Adtran Holdings Reports Q2 2026 Results: Full Earnings Call Transcript

Adtran Holdings (NASDAQ: ADTN ) released second-quarter financial results and hosted an earnings call on Tuesday.

Read the complete transcript below.

This content is powered APIs.

For comprehensive financial data and transcripts, visit View the webcast at Summary Adtran Holdings Inc. reported Q2 revenue of $281.1 million and a non-GAAP operating margin of 3.8%, impacted by a project delay from a single customer and supply constraints.

The company's optical business is a key growth engine, with optical networking revenue up 22% year over year, and there is strong diversification in revenue from enterprise, government, and cloud customers.

Adtran completed a refinancing of its credit facility, lowering borrowing costs and extending maturities, providing financial flexibility for its long-term strategy.

Despite the Q2 challenges, underlying demand remains strong, and the company is committed to its long-term operating margin target of 42%-43% gross margin and a 10% non-GAAP operating margin.

Future outlook for Q3 includes revenue guidance of $275 million to $295 million, with non-GAAP operating margin between 1.5% and 5.5%, driven by strong demand in Optical Networking Solutions.

Full Transcript OPERATOR Ladies and gentlemen, welcome to the Adtran Holdings Inc. second quarter 2026 earnings conference call.

Please note that this call is being recorded.

After the speakers' remarks, there will be a question and answer session.

If you would like to ask a question at this time, simply press star followed by the number one on your telephone keypad, and if you would like to withdraw your question, just press star one again.

Thank you.

Now I would like to turn the call over to Tom Stanton, Chairman and CEO of Adtran Holdings Inc.

Tom, you may begin.

Tom Stanton, Chairman and CEO Thank you, operator.

Good morning, everyone.

Although we are disappointed with the reported results of this past quarter, we believe they were driven by a specific set of factors.

As we communicated in our preliminary results press release, a project delay from a single customer combined with unfavorable impacts from product and customer mix caused our results to fall short of our guidance.

Despite these factors, demand across our end markets remains healthy, our strategic priorities remain on track, and our customer base continues to diversify.

We believe those underlying fundamentals position us well as we look ahead into 2027.

As we shared in our pre-announcement, one of our customers adjusted the timing of a project which affected our results for the quarter.

This customer remains committed to its deployment objectives, and we view this as a timing adjustment rather than a change in demand.

Overall, customer demand remained strong during the quarter, but a challenging supply environment limited our ability to fulfill that demand, constraining shipments and resulting in an unfavorable mix.

To be clear, absent these incremental supply constraints, we would have met our original revenue guidance.

Against this backdrop, Adtran delivered second quarter revenue of $281.1 million, consistent with our preliminary results, and non-GAAP operating margin of approximately 3.8%, also in line with our pre-announcement.

While these results reflected the items I just discussed, several indicators of our strategic progress continued to strengthen during the quarter.

Our optical business continued to serve as a key growth engine, and our growth was broad-based across service provider, enterprise, government, and cloud customers, and reflects continued demand for higher-capacity optical infrastructure, AI-driven networking expansion, and secure connectivity.

We are also generating tangible benefits from our diversification strategy.

Revenue from enterprise, government, and cloud customers grew a strong 47% year over year and 19% sequentially, accounting for 25% of total company revenue in the quarter.

Within this customer segment, revenue from hyperscalers increased 97% year over year, underscoring the strength of our diversification strategy.

This momentum is being driven primarily by our data center interconnect business.

In parallel, we continue to expand engagements with hyperscalers and large-scale content providers for our upcoming Micromux Quattro and the LightWave 800 pluggable optics solutions.

The results highlight our growing participation in attractive end markets beyond our traditional service provider base and reflect the opportunities created by continued investment in cloud and AI infrastructure.

As we broaden our customer adoption and expand our solutions footprint, we believe we are well positioned to benefit from these longer-term growth trends.

Secure connectivity is another area where we continue to drive increasing customer demand.