkehrende Einnahmen und Tools. Produkte: offene ONU (vendor‑agnostic), SeaStar für Low‑Density‑MDUs und RPDs für 4.0‑Rollouts.
🔭 Neue Informationen
- Neu: Konkretes Angebot von MediaKind und Zeitplan (Close H1 2026). Kein neues numerisches Umsatz‑ oder Margen‑Guidance im Call; Management nennt Deal als Kapitalquelle. BEAD (Broadband Equity, Access and Deployment) wird als Upside für spät‑2026/2027 gesehen; SeaStar‑Interesse und Comcast‑Fiber liefern bereits Umsatzbelege.
❓ Fragen der Analysten
- Themen: 1) Verkaufspaket: Management erklärt Paketverkauf wegen Kundenwunsch nach integrierten Appliance+Cloud‑Lösungen. 2) DOCSIS4.0‑Timing & Kundenreadiness: Management sieht breite Marktreife und einen Beschleuniger in 2026, liefert jedoch keine detaillierten Spend‑Prognosen für Comcast/Charter. 3) Kapitalallokation: $200M Rückkaufprogramm besteht, $66M ausgeführt bis Ende Q3; man prüft M&A selektiv, bleibt aber zurückhaltend.
⚡ Bottom Line
- Fazit: Transaktion macht Harmonic zum fokussierten Breitband‑Player mit potenzieller Margenverbesserung durch stärkeren Lizenz‑/Servicemix. Positiv: stärkerer Cash‑Puffer, Referenz‑wins (Comcast Fiber), BEAD‑Upside. Risiken: hohe Kundenkonzentration (Top‑2), Abschluss‑ und Auslieferungsrisiken bei DOCSIS4.0‑Rollouts.
Harmonic Inc. — Harmonic Inc., Mk Systems Usa Inc. - M&A Call
1. Management Discussion
Welcome to the Harmonic Investor Conference Call. My name is Michelle, and I will be your operator for today's call. [Operator Instructions] Please note that this conference is being recorded. I will now turn the call over to David Hanover, Investor Relations. David, you may begin.
Thank you, operator. Hello, everyone, and thank you for joining us today for Harmonic's investor conference call. With me today are Nimrod Ben-Natan, President and CEO; and Walter Jankovic, Chief Financial Officer.
Before we begin today, I would like to remind everyone that this conference call contains certain forward-looking statements. All statements that address our operating performance, events or developments that we expect or anticipate occurring in the future are forward-looking statements. These forward-looking statements are based on management's beliefs and assumptions and not on information currently available to our management team. Our management team believes that these forward-looking statements are reasonable as and when made. However, you should not place any undue reliance on any such forward-looking statements because such statements speak only as of the date when made.
We do not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information or future events or otherwise, except as required by law. In addition, forward-looking statements are subject to certain risks and uncertainties that could cause actual results, events and developments to materially differ from our historical experience and our present expectations or projections. These risks and uncertainties include, but are not limited to those described in documents Harmonic has filed with the SEC, including our most recent 10-Q and 10-K reports and the forward-looking statements section of today's press release.
And now I'll turn the call over to our CEO, Nimrod Ben-Natan. Nimrod?
Thanks, David. Good morning, everyone, and thank you for joining us on today's call. I have some exciting news to share with you. Earlier today, we announced that we have received a binding offer from MediaKind to sell our video business segment for approximately $145 million in cash.
For those of you who may not be familiar with MediaKind, they are a global leader in cloud-based video streaming technology. The transaction is expected to close in the first half of '26, subject to customary closing conditions and regulatory approvals. Please see the press release we distributed earlier today and the 8-K we will be filing shortly for further details.
We are excited to share today's news. This strategic and transformative transaction advances our ability to expand and grow our broadband business. It allows us to tap the full potential of our expanding installed base and unlock additional growth opportunities, leveraging our capabilities and broadening footprint. Additionally, this pending sale will provide us the capital to increase our investment in our rapidly growing fiber business as we see both cable operators and telcos adopting our solution. Moreover, this sale is poised to deliver a healthy capital infusion, part of which will go towards executing our current $200 million share repurchase program.
With the pending sale of the video business, we will no longer manage 2 distinct operational models. This will simplify our business and enable us to operate more effectively and with greater agility.
For the video business, this pending sale means its customers and dedicated employees now become part of a combined larger industry-leading video technology company. We are incredibly proud of our video team's accomplishments and upon sale completion, look forward to this business future growth under MediaKind's stewardship. MediaKind has a proven track record in the industry, and we are confident in their ability to continue innovating and supporting our customers.
Considering the strategic and financial benefits this transaction would bring us, I am sure you can see why we are so excited about today's announcement. We look forward to providing you more information regarding the go-forward projections of the company, which will consider this pending sale during our next earnings call. With regards to Q4 '25, we are reaffirming the guidance that we provided on our last earnings call.
That concludes our prepared remarks. Now Walter and I will be happy to take your questions.
[Operator Instructions] At this time, I am showing no questions in the queue. I would now like to turn the call back to management for closing remarks.
Again, I want to thank you all for joining us on today's conference call. We appreciate your questions and your continued support. For those interested, very shortly, we will be participating in a Raymond James TMT and Consumer Conference fireside chat at 8:40 a.m. Eastern Time this morning. This event will be webcast and available for viewing on our Investor Relations website. And later this week, on Wednesday, December 10, we will also be participating in a fireside chat at the Barclays 23rd Annual Global Technology Conference in San Francisco. This event will also be webcast and available for viewing on our website. We look forward to speaking with you at these upcoming events and afterwards on our full year 2025 results conference call. Thank you again, and enjoy the rest of the day.
This does conclude today's conference call. Thank you for participating, and you may now disconnect.
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Harmonic Inc. — Harmonic Inc., Mk Systems Usa Inc. - M&A Call
🎯 Kernbotschaft
- Kern: Harmonic hat ein verbindliches Angebot von MediaKind über rund $145 Mio. in bar für das Video‑Segment erhalten; Abschluss erwartet in der ersten Hälfte 2026 vorbehaltlich üblicher Bedingungen und behördlicher Genehmigungen. Zweck: Vereinfachung des Konzerns, Fokussierung auf das wachstumsstarke Broadband/Fiber‑Geschäft und Kapitalfreisetzung für Investitionen und Rückkäufe. Die Guidance für Q4 2025 bleibt bestätigt.
🚀 Strategische Highlights
- Strategie: Erlös soll vorrangig in Ausbau des Fiber-/Broadband‑Geschäfts reinvestiert, um Marktanteile bei Kabelnetzbetreibern und Telekommunikationsanbietern (Telcos) zu gewinnen; Teil der Mittel ist für das bestehende $200 Mio. Aktienrückkaufprogramm vorgesehen; durch Wegfall der zwei getrennten Geschäftsmodelle sollen operative Effizienz und Agilität steigen; Video‑Kunden und -Mitarbeiter gehen an MediaKind über.
🆕 Neue Informationen
- Neu: Gegenüber vorheriger Kommunikation ist jetzt ein verbindliches Kaufangebot über etwa $145 Mio. veröffentlicht und ein Abschluss in H1 2026 angekündigt. Management betont, dass die bisherige Q4‑2025‑Guidance unverändert bleibt; detaillierte Pro‑forma‑Angaben zu Umsatz und EBITDA sowie die genaue Verwendung der Mittel werden beim nächsten Earnings Call geliefert.
⚡ Bottom Line
- Fazit: Für Aktionäre bedeutet die Transaktion kurzfristig eine substanzielle Barmittelzufuhr und einen klareren strategischen Fokus auf das wachstumsstarke Fiber‑Geschäft; das $200 Mio. Rückkaufprogramm kann dadurch beschleunigt werden und das Ergebnis je Aktie (EPS) stützen. Wesentliche Risiken bleiben Abschluss‑ und Regulierungsbedingungen sowie mögliche Kunden‑/Integrationsrisiken; fehlende Pro‑forma‑Prognosen bis zum nächsten Quartalsbericht schränken die sofortige Bewertungsklarheit ein.
Harmonic Inc. — Q3 2025 Earnings Call
1. Management Discussion
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2. Question Answer
" Raymond James & Associates, Inc., Research Division
" Needham & Co.
" Rosenblatt Securities Inc., Research Division
" Wolfe Research
Welcome to the Third Quarter 2025 Harmonic Earnings Conference Call. My name is Sherry, and I'll be your operator for today's call. [Operator Instructions] Please note that this conference is being recorded.
I will now turn the call over to Scott Eckstein, Investor Relations. You may begin, Scott.
Thank you, operator. Hello, everyone, and thank you for joining us today for Harmonic's Third Quarter 2025 Financial Results Conference Call. With me today are Nimrod Ben-Natan, President and CEO; and Walter Jankovic, Chief Financial Officer.
Before we begin, I'd like to point out that in addition to the audio portion of the webcast, we've also provided slides for this webcast, which you may view by going to our webcast on our Investor Relations website.
Now turning to Slide 2. During this call, we will provide projections and other forward-looking statements regarding future events or future financial performance of the company. Such statements are only current expectations and actual events or results may differ materially. We refer you to documents Harmonic filed with the SEC, including our most recent 10-Q and 10-K reports and the forward-looking statements section of today's preliminary results press release. These documents identify important risk factors, which can cause actual results to differ materially from those contained in our projections or forward-looking statements.
And please note that unless otherwise indicated, the financial metrics we provide you on this call are determined on a non-GAAP basis. These metrics, together with corresponding GAAP numbers and a reconciliation to GAAP are contained in today's press release, which we have posted on our website and filed with the SEC on Form 8-K.
We will also discuss historical financial and other statistical information regarding our business and operation, and some of this information is included in the press release. The remainder of the information will be available on a recorded version of this call or on our website.
And now I'll turn the call over to our CEO, Nimrod Ben-Natan. Nimrad?
Thanks, Scott, and welcome, everyone, to our third quarter 2025 earnings call.
Today, we shared strong third quarter results that exceeded our guidance and reflect both focused execution and growing market momentum across our broadband and video businesses. Revenue was $142.4 million, driven by strong unified RPD and fiber product shipments, along with year-over-year growth in broadband rest of the world and continued strong video performance across both appliances and SaaS streaming.
In addition to these operational achievements, we returned capital to shareholders by repurchasing an additional $16 million of our outstanding common shares, bringing total repurchases under the current program to $66.1 million. We closed the quarter with backlog and deferred revenue of $495 million, underscoring consistent customer demand and visibility into future deployments as operators accelerate network modernization.
Earlier today, we announced an expanded partnership with Charter to extend our cOS virtualized broadband platform and advanced operational tools across their entire footprint, including the deployment of DOCSIS 4.0 unified RPDs. This expansion reinforces Harmonic's leadership in virtualized broadband and our ability to scale next-generation architectures for the world's largest operators.
Turning to Slide 5. Across the industry, broadband operators are making significant investments to modernize their networks for higher speeds and to deliver better economics and improve subscriber satisfaction. Network evolution has become a strategic imperative, elevating quality of experience, reducing churn and lowering operating costs are no longer optional. They are core business goals.
Harmonic's virtualized broadband platform, cloud services and operational tools, together with our portfolio of compact, energy-efficient and feature-rich DOCSIS and fiber access devices are driving this industry transformation. Our customers rely on us to simplify network modernization, accelerate deployments and continuously optimize performance at scale. These capabilities make the business case for transformation both compelling and sustainable.
Turning to Slide 6. Building on our broadband growth strategy, revenue in this segment reached $90.5 million for the quarter with gross margin of 47.3%. We now have 142 cOS deployments in production, serving over 37 million cable modems and ONUs worldwide, reflecting our unmatched scale and reliability in virtualized broadband. At this scale, the gap between Harmonic and the rest of the market has become extraordinary. Our field-proven consistency, operational depth and nearly decade-long production maturity place our platform in a class of its own.
In addition to these results, this quarter, we also achieved several important milestones with key customers that highlight our leadership in Unified DOCSIS 4.0 and fiber convergence. Together with Mediacom, the fifth largest cable operator in the U.S., we completed the industry's first production deployment of a Unified DOCSIS 4.0 on a live extended spectrum network. This deployment showcased at SCTE TechExpo demonstrated symmetric multi-gig performance and live analytics with real subscribers, a breakthrough moment for the broadband industry.
We are also powering GCI's modernization program with our cOS platform and Unified DOCSIS 4.0 nodes, enabling them to bring multi-gigabit broadband to some of the most remote regions in North America. This collaboration highlights how our technology helps operators extend the reach and longevity of existing HFC infrastructure. Additionally, Midco, a leading operator in the Midwest, continued its rollout of virtual CMTS and DAA nodes, selecting Harmonic to upgrade its HFC network and prepare for future 40 upgrades.
Also, among recent highlights is a multimillion dollar RFP award from a leading -- operator in Europe, along with another win with an international Tier 1 operator, both partnered with Harmonic to power their next-generation broadband transformation.
Our fiber business delivered another strong quarter, demonstrating both robust year-over-year growth and accelerating customer momentum. We continue to win new projects and follow-on orders across North America and international markets.
A major highlight this quarter is our expanding collaboration with Comcast, which is deploying our fiber solution, including our virtual BNG and remote OLTs as part of its network expansion program. Comcast is adding roughly one million new fiber passing per year, leveraging our technology to deliver multi-gigabit symmetrical broadband with ultra-low latency. This expansion extends connectivity to new and remote communities and demonstrates how our solution accelerates fiber reach while simplifying operations and reducing cost. The fiber segment remains a key growth driver supported by record booking and expanding global adoption.
Our Unified DOCSIS 4.0 strategy continues to gain momentum, marked this quarter by the first commercial extended spectrum rollouts. These live deployments validate the maturity and of the technology and are fueling growing operator interest as the ecosystem advances through ongoing interoperability work and increasing readiness of modems and smart amplifiers. Unified RPD shipments remain strong, and our new unified RF front-end tray is on track for initial shipments late in the fourth quarter.
Innovation continues to be a defining strength for Harmonic. And this quarter, we expanded our capabilities of our broadband cloud platform to drive higher network intelligence and operational automation. We introduced new tools that allow operators to detect and resolve service issues in real time down to micro-outage levels, improving subscriber satisfaction and reducing churn. These capabilities leverage our advanced streaming telemetry to provide instant root cause analysis and to automate corrective actions and optimize field resources to dispatch with exceptional precision.
At SCTE, we also unveiled Pathfinder, a patent-pending new self-healing capability within our broadband platform. Pathfinder enables the rapid mitigation of localized spectrum interference that could otherwise affect quality of experience for any group of subscribers. This functionality complements our Beacon Speed Maximizer technology, which dynamically adapts RF network configuration to maintain peak throughput even in challenging and dynamic conditions. Together, these innovations mark a new level of adaptive intelligence for Harmonic's broadband platform, reinforcing our leadership and unique differentiation.
To summarize, our broadband business continues to perform, fueled by new deployments, expanding fiber adoption and advances in Unified DOCSIS 4.0. Our converged DOCSIS and fiber architecture is proven at scale, enabling operators to deliver multi-gigabit services with higher quality of experience and lower total cost of ownership. Fiber continues as a high priority as we execute successfully across a growing number of deployments. It stands out as a major growth engine for Harmonic with rising customer wins, expanding used cases and consistently increasing revenue.
Meanwhile, the successful launch of Live DOCSIS 4.0 services and a maturing ecosystem are driving momentum and giving more operators the confidence to advance their own deployments. Combined with growing intelligence of our cloud-based capabilities, Harmonic is positioned as partner of choice for operators seeking to elevate broadband performance, simplify operations and maximize value from their network investments. These dynamics give us confidence in our long-term growth trajectory as Unified DOCSIS 4.0 and fiber deployments scale through 2026 and beyond.
Turning to Slide 7. The video market continues to transform rapidly, shaped by new audience experiences and rising expectations for reliability. Broadcast-grade availability is now essential to streaming success, specifically for live sports, where even a brief disruption carries immediate business impact. The recent widespread cloud outages that took down major -- streaming, gaming and messaging services worldwide was a clear reminder of how dependent the industry remains on a few cloud providers.
Our VOS streaming platform was designed from the ground up to avoid this single point dependency. It is fully cloud-agnostic, geo-redundant and capable of seamless failover across cloud providers. This architecture enables our customers to maintain continuity and deliver uninterrupted service even when a major cloud experiences downtime. At the same time, sports streaming is evolving rapidly with new innovation and differentiation. Leading platforms are competing to offer more immersive and personalized fan experiences. A major streaming platform is expanding its involvement in live sports through Formula 1 coverage designed to offer a data-driven and immersive experience by integrating live race telemetry, multiple in-car camera views and special audio to make viewers feel like they are inside the action. Meanwhile, Peacock recently introduced Dolby Atmos to Sunday Night Football, bringing viewers closer to the action than ever before. Such experiences highlight the next frontier of sports engagement, immersive, interactive and powered by real-time data.
Our strategy aligns closely with that trend. VOS360 Media SaaS and VOS360 Ad SaaS now deliver sub-5-second synchronized low-latency streaming, multi-view experiences, AI-based highlights creation and dynamic in-stream advertising. These capabilities position Harmonic as a critical enabler of next-generation live sports streaming services.
In the third quarter, video segment delivered $51.9 million in revenue, up sequentially and reflecting solid execution across both appliances and SaaS streaming. Our appliance business delivered solid execution through continued Tier 1 refresh programs, competitive takeouts and primary distribution wins, while SaaS streaming once again achieved record performance with $16.1 million in quarterly revenue, driven by global live sports deployments and new Tier 1 opportunities moving into scale.
We also expanded our ecosystem of technology partners, including AI-specific ad tech integrations with Google Ad Manager and other leading monetization platforms. These advancements, combined with our unique advertising capabilities are driving strong momentum and wins for our VOS Ad solutions and redefining how live sports is delivered, monetized and experienced. Looking ahead, our combination of appliance strengths, accelerating SaaS growth and differentiated multi-cloud resiliency provide a strong foundation for continued profitable expansion in 2026 and beyond.
Now I will turn to Walter for a deeper review of our financials.
Thanks, Nimrod, and thank you all for joining us today.
Before I discuss our quarterly results and outlook, I'd like to remind everyone the financial results I'll be referring to on this call are provided on a non-GAAP basis. As Scott mentioned earlier, our Q3 press release and earnings presentation include reconciliations of the non-GAAP financial measures to GAAP. Both of these are available on our website.
Here on Slide 10 are some financial highlights for the quarter. As Nimrod mentioned, in Q3, both our broadband and video businesses exceeded our revenue and EBITDA expectations. On a total company basis, revenue was $142.4 million, while EPS was $0.12. The year-over-year comparison was impacted by extremely strong performance in broadband during the third quarter of last year. Free cash flow during the quarter was $21 million, and our cash balance at quarter end was $127.4 million, a year-over-year increase of $69.2 million. I'd like to point out that this substantial increase in cash is net of $65.8 million in stock repurchases that we did during the past 12 months. Even at these recent quarterly revenue levels, we have continued to maintain profitability and free cash flow. Furthermore, given our expectations for broadband revenue growth in 2026, we are confident in our ability to expand profit margins and future free cash flow considering the high operating leverage we have previously demonstrated.
Looking more closely at our businesses, third quarter broadband revenue and adjusted EBITDA were $90.5 million and $14.2 million, respectively. These year-over-year results were largely expected, reflecting the timing of operators shifting to DOCSIS 4.0 that we have previously discussed.
Revenues for Q3 exceeded our guidance range, in part due to orders that we had expected to occur in Q4. Similar to last quarter, our Q3 rest of world revenue showed strong year-over-year growth as we focus on customer diversification. In our video business, we continue to see strong and consistent momentum as video revenue was $51.9 million, up 2.9% year-over-year, while adjusted EBITDA in this business was $7.7 million due to the increasing mix of recurring revenue and overall strong margins, coupled with our efficiency improvements. Importantly, we've continued to see strong growth in the video SaaS part of our business as this revenue line grew 13.6% year-over-year to reach a record $16.1 million.
Moving to Slide 11. As we stated previously, we continue to focus on 3 capital allocation priorities. These include making targeted investments in our business to drive our organic growth, returning capital to our shareholders and identifying and evaluating inorganic growth opportunities or M&A that complement and leverage our growing broadband installed base. Aligned with our first key priority, we expect to invest in our inventory over the next several quarters to support our expected growth in broadband, which includes our rest of world customers, where we are continuing to make good progress. While our inventory was actually lower in Q3, this remains a priority as we continue to order material for next year.
Returning capital to our shareholders is also important to us. As such, we will continue to engage in opportunistic stock repurchases under our share repurchase program, which authorizes up to $200 million of repurchases and doubled our previous program. Year-to-date, we have repurchased $65.8 million of our common shares under this program, including repurchasing shares totaling $15.7 million in the third quarter. As we stated before, we plan to fund these purchases with expected strong free cash flow generation over the next 3 years.
Our balance sheet remains strong with ample sources of liquidity. At the end of Q3, we had $127.4 million in cash and $82 million available under our credit facility. We believe this is more than sufficient to support our capital allocation priorities. Additionally, I'm pleased to share that following an analysis of the recent passage of the One Big Beautiful Bill Act, as well as the impact of Section 174 R&D adjustments, we expect to realize a meaningful reduction in our cash income taxes by a cumulative total of approximately $50 million for both 2025 and 2026. This will further enhance our capital allocation plan as we consider additional investments to accelerate our growth in broadband.
Now let's take a more detailed look at our third quarter 2025 financial results on Slide 12. As I mentioned earlier, second quarter total company revenue was $142.4 million. In the quarter, we had one customer representing greater than 10% of total revenue, which was Comcast accounting for 43% of total revenue. Total company Q3 gross margin was 54.4%, once again surpassing the high end of our guidance range and up 70 basis points year-over-year.
Broadband Q3 gross margin was 47.3%, which was also above our guidance range and down year-over-year as anticipated, mainly due to tariff costs and mix. Video gross margin in Q3 was 66.7%, reflecting continued revenue strength from larger appliance deals, SaaS expansion and our cost optimization efforts.
Moving down the income statement on Slide 13. Q3 total company operating expenses were $58.4 million, down 3.5% year-over-year as a result of our prior restructuring initiatives in video and additional cost actions. We expect OpEx to increase in Q4 due to seasonality. Our profitability metrics exceeded our guidance range as third quarter 2025 broadband EBITDA was $14.2 million and video EBITDA was $7.7 million. Total company EPS was $0.12.
Q3 bookings were $133.3 million. The book-to-bill ratio for the quarter was 0.9 compared to 1.1 in Q2 '25 and 0.9 in Q3 '24. Broadband book-to-bill was above 1. Over time, we expect our book-to-bill ratio to normalize with some possible quarterly fluctuations and approach the historical benchmark of greater than 1, especially as we see growth in broadband due to Unified DOCSIS 4.0 and other customer ramps accelerate.
Turning to the balance sheet on Slide 14. As I've noted earlier, we ended Q3 with cash and cash equivalents of $127.4 million. The sequential change in cash was mainly attributable to positive free cash flow in the quarter, offset by share repurchases. Days sales outstanding at the end of Q3 was 66 compared to 79 in Q2 '25 and 80 in Q3 '24. The sequential decrease was due to a larger number of shipments that took place earlier in the quarter, allowing for collections to occur in the quarter. We expect DSO to return to our typical levels. Inventory decreased $2.5 million in the quarter, and our days inventory on hand fell to 95 from 101 days last quarter.
At the end of Q3, total backlog and deferred revenue was $494.5 million. Around 63% of our backlog and deferred revenue have customer request dates for shipments of products and for providing services within the next 12 months.
Turning to guidance. We continue to anticipate a moderate pace of broadband upgrade activity in the short term. However, we continue to see positive tailwinds for 2026 as Unified 4.0 technology progresses and customer ramp readiness improves. We expect these positive developments to support increasing revenue growth in broadband during the course of 2026.
Now let's review our non-GAAP guidance for Q4 2025, beginning on Slide 15. Given the timing of the DOCSIS 4.0 transition and macroeconomic conditions, similar to last quarter, we're taking a prudent approach to our Q4 guidance. For Q4, we expect broadband to deliver revenue between $85 million to $95 million, gross margins between 48% to 50% due to product mix and adjusted EBITDA between $10 million to $16 million. This broadband guidance includes an estimated tariff impact of less than $1 million in the Q4 margins, similar to what we saw in Q3 based on the current announced tariff rates and exemptions. For our video segment in Q4, we expect revenue in the range of $48 million to $52 million, gross margin in the range of 66% to 67% and adjusted EBITDA to range from $3 million to $6 million.
On this slide, we have also provided total company guidance for Q4. In the interest of time, I will let you read through the details. Please also note that our non-GAAP tax rate remains at 21%. I would like to highlight that total company EPS for the fourth quarter is expected to be in the range of $0.06 to $0.12.
In closing, we executed a very successful quarter with sequential momentum and results that exceeded our expectations across both businesses. As we finish 2025, we are starting to see the effects of DOCSIS 4.0 transition timing become the tailwinds we anticipate will drive our broadband growth in 2026 with increasing strength as the year progresses and operator ramp-ups accelerate. Based on all of this, we expect modest sequential broadband revenue growth in Q1 2026 versus Q4 2025 guidance, again, with momentum building as we move throughout 2026. This growth, combined with our substantial operating leverage and the cash tax benefits I mentioned earlier, leave us well positioned for not only stronger revenue growth, but also increased profitability and free cash flow as we move into next year and beyond.
We thank everyone for their attention today. And now I'll turn it back to Nimrod for final remarks before we open up the call for questions.
Thanks, Walter. For the third quarter, we generated strong results that were once again above the high end of the guidance, driven by our progress in cOS deployments, Unified 4.0, fiber and video appliances and SaaS streaming. Looking ahead, we remain confident that 2026 will mark a return to growth, supported by expanding Unified 4.0 adoption, continued fiber expansion and growing impact of our intelligent cloud services.
That concludes our prepared remarks. Walter and I are now happy to take your questions.
[Operator Instructions] Our first question will come from the line of Simon Leopold with Raymond James.
So it looks like your top customers continuing to be on an improving trend through this year. Just wondering how you're thinking about that long term? In other words, should we expect that you're on a path now to getting back to levels you've had historically? Or would you consider the current level somewhat normalized? And just wondering, you haven't had that second 10% customer in a bit. We think that, that customer has been absorbing inventory. Just sort of what's your expectation for when you get a second 10% customer?
Simon, it's Walter. So to address both of those questions, first of all, we're not going to specifically guide any one of our large customers here in terms of when they're going to be 10% or not. I think you can look at the history of that customer in terms of being a 10% customer in past quarters, and we expect that customer to return to that level at some point in time.
With regards to how we think about our top customers, obviously, we are planning in tandem our view of our top customers as well as the rest of world customers as we look at the broadband picture for 2026 and beyond. Today, we shared in our prepared remarks commentary around how we see Q1 of '26 unfolding based on the visibility we have today as well as our expectations that the momentum will pick up as the year goes on in terms of the growth. We're just today starting to get some visibility around customers' plans for next year, and that will be fine-tuned over the coming months as it typically does as we enter into the new year.
One moment for our next question. And that will come from the line of Ryan Koontz with Needham & Co.
This is Matt on for Ryan. Your fourth quarter guidance implies a change to normal seasonality, which if you look historically, is usually up strong sequentially. How should we think about that change this year? And then going forward, should we expect a return to normal seasonality?
Matt, it's Walter here. So with regards to our Q4 guidance, I think all year, we have been communicating the headwinds impacting us in terms of getting ready for the DOCSIS 4.0 transition, the Unified 4.0 platform specifically. And so I think with this year, specifically, we're looking at getting ready for that transition as we move into 2026. So that's why we're guiding what we're guiding for Q4 based on where we see things today in terms of that transition.
But as Nimrod mentioned in the prepared remarks, we're seeing everything on track in terms of progress across the piece in terms of customers getting ready for deployment of Unified 4.0. Nimrod mentioned Mediacom in his opening remarks as a great example of that. As we look at customers getting ready for that transition, that's why we continue to point to 2026 in terms of growth and accelerating growth through that year.
And we also mentioned that the specific unified RF tray would only become available late in the fourth quarter. So that by itself is also a factor for Q4.
Great. And as a follow-up, earlier in the call, you had highlighted the strong growth coming out of your rest of world segment. Could you just share what the current market drivers are there for that strength? And how we should think about that opportunity for more customer diversification going forward?
Yes. So over time, we expect most of the global market of DOCSIS to make the transition from legacy into the virtualized platform for a long list of reasons. But I think, as I highlighted, the imperatives for the network evolution for them, increasing speed was historically the driver for that, but it's no longer the main driver. They have to do whatever they can to improve customer experience and satisfaction and as a result of that, to drive improvement of churn and reducing the operating cost. And the new platform with all the tools that we provide is enabling that.
So --that's what we see globally, and we shared today a fairly long list of recent wins. And specifically, as it relates to DOCSIS 4.0 with the success and I think the Mediacom specifically kind of their launch of the service gave a lot of confidence to the rest of the market. So we clearly see that. And I also recognize the progress that we are seeing in the kind of maturity of the ecosystem, interoperability that is taking place by CableLabs, modems availability, smart amplifiers. So it's all coming together, and that's what's kind of driving our confidence.
[Operator Instructions] Our next question will come from the line of Steve Frankel with Rosenblatt Securities.
I'm wondering if you might quantify a couple of things for me. The extent of that pull-in in the broadband business that you mentioned, how material was that in pulling revenue, which you anticipated in Q4 into Q3? And then I have a video question for you when you're finished with that.
Yes, Steve, it's Walter. It was a few million dollars.
Okay. And then maybe a ballpark on or some description of the Akamai impact on the video business that you mentioned in the slides, either in terms of revenue or new customer acquisition? How should we think about the leverage from that partnership?
Sure, Steve. I'll kick it off. With regards to Akamai, we've started onboarding customers onto the platform. And when you look at our sequential growth in video in terms of video SaaS from Q2 to Q3, a large part of that was a result of getting started with the onboarding with Akamai. Now that's going to continue in terms of several months to onboard additional customers onto the platform, and we see that as a big factor of growth as we move forward. And as we look at FY '26 and bring those customers on and get them to full run rate, it will be part of the -- big part of the growth story in SaaS next year.
The other thing is that, Steve, just on Akamai we are transitioning the media services, which is kind of the first layer, if you will. And some of these customers are then taking our additional services that we provide with VOS on live streaming and ad. So we see incremental revenues, and some of that was already reflected in the third quarter.
Okay. But it will continue to build as we get into 2026 is what I'm hearing you say you're fully transitioned until some point in '26.
That’s correct.
And then if I sneak one last one in. This Spectrum announcement today, that's saying there was a portion of their network originally they thought was going to stay 3.1. Now it's going to look like the 85% that you were focused on before, correct?
I think you should relate to what they publicly announced. If I'm not mistaken, they always talked about a 4.0 phase in their network evolution. I guess the news from our point of view is that both the virtual CMTS -- well, the virtual CMTS obviously supports 4.0 and future evolution of DOCSIS. There was a discussion around that during the recent SCTE TechExpo about going beyond 1.8 gigahertz. So future potential evolution of that will be covered as well as our participation in the Unified DOCSIS 4.0.
One moment for our next question. And that will come from the line of George Notter with Wolfe Research.
This is Taren on for George. I just wanted to get a better idea of the sizing or potential opportunity of this fiber-to-the-home opportunity, the announcement you guys made with Comcast. I would love any more detail there and how you guys think about that going forward?
Yes. So I guess what we shared is the announcement we made around the SCTE, which we enable Comcast to do that on the remote OLT and software components like the virtual BNG and that Comcast is doing about one million new homes a year. We did not provide any financial details unit count or anything like that. But one million new homes is quite sizable in terms of what they do, and we power them to enable that.
I'm showing no further questions in the queue at this time. I would now like to turn the call back over to management for any closing remarks.
We appreciate your continued interest in Harmonic and look forward to updating you on our progress in the future. Thank you all for joining the call. Have a good day.
This concludes today's program. Thank you all for participating. You may now disconnect.
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Harmonic Inc. — Q3 2025 Earnings Call
Harmonic Inc. — Q3 2025 Earnings Call
📊 Quartal auf einen Blick
- Umsatz: $142,4 Mio. (Q3 2025)
- Broadband: $90,5 Mio.; Adjusted EBITDA (bereinigt) $14,2 Mio.
- Video: $51,9 Mio. (+2,9% YoY); SaaS-Streaming $16,1 Mio. (+13,6% YoY)
- Profitabilität: Non‑GAAP EPS $0,12; Gesamt-Bruttomarge 54,4% (+70 Basispunkte YoY)
- Cash & Rückkauf: Kasse $127,4 Mio.; Aktienrückkäufe gesamt ~ $66M unter aktuellem Programm
🎯 Was das Management sagt
- Unified DOCSIS 4.0: Kommerzielle Live‑Rollouts (z.B. Mediacom) und erweiterte Partnerschaft mit Charter – Harmonic positioniert sich als Lieferant für Unified RPDs und virtuelle Plattformen.
- Fiber‑Wachstum: Zusammenarbeit mit Comcast (≈1 Mio. neue FTTH‑Passings/Jahr) und Remote‑OLT/virtual BNG‑Einsätze; Fiber als Hauptwachstumstreiber.
- Video & SaaS: VOS‑Plattform mit Multi‑Cloud‑Resilienz, AI‑Ad‑Integrationen und Akamai‑Onboarding treiben wiederkehrende SaaS‑Erlöse.
- Kapitalallokation: Fokus auf gezielte Investitionen, opportunistische Rückkäufe (Programm bis $200M) und selektive M&A‑Prüfungen.
🔭 Ausblick & Guidance
- Q4 Guidance Broadband: $85–95 Mio. Umsatz; Bruttomarge 48–50%; Adjusted EBITDA $10–16 Mio.; berücksichtigt geschätzte Zollwirkung <$1M.
- Q4 Guidance Video: $48–52 Mio. Umsatz; Bruttomarge 66–67%; Adjusted EBITDA $3–6 Mio.
- 2026‑Ausblick: Management erwartet beschleunigtes Broadband‑Wachstum während 2026 mit steigender Profitabilität; zusätzlicher Cash‑Steuervorteil ≈ $50 Mio. kumulativ für 2025–2026.
❓ Fragen der Analysten
- Kundenkonzentration: Nachfrage nach Rückkehr eines zweiten >10%-Kunden; Management verweist auf historische Schwankungen und erwartet Rückkehr, nennt aber kein Timing.
- Jahreszeitlichkeit: Analysten fragten nach veränderter Q4‑Saisonalität; Antwort: vorsichtige Guidance wegen DOCSIS‑4.0‑Übergang und verzögerter RF‑Tray‑Verfügbarkeit (erste Lieferungen Ende Q4).
- Akamai & Comcast: Akamai‑Onboarding erklärt als Treiber für weiteres Video‑SaaS‑Wachstum in 2026; Comcast‑FTTH‑Programm (1M Homes/Jahr) bestätigt, finanzielle Details nicht offengelegt.
⚡ Bottom Line
- Fazit: Q3 übertraf die Guidance, profitabel mit starkem Free Cash Flow und solidem Backlog (~$495M). Near‑term Timingrisiken durch DOCSIS‑4.0‑Übergang und Produktverfügbarkeit drücken konservativ die Q4‑Leitlinien, während 2026 als Jahr der beschleunigten Broadband‑Wachstums‑ und Margenentwicklung dargestellt wird. Für Anleger heißt das: solide operative Dynamik und Kapitalrückführung, aber fortgesetzte Abhängigkeit vom Rollout‑Timetable großer Netzbetreiber.
Finanzdaten von Harmonic Inc.
Umsatz
Der Umsatz stellt die Summe aller Einnahmen eines Unternehmens z. B. für dessen Produkte oder Dienstleistungen dar.
Umsatz (TTM) einfach erklärtDirekte Kosten
Direkte Kosten sind die Kosten, die direkt im Zusammenhang mit der Herstellung des Produkts oder der Dienstleistung entstehen.
Bruttoertrag
Der Bruttoertrag gibt an, wie viel vom Umsatz nach Abzug der direkten Herstellkosten im Unternehmen verbleibt. Berechnet man den prozentualen Anteil vom Umsatz, spricht man von der Bruttomarge (engl. Gross Margin).
Brutto Marge einfach erklärtVertriebs- und Verwaltungskosten
Die Vertriebs- & Verwaltungskosten (engl. Selling, General & Administrative expenses, kurz SG&A) beinhalten alle Aufwände für Marketing und den Verkauf sowie die allgemeine Verwaltung des Unternehmens.
Forschungs- und Entwicklungskosten
Die Forschungs- und Entwicklungskosten (engl. research & development costs, kurz R&D) geben Auskunft darüber, wie viel das Unternehmen in die Forschung und die Entwicklung seiner Produkte investiert. Vor allem prozentual vom Umsatz und im Vergleich zu direkten Wettbewerbern sind die Kosten interessant.
EBITDA
Das EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) ist der Gewinn des Unternehmens vor Zinsen, Steuern und Abschreibungen. Berechnet man den prozentualen Anteil vom Umsatz, spricht man von der EBITDA-Marge.
Abschreibungen
Abschreibungen stellen Wertminderungen von Vermögensgegenständen des Unternehmens dar (z.B. durch Abnutzung von Maschinen).
EBIT (Operatives Ergebnis)
Das EBIT (engl. Earnings Before Interest and Taxes) ist der Gewinn des Unternehmens vor Zinsen und Steuern, das auch als operatives Ergebnis bezeichnet wird. Berechnet man den prozentualen Anteil vom Umsatz, spricht man von
der EBIT-Marge.
Nettogewinn
Der Nettogewinn stellt den Gewinn oder Verlust nach Abzug aller Kosten dar.
Nettogewinn einfach erklärtaktien.guide Premium
| Jul '26 |
+/-
%
|
||
| Umsatz | 417 417 |
39 %
39 %
100 %
|
|
| - Direkte Kosten | 205 205 |
33 %
33 %
49 %
|
|
| Bruttoertrag | 212 212 |
45 %
45 %
51 %
|
|
| - Vertriebs- und Verwaltungskosten | 106 106 |
29 %
29 %
25 %
|
|
| - Forschungs- und Entwicklungskosten | 91 91 |
25 %
25 %
22 %
|
|
| EBITDA | 56 56 |
54 %
54 %
13 %
|
|
| - Abschreibungen | 11 11 |
3 %
3 %
3 %
|
|
| EBIT (Operatives Ergebnis) EBIT | 45 45 |
59 %
59 %
11 %
|
|
| Nettogewinn | -47 -47 |
169 %
169 %
-11 %
|
|
Angaben in Millionen USD.
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Firmenprofil
Harmonic, Inc. beschäftigt sich mit der Entwicklung und dem Verkauf von Software, Produkten, Systemlösungen und Dienstleistungen für die Videobereitstellung. Sie ist in den Segmenten Video und Cable Access tätig. Das Segment Video verkauft Videoverarbeitung und -produktion sowie Playout-Dienste an Kabelnetzbetreiber, Anbieter von Satelliten- und Telekommunikations-Pay-TV-Diensten sowie an Rundfunk- und Medienunternehmen. Das Segment Kabelzugang bietet Kabelnetzbetreibern Lösungen an. Das Unternehmen wurde im Juni 1988 gegründet und hat seinen Hauptsitz in San Jose, Kalifornien.
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| Hauptsitz | USA |
| CEO | Mr. Ben-Natan |
| Mitarbeiter | 521 |
| Gegründet | 1988 |
| Webseite | www.harmonicinc.com |


