A10 Networks (ATEN) Q2 2026 earnings summary

Executive summary

• Q2 2026 revenue reached $80.1 million, up 15.5% year-over-year, with first-half revenue up 14.5% year-to-date, driven by strong enterprise demand in the Americas and security-led growth.

• Completed acquisition of TrojAI, enhancing AI security capabilities, and signed a long-term strategic agreement with Microsoft, deepening operational integration.

• Raised full-year 2026 revenue growth outlook to 12%-14% and EPS growth to 14%-16% due to strong demand and execution.

• Returned $6.7 million to shareholders in Q2 via dividends and share repurchases; Board approved a $0.06 per share dividend for September 2026.

• Issued a warrant to Microsoft for up to 800,000 shares, aligning commercial interests and supporting future sales.

Financial highlights

• Q2 2026 revenue was $80.1 million (+15.5% YoY); year-to-date revenue was $155.1 million (+14.5% YoY).

• Product revenue was $49 million (61% of total), service revenue $31.1 million (39% of total).

• Non-GAAP gross margin was 80.3%; GAAP gross margin was 79.1%.

• Non-GAAP net income was $18.7 million ($0.25 per diluted share); GAAP net income was $8.9 million ($0.12 per diluted share).

• Adjusted EBITDA was $25.4 million (30.5% of revenue); cash, cash equivalents, and marketable securities totaled $357.3 million as of June 30, 2026.

Outlook and guidance

• Full-year 2026 revenue growth guidance increased to 12%-14% (from 10%-12%).

• EPS growth guidance raised to 14%-16% (from 12%-14%).

• Free cash flow expected to grow year-over-year from $65 million in 2025.

• Management expects continued investment in R&D and sales to support growth in cybersecurity and AI-driven solutions.

• Existing liquidity is expected to cover operational and strategic needs for at least the next 12 months.