Track market-moving stories before they get noisy

Cautious IT spending amid heightened uncertainty over global macroeconomic conditions and volatile supply-chain dynamics due to tariff troubles continues to be concerning for the participants in the Zacks Computer - Networking industry in the near term. Fierce competition is an overhang on pricing power and margin expansion.

However, over the long term, the participants are expected to benefit from the networking infrastructure upgrade driven by AI workloads, cloud computing, big data, network security and next-generation connectivity.

The proliferation of AI workloads and hyperscale data centers is accelerating investments in high-speed interconnects, optical networking and Ethernet switches. Players in this space are focused on capitalizing on the multi-billion-dollar AI infrastructure opportunity. The rapid deployment of 5G is fueling the proliferation of the Internet of Things (IoT), Advanced Driver Assistance Systems, Augmented Reality/Virtual Reality (AR/VR) devices and 5G smartphones, driving demand for robust networking infrastructure. The Wi-Fi 7 upgrade cycle will act as a catalyst.

Also, the explosion of AI workloads requires a major upgrade to observability infrastructure. There is a greater need for continuous monitoring of hybrid environments and tighter security amid rising attacks. This will spur demand for innovative networking products, favoring prospects for prominent industry players such as Cisco Systems (CSCO - Free Report) , Extreme Networks (EXTR - Free Report) and Digi International (DGII - Free Report) .

Industry Description The Zacks Computer-Networking industry comprises companies that offer networking and Internet-connected products, including wireless (Wi-Fi and Long-Term Evolution or LTE), Ethernet and powerline, focusing on dependability and ease of use. The products are available in numerous configurations to cater to the changing requirements of consumers in each geographic territory where it operates. Some industry players also provide mission-critical IoT solutions and network security services to help clients build next-generation connected products, and implement and manage critical communications infrastructures in demanding environments with enhanced safety levels. Focus on developing IoT sensors, drones and wearables amid increasing demand for cloud computing-based contact tracing applications is driving the industry.

4 Trends Influencing the Industry's Future Technological Advancement Opening Business Avenues: The proliferation of AI and high adoption of cloud and data-intensive applications is driving higher traffic and creating a need for advanced optical networking, high-speed interconnects, Ethernet switches, routing and wireless infrastructure. Expansion of industrial IoT and edge computing, and the increasing popularity of smart connected devices are further creating growth opportunities. Rising cybersecurity concerns are emerging as a key tailwind, driving demand for solutions such as threat detection, network monitoring and zero-trust security architectures.

Rapid Deployment of 5G to Boost Growth Prospects: The success of the 5G technology hinges on substantial investments to upgrade infrastructure in the core fiber backhaul network to support growth in data services. Efforts to develop smart connected homes, hospitals, factories, buildings, cities and self-driving vehicles bode well for industry players. These firms invest heavily in LTE, broadband and fiber to provide additional capacity and improve Internet and wireless networks. These initiatives hold promise.

Wi-Fi 7 Upgrade Cycle to Drive Momentum: Brisk technological advancement, dynamic products, high-speed connectivity, low latency and evolving industry standards define the networking industry. The growing clout of the latest Wi-Fi 6E-compliant residential gateways, Wi-Fi routers, set-top boxes and wireless range extenders is a testament to the same. The increasing demand for connecting more devices to the network has been driving demand for Wi-Fi 6E devices. Wi-Fi 6E addresses Wi-Fi spectrum shortage issues by providing continuous channel bandwidth to support a higher number of connected devices without compromising speed. The rollout of Wi-Fi 7 bodes well for the companies in this space.

Macroeconomic Turmoil Is Concerning: Global macroeconomic weakness and volatile supply-chain dynamics are persistent concerns. Tariff troubles, especially between the United States and China, remain an overhang on global supply chains. Inflation could affect spending across small and medium-sized businesses globally and uncertainty in business visibility could dent the industry’s near-term performance.

The computer networking industry remains highly competitive, with a large number of established and new players vying for market share. As growth stabilizes, competition often intensifies, leading to pricing pressure and margin compression.

Zacks Industry Rank Indicates Bleak Near-Term Prospects The Zacks Computer-Networking Industry is housed within the broader Zacks Computer and Technology sector. The industry carries a Zacks Industry Rank #167, positioning it in the bottom 32% of more than 247 Zacks industries.

The group’s Zacks Industry Rank, which is the average of the Zacks Rank of all the member stocks, indicates bleak near-term prospects. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than two to one.

Before we present a few stocks you may want to consider for your portfolio, considering bright prospects, let us look at the industry’s recent stock-market performance and valuation picture.

Industry Outperforms the S&P 500 and the Sector The Zacks Computer-Networking industry has outperformed the S&P 500 composite and the broader Zacks Computer and Technology sector in the past year.

The industry has gained 67.4% over this period, compared with the broader sector’s 24.3% rally. The S&P 500 has appreciated 18.4% over the same time frame.

One-Year Price Performance

Industry's Current Valuation Based on the forward 12-month price-to-earnings (P/E) ratio, a common multiple for valuing Computer-Networking stocks, the industry is currently trading at 28.78X, compared with the S&P 500’s 20.11X. It is also higher than the sector’s forward-12-month P/E of 20.64X.

In the past five years, the industry traded as high as 31.47X and as low as 12.45X, with the median being 17.27X, as the charts below show.

Forward 12-Month P/E Ratio

3 Computer-Networking Stocks to Add to Portfolio Cisco Systems: Headquartered in San Jose, CA, the company offers identity and access, advanced threat and unified threat management solutions.

Cisco is benefiting from the demand for AI Infrastructure solutions, with hyperscaler demand acting as a key catalyst. The company expects its networking portfolio, led by Silicon One, AI native security solutions and operating systems, to support top-line expansion moving forward. The company expects AI hyperscale revenues to ramp considerably, and expects at least $6 billion in AI-related revenues for fiscal 2027.

In the third quarter of fiscal 2026, AI infrastructure orders from hyperscalers came in at $1.9 billion, taking year-to-date total to $5.3 billion. The company also raised expected hyperscaler AI orders to $9 billion and expected AI infrastructure revenues from hyperscalers to about $4 billion for fiscal 2026.

Within its core Networking segment, Cisco is witnessing robust traction across the enterprise data center switching business, as customers prepare their infrastructure for agentic applications and AI inferencing.

Acacia business is also witnessing strong growth as hyperscalers deploy both 400G and 800G coherent optics, with 800G pluggables gaining significant traction.

CSCO returned $2.9 billion to its shareholders through repurchases and dividends in the last reported quarter. The Zacks Consensus Estimate for fiscal 2026 bottom line is pinned at $4.28, unchanged in the past 30 days. Shares have gained 68.6% in the past year.

At present, CSCO carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. 

Price & Consensus: CSCO

Extreme Networks: Based in Morrisville, NC, the company provides AI-driven cloud networking solutions. Strong demand for the company’s networking solutions bodes well. EXTR expects revenues to be $1.275 billion to $1.28 billion for fiscal 2026.Extreme’s launch of Platform ONE and pivot to a recurring model is supporting growth amid solid enterprise networking demand. In the fiscal third quarter, revenue growth was11% year over year while product revenues were up 12% from the prior-year quarter.

Momentum in subscription bookings is expected to grow with the adoption of Platform ONE and drive up SaaS annual recurring revenues (“ARR”). In the fiscal third quarter, SaaS ARR rose 29% year over year to $236 million. Extreme closed 44 deals, each worth more than $1 million, signaling stronger deal quality and strategic growth.

EXTR also launched Extreme Agent ONE, a new set of AI agents designed for enterprise networking in May 2026.

Wi-Fi 7 is emerging as a key catalyst, driving network refresh cycles. It recently unveiled Extreme Multi-Beam Wireless, a next-generation stadium Wi-Fi connectivity solution. This solution is designed for high-density environments and supports higher bandwidth.

However, the company continues to face component pricing pressure as well as supply chain issues. To tackle these, EXTR has secured its supply chain through fiscal 2027, improving fulfillment certainty and margin visibility.

At present, EXTR carries a Zacks Rank #3 (Hold). The Zacks Consensus Estimate for fiscal 2026 earnings is pegged at $1.04, unchanged in the past 30 days. Shares are up 67.2% in the past year.

Price & Consensus: EXTR

Digi International: Based in Hopkins, MN, Digi is a well-known provider of business and mission-critical Internet of Things (IoT) products and services globally. The company’s industrial Internet of Things offerings encompass embedded, edge and turnkey vertical solutions. These solutions find applications across emerging technology trends such as AI, edge computing and industrial automation. Digi is embedding AI across its portfolio. Digi’s outlook remains supported by sustained ARR growth, ongoing benefits from acquisitions and the long-term opportunity to integrate AI into industrial IoT solutions. The company expects ARR to grow 25% in fiscal 2026, reaching around $190 million by the end of the year.

To capitalize on the AI opportunity, DGII recently unveiled DANI, the Digi Artificial Network Intelligence agent. DANI is an AI network operations agent that is embedded in Digi Remote Manager, a networking device management platform, enabling network operators/managed service providers to monitor network issues, identify causes, and offer recommended actions through a unified conversational interface.

Digi continues to pursue strategic acquisitions, which are likely to supplement organic growth.

Management highlighted challenges in the supply chain, including higher memory pricing and energy-driven freight costs, which continue to create cost volatility.

At present, DGII carries a Zacks Rank #3. The Zacks Consensus Estimate for fiscal 2026 bottom line is pegged at $2.48, unchanged in the past 30 days. Shares have gained 101.3% in the past year.

Price & Consensus: DGII

MORRISVILLE, N.C.--(BUSINESS WIRE)--Extreme today announced Bond's Extreme Journey, a first-of-its-kind 10,000-mile cycling expedition to every NFL stadium in the country.

Shareholders are urged to contact the firm immediately at no cost or obligation, as there may be limited time to enforce your rights.

We would handle the matter on a contingent fee basis, whereby you would not be responsible for out-of-pocket payment of our legal fees or expenses.

, /PRNewswire/ -- Halper Sadeh LLC, an investor rights law firm, is investigating whether certain officers and directors of Extreme Networks, Inc. (NASDAQ: EXTR) breached their fiduciary duties to shareholders.

If you currently own Extreme Networks stock and are a long-term shareholder, you may be able to seek corporate governance reforms, the return of funds back to the company, a court-approved financial incentive award, or other relief and benefits. Please click here to learn more about your legal rights and options or contact Daniel Sadeh or Zachary Halper at (212) 763-0060 or [email protected] or [email protected].

Why Your Participation Matters:

Shareholder involvement can help improve a company's policies, practices, and oversight mechanisms to create a more transparent, accountable, and effectively managed organization, which can enhance shareholder value.

Halper Sadeh LLC represents investors all over the world who have fallen victim to securities fraud and corporate misconduct. Our attorneys have been instrumental in implementing corporate reforms and recovering millions of dollars on behalf of defrauded investors.

Attorney Advertising. Prior results do not guarantee a similar outcome.

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SOURCE Halper Sadeh LLP

Extreme Networks (EXTR - Free Report) closed the last trading session at $17.59, gaining 15.3% over the past four weeks, but there could be plenty of upside left in the stock if short-term price targets set by Wall Street analysts are any guide. The mean price target of $23.38 indicates a 32.9% upside potential.

The average comprises eight short-term price targets ranging from a low of $17.00 to a high of $26.00, with a standard deviation of $2.97. While the lowest estimate indicates a decline of 3.4% from the current price level, the most optimistic estimate points to a 47.8% upside. More than the range, one should note the standard deviation here, as it helps understand the variability of the estimates. The smaller the standard deviation, the greater the agreement among analysts.

While the consensus price target is highly sought after by investors, the ability and unbiasedness of analysts in setting price targets have long been questionable. And investors making investment decisions solely based on this tool would arguably do themselves a disservice.

But, for EXTR, an impressive average price target is not the only indicator of a potential upside. Strong agreement among analysts about the company's ability to report better earnings than they predicted earlier strengthens this view. While a positive trend in earnings estimate revisions doesn't gauge how much a stock could gain, it has proven to be powerful in predicting an upside.

Price, Consensus and EPS Surprise

Here's What You May Not Know About Analysts' Price TargetsAccording to researchers at several universities across the globe, a price target is one of many pieces of information about a stock that misleads investors far more often than it guides. In fact, empirical research shows that price targets set by several analysts, irrespective of the extent of agreement, rarely indicate where the price of a stock could actually be heading.

While Wall Street analysts have deep knowledge of a company's fundamentals and the sensitivity of its business to economic and industry issues, many of them tend to set overly optimistic price targets. Are you wondering why?

They usually do that to drum up interest in shares of companies that their firms either have existing business relationships with or are looking to be associated with. In other words, business incentives of firms covering a stock often result in inflated price targets set by analysts.

However, a tight clustering of price targets, which is represented by a low standard deviation, indicates that analysts have a high degree of agreement about the direction and magnitude of a stock's price movement. While that doesn't necessarily mean the stock will hit the average price target, it could be a good starting point for further research aimed at identifying the potential fundamental driving forces.

That said, while investors should not entirely ignore price targets, making an investment decision solely based on them could lead to disappointing ROI. So, price targets should always be treated with a high degree of skepticism.

Here's Why There Could be Plenty of Upside Left in EXTRThere has been increasing optimism among analysts lately about the company's earnings prospects, as indicated by strong agreement among them in revising EPS estimates higher. And that could be a legitimate reason to expect an upside in the stock. After all, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.

The Zacks Consensus Estimate for the current year has increased 2.2% over the past month, as one estimate has gone higher compared to no negative revision.

Moreover, EXTR currently has a Zacks Rank #2 (Buy), which means it is in the top 20% of more than 4,000 stocks that we rank based on four factors related to earnings estimates. Given an impressive externally-audited track record, this is a more conclusive indication of the stock's potential upside in the near term. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>> .

Therefore, while the consensus price target may not be a reliable indicator of how much EXTR could gain, the direction of price movement it implies does appear to be a good guide.

Key Takeaways Cognizant is set to report Q1 2026 results with EPS expected to rise 8.13% year over year. CTSH growth is driven by strong bookings, large deals, and rising GenAI demand across industries. Cognizant faces headwinds from weak segment demand and macro-driven spending pressures. Cognizant Technology Solutions (CTSH - Free Report) is scheduled to report its first-quarter 2026 results on April 29, 2026.

The Zacks Consensus Estimate for first-quarter 2026 earnings is pegged at $1.33 per share, decreased by a penny over the past 30 days. This represents an 8.13% increase from the figure reported in the year-ago quarter.

Cognizant expects first-quarter 2026 revenues between $5.36 billion and $5.44 billion, indicating growth of 4.8%-6.3% and an increase of 2.7%-4.2% on a cc basis.

The Zacks Consensus Estimate for first-quarter revenues is pegged at $5.41 billion, indicating a year-over-year increase of 5.81%.

Cognizant’s earnings surpassed the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 4.34%.

Let’s see how things have shaped up for the upcoming announcement.

Factors to NoteCognizant’s first-quarter 2026 performance is likely to have benefited from an expanding client base and a robust pipeline, including a favorable mix of new opportunities. On a trailing 12-month basis, bookings increased 5% year over year to $28.4 billion, which represented a book-to-bill of approximately 1.3 times. Bookings in the fourth quarter increased 9% year over year. Fourth-quarter bookings included 12 large deals, with a total contract value of more than $100 million, of which two were mega deals, or deals with a total contract value of more than $500 million.These deals are expected to have contributed to revenue growth in the to-be-reported quarter.

The growing demand for GenAI solutions across industries like financial services, healthcare, and manufacturing is expected to provide continued growth opportunities in the first quarter of 2026, particularly in areas like fraud detection, medical imaging, and predictive maintenance. Cognizant had more than 4,000 early Generative AI client engagements in the fourth quarter of 2025.

The recently completed acquisition of 3Cloud is another key factor expected to benefit CTSH in the first quarter. This acquisition adds over 1,200 Azure specialists and engineers, strengthening CTSH’s capabilities in Azure, data, AI, and application innovation. The integration of 3Cloud is expected to have contributed approximately 100 basis points to the first quarter of 2026 revenue growth, further supporting the company’s inorganic growth strategy and expanding its expertise in cloud and AI services.

CTSH’s NextGen initiative is expected to have played a pivotal role in enhancing operational efficiency in the to-be-reported quarter.

However, CTSH is suffering from weak demand in the products and resources segment, which was due to tariff policy concerns and spending pressures. Macroeconomic uncertainties, muted discretionary spending, and ongoing cost optimization pressures across some sectors remain a concern.

What Our Model SaysPer the Zacks model, the combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy), or 3 (Hold) increases the odds of an earnings beat. But that is not the case here.

Cognizant has an Earnings ESP of -0.99% and a Zacks Rank #4 (Sell). You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks to ConsiderHere are some companies worth considering, as our model shows that these have the right combination of elements to beat on earnings in their upcoming releases:

Sandisk (SNDK - Free Report) has an Earnings ESP of +4.96% and a Zacks Rank #1 at present. You can see the complete list of today’s Zacks #1 Rank stocks here. Sandisk is set to report third-quarter fiscal 2026 results on April 30. Sandisk shares have increased 317.1% in the year-to-date period.

Audioeye (AEYE - Free Report) has an Earnings ESP of +9.62% and a Zacks Rank #2 at present. Audioeye is likely to report its first-quarter 2026 results on May 13. Audioeye shares have decreased 27.4% in the year-to-date period.

Extreme Networks (EXTR - Free Report) has an Earnings ESP of +1.41% and a Zacks Rank #2. Extreme Networks is set to report its third-quarter 2026 results on April 29. Extreme Networks' shares have increased 5.7% in the year-to-date period.

MORRISVILLE, N.C.--(BUSINESS WIRE)--Extreme Networks, Inc. (“Extreme”) (Nasdaq: EXTR) today released financial results for its third quarter of fiscal 2026 ended March 31, 2026.

“Our fifth straight quarter of double-digit growth highlights strong momentum, fueled by disciplined execution, differentiated technology, and rising demand for our AI-powered platform. We’ve fully addressed our current and longer-term supply chain needs, including memory, through targeted sourcing strategies, product redesign, and strategic purchase commitments. These actions position us for continued share gains and growth. This quarter’s results reflect not just our performance today, but the strength and scalability of our strategy going forward,” said Ed Meyercord, President and CEO of Extreme.

“SaaS ARR growth accelerated, reflecting rising adoption and deeper customer engagement with Extreme Platform ONE. This momentum underscores the power of our platform approach and the shift toward a more predictable, recurring revenue model. It’s a clear signal that customers are standardizing on our platform to drive automation, boost productivity, and scale their operations,” said Meyercord.

Kevin Rhodes, Executive Vice President and Chief Financial Officer, noted, “The third quarter marked our eighth consecutive quarter of sequential product revenue growth, reflecting continued execution and share gains. Enterprise networking demand remains resilient, and the targeted pricing actions we implemented are successfully offsetting the incremental supply chain costs we have incurred. Together, these actions underpin our gross margin results and outlook. In addition, we returned $50 million to shareholders through an accelerated share repurchase, underscoring our confidence in the durability of our operating model and cash flow generation.”

Fiscal Third Quarter Results:

Revenue $316.9 million, up 11% year-over-year and relatively flat quarter-over-quarter SaaS ARR $236.4 million, up 28.6% year-over-year and 4.2% quarter-over-quarter GAAP diluted EPS $0.08, compared to $0.03 last year and $0.06 last quarter Non-GAAP diluted EPS $0.26, compared to $0.21 last year and $0.26 last quarter GAAP gross margin 61.7%, compared to 61.7% last year and 61.4% last quarter Non-GAAP gross margin 62.3%, compared to 62.3% last year and 62.0% last quarter GAAP operating margin 5.5%, compared to 3.6% last year and 4.1% last quarter Non-GAAP operating margin 15.2%, compared to 14.1% last year and 15.0% last quarter Share repurchases of $50.0 million during the quarter Liquidity:

Q3 ending cash balance was $210.1 million, a decrease of $9.7 million from the end of Q2 2026 and an increase of $24.6 million from the end of Q3 in the prior year. Q3 net cash was $11.3 million, as compared to net cash of $47.3 million at the end of Q2 2026 and net cash of $3.0 million at the end of Q3 in the prior year. Recent Key Highlights:

Extreme supported Lucas Oil Stadium in Indianapolis for the NCAA Men’s Final Four and rapidly modernized connectivity by removing legacy access points and deploying temporary infrastructure to ensure the venue was fully game-ready on an accelerated timeline. With Wi-Fi 7 from Extreme coming in time for the upcoming Indianapolis Colts season, this upgrade will enhance stadium operations through faster, more reliable network performance for ticketing, security, and concessions, while elevating the fan experience with seamless high-speed connectivity for streaming and mobile engagement. Extreme secured several new Extreme Platform ONE wins during the quarter, including Asiana Airlines, Atlantic Food Distributors, Bridgeport Public Schools, City of Prescott (AZ), Johnstone Supply, Nissha Medical Technologies, and the University of Buckingham. These customers are leveraging AI-powered automation to reduce manual tasks, streamline operations, minimize network complexity, and enable faster execution at lower cost. Extreme continues to gain share within the UK National Health Service, with a new win at South London and Maudsley NHS Foundation Trust, where Extreme displaced a larger Chinese competitor. Fabric played a key role by delivering secure segmentation to protect patient data and devices. NHS selected Extreme’s one-license, one-device model for its simplicity and predictable cost. London Business School is deploying a full-stack Extreme solution to modernize networking across a complex urban campus spanning historic and modern academic buildings. The solution includes Extreme Platform ONE and wired and wireless platforms. Using Extreme Fabric, the school is automating and unifying the network across dorms, labs, and academic buildings, simplifying deployment while ensuring consistent security policies. Extreme Platform ONE provides unified management and security, while high-performance Wi-Fi 7 enables secure, seamless connectivity for students, faculty, and staff across campus. Extreme is enhancing the fan experience for the Carolina Hurricanes at the Lenovo Center with a full Wi-Fi 7 upgrade, replacing legacy Wi-Fi 5 to deliver faster, more reliable connectivity throughout the arena. Fiscal Q3 2026 Financial Results:

(in millions, except percentages and per share information)

  GAAP Results

Three Months Ended

March 31, 2026

March 31, 2025

Change

Product

$

199.4

$

178.1

$

21.3

Subscription and support

117.5

106.4

11.1

Total net revenue

$

316.9

$

284.5

$

32.4

Gross margin

61.7

%

61.7

%

0.0

%

Operating margin

5.5

%

3.6

%

1.9

%

Net income

$

10.6

$

3.5

$

7.1

Net income per diluted share

$

0.08

$

0.03

$

0.05

Non-GAAP Results

Three Months Ended

March 31, 2026

March 31, 2025

Change

Product

$

199.4

$

178.1

$

21.3

Subscription and support

117.5

106.4

11.1

Total net revenue

$

316.9

$

284.5

$

32.4

Gross margin

62.3

%

62.3

%

0.0

%

Operating margin

15.2

%

14.1

%

1.1

%

Net income

$

34.8

$

28.0

$

6.8

Net income per diluted share

$

0.26

$

0.21

$

0.05

Extreme uses the non-GAAP free cash flow metric as a measure of operating performance. Free cash flow represents GAAP net cash provided by operating activities, less purchases of property, equipment and capitalized software development costs. Extreme considers free cash flow to be useful information for management and investors regarding the amount of cash generated by the business after the purchases of property, equipment and capitalized software development costs, which can then be used to, among other things, invest in Extreme’s business, make strategic acquisitions, and strengthen the balance sheet. A limitation of the utility of this non-GAAP free cash flow metric as a measure of financial performance is that it does not represent the total increase or decrease in the Company’s cash balance for the period. The following table shows the non-GAAP free cash flow calculation (in millions):

Free Cash Flow

Three Months Ended

March 31, 2026

March 31, 2025

Cash flow provided by operations

$

14.2

$

30.0

Less: Capital expenditures for property, equipment and capitalized software development costs

(6.4

)

(5.8

)

Total free cash flow

$

7.8

$

24.2

SaaS ARR: SaaS annual recurring revenue (“SaaS ARR”) represents the annualized value of our subscription offerings and the renewable, term-based license portion of software license arrangements. SaaS ARR excludes perpetual licenses, upfront license fees, variable or non-recurring revenue, professional services revenue, support revenue from maintenance contracts, and other non-subscription revenue. SaaS ARR reflects the annual recurring revenue associated with Extreme Platform ONE (which includes embedded support), ExtremeCloud IQ, and other subscription revenue, based on the annualized value of quarterly subscription revenue and the trailing twelve months of term-based license revenue. Management uses SaaS ARR to evaluate the scale and trajectory of the Company’s subscription-based offerings and progress against customer adoption initiatives. We believe this metric is useful to investors for the same reasons, as it provides insight into our ability to acquire new customers and to maintain and expand our existing customer relationships. SaaS ARR is an operating metric and should be considered independently of revenue or deferred revenue determined in accordance with U.S. GAAP. SaaS ARR does not have a standardized meaning and therefore may not be comparable to similarly titled measures presented by other companies. SaaS ARR is not intended to be a replacement for, or a forecast of, revenue.

Gross debt: Gross debt is defined as long-term debt and the current portion of long-term debt as shown on the balance sheet plus unamortized debt issuance costs, if any.

Net cash: is defined as cash and cash equivalents minus gross debt, as shown in the table below (in millions):

Cash and cash equivalents

Gross debt

Net cash

$

210.1

$

198.8

$

11.3

Business Outlook:

Extreme’s business outlook is based on current expectations. The following statements are forward-looking, and actual results could differ materially based on various factors, including market conditions and the factors set forth under “Forward-Looking Statements” below.

For its fourth quarter fiscal 2026, ending June 30, 2026, the Company is targeting:

(in millions, except percentages and per share information)

Low-End

High-End

FQ4'26 Guidance – GAAP

Total net revenue

$

330.0

$

335.0

Gross margin

61.2

%

61.6

%

Operating margin

6.1

%

7.1

%

Earnings per share

$

0.12

$

0.15

Diluted shares outstanding used in calculating GAAP EPS

131.8

131.8

FQ4'26 Guidance – Non-GAAP

Total net revenue

$

330.0

$

335.0

Gross margin

61.8

%

62.2

%

Operating margin

15.2

%

16.1

%

Earnings per share

$

0.28

$

0.30

Diluted shares outstanding used in calculating non-GAAP EPS

131.8

131.8

The following table shows the GAAP to non-GAAP reconciliation for Q4 FY'26 guidance:

FQ4'26

Gross Margin

Operating Margin

Earnings per Share

GAAP

61.2% - 61.6%

6.1% - 7.1%

$0.12 - $0.15

Estimated adjustments for:

Share-based compensation

0.5%

7.0% - 7.1%

0.18

Amortization of product intangibles

0.1%

0.1%

0.00

Amortization of non-product intangibles

—

0.1%

0.00

Litigation charges

—

0.9%

0.02

System transition costs

—

0.9%

0.02

Tax adjustment

—

—

(0.07) - (0.06)

Non-GAAP

61.8% - 62.2%

15.2% - 16.1%

$0.28 - $0.30

The total percentage rate changes may not equal the total change in all cases due to rounding.

For the full year fiscal 2026, ending June 30, 2026, the Company is targeting:

(in millions, except percentages and per share information)

Low-End

High-End

FY'26 Guidance

Total net revenue

$

1,275.0

$

1,280.0

Gross margin

61.2

%

61.3

%

Operating margin

4.8

%

5.1

%

Earnings per share

$

0.30

$

0.33

Diluted shares outstanding used in calculating GAAP EPS

133.9

133.9

FY'26 Guidance – Non-GAAP

Total net revenue

$

1,275.0

$

1,280.0

Gross margin

61.8

%

61.9

%

Operating margin

14.7

%

14.9

%

Earnings per share

$

1.02

$

1.04

Diluted shares outstanding used in calculating non-GAAP EPS

133.9

133.9

The following table shows the GAAP to non-GAAP reconciliation for FY'26 guidance:

FY'26

Gross Margin

Operating Margin

Earnings per Share

GAAP

61.2% - 61.3%

4.8% - 5.1%

$0.30 - $0.33

Estimated adjustments for:

Share-based compensation

0.5%

7.1% - 7.2%

0.67

Amortization of product intangibles

0.1%

0.1%

0.01

Amortization of non-product intangibles

—

0.1%

0.01

Other non-recurring costs

—

0.3%

0.03

Litigation charges

—

0.5%

0.05

System transition costs

—

1.7%

0.16

Tax adjustment

—

—

(0.22) - (0.21)

Non-GAAP

61.8% - 61.9%

14.7% - 14.9%

$1.02 - $1.04

The total percentage rate changes may not equal the total change in all cases due to rounding.

Conference Call:

Extreme will host a conference call at 8:00 a.m. Eastern (5:00 a.m. Pacific) today to review the third quarter results of fiscal 2026 as well as the business outlook for the fourth quarter of fiscal 2026 and the full year fiscal 2026, ending June 30, 2026, including significant factors and assumptions underlying the targets noted above. The conference call will be available to the public through a live audio web broadcast via the internet at http://investor.extremenetworks.com and a replay of the call will be available on the website for at least 7 days following the call. To access the call, please go to this link (Registration Link) and you will be provided with dial in details. If you would like to participate in the Q&A, please register here: Q&A Registration Link. To avoid delays, we encourage participants to dial into the conference call fifteen minutes ahead of the scheduled start time.

About Extreme:

Extreme Networks, Inc. (EXTR) is a leader in AI-powered cloud networking, focused on delivering simple and secure solutions that help businesses address challenges and enable connections among devices, applications, and users. We push the boundaries of technology, leveraging the powers of artificial intelligence, analytics, and automation. Tens of thousands of customers globally trust our AI-driven cloud networking solutions and industry-leading support to enable businesses to drive value, foster innovation, and overcome extreme challenges. For more information, visit Extreme’s website at https://www.extremenetworks.com/ or LinkedIn, YouTube, X (Formerly Twitter), Facebook or Instagram.

Extreme Networks, ExtremeCloud, Extreme Platform ONE, and the Extreme Networks logo, are trademarks of Extreme Networks, Inc. or its subsidiaries in the United States and/or other countries. Other trademarks shown herein are the property of their respective owners.

Non-GAAP Financial Measures:

Extreme provides all financial information required in accordance with U.S. generally accepted accounting principles (“GAAP”). The Company is providing with this press release non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating margin, non-GAAP operating income, non-GAAP net income, non-GAAP net income per diluted share, adjusted EBITDA, net cash and free cash flow. In preparing non-GAAP information, the Company has excluded, where applicable, the impact of share-based compensation, amortization of intangibles, restructuring and related charges, system transition costs, litigation charges, other non-recurring costs, debt refinancing charges and the tax effect of non-GAAP adjustments. The Company believes that excluding these items provides both management and investors with additional insight into its current operations, the trends affecting the Company, the Company’s marketplace performance, and the Company’s ability to generate cash from operations. Please note the Company’s non-GAAP measures may be different than those used by other companies. The additional non-GAAP financial information the Company presents should be considered in conjunction with, and not as a substitute for, the Company’s GAAP financial information.

The Company has provided a non-GAAP reconciliation of the results for the periods presented in this release, which are adjusted to exclude certain items as indicated. These measures should only be used to evaluate the Company’s results of operations in conjunction with the corresponding GAAP measures for comparable financial information and understanding of the Company’s ongoing performance as a business. Extreme uses both GAAP and non-GAAP measures to evaluate and manage its operations.

Forward-Looking Statements:

This press release contains ‘forward-looking statements’ within the meaning of the Private Securities Litigation Reform Act of 1995, including, among others, statements regarding our outlook, targets, and guidance; our expectations regarding demand, product adoption, competitive dynamics, revenues, margins, cash flow and other operating or financial results; and our plans, objectives and assumptions. These forward-looking statements speak only as of the date of this release. There are several important factors that could cause actual results and other future events to differ materially from those suggested or indicated by such forward-looking statements. These include, among others, risks related to global macroeconomic, industry and business trends; variability in demand, sales cycles and pipeline conversion; the Company’s failure to achieve targeted financial metrics; a highly competitive business environment for network switching equipment and cloud management of network devices; supply chain challenges and component shortages; the Company’s effectiveness in controlling expenses; the possibility that the Company might experience delays in the development or introduction of new technology and products; customer response to the Company’s new technology and products; risks related to pending or future litigation; political and geopolitical factors, including the possible impact of tariffs and changes to U.S. tax regulations; and a dependency on third parties for certain components and for the manufacturing of the Company’s products.

For more information about factors that could cause actual results and other future events to differ materially from those suggested or indicated by such forward-looking statements, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” included in the Company’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and other documents of the Company on file with the Securities and Exchange Commission (available at www.sec.gov). As a result of these risks and others, actual results could vary significantly from those anticipated in this press release, and the Company’s financial condition and results of operations could be materially adversely affected. Except as required under the U.S. federal securities laws and the rules and regulations of the Securities and Exchange Commission, Extreme disclaims any obligation to update any forward-looking statements after the date of this release, whether as a result of new information, future events, developments, changes in assumptions or otherwise.

  EXTREME NETWORKS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except per share amounts)

(Unaudited)

March 31, 2026

June 30, 2025

ASSETS

Current assets:

Cash and cash equivalents

$

210,113

$

231,745

Accounts receivable, net

162,710

126,708

Inventories

76,634

102,578

Prepaid expenses and other current assets

92,345

74,265

Total current assets

541,802

535,296

Property and equipment, net

53,544

44,366

Operating lease right-of-use assets, net

32,508

38,655

Goodwill

398,211

399,574

Intangible assets, net

3,840

6,541

Other assets

140,155

128,786

Total assets

$

1,170,060

$

1,153,218

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:

Accounts payable

$

81,157

$

63,939

Accrued compensation and benefits

48,669

62,895

Accrued warranty

10,139

9,684

Current portion of deferred revenue

334,598

325,078

Current portion of long-term debt, net of unamortized debt issuance costs of $679 and $729, respectively

48,071

14,271

Current portion of operating lease liabilities

12,275

11,456

Other accrued liabilities

58,356

100,552

Total current liabilities

593,265

587,875

Deferred revenue, less current portion

312,515

292,415

Long-term debt, less current portion, net of unamortized debt issuance costs of $777 and $1,276, respectively

149,223

163,724

Operating lease liabilities, less current portion

26,170

33,991

Deferred income taxes

7,343

7,033

Other long-term liabilities

2,579

2,596

Commitments and contingencies

Stockholders’ equity:

Convertible preferred stock, $0.001 par value, issuable in series, 2,000 shares authorized; none issued

—

—

Common stock, $0.001 par value, 750,000 shares authorized; 156,657 and 152,673 shares issued, respectively; 132,513 and 132,064 shares outstanding, respectively

157

153

Additional paid-in capital

1,350,759

1,298,791

Accumulated other comprehensive loss

(15,684

)

(8,137

)

Accumulated deficit

(925,352

)

(949,429

)

Treasury stock at cost, 24,144 shares and 20,609 shares, respectively

(330,915

)

(275,794

)

Total stockholders’ equity

78,965

65,584

Total liabilities and stockholders’ equity

$

1,170,060

$

1,153,218

  EXTREME NETWORKS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

(Unaudited)

Three Months Ended

Nine Months Ended

March 31,
2026

March 31,
2025

March 31,
2026

March 31,
2025

Net revenues:

Product

$

199,345

$

178,060

$

591,151

$

512,605

Subscription and support

117,529

106,445

353,893

320,459

Total net revenues

316,874

284,505

945,044

833,064

Cost of revenues:

Product

86,206

76,059

259,334

218,065

Subscription and support

35,124

33,037

107,057

94,960

Total cost of revenues

121,330

109,096

366,391

313,025

Gross profit:

Product

113,139

102,001

331,817

294,540

Subscription and support

82,405

73,408

246,836

225,499

Total gross profit

195,544

175,409

578,653

520,039

Operating expenses:

Research and development

59,184

55,656

174,459

164,990

Sales and marketing

88,979

79,773

267,295

241,123

General and administrative

29,634

29,537

93,420

92,202

Restructuring and related charges (benefit)

—

(441

)

538

1,871

Amortization of intangible assets

407

507

1,314

1,528

Total operating expenses

178,204

165,032

537,026

501,714

Operating income

17,340

10,377

41,627

18,325

Interest income

983

972

3,312

2,657

Interest expense

(3,249

)

(3,797

)

(10,262

)

(12,398

)

Other expense, net

(263

)

(385

)

(1,110

)

(445

)

Income before income taxes

14,811

7,167

33,567

8,139

Provision for income taxes

4,221

3,709

9,490

7,803

Net income

$

10,590

$

3,458

$

24,077

$

336

Basic and diluted income per share:

Net income per share – basic

$

0.08

$

0.03

$

0.18

$

0.00

Net income per share – diluted

$

0.08

$

0.03

$

0.18

$

0.00

Shares used in per share calculation – basic

132,931

132,979

133,275

132,173

Shares used in per share calculation – diluted

133,591

134,590

134,917

133,770

  EXTREME NETWORKS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

Nine Months Ended

March 31, 2026

March 31, 2025

Cash flows from operating activities:

Net income

$

24,077

$

336

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation

11,600

11,261

Amortization of intangible assets

2,631

3,356

Amortization of cloud computing implementation costs

2,848

—

Reduction in carrying amount of right-of-use asset

7,710

7,386

Provision for credit losses

430

85

Share-based compensation

66,447

61,573

Deferred income taxes

658

(879

)

Provision for excess and obsolete inventory

4,639

1,616

Non-cash interest expense

907

902

Other

1,393

703

Changes in operating assets and liabilities:

Accounts receivable, net

(36,432

)

(10,113

)

Inventories

19,012

14,445

Prepaid expenses and other assets

(38,488

)

(20,331

)

Accounts payable

16,388

(3,982

)

Accrued compensation and benefits

(15,927

)

1,302

Operating lease liabilities

(8,532

)

(8,060

)

Deferred revenue

33,299

17,746

Other current and long-term liabilities

(42,327

)

(7,254

)

Net cash provided by operating activities

50,333

70,092

Cash flows from investing activities:

Capital expenditures for property, equipment and capitalized software development costs

(20,364

)

(18,067

)

Net cash used in investing activities

(20,364

)

(18,067

)

Cash flows from financing activities:

Borrowings under revolving facility

55,000

—

Payments on revolving facility

(25,000

)

—

Payments on debt obligations

(11,250

)

(7,500

)

Payments on debt financing costs

—

(695

)

Repurchase of common stock including accelerated share repurchases

(62,000

)

(13,000

)

Payments for tax withholdings, net of proceeds from issuance of common stock

(7,596

)

(1,907

)

Net cash used in financing activities

(50,846

)

(23,102

)

Foreign currency effect on cash and cash equivalents

(755

)

(142

)

Net increase (decrease) in cash and cash equivalents

(21,632

)

28,781

Cash and cash equivalents at beginning of period

231,745

156,699

Cash and cash equivalents at end of period

$

210,113

$

185,480

Extreme Networks, Inc.
Non-GAAP Measures of Financial Performance

To supplement the Company’s consolidated financial statements presented in accordance with U.S. generally accepted accounting principles (“GAAP”), Extreme uses non-GAAP measures of certain components of financial performance. These non-GAAP measures include non-GAAP gross profit, non-GAAP gross margin, non-GAAP operating margin, non-GAAP operating income, non-GAAP net income, non-GAAP net income per diluted share, adjusted EBITDA (calculated as GAAP net income excluding interest, income taxes, depreciation and amortization as well as costs or benefits that are not reflective of the Company’s ongoing or expected future operational performance as noted below), net cash and free cash flow.

Reconciliation to the nearest GAAP measure of all historical non-GAAP measures included in this press release can be found in the tables included with this press release.

Non-GAAP measures presented in this press release are not in accordance with or alternative measures prepared in accordance with GAAP and may be different from non-GAAP measures used by other companies. In addition, these non-GAAP measures are not based on any comprehensive set of accounting rules or principles. Non-GAAP measures have limitations in that they do not reflect all of the amounts associated with Extreme’s results of operations as determined in accordance with GAAP. These non-GAAP measures should only be used to evaluate Extreme’s results of operations in conjunction with the corresponding GAAP measures.

Extreme believes these non-GAAP measures, when shown in conjunction with the corresponding GAAP measures, enhance investors’ and management’s overall understanding of the Company’s current financial performance and the Company’s prospects for the future, including cash flows available to pursue opportunities to enhance stockholder value. In addition, because Extreme has historically reported certain non-GAAP results to investors, the Company believes the inclusion of non-GAAP measures provides consistency in the Company’s financial reporting.

For its internal planning process, and as discussed further below, Extreme’s management uses financial statements that do not include share-based compensation expense, amortization of intangibles, restructuring and related charges, system transition costs, litigation charges, other non-recurring costs, debt refinancing charges, and the tax effect of non-GAAP adjustments. Extreme’s management also uses non-GAAP measures, in addition to the corresponding GAAP measures, in reviewing the Company’s financial results.

As described above, Extreme excludes the following items from one or more of its non-GAAP measures when applicable.

Share-based compensation. Share-based compensation consists of associated expenses for stock options, restricted stock awards and the Company’s Employee Stock Purchase Plan. Extreme excludes share-based compensation expenses from its non-GAAP measures primarily because they are non-cash expenses that the Company does not believe are reflective of ongoing cash requirement related to its operating results. Extreme expects to incur share-based compensation expenses in future periods.

Amortization of intangibles. Amortization of intangibles includes the monthly amortization expense of intangible assets such as developed technology, customer relationships and trademarks. The amortization of the developed technology are recorded in cost of goods sold, while the amortization for the other intangibles are recorded in operating expenses. Extreme excludes these expenses since they result from an intangible asset and for which the period expense does not impact the operations of the business and are non-cash in nature.

Restructuring and related charges. Restructuring and related charges consist of severance costs for employees, asset disposal costs and other charges related to excess facilities that do not provide economic benefit to our future operations. Extreme excludes restructuring expenses since they result from events that occur outside of the ordinary course of continuing operations.

System transition costs. System transition costs consist of costs related to direct and incremental costs incurred in connection with our multi-phase transition of our customer relationship management solution, our configure, price, quote solution and our enterprise resource planning tools that were not capitalizable. Extreme excludes these costs because we believe that these costs do not reflect future operating expenses and will be inconsistent in amount and frequency, making it difficult to contribute to a meaningful evaluation of our operating performance.

Litigation charges. Litigation charges consist of estimated settlement and related legal expenses for non-recurring litigations offset by any proceeds received or expected to be received from insurance.

Debt refinancing charges. Debt refinancing charges consist of costs that were not capitalizable and are included in other expense, net, that occurred in conjunction with the amendments related to our outstanding credit facility.

Other non-recurring costs. Other non-recurring costs consist of certain external advisory and professional fees incurred for various non-recurring transactions and activities that occur outside of the normal course of business. Extreme excludes these costs because we believe that these costs do not reflect future operating expenses and will be inconsistent in amount and frequency, making it difficult to contribute to a meaningful evaluation of our operating performance.

Tax effect of non-GAAP adjustments. We calculate our non-GAAP provision for income taxes in accordance with the SEC guidance on non-GAAP Financial Measures Compliance and Disclosure Interpretation. We have assumed our U.S. federal and state net operating losses would have been fully consumed by the historical non-GAAP financial adjustments, eliminating the need for a full valuation allowance against our U.S. deferred tax assets which, consequently, enables our use of research and development tax credits. The non-GAAP tax provision consists of current and deferred income tax expense commensurate with the non-GAAP measure of profitability using our blended U.S. statutory tax rate of 24.6%.

The non-GAAP provision for income taxes has typically been and is currently higher than the GAAP provision given the Company has a valuation allowance against its US and a portion of its Irish deferred tax assets due to historical losses. Once these valuation allowances are released, the non-GAAP and the GAAP provision for income taxes will be more closely aligned.

Over the next year, our cash taxes will be driven by US federal and state taxes and the tax expense of our foreign subsidiaries, which amounts have not historically been significant, with the exception of the Company’s Canadian, German and Indian subsidiaries which perform research and development and sales and marketing activities for the Company, as well as the Company’s Irish trading subsidiaries.

EXTREME NETWORKS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

GAAP TO NON-GAAP RECONCILIATION

(In thousands, except percentages and per share amounts)

(Unaudited)

  Revenues

Three Months Ended

Nine Months Ended

March 31,
2026

March 31,
2025

March 31,
2026

March 31,
2025

Revenues – GAAP

$

316,874

$

284,505

$

945,044

$

833,064

Non-GAAP Gross Margin

Three Months Ended

Nine Months Ended

March 31,
2026

March 31,
2025

March 31,
2026

March 31,
2025

Gross profit – GAAP

$

195,544

$

175,409

$

578,653

$

520,039

Gross margin – GAAP percentage

61.7

%

61.7

%

61.2

%

62.4

%

Adjustments:

Share-based compensation expense, Product

755

663

2,303

1,961

Share-based compensation expense, Subscription and support

723

706

2,209

2,193

Amortization of intangibles, Product

336

580

1,264

1,775

Total adjustments to GAAP gross profit

$

1,814

$

1,949

$

5,776

$

5,929

Gross profit – non-GAAP

$

197,358

$

177,358

$

584,429

$

525,968

Gross margin – non-GAAP percentage

62.3

%

62.3

%

61.8

%

63.1

%

Non-GAAP Operating Margin

Three Months Ended

Nine Months Ended

March 31,
2026

March 31,
2025

March 31,
2026

March 31,
2025

GAAP operating income

$

17,340

$

10,377

$

41,627

$

18,325

GAAP operating margin

5.5

%

3.6

%

4.4

%

2.2

%

Adjustments:

Share-based compensation expense, cost of revenues

1,478

1,369

4,512

4,154

Share-based compensation expense, R&D

4,267

4,178

13,353

12,858

Share-based compensation expense, S&M

7,564

6,963

23,086

21,441

Share-based compensation expense, G&A

8,459

7,844

25,496

23,120

Restructuring and related charges (benefit)

—

(441

)

538

1,871

Litigation charges

376

1,123

3,135

12,716

System transition costs

7,556

7,548

18,948

16,919

Amortization of intangibles

743

1,087

2,578

3,303

Other non-recurring costs

231

—

3,879

—

Total adjustments to GAAP operating income

$

30,674

$

29,671

$

95,525

$

96,382

Non-GAAP operating income

$

48,014

$

40,048

$

137,152

$

114,707

Non-GAAP operating margin

15.2

%

14.1

%

14.5

%

13.8

%

Non-GAAP Net Income

Three Months Ended

Nine Months Ended

March 31,
2026

March 31,
2025

March 31,
2026

March 31,
2025

GAAP net income

$

10,590

$

3,458

$

24,077

$

336

Adjustments:

Share-based compensation expense

21,768

20,354

66,447

61,573

Restructuring and related charges (benefit)

—

(441

)

538

1,871

Litigation charges

376

1,123

3,135

12,716

System transition costs

7,556

7,548

18,948

16,919

Amortization of intangibles

743

1,087

2,578

3,303

Other non-recurring costs

231

—

3,879

—

Debt refinancing charges

—

—

—

79

Tax effect of non-GAAP adjustments

(6,419

)

(5,171

)

(19,888

)

(17,866

)

Total non-GAAP adjustments to GAAP net income

$

24,255

$

24,500

$

75,637

$

78,595

Non-GAAP net income

$

34,845

$

27,958

$

99,714

$

78,931

Earnings per share

GAAP net income per share – diluted

$

0.08

$

0.03

$

0.18

$

0.00

Non-GAAP net income per share – diluted

$

0.26

$

0.21

$

0.74

$

0.59

Shares used in net income per share – diluted:

GAAP shares used in per share calculation – basic

132,931

132,979

133,275

132,173

Potentially dilutive equity awards

660

1,611

1,642

1,597

GAAP and Non-GAAP shares used in per share calculation – diluted

133,591

134,590

134,917

133,770

Adjusted EBITDA

Three Months Ended

Nine Months Ended

March 31,
2026

March 31,
2025

March 31,
2026

March 31,
2025

GAAP net income

$

10,590

$

3,458

$

24,077

$

336

Adjustments:

Depreciation expense

3,807

3,456

11,600

11,261

Amortization expense

2,584

1,105

5,479

3,356

Share-based compensation expense

21,768

20,354

66,447

61,573

Restructuring and related charges (benefit)

—

(441

)

538

1,871

Litigation charges

376

1,123

3,135

12,716

System transition costs

7,556

7,548

18,948

16,919

Other non-recurring costs

231

—

3,879

—

Debt refinancing charges

—

—

—

79

Interest income

(983

)

(972

)

(3,312

)

(2,657

)

Interest expense

3,249

3,797

10,262

12,398

Provision for income taxes

4,221

3,709

9,490

7,803

Total adjustments to GAAP net income

42,809

39,679

126,466

125,319

Adjusted EBITDA

$

53,399

$

43,137

$

150,543

$

125,655

More News From Extreme Networks, Inc.

Extreme Networks, Inc. (EXTR) Q3 2026 Earnings Call Transcript

-

MORRISVILLE, N.C.--(BUSINESS WIRE)--Extreme Networks, Inc. (Nasdaq: EXTR), a leader in AI-powered automation for networking, today announced its investor conference schedule for May and June 2026:

Extreme Connect 2026
Ed Meyercord, President and CEO
Kevin Rhodes, EVP and CFO
Nabil Bukhari, EVP, Chief Technology Officer and President, AI Platforms
Orlando, FL
Monday, May 4 – Thursday, May 7, 2026
8:30 a.m. ET Watch Keynotes Live on Tuesday, May 5 and Wednesday, May 6
Conducting meetings throughout the week 21st Annual Needham Technology, Media, & Consumer 1x1 Conference
Stan Kovler, SVP, Finance and Corporate Development
New York, NY
Tuesday, May 12, 2026
12:45 p.m. ET Fireside chat and meetings throughout the day 54th Annual J.P. Morgan Global Technology, Media and Communications Conference
Ed Meyercord, President and CEO
Boston, MA
Monday, May 18, 2026
11:45 a.m. ET Fireside chat and meetings throughout the day B. Riley Securities 26th Annual Investor Conference
Kevin Rhodes, EVP and CFO
Marina del Rey, CA
Wednesday, May 20, 2026
Conducting meetings throughout the day Evercore Global TMT Conference
Kevin Rhodes, EVP and CFO
San Francisco, CA
Tuesday, June 2, 2026
Conducting meetings throughout the day Bank of America 2026 Global Technology Conference
Kevin Rhodes, EVP and CFO
San Francisco, CA
Wednesday, June 3, 2026
9:20 a.m. PT Fireside chat and meetings throughout the day Rosenblatt’s 6th Annual Technology Summit
Kevin Rhodes, EVP and CFO
Virtual
Wednesday, June 10, 2026
11:00 a.m. ET Fireside chat and meetings throughout the day A live webcast from each fireside chat will be accessible under Events & Presentations on the Investor Relations section of the Extreme Networks website at http://investor.extremenetworks.com and will be archived for at least 30 days following the live presentation.

About Extreme Networks:

Extreme Networks, Inc. (EXTR) is a leader in AI-powered cloud networking, focused on delivering simple and secure solutions that help businesses address challenges and enable connections among devices, applications, and users. We push the boundaries of technology, leveraging the powers of artificial intelligence, analytics, and automation. Tens of thousands of customers globally trust our AI-powered cloud networking solutions and industry-leading support to enable businesses to drive value, foster innovation, and overcome extreme challenges. For more information, visit Extreme's website at www.extremenetworks.com or follow us on LinkedIn, YouTube, X, Facebook, or Instagram.

Extreme Networks and the Extreme Networks logo are trademarks or registered trademarks of Extreme Networks, Inc. in the United States and other countries.

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Innovative operating model moves industry from assistive AI to autonomous, always-on operations

MORRISVILLE, N.C.--(BUSINESS WIRE)--Extreme Networks, Inc. (NASDAQ: EXTR) today introduced Extreme Agent ONE™, a new class of AI agents for enterprise networking. Moving beyond generic, prompt-based AI, Extreme Agent ONE runs on the Extreme AI stack purpose-built for enterprise environments, which combines advanced AI reasoning, live network context, and operational expertise to transform enterprise networks into systems that detect, decide, and act autonomously within the established governance framework. As a result, customers experience fewer disruptions, faster outcomes, and networks that operate at the speed of the business.

Nabil Bukhari, CTO and President of AI Platforms at Extreme Networks, said, “As networks begin to think, adapt, and act in real-time, the relationship between human users and AI agents will rapidly evolve, making simplicity and control essential to success. Our vision is autonomous networking at scale delivered on a foundation of trust between humans and AI agents, which means fewer disruptions, faster outcomes, and operational efficiency.”

Agent ONE Coworker: Proactive AI That Works Alongside IT Teams

The first mode of Extreme Agent ONE, available Q3 CY2026 within Extreme Platform ONE™, is Agent ONE Coworker, an AI agent designed to work alongside IT teams and deliver proactive, context-aware intelligence with real-time decisioning and automated execution at machine speed. Through a single conversational interface, it continuously monitors network activity, investigates anomalies, and acts, reducing resolution times, minimizing manual effort, and preventing issues before they impact users.

Unlike traditional AI tools that wait for prompts, Agent ONE Coworker operates proactively, surfacing insights and guiding decisions within the workflow. Its “Nudge” capability delivers timely, contextual recommendations that turn insight into immediate action.

For example, it can detect rising Wi-Fi congestion in a school and recommend or automatically apply a fix or identify recurring POS slowdowns in retail and suggest traffic prioritization during peak hours, turning patterns into immediate, low-effort decisions.

Agent ONE Coworker will deliver:

Conversational access to network data, documentation, and security insights Automated support workflows from case creation through resolution On-demand, real-time dashboards built from live data AI-driven Wi-Fi optimization through conversational control Proactive insights via “Nudge,” surfacing issues and recommendations based on urgency and context Agent ONE Operator: Always-On Autonomous Network Operations

Extreme also announced the second mode for Agent ONE, available Q4 CY2026, Agent ONE Operator, an always-on, autonomous agent designed to extend AI beyond real-time interaction to continuous network operation.

Agent ONE Operator will execute tasks independently within defined governance boundaries, responding to events in real time and running scheduled workflows without requiring constant human input. It will continuously learn from each interaction and outcome, becoming more precise and effective over time.

This evolution represents a shift from AI that assists in the moment to AI that operates continuously, ensuring networks are always monitored, optimized, and improving, even when IT teams are not actively engaged.

The Extreme AI Stack: Foundation for Autonomous Networking

The Extreme AI stack unifies data, intelligence, and automation into a continuously learning, closed-loop system—enabling real-time, autonomous execution across the network. Key capabilities include:

Advanced AI reasoning that continuously improves with leading models Real-time, environment-specific context across users, devices, and policies Encoded operational expertise, turning best practices into scalable, executable workflows Autonomous agents that analyze, validate, and act securely at scale, learning from users as the relationship between users and agents evolves “Most vendors are still delivering AI as copilots,” said Zeus Kerravala, founder of ZK Research. “Extreme is taking a different path—embedding reasoning, context, and execution into the network itself. That’s a meaningful step toward true autonomous infrastructure and a clear signal of where the industry is going.”

Extreme Exchange: Extending AI with Extensible Skills

Extreme also introduced Extreme Exchange™, an AI skills marketplace for Extreme Platform ONE that enables customers to discover, activate, and manage skills that extend Agent ONE Operator’s capabilities.

Extreme Exchange delivers domain-specific intelligence across industries such as healthcare, education, retail, and manufacturing, while integrating with IT service management, security, observability, and cloud platforms. Built on an open model, it supports first-party and partner-developed skills and is designed to support customer-created skills in the future.

About Extreme Networks

Extreme Networks, Inc. (EXTR) is a leader in AI-powered cloud networking, focused on delivering simple and secure solutions that help businesses address challenges and enable connections among devices, applications, and users. We push the boundaries of technology, leveraging the powers of artificial intelligence, analytics, and automation. Tens of thousands of customers globally trust our AI-driven cloud networking solutions and industry-leading support to enable businesses to drive value, foster innovation, and overcome extreme challenges.

For more information, visit Extreme's website at www.extremenetworks.com or follow us on LinkedIn, YouTube, X, Facebook, or Instagram.

Extreme Networks, Extreme Platform ONE, Extreme Agent ONE, Extreme Exchange, and the Extreme Networks logo are trademarks or registered trademarks of Extreme Networks, Inc. in the United States, and other countries. Other trademarks shown herein are the property of their respective owners.

More News From Extreme Networks, Inc.

Autonomous AI meets integrated security, simple pricing, and third-party management to power the next era of networking

MORRISVILLE, N.C.--(BUSINESS WIRE)--Extreme Networks, Inc. (Nasdaq: EXTR) today announced major advancements to Extreme Platform ONE™ including expanded third-party device management and integrated security, delivering a more intelligent, scalable, and secure enterprise networking solution. The platform is further enhanced with the introduction of Extreme Agent ONE™, a new class of AI agents for enterprise networking.

"Enterprise IT organizations are moving past fragmented tools and experimental AI deployments; they're demanding platforms that deliver integrated, automated operations at scale,” said Brandon Butler, Senior Research Manager, Network Infrastructure and Services at IDC. “A unified architecture that ties agentic AI, security, and multi-vendor management into a single operating model is a meaningful response to that demand. Advanced networking platforms are fast becoming a prerequisite for enterprises serious about turning AI investment into real outcomes, and vendors that deliver it are squarely aligned with where IT buyers are heading."

Extreme Platform ONE, generally available as of July 2025, was the industry’s first all-in-one AI-powered networking platform. With the latest set of advancements and new features, Extreme Platform ONE, in combination with Extreme Agent ONE and Extreme’s AI stack, delivers the foundation for a new generation of adaptive, intelligent networks.

Third-Party Management: Across Multi-Vendor Networks, from Cloud to On-Prem

Extreme Platform ONE now supports third-party hardware from other networking vendors, enabling customers to discover, monitor, and manage third-party devices within the platform, reducing tool sprawl, complexity, and costs while allowing customers switching to Extreme to migrate at their own pace without disrupting existing environments. Extreme’s edge service within Extreme Platform ONE extends platform reach securely from cloud to on-prem, offloading configuration and policy enforcement through a single platform.

Extreme Platform ONE Security: Zero Trust Without Complexity

Extreme Platform ONE Security now unifies network and security workflows in a single, intuitive experience, ensuring consistent policy enforcement, streamlined operations, and fewer authentication issues. With the addition of built-in Cloud PKI capabilities such as certificate authority, lifecycle management, deployment, and renewal, the platform enables identity-based Zero Trust security, continuously authenticating users, devices, and applications, while integrating with leading identity providers (IdP) and mobile device management (MDM) platforms. Combined with automated policy enforcement and certificate lifecycle management, organizations gain stronger security, reduced overhead, and end-to-end visibility without added complexity.

Extreme Platform ONE Enterprise Agreement: Simplifying Commercial Terms

The Extreme Platform ONE Enterprise Agreement simplifies how large customers buy, manage, and expand platform adoption. A single, consolidated agreement simplifies procurement, with co-termed subscriptions and price protection delivering predictable costs and easier renewals. This new approach removes long-standing friction in enterprise networking, enabling seamless expansion, self-service management, and significantly lower operational overhead.

Additional New Features

Extreme Platform ONE now also includes additional capabilities that further extend the platform's value at no extra cost:

Secure, flexible Wi-Fi guest access with multiple visitor onboarding options and built-in engagement analytics. Real-time asset, employee, and visitor tracking with floor-level location resolution and behavioral analytics. Wireless Intrusion Prevention System (WIPS) delivers centralized sensor management and security threat scoring across all locations. “Extreme is redefining the networking industry – we were the first to introduce an all-in-one AI-powered networking platform, and today we are continuing to reimagine what networks can do,” said Nabil Bukhari, CTO and President of AI Platforms at Extreme Networks. “With Extreme Platform ONE, we’re enabling enterprises to move from static infrastructure to intelligent, autonomous systems that drive the business forward. With these new features, the network isn’t just supporting operations, but actively accelerating innovation, resilience, and growth.”

About Extreme Networks

Extreme Networks, Inc. (EXTR) is a leader in AI-powered cloud networking, focused on delivering simple and secure solutions that help businesses address challenges and enable connections among devices, applications, and users. We push the boundaries of technology, leveraging the powers of artificial intelligence, analytics, and automation. Tens of thousands of customers globally trust our AI-driven cloud networking solutions and industry-leading support to enable businesses to drive value, foster innovation, and overcome extreme challenges. For more information, visit Extreme's website at www.extremenetworks.com or follow us on LinkedIn, YouTube, X, Facebook, or Instagram.

Extreme Networks, Extreme Platform ONE, Extreme Agent ONE, and the Extreme Networks logo are trademarks or registered trademarks of Extreme Networks, Inc. in the United States, and other countries. Other trademarks shown herein are the property of their respective owners.

More News From Extreme Networks, Inc.

Does Extreme Networks (EXTR) have what it takes to be a top stock pick for momentum investors? Let's find out.

Extreme Networks, Inc. (EXTR) Presents at J.P. Morgan 54th Annual Global Technology, Media and Communications Conference Transcript

After reaching an important support level, Extreme Networks, Inc. (EXTR - Free Report) could be a good stock pick from a technical perspective. EXTR recently experienced a "golden cross" event, which saw its 50-day simple moving average breaking out above its 200-day simple moving average.

There's a reason traders love a golden cross -- it's a technical chart pattern that can indicate a bullish breakout is on the horizon. This kind of crossover is formed when a stock's short-term moving average breaks above a longer-term moving average. Typically, a golden cross involves the 50-day and the 200-day moving averages, since bigger time periods tend to form stronger breakouts.

Golden crosses have three key stages that investors look out for. It starts with a downtrend in a stock's price that eventually bottoms out, followed by the stock's shorter moving average crossing over its longer moving average and triggering a trend reversal. The final stage is when a stock continues the upward climb to higher prices.

This kind of chart pattern is the opposite of a death cross, which is a technical event that suggests future bearish price movement.

Shares of EXTR have been moving higher over the past four weeks, up 31.8%. Plus, the company is currently a #2 (Buy) on the Zacks Rank, suggesting that EXTR could be poised for a breakout.

Once investors consider EXTR's positive earnings outlook for the current quarter, the bullish case only solidifies. No earnings estimate has gone lower in the past two months compared to 3 revisions higher, and the Zacks Consensus Estimate has increased as well.

Investors may want to watch EXTR for more gains in the near future given the company's key technical level and positive earnings estimate revisions.