Calix (CALX) Q3 2026 earnings summary

Executive summary

• Q3 revenue was $301.7M, up 14% YoY; software and services revenue rose 19% to $51.9M, while net income declined to $10.2M from $15.7M.

• Calix One contracts signed in Q3 more than doubled sequentially; the platform serves over 1,200 service-provider customers after more than $2B invested over 15 years.

• AI strategy spans Calix One, Agent Workforce, communications-specific language models and Gems, with expansion planned across broadband, MDU, MSP and hospitality markets.

• Q4 guidance implies continued growth; the long-term annual growth baseline is 15%, with management seeking to accelerate its target of OpEx growth at half the revenue growth rate into 2027.

Financial highlights

• Q3 revenue was $301.7M, up 3% sequentially and 14% YoY; appliance revenue was $249.8M, up 13% YoY, and software and services revenue was $51.9M, up 19%.

• Q3 gross profit was $160.8M versus $152.0M; operating income was $16.6M versus $17.4M, and net income was $10.2M versus $15.7M.

• Q3 basic and diluted EPS were each $0.16, versus $0.24 basic and $0.22 diluted in Q3 2025.

• 9M revenue rose 20% to $875.0M; net income was $38.5M versus $10.7M, operating income was $51.1M versus $11.7M, and diluted EPS was $0.58 versus $0.15.

• Non-GAAP OpEx was $124M, or 41% of revenue, versus 42% in Q2; cash and investments totaled $154.8M at quarter-end.

Outlook and guidance

• Q4 2026 revenue guidance is $311M-$317M; non-GAAP gross margin 52.25%-54.75%, OpEx $129.5M-$131.5M and EPS $0.41-$0.49.

• At the Q4 guidance midpoint, 2026 non-GAAP EPS is projected at $1.76, representing 30% annual growth versus 19% revenue growth.

• Q4 OpEx includes annual ConneXions spending and five additional quarter days, partly offset by productivity gains; excluding the seasonal increase, OpEx/revenue is expected to trend toward 40% and below.

• Management’s long-term annual growth baseline is 15%; it is working to move the target of OpEx growth at half the revenue growth rate into 2027 from 2028.

• 2027 appliance margins are expected to stabilize near current levels, while software and services margin of 70% is expected within the 2027 outlook.