Accessibility StatementSkip Navigation Ribbon is committed to helping service providers, enterprises and critical infrastructure operators worldwide modernize and secure their networks and services. About Ribbon Ribbon Communications (Nasdaq: RBBN) delivers secure cloud communications and IP and optical networking solutions to service providers, enterprises and critical infrastructure sectors globally. We engage deeply with our customers, helping them modernize their networks for improved competitive posit ...

PLANO, Texas, Nov. 12, 2025 /PRNewswire/ -- Ribbon Communications Inc. (Nasdaq: RBBN), a global leader in real-time communications technology and IP optical networking solutions, today announced the successful completion of a 20Tbps optical transmission field trial on the 10,000 km JUNO trans-Pacific submarine cable, developed and operated by Seren Juno. Ribbon's mission is to help service providers, enterprises and critical infrastructure operators worldwide modernize and secure their networks and services ...

Revenue Performance - Total revenue for Q3 2025 was $215.371 million, a slight increase from $210.238 million in Q3 2024, representing a growth of 1.1% year-over-year[12] - Product revenue for the three months ended September 30, 2025, was $109.979 million, compared to $112.151 million in 2024, indicating a decrease of about 1.0%[112] - Service revenue for the three months ended September 30, 2025, increased to $105.392 million from $98.087 million in Q3 2024, reflecting a growth of 7.3%[12] - Total revenue for the three months ended September 30, 2025, was $215.371 million, a slight decrease from $210.238 million in the same period of 2024, representing a year-over-year decline of approximately 1.1%[111] - Service revenue for the nine months ended September 30, 2025, was $310.206 million, an increase from $283.628 million in 2024, reflecting a growth of approximately 9.3%[112] - Sales to enterprise customers for the three months ended September 30, 2025, were $37.467 million, a decrease from $40.002 million in 2024, showing a decline of approximately 6.4%[112] - Sales to service provider customers for the nine months ended September 30, 2025, were $207.276 million, an increase from $182.982 million in 2024, indicating a growth of about 13.2%[112] Financial Performance - The net loss for Q3 2025 was $12.109 million, compared to a net loss of $13.422 million in Q3 2024, showing an improvement of 9.8%[12] - The company reported a basic loss per share of $0.07 for Q3 2025, an improvement from a loss of $0.08 per share in Q3 2024[12] - The company reported a net loss of $49,429,000 for the nine months ended September 30, 2025, an improvement from a net loss of $60,599,000 for the same period in 2024, representing an 18% reduction in losses[19] - The company reported a loss before income taxes of $9.0 million for the three months ended September 30, 2025, compared to a loss of $11.8 million in the same period of 2024[126] - The total adjusted gross profit for the three months ended September 30, 2025, was $113.2 million, slightly down from $116.3 million in the same period of 2024[126] Assets and Liabilities - Total current assets decreased to $418.427 million as of September 30, 2025, down from $463.662 million at the end of 2024, a decline of 9.7%[10] - Total liabilities decreased to $745.182 million as of September 30, 2025, compared to $757.933 million at the end of 2024, a reduction of 1.7%[10] - The company reported total stockholders' equity of $360,052,000 as of September 30, 2025, down from $404,621,000 at the beginning of the year[15] - The accumulated deficit increased to $(1,623,614,000) as of September 30, 2025, from $(1,611,505,000) on July 1, 2025[15] - The term debt balance as of September 30, 2025, was $344.3 million, with a fair value of approximately $348.6 million[47] Cash Flow and Investments - Cash flows from operating activities provided $22,159,000 in the nine months ended September 30, 2025, compared to cash used of $11,527,000 in the same period of 2024, indicating a significant turnaround[19] - The company reported net cash used in investing activities of $23,368,000 for the nine months ended September 30, 2025, compared to $14,890,000 in 2024, indicating a 57% increase in investment outflows[19] - Ribbon Communications' cash and cash equivalents at the end of the period were $76,767,000, up from $40,093,000 at the end of September 2024, marking a 91% increase year-over-year[19] Research and Development - Research and development expenses for the nine months ended September 30, 2025, were $134.158 million, slightly down from $134.897 million in the same period of 2024[12] - Research and development expenses for the three months ended September 30, 2025, were $45.9 million, consistent with $45.6 million in the same period of 2024[126] Stock and Shareholder Information - Ribbon Communications Inc. repurchased 911,092 shares of common stock during the three months ended September 30, 2025, resulting in a reduction of additional paid-in capital by $3,478,000[15] - The total number of common shares outstanding decreased from 177,156,341 on July 1, 2025, to 176,476,492 on September 30, 2025[15] - The company has authorized 390,000,000 shares as of September 30, 2025, an increase from 240,000,000 shares authorized at December 31, 2024[10] Restructuring and Related Expenses - The company recorded restructuring expenses of $10.2 million for the nine months ended September 30, 2025, compared to $8.8 million for the same period in 2024[52] - Total restructuring and related expenses for the nine months ended September 30, 2025, included $4.996 million in severance costs and $5.197 million in variable and other facilities-related costs[56] - The restructuring expenses include costs for severance, estimated future variable lease costs, and accelerated rent amortization[52] Other Financial Metrics - Interest paid increased to $28,797,000 for the nine months ended September 30, 2025, compared to $22,851,000 in 2024, representing a 26% increase[20] - The company recorded income tax provisions of $4.6 million for the nine months ended September 30, 2025, down from $6.5 million in the same period of 2024[150] - The company recognized approximately $96 million of revenue in the nine months ended September 30, 2025, that was recorded as deferred revenue at December 31, 2024[115]

Core Insights - Premarket trading is showing notable activity with significant price movements indicating potential investment opportunities before the market opens [1] Premarket Gainers - Ventyx Biosciences, Inc. (VTYX) increased by 108% to $8.05 - Brera Holdings PLC (SLMT) rose by 49% to $12.50 - Safe & Green Holdings Corp. (SGBX) gained 39% to $3.18 - American Rebel Holdings, Inc. (AREB) up by 26% to $2.71 - Tango Therapeutics, Inc. (TNGX) increased by 18% to $10.25 - Garrett Motion Inc. (GTX) rose by 14% to $14.30 - ETHZilla Corporation (ETHZ) gained 12% to $17.61 - D-Wave Quantum Inc. (QBTS) increased by 11% to $30.40 - IonQ, Inc. (IONQ) rose by 10% to $61.04 - Megan Holdings Limited (MGN) up by 7% to $2.31 [3] Premarket Losers - Splash Beverage Group, Inc. (SBEV) decreased by 21% to $2.06 - Molina Healthcare, Inc. (MOH) down by 18% to $158.44 - SCHMID Group N.V. (SHMD) fell by 18% to $3.18 - Beyond Meat, Inc. (BYND) decreased by 18% to $2.91 - Agencia Comercial Spirits Ltd (AGCC) down by 16% to $5.07 - Super League Enterprise, Inc. (SLE) fell by 13% to $2.25 - Armata Pharmaceuticals, Inc. (ARMP) decreased by 12% to $5.99 - Applied DNA Sciences, Inc. (BNBX) down by 12% to $4.19 - Ribbon Communications Inc. (RBBN) fell by 12% to $3.49 - Tamboran Resources Corporation (TBN) decreased by 11% to $21.81 [4]

Group 1 - The article does not provide any relevant content regarding company or industry insights [1]

Core Insights - Ribbon Communications reported quarterly earnings of $0.04 per share, missing the Zacks Consensus Estimate of $0.06 per share, and down from $0.05 per share a year ago [1][2] - The company posted revenues of $215.37 million for the quarter ended September 2025, which was 2.27% below the Zacks Consensus Estimate and an increase from $210.24 million year-over-year [3] - The stock has underperformed the market, losing about 2.9% since the beginning of the year compared to the S&P 500's gain of 14.5% [4] Earnings Performance - The earnings surprise for the quarter was -33.33%, with the company having surpassed consensus EPS estimates only once in the last four quarters [2] - The current consensus EPS estimate for the upcoming quarter is $0.15 on revenues of $252.8 million, and for the current fiscal year, it is $0.23 on revenues of $875.05 million [8] Industry Context - Ribbon Communications operates within the Zacks Communication - Network Software industry, which is currently ranked in the top 18% of over 250 Zacks industries [9] - The industry outlook can significantly impact the stock's performance, with research indicating that the top 50% of Zacks-ranked industries outperform the bottom 50% by more than 2 to 1 [9] Future Outlook - The company's earnings outlook will be crucial for assessing future stock performance, with mixed trends in estimate revisions noted prior to the earnings release [5][7] - The current Zacks Rank for Ribbon Communications is 3 (Hold), suggesting that the shares are expected to perform in line with the market in the near future [7]

Financial Data and Key Metrics Changes - The company reported revenues of $215 million for Q3 2025, a 2% increase year-over-year, and year-to-date revenue has increased by 6% [18][7] - Non-GAAP gross margin for Q3 was 52.6%, lower than expected due to reduced software sales to U.S. government customers, but overall gross margin improved sequentially by 50 basis points [18][19] - Adjusted EBITDA for Q3 was $29 million, a $1 million decrease from the prior year, driven by lower gross margins [19][18] Business Line Data and Key Metrics Changes - IP Optical Networks revenue for Q3 was $91 million, an 11% increase year-over-year, with a positive EBITDA contribution of $1 million [21][11] - Cloud and Edge segment revenue for Q3 was $124 million, a decrease of 3% year-over-year, with adjusted EBITDA down $10 million year-over-year [22][15] - Sales to service providers increased by 5% year-over-year, while sales to enterprise customers decreased by approximately 3% year-over-year [8][15] Market Data and Key Metrics Changes - Sales to Europe, Middle East, and Africa grew 26% year-over-year, while sales to Asia-Pacific increased by 13%, led by India [10][12] - North American sales were impacted by lower U.S. federal sales, declining approximately 10% year-over-year [10][15] - The company expects continued strong execution in North America, particularly with Verizon projects [26][29] Company Strategy and Development Direction - The company is focusing on AI ops and automation through its new product, Acumen, which aims to help customers transition to autonomous networks [4][5] - The strategy includes expanding the Cloud and Edge portfolio to support agentic AI platforms and enhancing network reliability [4][6] - The company is optimistic about the convergence of AI and voice technologies, viewing it as a significant opportunity for growth [7][29] Management's Comments on Operating Environment and Future Outlook - Management noted that the U.S. government shutdown has delayed procurement processes but emphasized that no business has been lost, only delayed [9][8] - The outlook for Q4 remains strong, with expectations for it to be the strongest quarter of the year despite the shutdown [25][29] - The company anticipates revenue in a range of $230 million to $250 million for Q4, with adjusted EBITDA projected between $42 million and $48 million [28][29] Other Important Information - The company repurchased approximately 900,000 shares for a total cost of $3.5 million during Q3 [23] - The company is experiencing foreign exchange headwinds of approximately $3 million year-over-year, primarily due to the shekel [43][42] - The company has identified several new growth vectors related to AI technology and autonomous network operations [30][29] Q&A Session Summary Question: Future growth from AI and automation - Management views AI ops as a new category that will drive growth in the Cloud and Edge segment, allowing customers to build their own smart agents [32][33] Question: Performance of Verizon and U.S. IP Optical Networks - Verizon grew about 20% year-over-year in Q3, with a focus on services rather than products [34][35] Question: Impact of the government shutdown - Management believes that without the shutdown, they would have comfortably met or exceeded guidance for Q3 [37][38] Question: Foreign exchange and tariff impacts - Foreign exchange impacts were approximately $3 million, while tariffs are a smaller headwind of about $0.5 million per quarter [42][45] Question: Sustainability of growth in India - India has shown sustained momentum over the past five quarters, with a strong partnership with BARDI contributing to growth [49][50] Question: Expectations for government business growth - Management anticipates solid growth in government programs as they expand deployments and seek new customers [70][69]

Financial Data and Key Metrics Changes - Revenue for Q3 2025 was $215 million, a 2% increase year over year, and year-to-date revenue increased by 6% [18][7] - EBITDA for Q3 was $29 million, a decrease of $1 million from the prior year, with a non-GAAP tax rate of 40% [19][20] - Non-GAAP diluted earnings per share were $0.04, down from $0.01 in the prior year [20] Business Line Data and Key Metrics Changes - IP Optical Networks revenue increased by 11% year over year to $91 million, with a non-GAAP gross margin of 39.4% [21] - Cloud and Edge revenue decreased by 3% year over year to $124 million, with a non-GAAP gross margin of 62.2% [22] - Sales to service providers increased by 5% year over year, while sales to enterprise customers decreased by approximately 3% [8][15] Market Data and Key Metrics Changes - Sales in Europe, Middle East, and Africa grew by 26% year over year, while sales in Asia-Pacific increased by 13% [10] - North American sales were impacted by a decline of approximately 10% year over year due to lower U.S. federal sales [10][15] - Sales to India increased by 31% year over year, contributing to strong growth in the Asia-Pacific region [12] Company Strategy and Development Direction - The company is focusing on AI ops automation with the launch of the Acumen platform, aimed at enhancing network reliability and performance [4][5] - There is a strategic emphasis on the convergence of AI and voice technologies, with significant opportunities identified in this area [7][29] - The company expects Q4 to be the strongest quarter of the year, despite uncertainties related to the U.S. government shutdown [25][26] Management's Comments on Operating Environment and Future Outlook - Management noted that the U.S. government shutdown has delayed procurement processes but emphasized that no business has been lost [9][38] - The fundamentals of the Cloud and Edge and IP Optical Networks businesses remain strong, with good demand from service provider and enterprise customers [9][29] - The company anticipates continued growth in voice communications and investment in data centers and fiber networks [29] Other Important Information - The company repurchased approximately 900,000 shares for a total cost of $3.5 million during the quarter [23] - The company expects Q4 revenue to be in the range of $230 to $250 million, with adjusted EBITDA projected between $42 to $48 million [28] Q&A Session Summary Question: Impact of AI on Cloud and Edge growth - Management views AI as a new category that will drive growth in Cloud and Edge, with a focus on AI ops and the convergence of voice and AI [32][33] Question: Performance of Verizon and U.S. IP Optical Networks - Verizon grew about 20% year over year in Q3, with a shift towards services rather than products [34] - U.S. IP Optical business is expected to be lumpy, with revenue influenced by various projects [35] Question: Quantifying the impact of the government shutdown - Management indicated that the shutdown impacted Q3 results, with a potential revenue loss of around $10 million to $15 million in Q4 [61][62] Question: Future growth of government program business - Management anticipates solid growth in government programs, particularly with new voice modernization projects [67][69] Question: BEAD funding and its impact - Management has not factored BEAD funding into the outlook yet, as the timing and execution remain uncertain [78] Question: New product innovations and potential business segments - The Acumen product spans both business units, and while it currently falls under Cloud and Edge, future categorization may evolve [83]

Financial Data and Key Metrics Changes - Revenue for Q3 2025 was $215 million, a 2% increase year over year, within the guidance range [17] - Year-to-date revenue increased by 6%, and EBITDA rose by 5% compared to the same period in 2024 [6][17] - Non-GAAP gross margin was 52.6%, lower than expected due to reduced software sales to U.S. government customers [17] - Adjusted EBITDA for Q3 was $29 million, a $1 million decrease from the prior year [18] Business Line Data and Key Metrics Changes - IP Optical Networks revenue was $91 million, an 11% increase year over year, with a positive EBITDA contribution of $1 million [19] - Cloud and Edge revenue decreased by 3% year over year to $124 million, with adjusted EBITDA down $10 million year over year [20] - Sales to service providers increased by 5% year over year, while enterprise sales were down approximately 3% year over year [7][14] Market Data and Key Metrics Changes - Sales in Europe, Middle East, and Africa grew 26% year over year, while Asia-Pacific sales increased by 13% [9] - North American sales declined approximately 10% year over year, primarily due to lower U.S. federal sales [9] - Sales to India increased by 31% year over year, contributing to strong growth in the Asia-Pacific region [11] Company Strategy and Development Direction - The company is focusing on AI ops and automation through its new Acumen platform, which aims to help customers transition to autonomous networks [4][5] - Continued investment in voice and data network modernization is expected to drive growth across service provider and enterprise customers [8][24] - The company anticipates strong demand for its Cloud and Edge and IP Optical Networks businesses, despite short-term disruptions [8][26] Management's Comments on Operating Environment and Future Outlook - Management noted that the U.S. government shutdown has delayed procurement processes but emphasized that no business has been lost [8][34] - The outlook for Q4 is expected to be strong, with a projected revenue range of $230 to $250 million and non-GAAP adjusted EBITDA of $42 to $48 million [26] - Management remains optimistic about the growth potential in data centers and critical infrastructure investments [26] Other Important Information - The company repurchased approximately 900,000 shares for a total cost of $3.5 million during the quarter [21] - The company is experiencing foreign exchange headwinds of approximately $3 million year over year, primarily due to the shekel [38] Q&A Session Summary Question: Impact of AI on Cloud and Edge growth - Management views AI as a new category that will drive growth in Cloud and Edge, allowing customers to build their own smart agents [30][31] Question: Performance of Verizon and U.S. IP Optical business - Verizon grew about 20% year over year in Q3, with a focus on services rather than products [32] - U.S. IP Optical business is expected to be lumpy, with revenue fluctuating based on project timing [33] Question: Shutdown impact on Q3 and Q4 - Management indicated that the shutdown impacted Q3 results, and they would have comfortably met guidance without it [34][54] Question: Foreign exchange and tariff impacts - Foreign exchange impacts were approximately $3 million, while tariffs posed a smaller headwind of about $0.5 million per quarter [37][39] Question: Government business growth expectations - Management expects solid growth in government business as new projects are initiated, despite current uncertainties [56][58] Question: BEAD funding and outlook - Management is cautiously optimistic about BEAD funding but has not factored it significantly into the outlook yet [62] Question: New product innovation with Acumen - The Acumen platform is generating significant interest, and management is exploring how to categorize it within their business segments [66][67]

Financial Data and Key Metrics Changes - Revenue for Q3 2025 was $215 million, a 2% increase year over year, within the guidance range [24] - Year-to-date revenue increased by 6%, and EBITDA rose by 5% compared to the same period in 2024 [9][24] - Non-GAAP gross margin for Q3 was 52.6%, lower than expected due to reduced software sales to U.S. government customers [24] - Non-GAAP net income for the quarter was $7 million, down from $8 million in the prior year, resulting in a diluted EPS of $0.04 [27] Business Line Data and Key Metrics Changes - IP Optical Networks revenue for Q3 was $91 million, an 11% increase year over year, driven by strong sales in India and EMEA [28] - Cloud and Edge segment revenue was $124 million, a decrease of 3% year over year, primarily due to lower U.S. Federal sales [30] - Sales to service providers increased by 5% year over year, with Verizon's revenue growing approximately 20% [20][44] Market Data and Key Metrics Changes - Sales in Europe, Middle East, and Africa grew by 26% year over year, while Asia Pacific sales increased by 13%, led by India [13] - North American sales declined approximately 10% year over year, impacted by lower U.S. Federal sales due to the government shutdown [14][22] - IP Optical sales in North America were lower, but Europe and the Middle East saw significant growth, particularly in critical infrastructure projects [16][17] Company Strategy and Development Direction - The company is focusing on the convergence of AI and voice technologies, with the launch of the Acumen AIOps automation platform [5][6] - There is a strategic emphasis on modernizing voice and data networks for service providers and enterprises, with ongoing investments in cloud and edge solutions [13][20] - The company aims to expand its presence in the U.S. Federal market, despite current delays due to the government shutdown [12][90] Management's Comments on Operating Environment and Future Outlook - Management noted that the U.S. government shutdown has delayed procurement processes but emphasized that no business has been lost [10][12] - The outlook for Q4 is expected to be strong, with continued momentum in enterprise and service provider segments, despite the impact of the government shutdown [33][35] - The company anticipates revenue in Q4 to range from $230 million to $250 million, with adjusted EBITDA between $42 million and $48 million [37] Other Important Information - The company repurchased approximately 900,000 shares for a total cost of $3.5 million during the quarter [31] - The cash balance at the end of the quarter was $77 million, up $14 million from the previous quarter [31] Q&A Session Summary Question: Is AI a driver for future growth in Cloud and Edge? - Management views AI as a new category that will drive growth, particularly through AIOps and the convergence of voice and AI technologies [40][42] Question: How did Verizon perform in Q3 and what is the outlook? - Verizon grew about 20% year over year in Q3, with expectations for continued strong performance in Q4 [43][44] Question: What was the impact of the government shutdown on Q3 and Q4? - The shutdown impacted Q3 results, with management estimating a potential $10 million to $15 million effect on revenue for Q4 [79][82] Question: What is the expected growth rate for government business in 2026? - Management anticipates solid growth in government business as new projects are initiated, but specific growth rates are uncertain due to the current budget situation [90] Question: What is the impact of foreign exchange and tariffs? - Foreign exchange headwinds were approximately $3 million year over year, primarily due to the shekel's performance [54][56]