Ribbon Communications Inc. reports third Quarter 2026 Financial Results. Oct 27, 2026, 16:03 ET Revenue increased 14% sequentially and Net Income improved by $18M; further significant gains expected in 4Q 2026 IP Optical Networks Revenue increased 17% QoQ led by new wins in North America Cloud and Edge Revenue increased 11% QoQ led by U.S. Tier 1 Network Modernization Growing Pipeline of Data Center and AI-related Opportunities PLANO, Texas, Oct. 27, 2026 /PRNewswire/ - Ribbon Communications Inc. (Nasdaq: RBBN), a global leader in real-time communications technology, IP routing, and optical networking solutions, today announced its financial results for the third quarter of 2026. Third Quarter 2026 Highlights Financial Results[1]: * Revenue was $219 million, compared to $215 million for the third quarter of 2025 * GAAP Operating Income was $6 million, compared to $3 million for the third quarter of 2025 * Non-GAAP Adjusted EBITDA was $27 million, compared to $29 million for the third quarter of 2025 * GAAP Gross Margin was 48.2%, compared to 50.1% for the third quarter of 2025 * Non-GAAP Gross Margin was 50.3%, compared to 52.6% for the third quarter of 2025 "We had meaningful sequential increases in revenue and profitability in both of our operating segments again in the third quarter, consistent with our second quarter results commentary. The strong IP Optical Networks bookings trend in the first half of the year translated into a record third quarter sales for the business, growing 5% year over year and included two new U.S. Tier 2 Internet Service Provider customers," stated Bruce McClelland, President and Chief Executive Officer of Ribbon Communications. "We are also encouraged by increased activity in the Cloud and Edge segment with Service Provider revenue growing 15% sequentially supported by a 50% increase in sales to our largest customer, along with further growth in the Enterprise and Government market segments. This progress clearly supports the second-half improvement we expected, with positive trends in both operating segments and stronger results projected for the fourth quarter. Looking ahead to 2027, we see further growth drivers with the adoption of voice-enabled Enterprise AI applications, new solutions to mitigate AI-generated voice-phishing cyber-attacks, and broader demand for data center fiber infrastructure." Rick Marmurek, Chief Financial Officer of Ribbon Communications, remarked, "Our performance improved significantly in the third quarter, with revenue increasing 14% and Adjusted EBITDA more than doubling to $27 million from $12 million in the second quarter. At the same time, Non-GAAP operating expenses remained at $88 million. We continue to focus on expanding margins, maintaining strong cost discipline, and further strengthening our balance sheet." | / | / | Three months ended | / | Nine months ended | | / | / | September 30, | / | September 30, | | In millions, except per share amounts | / | 2026 | / | 2025 | / | 2026 | / | 2025 | | GAAP Revenue | / | $ 219 | / | $ 215 | / | $ 574 | / | $ 617 | | GAAP Net income (loss) | / | $ (9) | / | $ (12) | / | $ (70) | / | $ (49) | | Non-GAAP Net income (loss) | / | $ 12 | / | $ 7 | / | $ (1) | / | $ 12 | | Non-GAAP Adjusted EBITDA | / | $ 27 | / | $ 29 | / | $ 30 | / | $ 67 | | GAAP diluted earnings (loss) per share | / | $ (0.05) | / | $ (0.07) | / | $ (0.40) | / | $ (0.28) | | Non-GAAP diluted earnings (loss) per share | / | $ 0.07 | / | $ 0.04 | / | $ - | / | $ 0.07 | | Weighted average shares outstanding basic | / | 179 | / | 177 | / | 177 | / | 176 | | Weighted average shares outstanding diluted | / | 180 | / | 181 | / | 180 | / | 181 | | [1] Please see the reconciliations of the non-GAAP financial measures to the most directly comparable GAAP measures and additional information about non-GAAP measures in the section entitled "Discussion of Non-GAAP Financial Measures" in the attached schedules. | Business Highlights: Business Outlook[2] For the fourth quarter of 2026, the Company projects revenue of $233 million to $247 million. Non-GAAP gross margin is projected in a range of 53.5% to 54.5%. Adjusted EBITDA is projected in a range of $40 million to $47 million. The Company's outlook is based on current indications for its business, which are subject to change. | [2] GAAP earnings guidance is not provided. Please see the reconciliations of the non-GAAP financial measures to the most directly comparable GAAP measures and additional information about the non-GAAP measures in the section entitled "Discussion of Non-GAAP Financial Measures" in the attached schedules. | Upcoming Conference Schedule * November 10-12, 2026: Ribbon Insights, U.S. * November 19, 2026: Needham Virtual Technology Conference * December 1, 2026: UBS Global Technology & AI Conference Conference Call and Webcast Information Ribbon Communications will host a conference call to discuss the Company's financial results at 4:30 p.m. ET on Tuesday, October 27, 2026. Dial-in Information: US/Canada: 877-407-2991 International: 201-389-0925 Instant Telephone Access: Call me(TM) A live (listen-only) webcast and replay will be available on the Company's Investor Relations website at investors.ribboncommunications.com. Investor Contact +1 (978) 614-8050 [email protected] Media Contact Catherine Berthier +1 (646) 741-1974 [email protected] About Ribbon Ribbon Communications (Nasdaq: RBBN) is a global provider of voice communications software, IP routing, and optical networking to mobile and wireline service providers, enterprises, critical infrastructure and defense sectors. We support our customers' Path to Autonomous Networks by leveraging the latest AIOps automation platforms and Agentic AI technologies, helping them deliver better customer experiences, reduce operational costs, and achieve sustainable growth. To learn more about Ribbon, visit rbbn.com. Important Information Regarding Forward-Looking Statements This release contains "forward-looking statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, which are subject to a number of risks and uncertainties. All statements other than statements of historical facts contained in this release, including without limitation, statements regarding Company's projected financial results for the fourth quarter 2026 and beyond; expected customer bookings, spend and timing; beliefs about the Company's business strategy, including new product introductions such as the Acumen AIOps platform; beliefs about the accelerating adoption of AI and the shift towards autonomous networking; and the timing of customer network transformation projects, are forward-looking statements. Without limiting the foregoing, the words "anticipates", "believes", "could", "estimates", "expects", "expectations", "intends", "may", "plans", "projects" and other similar language, whether in the negative or affirmative, are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Forward-looking statements are based on the Company's current expectations and assumptions regarding its business, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are unknown and/or difficult to predict and that may cause the Company's actual results, performance or achievements to be materially different from those expressed or implied by the forward-looking statements. Such risks and uncertainties include, but are not limited to, unpredictable fluctuations in quarterly revenue and operating results; the impact of restructuring and cost-containment activities; impacts from new tariffs, the potential modification of, or loss of benefits under, the USMCA and other trade restrictions or taxes on our products; supply chain disruptions resulting from component availability; impacts from the wars in the Middle East and Ukraine and related economic volatility and uncertainty resulting therefrom; the impact of military call-ups of our employees in Israel; material litigation; the impact of fluctuations in interest rates; material cybersecurity and data intrusion incidents, including any security breaches resulting in the theft, transfer, or unauthorized disclosure of customer, employee, or company information; our ability to comply with applicable domestic and foreign information security and privacy laws, regulations and technology platform rules or other obligations related to data privacy and security; failure to compete successfully against telecommunications equipment and networking companies; failure to grow our customer base or generate recurring business from our existing customers; credit risks; the timing of customer purchasing decisions and our recognition of revenues; macroeconomic conditions, including inflation; our ability to adapt to rapid technological and market changes; our ability to generate positive returns on our research and development; our ability to protect our intellectual property rights and obtain necessary licenses; our ability to maintain partner, reseller, distribution and vendor support and supply relationships; the potential for defects in our products; risks related to the terms of our Credit Agreement, including our ability to comply with the maximum net leverage ratio, our ability to obtain future waivers or amendments to the Credit Agreement, and increases in the applicable interest margin; higher risks in international operations and markets; currency fluctuations; unanticipated adverse changes in legal, regulatory or tax laws; future accounting pronouncements or changes in our accounting policies; and/or failure or circumvention of our controls and procedures. We therefore caution you against relying on any of these forward-looking statements. These factors are not intended to be an all-encompassing list of risks and uncertainties that may affect the Company's business and results from operations. Additional information regarding these and other factors can be found in the Company's reports filed with the Securities and Exchange Commission, including, without limitation, its Form 10-K for the year ended December 31, 2025. Any forward-looking statement made by the Company in this release speaks only as of the date on which this release was first issued. The Company undertakes no obligation to update any forward-looking statement publicly or otherwise, whether as a result of new information, future developments or otherwise, except as required by law. Discussion of Non-GAAP Financial Measures The Company's management uses several different financial measures, both GAAP and non-GAAP, in analyzing and assessing the overall performance of its business, making operating decisions, planning and forecasting future periods, and determining payments under compensation programs. The Company considers the use of non-GAAP financial measures helpful in assessing the core performance of its continuing operations and when planning and forecasting future periods. The Company's annual financial plan is prepared on a non-GAAP basis and is approved by its board of directors. In addition, budgeting and forecasting for revenue and expenses are conducted on a non-GAAP basis, and actual results on a non-GAAP basis are assessed against the annual financial plan. The Company defines continuing operations as the ongoing results of its business adjusted for certain expenses and credits, as described below. The Company believes that providing non-GAAP information to investors allows them to view the Company's financial results in the way its management views them and helps investors to better understand the Company's core financial and operating performance and evaluate the efficacy of the methodology and information used by its management to evaluate and measure such performance. While the Company's management uses non-GAAP financial measures as tools to enhance its understanding of certain aspects of the Company's financial performance, management does not consider these measures to be a substitute for, or superior to, GAAP measures. In addition, the Company's presentations of these measures may not be comparable to similarly titled measures used by other companies. These non-GAAP financial measures should not be considered alternatives for, or in isolation from, the financial information prepared and presented in accordance with GAAP. Investors are cautioned that there are material limitations associated with the use of non-GAAP financial measures. In particular, many of the adjustments to the Company's financial measures reflect the exclusion of items that are recurring and will be reflected in its financial results for the foreseeable future. Stock-Based Compensation The expense related to stock-based awards is generally not controllable in the short-term and can vary significantly based on the timing, size and nature of awards granted. The Company believes that presenting non-GAAP operating results that exclude stock-based compensation provides investors with visibility and insight into its management's method of analysis and its core operating performance. Amortization of Acquired Technology (including software licenses); Amortization of Acquired Intangible Assets Amortization amounts are inconsistent in frequency and amount and are significantly impacted by the timing and size of acquisitions. Amortization of acquired technology is reported separately within Cost of revenue and Amortization of acquired intangible assets is reported separately within Operating expenses. These items are reported collectively as Amortization of acquired intangible assets in the accompanying reconciliations of non-GAAP and GAAP financial measures. The Company believes that excluding non-cash amortization of these intangible assets facilitates the comparison of its financial results to its historical operating results and to other companies in its industry as if the acquired intangible assets had been developed internally rather than acquired. Litigation Costs In connection with certain ongoing litigation where Ribbon is the defendant (as described in the Company's Commitments and Contingencies footnotes in its Form 10-Qs and Form 10-Ks filed with the SEC), the Company has incurred litigation costs beginning in 2023. These costs are included as a component of general and administrative expense. The Company believes that such costs are not part of its core business or ongoing operations, are unplanned, and generally are not within its control. Accordingly, the Company believes that excluding litigation costs related to these specific legal matters facilitates the comparison of the Company's financial results to its historical operating results and to other companies in its industry. Cybersecurity Incident The Company has recorded expenses associated with responding to and remediating a cybersecurity incident, including costs for external legal services, cybersecurity experts, and IT restoration activities. The Company believes that excluding these expenses facilitates the comparison of its financial results to its historical operating performance and to other companies in its industry, as these costs are non-recurring in nature and are not associated with future revenue streams or ongoing operational benefits. Acquisition-, Disposal- and Integration-Related The Company considers certain acquisition-, disposal- and integration-related costs to be unrelated to the organic continuing operations of the Company and its acquired businesses. Such costs are generally not relevant to assessing or estimating the long-term performance of the acquired assets. In 2025, the Company recorded expense for legal and professional fees associated with contemplated corporate development activities. The Company excludes such acquisition-, disposal- and integration-related costs to allow more accurate comparisons of its financial results to its historical operations and the financial results of less acquisitive peer companies and allows management and investors to consider the ongoing operations of the business both with and without such expenses. Restructuring and Related The Company has recorded restructuring and related expense to streamline operations and reduce operating costs by closing and consolidating certain facilities and reducing its worldwide workforce. The Company believes that excluding restructuring and related expense facilitates the comparison of its financial results to its historical operating results and to other companies in its industry, as there are no future revenue streams or other benefits associated with these costs. Preferred Stock and Warrant Liability Mark-to-Market Adjustment The Company recorded adjustments to the fair value of its Series A Preferred Stock and Warrants to purchase shares of the Company's common stock in Other (expense) income, net. Both of these instruments were issued in March 2023 in connection with the Company's private placement and have been classified as liabilities and marked to market each reporting period until the Series A Preferred Stock was fully redeemed on June 25, 2024. The Warrant liability remains outstanding and will continue to be marked to market each reporting period. The Company excluded these gains and losses from the change in the fair value of these liabilities because it believes that such gains or losses were not part of its core business or ongoing operations. Tax Effect of Non-GAAP Adjustments The Non-GAAP income tax provision is presented based on an estimated tax rate applied against forecasted annual non-GAAP income. The Company computes its non-GAAP estimated tax rate using its estimated GAAP annual effective tax rate for the period and adjusting for the tax effect of pre-tax non-GAAP adjustments. The Company computes a single annual non-GAAP rate for the Company and applies that rate (rather than multiple rates by jurisdiction) to its consolidated quarterly results. The Company expects that this methodology will provide a consistent rate throughout the year and allow investors to better understand the impact of income taxes on its results. Due to the methodology applied to its estimated annual tax rate, the Company's estimated tax rate on non-GAAP income will differ from its GAAP tax rate and from its actual tax liabilities. Adjusted EBITDA The Company uses Adjusted EBITDA as a supplemental measure to review and assess its performance. The Company calculates Adjusted EBITDA by excluding from income (loss) from operations: depreciation; stock-based compensation; amortization of acquired intangible assets; certain litigation costs; expenses related to cybersecurity incidents; acquisition-, disposal- and integration-related expense; and restructuring and related expense. In general, the Company excludes the expenses that it considers to be non-cash and/or not a part of its ongoing operations. The Company may exclude other items in the future that have those characteristics. Adjusted EBITDA is a non-GAAP financial measure that is used by the investing community for comparative and valuation purposes. The Company discloses this metric to support and facilitate dialogue with research analysts and investors. Other companies may calculate Adjusted EBITDA differently than the Company does, limiting its usefulness as a comparative measure. | RIBBON COMMUNICATIONS INC. | | Consolidated Statements of Operations | | (in thousands, except percentages and per share amounts) | | (unaudited) | | / | / | / | / | Three months ended | | / | / | / | / | September 30, | / | June 30 | / | September 30, | | / | / | / | / | 2026 | / | 2026 | / | 2025 | | Revenue: | / | / | / | / | / | / | | / | Product | $ 121,322 | / | $ 95,560 | / | $ 109,979 | | / | Service | 97,388 | / | 96,780 | / | 105,392 | | / | / | Total revenue | 218,710 | / | 192,340 | / | 215,371 | | Cost of revenue: | / | / | / | / | / | | / | Product | 70,166 | / | 58,877 | / | 62,037 | | / | Service | 38,665 | / | 38,766 | / | 40,311 | | / | Amortization of acquired technology | 4,353 | / | 4,354 | / | 5,057 | | / | / | Total cost of revenue | 113,184 | / | 101,997 | / | 107,405 | | Gross profit | 105,526 | / | 90,343 | / | 107,966 | | Gross margin | 48.2 % | / | 47.0 % | / | 50.1 % | | Operating expenses: | / | / | / | / | / | | / | Research and development | 44,424 | / | 44,858 | / | 45,894 | | / | Sales and marketing | 33,376 | / | 33,124 | / | 33,063 | | / | General and administrative | 15,233 | / | 14,643 | / | 16,368 | | / | Amortization of acquired intangible assets | 5,461 | / | 5,495 | / | 5,933 | | / | Acquisition-, disposal- and integration-related | - | / | - | / | 439 | | / | Restructuring and related | 1,436 | / | 4,442 | / | 3,506 | | / | / | Total operating expenses | 99,930 | / | 102,562 | / | 105,203 | | Income (loss) from operations | 5,596 | / | (12,219) | / | 2,763 | | Interest expense, net | (11,273) | / | (10,685) | / | (11,606) | | Other (expense) income, net | 1,125 | / | (2,258) | / | (134) | | Income (loss) before income taxes | (4,552) | / | (25,162) | / | (8,977) | | Income tax benefit (provision) | (4,565) | / | (1,709) | / | (3,132) | | Net income (loss) | $ (9,117) | / | $ (26,871) | / | $ (12,109) | | Earnings (loss) per share: | / | / | / | / | / | | / | Basic | / | $ (0.05) | / | $ (0.15) | / | $ (0.07) | | / | Diluted | $ (0.05) | / | $ (0.15) | / | $ (0.07) | | Weighted average shares used to compute earnings (loss) per share: | / | / | / | / | / | | / | Basic | / | 178,861 | / | 177,251 | / | 176,620 | | / | Diluted | 178,861 | / | 177,251 | / | 176,620 | | RIBBON COMMUNICATIONS INC. | | Consolidated Statements of Operations | | (in thousands, except percentages and per share amounts) | | (unaudited) | | / | / | / | / | Nine months ended | | / | / | / | / | September 30, | / | September 30, | | / | / | / | / | 2026 | / | 2025 | | Revenue: | / | / | / | / | | / | Product | $ 284,996 | / | $ 307,027 | | / | Service | 288,660 | / | 310,206 | | / | / | Total revenue | 573,656 | / | 617,233 | | Cost of revenue: | / | / | / | | / | Product | 178,468 | / | 186,676 | | / | Service | 116,359 | / | 115,192 | | / | Amortization of acquired technology | 13,269 | / | 15,722 | | / | / | Total cost of revenue | 308,096 | / | 317,590 | | Gross profit | 265,560 | / | 299,643 | | Gross margin | 46.3 % | / | 48.5 % | | Operating expenses: | / | / | / | | / | Research and development | 133,727 | / | 134,158 | | / | Sales and marketing | 98,769 | / | 97,387 | | / | General and administrative | 46,854 | / | 48,126 | | / | Amortization of acquired intangible assets | 16,612 | / | 18,063 | | / | Acquisition-, disposal- and integration-related | - | / | 4,337 | | / | Restructuring and related | 7,916 | / | 10,193 | | / | / | Total operating expenses | 303,878 | / | 312,264 | | Income (loss) from operations | (38,318) | / | (12,621) | | Interest expense, net | (31,714) | / | (33,083) | | Other (expense) income, net | (619) | / | 836 | | Income (loss) before income taxes | (70,651) | / | (44,868) | | Income tax benefit (provision) | 174 | / | (4,561) | | Net income (loss) | $ (70,477) | / | $ (49,429) | | Earnings (loss) per share: | / | / | / | | / | Basic | / | $ (0.40) | / | $ (0.28) | | / | Diluted | $ (0.40) | / | $ (0.28) | | Weighted average shares used to compute earnings (loss) per share: | / | / | / | | / | Basic | / | 177,270 | / | 176,366 | | / | Diluted | 177,270 | / | 176,366 | | RIBBON COMMUNICATIONS INC. | | Consolidated Balance Sheets | | (in thousands) | | (unaudited) | | / | / | / | / | September 30, | / | December 31, | | / | / | / | / | 2026 | / | 2025 | | Assets | / | / | / | | Current assets: | / | / | / | | / | Cash and cash equivalents | $ 40,383 | / | $ 96,405 | | / | Restricted cash | 1,972 | / | 1,726 | | / | Accounts receivable, net | 246,232 | / | 231,885 | | / | Inventory | 86,409 | / | 78,806 | | / | Other current assets | 52,052 | / | 45,663 | | / | / | Total current assets | 427,048 | / | 454,485 | | Property and equipment, net | 58,448 | / | 65,559 | | Intangible assets, net | 114,570 | / | 143,344 | | Goodwill | / | 300,892 | / | 300,892 | | Deferred income taxes | 180,154 | / | 174,318 | | Operating lease right-of-use assets | 42,888 | / | 46,240 | | Other assets | 26,574 | / | 27,417 | | / | / | / | / | $ 1,150,574 | / | $ 1,212,255 | | Liabilities and Stockholders' Equity | / | / | / | | Current liabilities: | / | / | / | | / | Current portion of term debt | $ 10,938 | / | $ 8,750 | | / | Revolving credit facility | 15,000 | / | - | | / | Accounts payable | 94,083 | / | 79,840 | | / | Accrued expenses and other | 78,857 | / | 90,759 | | / | Operating lease liabilities | 11,200 | / | 11,699 | | / | Warrant liability | 99 | / | - | | / | Deferred revenue | 112,454 | / | 124,425 | | / | / | Total current liabilities | 322,631 | / | 315,473 | | Long-term debt, net of current | 316,937 | / | 324,525 | | Warrant liability | - | / | 1,919 | | Operating lease liabilities, net of current | 55,609 | / | 60,159 | | Deferred revenue, net of current | 36,863 | / | 31,654 | | Deferred income taxes | 5,728 | / | 5,728 | | Other long-term liabilities | 24,088 | / | 23,803 | | / | / | / | Total liabilities | 761,856 | / | 763,261 | | Commitments and contingencies | / | / | / | | Stockholders' equity: | / | / | / | | / | Common stock | 18 | / | 18 | | / | Additional paid-in capital | 1,987,542 | / | 1,976,958 | | / | Accumulated deficit | (1,605,026) | / | (1,534,549) | | / | Accumulated other comprehensive income | 6,184 | / | 6,567 | | / | / | / | Total stockholders' equity | 388,718 | / | 448,994 | | / | / | / | / | $ 1,150,574 | / | $ 1,212,255 | | RIBBON COMMUNICATIONS INC. | | Consolidated Statements of Cash Flows | | (in thousands) | | (unaudited) | | / | / | / | / | / | Nine months ended | | / | / | / | / | / | September 30, | / | September 30, | | / | / | / | / | / | 2026 | / | 2025 | | Cash flows from operating activities: | / | / | / | | / | Net income (loss) | $ (70,477) | / | $ (49,429) | | / | Adjustments to reconcile net income (loss) to cash flows (used in) provided by operating activities: | / | / | / | | / | / | Depreciation and amortization of property and equipment | 13,343 | / | 12,182 | | / | / | Amortization of intangible assets | 29,881 | / | 33,785 | | / | / | Amortization of debt issuance costs and original issue discount | 2,252 | / | 2,102 | | / | / | Stock-based compensation | 16,498 | / | 14,619 | | / | / | Deferred income taxes | (5,985) | / | 52 | | / | / | Change in fair value of warrant liability | (1,820) | / | (2,811) | | / | / | Foreign currency exchange (gains) losses | 2,880 | / | 1,698 | | / | / | Changes in operating assets and liabilities: | / | / | / | | / | / | / | Accounts receivable | (15,255) | / | 34,258 | | / | / | / | Inventory | (11,491) | / | (382) | | / | / | / | Other operating assets | 3,587 | / | 822 | | / | / | / | Accounts payable | 16,041 | / | (5,017) | | / | / | / | Accrued expenses and other long-term liabilities | (20,607) | / | (15,880) | | / | / | / | Deferred revenue | (6,762) | / | (3,840) | | / | / | / | / | Net cash (used in) provided by operating activities | (47,915) | / | 22,159 | | Cash flows from investing activities: | / | / | / | | / | Purchases of property and equipment | (8,464) | / | (23,368) | | / | Purchases of software licenses | (553) | / | - | | / | / | / | / | Net cash (used in) provided by investing activities | (9,017) | / | (23,368) | | Cash flows from financing activities: | / | / | / | | / | Borrowings under revolving line of credit | 50,000 | / | - | | / | Principal payments on revolving line of credit | (35,000) | / | - | | / | Principal payments of term debt | (6,562) | / | (3,938) | | / | Payment of debt issuance costs | (977) | / | - | | / | Proceeds from the exercise of stock options | - | / | 6 | | / | Payment of tax obligations related to vested stock awards and units | (5,090) | / | (3,827) | | / | Repurchase of common stock | (824) | / | (5,731) | | / | / | / | / | Net cash (used in) provided by financing activities | 1,547 | / | (13,490) | | Effect of exchange rate changes on cash and cash equivalents | (391) | / | 987 | | Net (decrease) increase in cash and cash equivalents | (55,776) | / | (13,712) | | Cash, cash equivalents and restricted cash, beginning of year | 98,131 | / | 90,479 | | Cash, cash equivalents and restricted cash, end of period | $ 42,355 | / | $ 76,767 | | RIBBON COMMUNICATIONS INC. | | Supplemental Information | | (in thousands) | | (unaudited) | | The following tables provide the details of stock-based compensation included as components of other line items in the Company's Consolidated Statements of Operations and the line items in which these amounts are reported. | | / | / | / | / | Three months ended | / | Nine months ended | | / | / | / | / | September 30, | / | June 30 | / | September 30, | / | September 30, | / | September 30, | | / | / | / | / | 2026 | / | 2026 | / | 2025 | / | 2026 | / | 2025 | | Stock-based compensation | / | / | / | / | / | / | / | / | / | | Cost of revenue - product | $ 35 | / | $ 39 | / | $ 17 | / | $ 117 | / | $ 116 | | Cost of revenue - service | 202 | / | 175 | / | 152 | / | 538 | / | 636 | | / | Cost of revenue | 237 | / | 214 | / | 169 | / | 655 | / | 752 | | Research and development | 479 | / | 460 | / | 398 | / | 1,416 | / | 1,578 | | Sales and marketing | 1,385 | / | 1,103 | / | 1,493 | / | 3,618 | / | 3,732 | | General and administrative | 3,611 | / | 3,052 | / | 3,784 | / | 10,809 | / | 8,557 | | / | Operating expense | 5,475 | / | 4,615 | / | 5,675 | / | 15,843 | / | 13,867 | | / | / | Total stock-based compensation | $ 5,712 | / | $ 4,829 | / | $ 5,844 | / | $ 16,498 | / | $ 14,619 | | RIBBON COMMUNICATIONS INC. | | Reconciliation of Non-GAAP and GAAP Financial Measures | | (in thousands, except per share amounts) | | (unaudited) | | / | Three months ended | | / | September 30, | / | June 30 | / | September 30, | | / | 2026 | / | 2026 | / | 2025 | | GAAP Gross margin | 48.2 % | / | 47.0 % | / | 50.1 % | | Stock-based compensation | 0.1 % | / | 0.1 % | / | 0.1 % | | Amortization of acquired technology | 2.0 % | / | 2.2 % | / | 2.4 % | | Non-GAAP Gross margin | 50.3 % | / | 49.3 % | / | 52.6 % | | GAAP Net income (loss) | $ (9,117) | / | $ (26,871) | / | $ (12,109) | | Stock-based compensation | 5,712 | / | 4,829 | / | 5,844 | | Amortization of intangible assets | 9,814 | / | 9,849 | / | 10,990 | | Litigation costs | 3 | / | 302 | / | 952 | | Acquisition-, disposal- and integration-related | - | / | - | / | 439 | | Restructuring and related | 1,436 | / | 4,442 | / | 3,506 | | Preferred stock and warrant liability mark-to-market adjustment | (909) | / | 325 | / | (1,170) | | Tax effect of non-GAAP adjustments | 5,440 | / | 2,223 | / | (1,501) | | Non-GAAP Net income (loss) | $ 12,379 | / | $ (4,901) | / | $ 6,951 | | GAAP Diluted earnings (loss) per share | $ (0.05) | / | $ (0.15) | / | $ (0.07) | | Stock-based compensation | 0.03 | / | 0.03 | / | 0.04 | | Amortization of intangible assets | 0.06 | / | 0.05 | / | 0.06 | | Litigation costs | * | / | * | / | 0.01 | | Acquisition-, disposal- and integration-related | - | / | - | / | * | | Restructuring and related | 0.01 | / | 0.03 | / | 0.02 | | Preferred stock and warrant liability mark-to-market adjustment | (0.01) | / | * | / | (0.01) | | Tax effect of non-GAAP adjustments | 0.03 | / | 0.01 | / | (0.01) | | Non-GAAP Diluted earnings (loss) per share | $ 0.07 | / | $ (0.03) | / | $ 0.04 | | Weighted average shares used to compute diluted earnings (loss) per share | / | / | / | / | / | | Shares used to compute GAAP diluted earnings (loss) per share | 178,861 | / | 177,251 | / | 176,620 | | Shares used to compute Non-GAAP diluted earnings (loss) per share | 179,550 | / | 177,251 | / | 181,033 | | GAAP Income (loss) from operations | $ 5,596 | / | $ (12,219) | / | $ 2,763 | | Depreciation | 4,212 | / | 4,671 | / | 4,425 | | Stock-based compensation | 5,712 | / | 4,829 | / | 5,844 | | Amortization of intangible assets | 9,814 | / | 9,849 | / | 10,990 | | Litigation costs | 3 | / | 302 | / | 952 | | Acquisition-, disposal- and integration-related | - | / | - | / | 439 | | Restructuring and related | 1,436 | / | 4,442 | / | 3,506 | | Non-GAAP Adjusted EBITDA | $ 26,773 | / | $ 11,874 | / | $ 28,919 | | * Less than $0.01 impact on earnings (loss) per share. | / | / | / | / | / | | RIBBON COMMUNICATIONS INC. | | Reconciliation of Non-GAAP and GAAP Financial Measures | | (in thousands, except per share amounts) | | (unaudited) | | / | Nine months ended | | / | September 30, | / | September 30, | | / | 2026 | / | 2025 | | GAAP Gross Margin | 46.3 % | / | 48.5 % | | Stock-based compensation | 0.1 % | / | 0.1 % | | Amortization of acquired technology | 2.3 % | / | 2.6 % | | Non-GAAP Gross Margin | 48.7 % | / | 51.2 % | | GAAP Net income (loss) | $ (70,477) | / | $ (49,429) | | Stock-based compensation | 16,498 | / | 14,619 | | Amortization of intangible assets | 29,881 | / | 33,785 | | Litigation costs | 1,049 | / | 4,066 | | Acquisition-, disposal- and integration-related | - | / | 4,337 | | Restructuring and related | 7,916 | / | 10,193 | | Preferred stock and warrant liability mark-to-market adjustment | (1,821) | / | (2,811) | | Tax effect of non-GAAP adjustments | 16,075 | / | (2,779) | | Non-GAAP Net income (loss) | $ (879) | / | $ 11,981 | | GAAP Diluted earnings (loss) per share | $ (0.40) | / | $ (0.28) | | Stock-based compensation | 0.09 | / | 0.08 | | Amortization of intangible assets | 0.17 | / | 0.19 | | Litigation costs | 0.01 | / | 0.02 | | Acquisition-, disposal- and integration-related | - | / | 0.03 | | Restructuring and related | 0.05 | / | 0.06 | | Preferred stock and warrant liability mark-to-market adjustment | (0.01) | / | (0.01) | | Tax effect of non-GAAP adjustments | 0.09 | / | (0.02) | | Non-GAAP Diluted earnings (loss) per share | $ - | / | $ 0.07 | | Weighted average shares used to compute diluted earnings (loss) per share | / | / | / | | Shares used to compute GAAP diluted earnings (loss) per share | 177,270 | / | 176,366 | | Shares used to compute Non-GAAP diluted earnings (loss) per share | 177,270 | / | 180,512 | | GAAP Income (loss) from operations | $ (38,318) | / | $ (12,621) | | Depreciation | 13,343 | / | 12,182 | | Stock-based compensation | 16,498 | / | 14,619 | | Amortization of intangible assets | 29,881 | / | 33,785 | | Litigation costs | 1,049 | / | 4,066 | | Acquisition-, disposal- and integration-related | - | / | 4,337 | | Restructuring and related | 7,916 | / | 10,193 | | Non-GAAP Adjusted EBITDA | $ 30,369 | / | $ 66,561 | | RIBBON COMMUNICATIONS INC. | | Reconciliation of Non-GAAP and GAAP Financial Measures | | (in thousands) | | (unaudited) | | / | / | / | Trailing Twelve Months | / | / | | / | September 30, | / | June 30 | / | September 30, | | / | 2026 | / | 2026 | / | 2025 | | GAAP Income (loss) from operations | $ (29,021) | / | $ (31,854) | / | $ 20,599 | | Depreciation | 17,889 | / | 18,102 | / | 15,590 | | Stock-based compensation | 21,285 | / | 21,417 | / | 18,644 | | Amortization of intangible assets | 40,289 | / | 41,465 | / | 45,570 | | Litigation costs | 2,022 | / | 2,971 | / | 5,649 | | Cybersecurity incident | 600 | / | 600 | / | - | | Acquisition-, disposal- and integration-related | - | / | 439 | / | 4,337 | | Restructuring and related | 17,381 | / | 19,451 | / | 11,574 | | Non-GAAP Adjusted EBITDA | $ 70,445 | / | $ 72,591 | / | $ 121,963 | | RIBBON COMMUNICATIONS INC. | | Reconciliation of Non-GAAP and GAAP Financial Measures - Outlook | | (unaudited) | | / | / | / | Three months ending | / | Year ending | | / | / | / | December 31, 2026 | / | December 31, 2026 | | / | / | / | Midpoint [(1)] | / | / | Range | / | Midpoint [(1)] | / | Range | | Revenue ($ millions) | $ 240 | / | / | +/- $7M | / | $ 814 | / | +/- $7M | | Gross margin: | / | / | / | / | / | / | / | / | | / | GAAP outlook | 52.1 % | / | / | / | / | 48.0 % | / | / | | / | Stock-based compensation | 0.1 % | / | / | / | / | 0.1 % | / | / | | / | Amortization of acquired technology | 1.8 % | / | / | / | / | 2.2 % | / | / | | / | / | Non-GAAP outlook | 54.0 % | / | / | +/- 0.5% | / | 50.3 % | / | +/- 0.2% | | Adjusted EBITDA ($ millions): | / | / | / | / | / | / | / | / | | / | GAAP income (loss) from operations | $ 20.7 | / | / | / | / | $ (18.8) | / | / | | / | Depreciation | 4.6 | / | / | / | / | 18.1 | / | / | | / | Stock-based compensation | 5.0 | / | / | / | / | 21.0 | / | / | | / | Amortization of intangible assets | 9.8 | / | / | / | / | 39.6 | / | / | | / | Litigation costs | 0.4 | / | / | / | / | 1.6 | / | / | | / | Restructuring and related | 3.0 | / | / | / | / | 12.5 | / | / | | / | / | Non-GAAP outlook | $ 43.5 | / | / | +/- $3.5M | / | $ 74.0 | / | +/- $3.5M | | / | (1) Q4 2026 and FY 2026 outlook represents the midpoint of the expected ranges | / | / | / | / | SOURCE Ribbon Communications Inc.

Ribbon Communications Q3 earnings call highlights. October 27, 2026 Key points. * Third-quarter results improved significantly: Revenue rose 14% sequentially to $219 million, while adjusted EBITDA more than doubled to $27 million and non-GAAP EPS increased to $0.07. * IP Optical Networks reached a record third-quarter performance, with revenue up 17% sequentially and 5% year over year, while Cloud and Edge recovered as Verizon-related activity increased. * Ribbon expects further growth in the fourth quarter, forecasting revenue of $233 million to $247 million and adjusted EBITDA of $40 million to $47 million. However, supply constraints could defer $5 million to $10 million of customer demand into the following quarter. * MarketBeat All Access makes it easier to follow Ribbon Communications with alerts, analyst ratings, and deeper research - now $149 a year with your rate locked in. Ribbon Communications NASDAQ: RBBN reported third-quarter 2026 results that improved sequentially as stronger IP Optical Networks sales and a rebound in Cloud and Edge activity lifted revenue and profitability. The company also forecast further sequential and year-over-year growth in the fourth quarter, although management said supply constraints could defer some customer shipments into 2027. Revenue totaled $219 million in the third quarter, up 14% from the preceding quarter and 2% from a year earlier. Adjusted EBITDA more than doubled sequentially to $27 million, while non-GAAP diluted earnings per share reached $0.07, compared with a $0.03 sequential loss and $0.04 in the prior-year period. "We had a solid third quarter with meaningful sequential increases in revenue and profitability in both of our operating segments," Chief Executive Officer Bruce McClelland said during the company's earnings call. IP Optical sales reach record third-quarter level. Ribbon's IP Optical Networks segment generated $96 million in revenue, up 17% sequentially and 5% year over year. The segment's product revenue increased 13% from the prior-year period, partly offset by lower services revenue following the expiration of a legacy support contract in the fourth quarter of 2025. McClelland said the business delivered its best third quarter ever and its second-highest quarterly U.S. revenue performance. U.S. IP Optical sales increased more than 150% from a year earlier, while segment sales were more than 50% higher than first-quarter 2026 levels. IP routing shipments rose about 35% during the quarter and exceeded optical sales, according to McClelland. He said the performance highlighted the importance of Ribbon's combined routing and optical portfolio, though optical-only projects remain an important opportunity. The company cited new wins with two U.S. Tier 2 service providers, ongoing work with a major U.S. energy producer, and a new project with a Midwest regional power generation and transmission utility. Ribbon also recorded shipments to regional service providers supporting mobile backhaul, broadband internet and data-center interconnect services. International activity also contributed. Asia-Pacific revenue increased 20% sequentially and 19% year over year, including a new IP and optical project in Vietnam expected to exceed $10 million during 2026. Ribbon reported increased activity across Southeast Asia, as well as continued momentum in India. EMEA revenue rose 14% sequentially, though it fell 11% from the prior-year period because of lower Middle East and Africa sales following a record quarter a year earlier. For the first nine months of 2026, the IP Optical Networks business produced a 1.24x book-to-revenue ratio. Third-quarter bookings for the segment increased about 9% year over year, although the quarterly book-to-bill ratio was 0.82 because of the higher revenue conversion from backlog, McClelland said. Cloud and Edge recovers as Verizon activity improves. Cloud and Edge revenue was $123 million, up 11% from the second quarter and down 1% year over year. The segment's non-GAAP gross margin improved 210 basis points sequentially to 61.9%, while adjusted EBITDA rose $10 million sequentially to $28 million, or 23% of segment revenue. Service-provider revenue in the segment increased 15% sequentially, led in part by greater activity with Ribbon's largest customers. Verizon remained a customer representing more than 10% of quarterly revenue, and sales to the carrier increased approximately 50% compared with the first-half quarterly run rate. McClelland said Ribbon expects additional Verizon-related revenue in the fourth quarter and anticipates a higher switch-migration pace in 2027. The company is also in planning discussions involving Verizon's Frontier footprint, though management said the approach and timing remain early. Beyond large service providers, Ribbon highlighted a partnership with TNS designed to offer smaller and rural operators a managed, cloud-based option for replacing legacy voice switches. The company also cited a new voice modernization project with a large civilian federal agency, additional defense-agency shipments, and a Network in a Box win in a NATO country. Management said its partnership with Salesforce for the Agentforce Contact Center platform and its relationship with AWS could support subscription revenue as enterprises deploy AI-powered voice applications. Ribbon also introduced capabilities intended to detect AI-generated voice impersonation, deep fakes and related voice-phishing threats through its session border controller platform. Margins, cash flow and fourth-quarter outlook. Consolidated non-GAAP gross margin was 50.3%, improving 100 basis points sequentially but declining 230 basis points year over year due primarily to product and customer mix. Non-GAAP operating expenses were $88 million, roughly flat sequentially and down $1 million from a year earlier. Cash flow from operations was negative $14 million in the third quarter. Ribbon ended the period with $42 million in cash, including a $15 million revolver draw that Chief Financial Officer Rick Marmurek said was used to simplify cash management. Net debt leverage was 4.4x. Marmurek said Ribbon expects EBITDA improvement to reduce leverage through the fourth quarter and into 2027. He also expects cash flow to improve in the fourth quarter and first quarter of 2027 after a slower first half affected cash usage and accounts receivable increased alongside third-quarter invoicing. For the fourth quarter, Ribbon forecast: * Revenue of $233 million to $247 million. * Adjusted EBITDA of $40 million to $47 million. * Approximately $2 million per quarter of additional product costs tied to higher component and logistics expenses. Management said fourth-quarter growth should be led primarily by Cloud and Edge, supported by a greater mix of software and professional services. The company expects both business segments to grow sequentially. McClelland said Ribbon expects to be supply constrained "to some extent" in the fourth quarter amid demand for memory, core silicon and optical technology. He estimated that $5 million to $10 million of customer demand could shift from the fourth quarter into the following quarter because of supply availability. Total third-quarter bookings increased 8% year over year and backlog rose 9% from the prior-year period. McClelland said the company sees a healthy demand environment, a growing opportunity set in critical infrastructure, government and defense, and expanding international potential for IP routing and optical transport products. About Ribbon Communications (NASDAQ:RBBN). Ribbon Communications Inc NASDAQ: RBBN provides communications software, networking solutions and related services for service providers, enterprises and government organizations. The company helps customers build, operate and secure voice, data and unified communications networks across cloud, IP and optical environments. Ribbon's offerings include session border controllers, voice and unified communications platforms, signaling and routing solutions, policy and analytics tools, and software designed to support cloud communications and 5G networks. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. Before you consider Ribbon Communications, you'll want to hear this. MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Ribbon Communications wasn't on the list. While Ribbon Communications currently has a Moderate Buy rating among analysts, top-rated analysts believe these five stocks are better buys. Tesla, Nvidia, and Google helped shape the last era of market growth, but the next wave could come from a new group of companies. 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Ribbon Communications names Priyanka Kharat to lead Acumen business. The former ScienceLogic Skylar AI general manager joins as SVP, Acumen AI Autonomous Networking Business Leader, reporting into the executive team. Ribbon Communications Inc. (Nasdaq: RBBN) has appointed Priyanka Kharat as SVP, Acumen AI Autonomous Networking Business Leader, the Plano, Texas company said on Oct. 22, 2026. Kharat joins from ScienceLogic, where she was Vice President and General Manager of Skylar AI. In that role, according to the release, she led the strategy, development, and go-to-market efforts for AI-powered monitoring and automation solutions across IT infrastructure, networks, applications, and operations tools. She joins Ribbon's executive team and will be responsible for all aspects of driving the next phase of growth for the company's Acumen business, Ribbon said. "Priyanka possesses a strong AI pedigree, coupled with a deep understanding of how to build an AI growth engine with a combination of agentic AI and autonomous decision making, that will drive our Acumen business forward in alignment with market dynamics and customer demand," Bruce McClelland, Chief Executive Officer, Ribbon, said in a statement. "Throughout her career, she has helped grow businesses by applying AI and data technologies across healthcare, medical devices, semiconductors, and enterprise software." "I'm thrilled to join Ribbon at a pivotal moment as the industry increasingly adopts automation to improve reliability and lower operational costs on their journey toward autonomous networking. Networks are the arteries of our connected world, and Ribbon's decades of innovation, deep customer relationships, and growing momentum in AIOps and automation creates an exciting new growth opportunity," Kharat said. Ribbon Acumen is an AIOps & Automation platform for voice and data networks, according to the company. It is comprised of a series of ready-made applications and AI agents, along with a builder capability that enables organizations to develop their own applications and custom workflows that leverage AI for deep learnings and pro-active operational policy application. These workflows analyze and react to data from a wide range of sources, which the company said enables Acumen to automate network deployment and operations and provide tools to resolve issues. Ribbon Communications describes itself as a global provider of voice communications software, IP routing, and optical networking to mobile and wireline service providers, enterprises, critical infrastructure and defense sectors. Share: RIQ News Desk. The RIQ News Desk reports on the developments that change how enterprise technology is bought, run and governed: leadership appointments, funding and acquisitions, product and platform releases, regulatory action and security incidents across enterprise tech, cybersecurity, AI, martech, fintech and HR tech.