Extreme Networks (EXTR) Q1 2027 earnings summary

Executive summary

• Q1 revenue was $341.1M, up 9.9% YoY, marking a seventh consecutive quarter of double-digit revenue and product revenue growth; non-GAAP EPS rose 50% to $0.33.

• SaaS ARR reached $264.7M, up 22.4% YoY; strong demand and Platform ONE adoption supported 10% FY27 growth expectations.

Financial highlights

• Product revenue was $218.3M, up 12.5%; subscription and support revenue was $122.8M, up 5.7%.

• GAAP net income was $16.0M versus $5.6M; non-GAAP net income was $44.5M, up 48% YoY.

• Non-GAAP gross margin was 62.6%, up from 61.3%; non-GAAP operating margin was 17.4%, up from 13.3%.

• Adjusted EBITDA was $65.6M, up 47%, with a 19.2% margin; free cash flow was $38.6M.

• Recurring revenue was $119M, up 7% YoY and 35% of total revenue.

Outlook and guidance

• Q2 FY27 revenue guidance is $345.8M–$350.8M; non-GAAP gross margin 62.2%–62.7%, operating margin 16.4%–17.4%, and EPS $0.32–$0.34.

• FY27 revenue guidance is $1,402.3M–$1,412.3M, up 10% at midpoint; non-GAAP gross margin 62.3%–62.8%, operating margin 17.2%–17.6%, and EPS $1.35–$1.39.

• GAAP Q2 EPS guidance is $0.19–$0.22; FY27 EPS guidance is $0.77–$0.83.

• SaaS ARR growth is expected to exceed 20% through the rest of FY27; recurring revenue growth is expected to accelerate in FY28 as SaaS deferred revenue builds.

• FY27 non-GAAP tax rate is expected to be 21.8%; profitability is expected to maintain its current course in Q2 despite seasonally higher expenses.