Harmonic (HLIT) investor relations material

Executive summary

• Q3 2025 revenue was $142.4 million, down 27% year-over-year but exceeded internal expectations for both Broadband and Video segments, with strong SaaS growth and net income of $2.7 million.

• Cash balance increased to $127.4 million, up from $58 million a year ago, with $16 million in Q3 share repurchases and $66.1 million year-to-date.

• Positioned for growth in 2026, driven by Unified DOCSIS 4.0, customer ramps, and expanded partnerships.

• Gross margin improved to 54.2%–54.4%, up 70 basis points year-over-year, driven by favorable product mix.

• Operating cash flow for the nine months ended September 26, 2025, was $95.7 million, up from $13.4 million in the prior year period.

Financial highlights

• Q3 revenue was $142.4 million (down 27% year-over-year); EPS was $0.12; net income was $2.7 million; free cash flow was $21 million; cash at quarter-end was $127.4 million.

• Broadband revenue was $90.5 million (down 38% year-over-year) with a gross margin of 47.3%; Video revenue was $51.9 million (up 3% year-over-year) with a gross margin of 66.7%.

• Video SaaS revenue grew 13.6% year-over-year to a record $16.1 million.

• Adjusted EBITDA was $21.9 million, down from $43.4 million year-over-year.

• Book-to-bill ratio was 0.9; bookings for the quarter were $133.3 million.

Outlook and guidance

• Q4 2025 revenue guidance: $133–$147 million; gross margin expected between 53.4% and 56.0%; EPS guidance $0.06–$0.12.

• Broadband revenue guidance: $85–$95 million; Video: $48–$52 million.

• Modest sequential broadband revenue growth anticipated in Q1 2026, with momentum building through 2026 as Unified DOCSIS 4.0 and fiber deployments scale.

• Positive tailwinds expected for broadband in 2026, supported by technology progress and customer ramp readiness.

• Liquidity is expected to remain adequate for at least the next 12 months, with $127.4 million in cash and $82 million available under the credit facility.