[Fiscal 2025 Fourth Quarter and Twelve Months Financial Results Overview](index=1&type=section&id=Fiscal%202025%20Fourth%20Quarter%20and%20Twelve%20Months%20Financial%20Results%20Overview) This section provides an overview of Aviat Networks' financial performance for the fourth quarter and full fiscal year 2025, highlighting key revenue, income, and EBITDA figures [Fourth Quarter Highlights](index=1&type=section&id=Fourth%20Quarter%20Highlights) Aviat Networks reported a strong fiscal 2025 fourth quarter, achieving significant GAAP net income growth and a third consecutive record for quarterly Adjusted EBITDA, despite a slight decrease in total revenue - Grew quarterly GAAP Net Income to **$5.2 million**, an increase of **$3.6 million** or **236%** versus the same period a year ago[9](index=9&type=chunk) - Achieved the third consecutive record for quarterly Adjusted EBITDA with **$15.1 million** at **13.0%** margin[9](index=9&type=chunk) Fiscal 2025 Fourth Quarter Key Financials (in millions) | Metric | GAAP Result | Non-GAAP Result | | :-------------------------- | :---------- | :-------------- | | Total Revenues | $115.3 million | N/A | | Gross Margin | 34.2% | 34.7% | | Operating Expenses | $30.6 million | $27.1 million | | Operating Income | $8.9 million | $12.9 million | | Net Income | $5.2 million | $10.7 million | | Net Income per diluted share | $0.40 | $0.83 | | Adjusted EBITDA | N/A | $15.1 million | | Cash and Cash Equivalents | $59.7 million | N/A | | Net Debt | $27.9 million | N/A | [Full Year Financial Highlights](index=1&type=section&id=Full%20Year%20Financial%20Highlights) For the full fiscal year 2025, Aviat Networks completed its fifth consecutive year of revenue growth, reaching $434.6 million, although GAAP net income and Adjusted EBITDA saw declines compared to the prior year - Completed fifth consecutive fiscal year of revenue growth[9](index=9&type=chunk) Fiscal 2025 Full Year Key Financials (in millions) | Metric | GAAP Result | Non-GAAP Result | | :-------------------------- | :---------- | :-------------- | | Total Revenues | $434.6 million | N/A | | Gross Margin | 32.1% | 32.8% | | Operating Expenses | $128.9 million | $113.5 million | | Operating Income | $10.6 million | $29.0 million | | Net Income | $1.3 million | $21.4 million | | Net Income per diluted share | $0.10 | $1.67 | | Adjusted EBITDA | N/A | $37.1 million | [Detailed Financial Performance](index=1&type=section&id=Detailed%20Financial%20Performance) This section provides an in-depth analysis of Aviat Networks' revenues, gross margins, operating expenses, operating income, income taxes, net income, and Adjusted EBITDA for both the fourth quarter and full fiscal year 2025 [Revenues](index=1&type=section&id=Revenues) Total revenues for Q4 FY25 slightly decreased by 1.1% year-over-year, primarily due to a decline in international revenue, offset by growth in North America's private network business. For the full fiscal year 2025, total revenue increased by 6.5%, driven by strong international growth [Fourth Quarter Revenues](index=1&type=section&id=Fourth%20Quarter%20Revenues) Fourth quarter revenues saw a slight overall decrease, with North America showing growth in private networks while international revenues declined due to project timing Fourth Quarter Revenues (in millions) | Metric | FY25 Q4 | FY24 Q4 | Change (Millions) | Change (%) | | :---------------- | :------ | :------ | :---------------- | :--------- | | Total Revenues | $115.3 | $116.7 | $(1.3) | (1.1)% | | North America | $58.0 | $56.2 | $1.8 | 3.2% | | International | $57.3 | $60.5 | $(3.1) | (5.2)% | - North America revenue growth was due to growth in private network business[4](index=4&type=chunk) - International revenue decrease was due to timing of certain mobile network projects[4](index=4&type=chunk) [Twelve Months Revenues](index=1&type=section&id=Twelve%20Months%20Revenues) Full year revenues increased by 6.5%, primarily driven by strong international growth, with North America also contributing to the overall increase Twelve Months Revenues (in millions) | Metric | FY25 | FY24 | Change (Millions) | Change (%) | | :---------------- | :----- | :----- | :---------------- | :--------- | | Total Revenues | $434.6 | $408.1 | $26.5 | 6.5% | | North America | $207.6 | $206.1 | $1.5 | 0.7% | | International | $227.0 | $202.0 | $25.0 | 12.4% | [Gross Margins](index=1&type=section&id=Gross%20Margins) Both GAAP and non-GAAP gross margins decreased in Q4 FY25 and for the full fiscal year 2025 compared to the prior year, primarily due to fluctuations in project and regional customer mix [Fourth Quarter Gross Margins](index=1&type=section&id=Fourth%20Quarter%20Gross%20Margins) Fourth quarter GAAP and non-GAAP gross margins both declined, influenced by changes in project and regional customer mix Fourth Quarter Gross Margins | Metric | FY25 Q4 | FY24 Q4 | Change (bps) | | :---------------- | :------ | :------ | :----------- | | GAAP Gross Margin | 34.2% | 35.3% | (110) | | Non-GAAP Gross Margin | 34.7% | 35.9% | (120) | - Gross margin fluctuations were driven by project and regional customer mix[6](index=6&type=chunk) [Twelve Months Gross Margins](index=1&type=section&id=Twelve%20Months%20Gross%20Margins) Full year GAAP and non-GAAP gross margins both decreased compared to the prior fiscal year Twelve Months Gross Margins | Metric | FY25 | FY24 | | :---------------- | :----- | :----- | | GAAP Gross Margin | 32.1% | 35.5% | | Non-GAAP Gross Margin | 32.8% | 36.4% | [Operating Expenses](index=2&type=section&id=Operating%20Expenses) Total GAAP and non-GAAP operating expenses decreased significantly in Q4 FY25, reflecting a 14.3% and 13.2% reduction respectively. However, for the full fiscal year 2025, both GAAP and non-GAAP operating expenses increased by 2.8% and 7.7% respectively [Fourth Quarter Operating Expenses](index=2&type=section&id=Fourth%20Quarter%20Operating%20Expenses) Fourth quarter GAAP and non-GAAP operating expenses both saw significant year-over-year decreases Fourth Quarter Operating Expenses (in millions) | Metric | FY25 Q4 | FY24 Q4 | Change (Millions) | Change (%) | | :----------------------- | :------ | :------ | :---------------- | :--------- | | GAAP Operating Expenses | $30.6 | $35.7 | $(5.1) | (14.3)% | | Non-GAAP Operating Expenses | $27.1 | $31.3 | $(4.1) | (13.2)% | [Twelve Months Operating Expenses](index=2&type=section&id=Twelve%20Months%20Operating%20Expenses) Full year GAAP and non-GAAP operating expenses increased compared to the prior fiscal year Twelve Months Operating Expenses (in millions) | Metric | FY25 | FY24 | Change (Millions) | Change (%) | | :----------------------- | :----- | :----- | :---------------- | :--------- | | GAAP Operating Expenses | $128.9 | $125.3 | $3.5 | 2.8% | | Non-GAAP Operating Expenses | $113.5 | $105.4 | $8.1 | 7.7% | [Operating Income](index=2&type=section&id=Operating%20Income) Aviat Networks saw a substantial increase in operating income for Q4 FY25, with GAAP operating income up 62.8% and non-GAAP up 21.9%. Conversely, for the full fiscal year 2025, operating income decreased significantly, primarily due to merger and acquisition related expenses [Fourth Quarter Operating Income](index=2&type=section&id=Fourth%20Quarter%20Operating%20Income) Fourth quarter GAAP and non-GAAP operating income both increased significantly year-over-year Fourth Quarter Operating Income (in millions) | Metric | FY25 Q4 | FY24 Q4 | Change (Millions) | Change (%) | | :------------------- | :------ | :------ | :---------------- | :--------- | | GAAP Operating Income | $8.9 | $5.5 | $3.4 | 62.8% | | Non-GAAP Operating Income | $12.9 | $10.6 | $2.3 | 21.9% | [Twelve Months Operating Income](index=2&type=section&id=Twelve%20Months%20Operating%20Income) Full year GAAP and non-GAAP operating income decreased substantially, primarily due to merger and acquisition related expenses Twelve Months Operating Income (in millions) | Metric | FY25 | FY24 | Change (Millions) | Change (%) | | :------------------- | :----- | :----- | :---------------- | :--------- | | GAAP Operating Income | $10.6 | $19.4 | $(8.8) | (45.5)% | | Non-GAAP Operating Income | $29.0 | $43.1 | $(14.1) | (32.7)% | - Operating income decreased primarily due to merger and acquisition related expenses[13](index=13&type=chunk) [Income Taxes](index=2&type=section&id=Income%20Taxes) GAAP income tax expense increased in Q4 FY25 compared to the prior year, while for the full fiscal year 2025, it decreased significantly [Fourth Quarter Income Taxes](index=2&type=section&id=Fourth%20Quarter%20Income%20Taxes) Fourth quarter GAAP income tax expense increased year-over-year Fourth Quarter Income Tax Expense (in millions) | Metric | FY25 Q4 | FY24 Q4 | | :------------------- | :------ | :------ | | GAAP Income Tax Expense | $5.0 | $3.1 | [Twelve Months Income Taxes](index=2&type=section&id=Twelve%20Months%20Income%20Taxes) Full year GAAP income tax expense decreased significantly compared to the prior fiscal year Twelve Months Income Tax Expense (in millions) | Metric | FY25 | FY24 | | :------------------- | :----- | :----- | | GAAP Income Tax Expense | $2.2 | $6.1 | [Net Income / Net Income Per Share](index=2&type=section&id=Net%20Income%20%2F%20Net%20Income%20Per%20Share) Aviat Networks reported a substantial increase in GAAP net income and EPS for Q4 FY25, alongside growth in non-GAAP net income and EPS. However, for the full fiscal year 2025, both GAAP and non-GAAP net income and EPS saw significant declines compared to the prior year [Fourth Quarter Net Income / Net Income Per Share](index=2&type=section&id=Fourth%20Quarter%20Net%20Income%20%2F%20Net%20Income%20Per%20Share) Fourth quarter GAAP and non-GAAP net income and diluted EPS all increased significantly year-over-year Fourth Quarter Net Income / EPS | Metric | FY25 Q4 | FY24 Q4 | | :----------------------- | :------ | :------ | | GAAP Net Income (Millions) | $5.2 | $1.5 | | GAAP Diluted EPS | $0.40 | $0.12 | | Non-GAAP Net Income (Millions) | $10.7 | $9.2 | | Non-GAAP Diluted EPS | $0.83 | $0.72 | [Twelve Months Net Income / Net Income Per Share](index=2&type=section&id=Twelve%20Months%20Net%20Income%20%2F%20Net%20Income%20Per%20Share) Full year GAAP and non-GAAP net income and diluted EPS decreased substantially compared to the prior fiscal year Twelve Months Net Income / EPS | Metric | FY25 | FY24 | | :----------------------- | :----- | :----- | | GAAP Net Income (Millions) | $1.3 | $10.8 | | GAAP Diluted EPS | $0.10 | $0.86 | | Non-GAAP Net Income (Millions) | $21.4 | $39.2 | | Non-GAAP Diluted EPS | $1.67 | $3.15 | [Adjusted EBITDA](index=2&type=section&id=Adjusted%20EBITDA) Adjusted EBITDA increased significantly in Q4 FY25, reaching a record high, but decreased for the full fiscal year 2025 compared to the prior year [Fourth Quarter Adjusted EBITDA](index=2&type=section&id=Fourth%20Quarter%20Adjusted%20EBITDA) Fourth quarter Adjusted EBITDA increased significantly year-over-year, setting a new quarterly record Fourth Quarter Adjusted EBITDA (in millions) | Metric | FY25 Q4 | FY24 Q4 | | :-------------- | :------ | :------ | | Adjusted EBITDA | $15.1 | $11.9 | [Twelve Months Adjusted EBITDA](index=2&type=section&id=Twelve%20Months%20Adjusted%20EBITDA) Full year Adjusted EBITDA decreased compared to the prior fiscal year Twelve Months Adjusted EBITDA (in millions) | Metric | FY25 | FY24 | | :-------------- | :----- | :----- | | Adjusted EBITDA | $37.1 | $48.1 | [Balance Sheet Highlights](index=2&type=section&id=Balance%20Sheet%20Highlights) This section summarizes key balance sheet figures, including cash and cash equivalents and total debt, as of the end of fiscal year 2025 [Balance Sheet Summary](index=2&type=section&id=Balance%20Sheet%20Summary) As of June 27, 2025, Aviat Networks reported an increase in cash and cash equivalents compared to the previous quarter, with total debt standing at $87.6 million Balance Sheet Highlights (in millions) | Metric | As of June 27, 2025 | As of March 28, 2025 | | :---------------------- | :------------------ | :------------------- | | Cash and Cash Equivalents | $59.7 | $49.4 | | Total Debt | $87.6 | N/A | [Fiscal 2026 Full Year Guidance](index=2&type=section&id=Fiscal%202026%20Full%20Year%20Guidance) This section provides Aviat Networks' financial outlook and projections for the full fiscal year 2026 [FY26 Guidance Overview](index=2&type=section&id=FY26%20Guidance%20Overview) Aviat Networks provided its full-year guidance for fiscal 2026, projecting revenue between $440 million and $460 million, and Adjusted EBITDA between $45.0 million and $55.0 million Fiscal 2026 Full Year Guidance (in millions) | Metric | Guidance Range | | :---------------- | :------------- | | Full year Revenue | $440 - $460 | | Full year Adjusted EBITDA | $45.0 - $55.0 | [Corporate Information & Events](index=2&type=section&id=Corporate%20Information%20%26%20Events) This section details corporate communications, upcoming investor engagements, company background, and investor relations contact information [Conference Call Details](index=2&type=section&id=Conference%20Call%20Details) Aviat Networks hosted a conference call to discuss its financial results, with key executives participating and providing access details for investors - Aviat Networks hosted a conference call on September 10, 2025, at 4:15 p.m. ET to discuss its fiscal 2025 fourth quarter financial results[19](index=19&type=chunk) - Participating on the call were Peter Smith (President and CEO), Michael Connaway (Sr. Vice President and CFO), and Andrew Fredrickson (Vice President, Corporate Finance and Interim CFO)[19](index=19&type=chunk) - Interested parties could access the call live via webcast through Aviat Network's Investor Relations website or participate via telephone by registering online[20](index=20&type=chunk) [Upcoming Events](index=2&type=section&id=Upcoming%20Events) Aviat Networks announced its participation in an upcoming investor conference - Aviat will participate in the 9th Annual Lake Street Capital Markets Best Ideas Growth Conference on September 11, 2025, in New York, NY[21](index=21&type=chunk) [About Aviat Networks](index=3&type=section&id=About%20Aviat%20Networks) Aviat Networks is a leading global provider of wireless transport and access solutions, serving a diverse customer base with over 70 years of innovation and comprehensive support services - Aviat Networks, Inc. is the leading expert in wireless transport and access solutions[23](index=23&type=chunk) - The company has sold over **one million** systems into **170 countries** worldwide, serving communications service providers and private network operators (state/local government, utility, federal government, and defense organizations)[23](index=23&type=chunk) - Aviat provides a comprehensive suite of localized professional and support services and is headquartered in Austin, Texas[23](index=23&type=chunk) [Investor Relations Contact](index=3&type=section&id=Investor%20Relations%20Contact) Contact information for investor relations inquiries is provided - Investor Relations contact: Andrew Fredrickson, Email: investorinfo@aviatnet.com[27](index=27&type=chunk) [Forward-Looking Statements and Risk Factors](index=3&type=section&id=Forward-Looking%20Statements%20and%20Risk%20Factors) This section provides a disclaimer regarding forward-looking statements and outlines key risk factors that could materially impact future financial results [Forward-Looking Statements Disclaimer](index=3&type=section&id=Forward-Looking%20Statements%20Disclaimer) This section outlines the nature of forward-looking statements within the report, emphasizing that actual results may differ materially due to various important factors and risks, including those detailed in the company's Form 10-K - The report includes forward-looking statements regarding Aviat's outlook, business conditions, new product solutions, future orders, profitability, acquisitions, and financial projections[24](index=24&type=chunk) - Forward-looking statements are based on current beliefs, expectations, and assumptions of senior management, but involve risks and uncertainties that could cause actual results to differ materially[24](index=24&type=chunk) - Important factors include disruptions from acquisitions (4RF and NEC), integration challenges, geopolitical conflicts, price and margin erosion, supply chain constraints, inflation, and global economic weakness. Investors should refer to the 'Risk Factors' section in Aviat's Form 10-K for more information[25](index=25&type=chunk)[26](index=26&type=chunk) [Condensed Consolidated Financial Statements (GAAP)](index=4&type=section&id=Condensed%20Consolidated%20Financial%20Statements%20(GAAP)) This section presents the unaudited GAAP condensed consolidated statements of operations and balance sheets for the specified periods [Condensed Consolidated Statements of Operations](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) This section presents the unaudited GAAP condensed consolidated statements of operations for the three and twelve months ended June 27, 2025, and June 28, 2024 Condensed Consolidated Statements of Operations (in thousands) | Metric | Three Months Ended June 27, 2025 | Three Months Ended June 28, 2024 | Twelve Months Ended June 27, 2025 | Twelve Months Ended June 28, 2024 | | :-------------------------- | :------------------------------- | :------------------------------- | :-------------------------------- | :-------------------------------- | | Product sales | $67,405 | $78,795 | $287,657 | $274,205 | | Services | $47,935 | $37,865 | $146,949 | $133,878 | | **Total revenues** | **$115,340** | **$116,660** | **$434,606** | **$408,083** | | Total cost of revenues | $75,874 | $75,521 | $295,170 | $263,351 | | **Gross margin** | **$39,466** | **$41,139** | **$139,436** | **$144,732** | | Total operating expenses | $30,587 | $35,684 | $128,861 | $125,331 | | **Operating income** | **$8,879** | **$5,455** | **$10,575** | **$19,401** | | Income before income taxes | $10,179 | $4,609 | $3,576 | $16,906 | | Provision for income taxes | $4,982 | $3,060 | $2,235 | $6,146 | | **Net income** | **$5,197** | **$1,549** | **$1,341** | **$10,760** | | Diluted Net income per share | $0.40 | $0.12 | $0.10 | $0.86 | [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This section presents the unaudited GAAP condensed consolidated balance sheets as of June 27, 2025, and June 28, 2024 Condensed Consolidated Balance Sheets (in thousands) | Metric | As of June 27, 2025 | As of June 28, 2024 | | :-------------------------- | :------------------ | :------------------ | | Cash and cash equivalents | $59,690 | $64,622 | | Accounts receivable, net | $180,321 | $158,013 | | Inventories | $83,979 | $62,267 | | **Total current assets** | **$463,575** | **$405,223** | | Goodwill | $19,655 | $8,217 | | **Total assets** | **$633,296** | **$535,223** | | Accounts payable | $148,093 | $92,854 | | Current portion of long-term debt | $18,624 | $2,396 | | **Total current liabilities** | **$282,196** | **$218,857** | | Long-term debt | $68,966 | $45,954 | | **Total liabilities** | **$370,113** | **$279,338** | | **Total stockholders' equity** | **$263,183** | **$255,885** | | **Total liabilities and stockholders' equity** | **$633,296** | **$535,223** | [Reconciliation of Non-GAAP Financial Measures](index=6&type=section&id=Reconciliation%20of%20Non-GAAP%20Financial%20Measures) This section provides detailed reconciliations of non-GAAP financial measures to their most comparable GAAP equivalents, offering additional insights into operational performance [Non-GAAP Measures Overview](index=6&type=section&id=Non-GAAP%20Measures%20Overview) This section provides reconciliations of non-GAAP financial measures to their most directly comparable GAAP measures, including gross margin, operating expenses, operating income, net income, and Adjusted EBITDA. These non-GAAP measures are presented to offer investors additional insights into period-over-period operating results, excluding certain non-recurring or non-cash items - Non-GAAP financial measures are provided to supplement GAAP consolidated financial statements, offering information useful to investors in understanding period-over-period operating results separate from items with disproportionate impacts[33](index=33&type=chunk) - Adjustments typically exclude share-based compensation, merger and acquisition related expenses, and restructuring charges[33](index=33&type=chunk)[37](index=37&type=chunk) - Reconciliations of forward-looking Adjusted EBITDA guidance are not provided due to the high variability and difficulty in making accurate forecasts for items like merger and acquisition costs and share-based compensation[34](index=34&type=chunk) [Non-GAAP Gross Margin Reconciliation](index=6&type=section&id=Non-GAAP%20Gross%20Margin%20Reconciliation) Reconciliation of GAAP gross margin to non-GAAP gross margin, adjusting for share-based compensation and merger and acquisition related expenses Non-GAAP Gross Margin Reconciliation (in thousands) | Metric | Three Months Ended June 27, 2025 | Three Months Ended June 28, 2024 | Twelve Months Ended June 27, 2025 | Twelve Months Ended June 28, 2024 | | :-------------------------- | :------------------------------- | :------------------------------- | :-------------------------------- | :-------------------------------- | | GAAP gross margin | $39,466 (34.2%) | $41,139 (35.3%) | $139,436 (32.1%) | $144,732 (35.5%) | | Share-based compensation | $19 | $96 | $233 | $406 | | Merger and acquisition related expense | $595 | $650 | $2,890 | $3,409 | | **Non-GAAP gross margin** | **$40,080 (34.7%)** | **$41,885 (35.9%)** | **$142,559 (32.8%)** | **$148,547 (36.4%)** | [Non-GAAP Operating Expenses Reconciliation](index=6&type=section&id=Non-GAAP%20Operating%20Expenses%20Reconciliation) Reconciliation of GAAP operating expenses to non-GAAP operating expenses, adjusting for share-based compensation, merger and acquisition related expenses, and restructuring charges Non-GAAP Operating Expenses Reconciliation (in thousands) | Metric | Three Months Ended June 27, 2025 | Three Months Ended June 28, 2024 | Twelve Months Ended June 27, 2025 | Twelve Months Ended June 28, 2024 | | :-------------------------- | :------------------------------- | :------------------------------- | :-------------------------------- | :-------------------------------- | | GAAP operating expense | $30,587 (26.5%) | $35,684 (30.6%) | $128,861 (29.7%) | $125,331 (30.7%) | | Share-based compensation | $(1,422) | $(1,700) | $(6,834) | $(6,935) | | Merger and acquisition and other expenses | $(6) | $(1,070) | $(4,896) | $(9,121) | | Restructuring (charges) recovery | $(2,019) | $(1,640) | $(3,611) | $(3,867) | | **Non-GAAP operating expense** | **$27,140 (23.5%)** | **$31,274 (26.8%)** | **$113,520 (26.1%)** | **$105,408 (25.8%)** | [Non-GAAP Operating Income Reconciliation](index=7&type=section&id=Non-GAAP%20Operating%20Income%20Reconciliation) Reconciliation of GAAP operating income to non-GAAP operating income, adjusting for share-based compensation, merger and acquisition related expenses, and restructuring charges Non-GAAP Operating Income Reconciliation (in thousands) | Metric | Three Months Ended June 27, 2025 | Three Months Ended June 28, 2024 | Twelve Months Ended June 27, 2025 | Twelve Months Ended June 28, 2024 | | :-------------------------- | :------------------------------- | :------------------------------- | :-------------------------------- | :-------------------------------- | | GAAP operating income | $8,879 (7.7%) | $5,455 (4.7%) | $10,575 (2.4%) | $19,401 (4.8%) | | Share-based compensation | $1,441 | $1,796 | $7,067 | $7,341 | | Merger and acquisition related expense | $601 | $1,720 | $7,786 | $12,530 | | Restructuring charges | $2,019 | $1,640 | $3,611 | $3,867 | | **Non-GAAP operating income** | **$12,940 (11.2%)** | **$10,611 (9.1%)** | **$29,039 (6.7%)** | **$43,139 (10.6%)** | [Non-GAAP Net Income Reconciliation](index=7&type=section&id=Non-GAAP%20Net%20Income%20Reconciliation) Reconciliation of GAAP net income and diluted EPS to non-GAAP net income and diluted EPS, adjusting for various non-recurring items and pro forma tax rates Non-GAAP Net Income Reconciliation (in thousands, except per share amounts) | Metric | Three Months Ended June 27, 2025 | Three Months Ended June 28, 2024 | Twelve Months Ended June 27, 2025 | Twelve Months Ended June 28, 2024 | | :-------------------------- | :------------------------------- | :------------------------------- | :-------------------------------- | :-------------------------------- | | GAAP net income | $5,197 (4.5%) | $1,549 (1.3%) | $1,341 (0.3%) | $10,760 (2.6%) | | Share-based compensation | $1,441 | $1,796 | $7,067 | $7,341 | | Merger and acquisition related expense | $601 | $1,720 | $7,786 | $12,530 | | Restructuring charges | $2,019 | $1,640 | $3,611 | $3,867 | | Other (income) expense, net | $(3,106) | $(70) | $941 | $158 | | Adjustment to reflect pro forma tax rate | $4,582 | $2,560 | $635 | $4,546 | | **Non-GAAP net income** | **$10,734 (9.3%)** | **$9,195 (7.9%)** | **$21,381 (4.9%)** | **$39,202 (9.6%)** | | GAAP Diluted EPS | $0.40 | $0.12 | $0.10 | $0.86 | | **Non-GAAP Diluted EPS** | **$0.83** | **$0.72** | **$1.67** | **$3.15** | [Adjusted EBITDA Reconciliation](index=7&type=section&id=Adjusted%20EBITDA%20Reconciliation) Reconciliation of GAAP net income to Adjusted EBITDA, by adding back depreciation, amortization, interest, taxes, and non-GAAP pre-tax adjustments Adjusted EBITDA Reconciliation (in thousands) | Metric | Three Months Ended June 27, 2025 | Three Months Ended June 28, 2024 | Twelve Months Ended June 27, 2025 | Twelve Months Ended June 28, 2024 | | :-------------------------- | :------------------------------- | :------------------------------- | :-------------------------------- | :-------------------------------- | | GAAP net income | $5,197 (4.5%) | $1,549 (1.3%) | $1,341 (0.3%) | $10,760 (2.6%) | | Depreciation and amortization | $2,110 | $1,265 | $8,045 | $4,993 | | Interest expense, net | $1,806 | $916 | $6,058 | $2,337 | | Other (income) expense, net | $(3,106) | $(70) | $941 | $158 | | Share-based compensation | $1,441 | $1,796 | $7,067 | $7,341 | | Merger and acquisition related expense | $601 | $1,720 | $7,786 | $12,530 | | Restructuring charges | $2,019 | $1,640 | $3,611 | $3,867 | | Provision for income taxes | $4,982 | $3,060 | $2,235 | $6,146 | | **Adjusted EBITDA** | **$15,050 (13.0%)** | **$11,876 (10.2%)** | **$37,084 (8.5%)** | **$48,132 (11.8%)** | [Supplemental Schedule of Revenue by Geographical Area](index=8&type=section&id=Supplemental%20Schedule%20of%20Revenue%20by%20Geographical%20Area) This section provides a detailed breakdown of Aviat Networks' revenues segmented by geographical region for both quarterly and annual periods [Revenue by Geographical Area](index=8&type=section&id=Revenue%20by%20Geographical%20Area) This chapter provides a breakdown of Aviat Networks' revenues by geographical area for both the three and twelve months ended June 27, 2025, and June 28, 2024, showing contributions from North America and various international regions Supplemental Schedule of Revenue by Geographical Area (in thousands) | Region | Three Months Ended June 27, 2025 | Three Months Ended June 28, 2024 | Twelve Months Ended June 27, 2025 | Twelve Months Ended June 28, 2024 | | :-------------------------- | :------------------------------- | :------------------------------- | :-------------------------------- | :-------------------------------- | | North America | $58,017 | $56,194 | $207,606 | $206,073 | | Africa and the Middle East | $11,218 | $13,063 | $49,428 | $48,884 | | Europe | $8,337 | $7,231 | $31,713 | $24,608 | | Latin America and Asia Pacific | $37,768 | $40,172 | $145,859 | $128,518 | | **Total international** | **$57,323** | **$60,466** | **$227,000** | **$202,010** | | **Total revenue** | **$115,340** | **$116,660** | **$434,606** | **$408,083** |

Core Insights - Aviat Networks reported total revenue of $115.3 million for the fiscal 2025 fourth quarter, a decrease of 1.1% compared to the previous year [2] - The company achieved a net income of $5.2 million for the fourth quarter, significantly up from $1.5 million in the same period last year, marking a 236% increase [11] - For the full fiscal year 2025, total revenue increased by 6.5% to $434.6 million compared to $408.1 million in fiscal 2024 [3] Financial Performance - **Fourth Quarter Revenue**: Total revenues were $115.3 million, down from $116.7 million in Q4 fiscal 2024, with North America revenue increasing by 3.2% to $58.0 million, while international revenue decreased by 5.2% to $57.3 million [2] - **Full Year Revenue**: Total revenue for the twelve months ended June 27, 2025, was $434.6 million, with North America revenue slightly up by 0.7% to $207.6 million and international revenue up by 12.4% to $227.0 million [3] Profitability Metrics - **Gross Margins**: The GAAP gross margin for Q4 was 34.2%, down from 35.3% in Q4 fiscal 2024, while the non-GAAP gross margin was 34.7% compared to 35.9% [4] - **Operating Income**: GAAP operating income for Q4 was $8.9 million, a 62.8% increase from $5.5 million in the prior year, while non-GAAP operating income rose by 21.9% to $12.9 million [8] - **Adjusted EBITDA**: Adjusted EBITDA for Q4 was $15.1 million, up from $11.9 million in Q4 fiscal 2024, achieving a margin of 13.0% [13] Expenses Overview - **Operating Expenses**: Total GAAP operating expenses for Q4 were $30.6 million, down 14.3% from $35.7 million in the previous year, while non-GAAP operating expenses decreased by 13.2% to $27.1 million [6] - **Full Year Operating Expenses**: For the twelve months ended June 27, 2025, total operating expenses were $128.9 million, an increase of 2.8% from $125.3 million in fiscal 2024 [7] Income Tax and Net Income - **Income Tax Expense**: GAAP income tax expense for Q4 was $5.0 million, compared to $3.1 million in Q4 fiscal 2024 [10] - **Net Income**: The company reported GAAP net income of $5.2 million for Q4, with a diluted earnings per share of $0.40, compared to $1.5 million and $0.12 per share in the prior year [11] Balance Sheet Highlights - **Cash and Cash Equivalents**: As of June 27, 2025, the company had $59.7 million in cash and cash equivalents, up from $49.4 million as of March 28, 2025 [14] - **Total Debt**: Total debt stood at $87.6 million as of June 27, 2025 [14] Guidance for Fiscal 2026 - The company provided guidance for fiscal 2026, projecting full year revenue between $440 million and $460 million and Adjusted EBITDA between $45.0 million and $55.0 million [22]

Core Viewpoint - Aviat Networks, Inc. is set to release its fourth quarter fiscal 2025 financial results on September 10, 2025, after market close, indicating a focus on transparency and communication with investors [1][6]. Financial Results Announcement - The financial results will cover the period ended June 27, 2025, showcasing the company's performance in the last quarter of the fiscal year [1]. - An earnings conference call and webcast will be held on the same day at 4:15 p.m. ET, featuring key executives including the President and CEO, CFO, and Interim CFO [2]. Access to Conference Call - Interested parties can access the conference call live via the webcast on Aviat Network's Investor Relations website or participate via telephone after registering [3]. - A replay of the conference call will be available on the company's investor relations website following the event [3]. Company Overview - Aviat Networks, Inc. specializes in wireless transport and access solutions, with over one million systems sold in 170 countries, serving various sectors including government and defense [4]. - The company has a long history of microwave innovations and offers a comprehensive suite of professional and support services to simplify network operations for its customers [4].

Core Viewpoint - Aviat Networks, Inc. announced the resignation of Michael Connaway, the Senior Vice President and Chief Financial Officer, effective after the filing of the Form 10-K for fiscal year 2025, to pursue another opportunity outside the industry [1][2]. Management Changes - Andrew Fredrickson, currently the Vice President of Corporate Finance, will take over as Interim CFO following Connaway's departure, while the company has begun a search for a permanent CFO with the help of an executive search firm [2][3]. Financial Performance - The company estimates GAAP net income for the fourth quarter ended June 27, 2025, to be greater than $4.5 million, a significant increase from $1.5 million reported in the same period last year [4]. - Non-GAAP Adjusted EBITDA for the fourth quarter is estimated to exceed $14.0 million, compared to $11.9 million in the year-ago period [5][13].

Core Insights - Aviat Networks has announced the IRU600 indoor microwave radio, which supports the highest transmitter power in the industry at +40 dBm, enabling longer links, increased capacity, and reduced costs for both private and public network applications worldwide [1][2] Product Features - The IRU600 operates in the 4 to 11 GHz bands and provides up to 10W of output power, which is over five times more than alternative indoor radio solutions, allowing for the use of antennas that are 50% smaller and 75% lighter [2] - The compact 2RU (44mm) high rack mount unit includes two independent radios and an integrated antenna coupling unit (ACU), making it suitable for mission-critical applications [4] Market Position - The IRU600 has been the leading all-indoor radio in North America for the past 15 years, with over 100,000 units shipped to customers in public safety, utility, and service provider networks across the US and Canada [3] - The product's reliability and high transmitter power have made it a preferred choice for customers, helping them reduce tower-related costs [3] Compliance and Availability - The IRU600 is now available and compliant with ETSI standards, supporting international frequency bands [5]

Group 1 - The focus has shifted towards offshore drilling, supply industry, and shipping, including tankers, containers, and dry bulk [1] - The fuel cell industry is being monitored as it is still in its early stages of development [1] Group 2 - The individual has extensive experience in auditing with PricewaterhouseCoopers before transitioning to day trading nearly 20 years ago [2] - Successfully navigated significant market events such as the dotcom bubble, the aftermath of the World Trade Center attacks, and the subprime crisis [2]

Company Overview - Aviat Networks (NASDAQ: AVNW) is a specialist in microwave backhaul, focusing on wireless transport solutions [1] - The company is well-positioned to benefit from several industry tailwinds, including increasing demand for rural broadband, the rollout of 5G technology, and the rise of private LTE/5G networks [1] Industry Trends - There is a surging demand for rural broadband, which is expected to drive growth for companies like Aviat Networks [1] - The ongoing rollout of 5G technology is contributing to increased demand for wireless transport solutions [1] - The rise of private LTE/5G networks is also creating additional opportunities for growth in the industry [1]

Company Performance - Aviat Networks, Inc. reported quarterly earnings of $0.88 per share, significantly exceeding the Zacks Consensus Estimate of $0.23 per share, and up from $0.73 per share a year ago, representing an earnings surprise of 282.61% [1] - The company posted revenues of $112.64 million for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 7.66% and showing a slight increase from $111.61 million year-over-year [2] - Over the last four quarters, Aviat Networks has surpassed consensus EPS estimates two times and topped consensus revenue estimates twice [2] Stock Performance - Aviat Networks shares have increased approximately 4.9% since the beginning of the year, contrasting with the S&P 500's decline of 3.9% [3] - The current consensus EPS estimate for the upcoming quarter is $0.86 on revenues of $123.18 million, and for the current fiscal year, it is $1.04 on revenues of $434.41 million [7] Industry Outlook - The Wireless Equipment industry, to which Aviat Networks belongs, is currently ranked in the top 19% of over 250 Zacks industries, indicating a favorable outlook [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact stock performance [5]

Financial Data and Key Metrics Changes - Total revenue for the third quarter was $112.6 million, an increase of $1.8 million or 1.6% year over year [12] - Non-GAAP gross margin was 35.8%, up from 35.1% in the prior year [13] - Record adjusted EBITDA of $14.9 million, up 17% compared to the same period last year [5][15] - Non-GAAP EPS was $0.88, reflecting a 12.8% increase year over year [15] Business Line Data and Key Metrics Changes - North America revenue was $49.4 million, an increase of $5 million or 11% year over year, driven by growth in private networks [12] - International revenues decreased by $3.2 million or 5% to $63.2 million, attributed to a tough year-over-year comparison with APAC's record performance in the previous year [13] - Gross margins improved due to a favorable regional and software mix [14] Market Data and Key Metrics Changes - The mobile service provider market showed strong performance, with good software volumes contributing to improved gross margins [6] - The company maintained its share in the private networks segment in North America and expanded its sales funnel internationally [7] - No cancellations were reported from U.S. Federal government customers despite spending reduction efforts [8] Company Strategy and Development Direction - The company is focused on growing its scale and has seen success with its disciplined operating model [5] - Strategic discussions with U.S. headquartered Fortune 500 companies are ongoing, which may lead to increased business in the U.S. market [10] - The company is working to mitigate tariff impacts through inventory management and optimizing manufacturing locations [11] Management's Comments on Operating Environment and Future Outlook - Management believes the CapEx cycle for U.S. Tier one customers has bottomed out, with expectations for an uptick in demand in the coming quarters [24] - The company is maintaining its annual guidance and expects to meet current consensus estimates for revenue and EBITDA [16] - Management expressed confidence in the demand environment despite macroeconomic uncertainties [66] Other Important Information - The company has approximately $450 million in net operating losses, which will help minimize cash tax payments for the foreseeable future [15] - Operating expenses were managed effectively, remaining flat year over year due to disciplined cost management [49] Q&A Session Summary Question: What factors could swing guidance to the high end versus the low end? - Management indicated that potential pull-ins to avoid tariffs could positively impact results, while maintaining annual guidance [20] Question: What is the outlook for the U.S. Tier one market? - Management believes the CapEx cycle has bottomed and expects an uptick in demand in a couple of quarters [24] Question: Can gross margins continue to improve? - Management noted that while Q3 gross margins were strong, they do not expect further acceleration in Q4 due to macro uncertainties and tariff impacts [27] Question: What is the impact of tariffs on gross margins? - Management estimated a potential impact of 2% to 2.5% on COGS due to tariffs, but does not anticipate earnings leakage [36] Question: What is the outlook for North America and Tier one customers? - Management reported good private network business but noted they are currently between projects with U.S. Tier one customers [32][68] Question: What are the opportunities with large Tier one customers in MDUs? - Management highlighted the trend towards fixed wireless access in apartment buildings, which could drive future backhaul needs [42]

Financial Data and Key Metrics Changes - Total revenue for the third quarter was $112.6 million, an increase of $1.8 million or 1.6% year over year [12] - Non-GAAP gross margin was 35.8%, up from 35.1% in the prior year [13] - Record adjusted EBITDA of $14.9 million, up 17% compared to the previous year [4][15] - Non-GAAP EPS was $0.88, reflecting a 12.8% increase year over year [15] Business Line Data and Key Metrics Changes - Mobile service provider market performed well, with software volumes contributing to improved gross margins [5] - Initial sales of ProVision Plus software were reported during the quarter, indicating progress in servicing Tier one customers [6] - Private networks maintained demand share in North America and expanded internationally [6] Market Data and Key Metrics Changes - North America accounted for 44% of total revenues, with revenues of $49.4 million, an increase of 11% year over year [12] - International revenues were $63.2 million, a decrease of 5% year over year, primarily due to tough comparisons with a strong prior year in APAC [13] Company Strategy and Development Direction - The company is focused on maintaining a disciplined operating model and improving operational efficiencies [4][14] - Strategic discussions with U.S. Fortune 500 companies are ongoing, potentially leading to increased business in the U.S. market [10] - The company aims to remain margin neutral despite tariff impacts through productivity and sourcing adjustments [11] Management's Comments on Operating Environment and Future Outlook - Management believes the CapEx cycle for U.S. Tier one customers has bottomed out, with expectations for an uptick in demand in the coming quarters [25] - The company is cautious about the macro environment and tariffs, maintaining guidance for fiscal year 2025 within previously provided ranges [17][18] Other Important Information - The company has approximately $450 million in net operating losses, which will minimize cash tax payments for the foreseeable future [15] - Operating expenses were managed effectively, with a decrease year over year due to disciplined cost management [14][49] Q&A Session Summary Question: What factors could swing guidance to the high end versus the low end? - Management indicated that potential pull-ins to avoid tariffs could positively impact results, while maintaining annual guidance [20][22] Question: What is the current state of the U.S. Tier one market? - Management believes the CapEx cycle has likely bottomed and expects an uptick in demand in the next couple of quarters [25][26] Question: Can gross margins continue to improve? - Management noted that while Q3 gross margins were strong, they do not expect further acceleration in Q4 due to macro uncertainties and tariff impacts [28] Question: What is the outlook for North America? - The company is optimistic about private network demand and anticipates that the next U.S. Tier one project will kick in soon [34] Question: What is the impact of tariffs on the business? - Management provided an upper bound of 2% to 2.5% on COGS due to tariffs, but they do not anticipate any earnings leakage [35][76] Question: What is the status of strategic communications with U.S. customers? - Management indicated that discussions are ongoing and could lead to increased business opportunities in the U.S. market [51] Question: What is the outlook for the fourth quarter? - Management affirmed that they are guiding to consensus estimates, with expectations for a sequential build in revenues but not a significant increase [65][66]