Extreme Networks(EXTR) - 2025 Q2 - Quarterly Results

Financial Performance - Total revenue for Q2 FY2025 was $279.4 million, down 5.7% year-over-year, but up 3.8% quarter-over-quarter[5] - GAAP diluted EPS for Q2 was $0.06, compared to $0.03 in the same quarter last year, and a loss of $0.08 in the previous quarter[5] - Non-GAAP diluted EPS was $0.21, down from $0.24 year-over-year and up from $0.17 quarter-over-quarter[5] - For Q3 FY2025, the company targets total net revenue between $276.0 million and $284.0 million[13] - For the full fiscal year 2025, total net revenue is targeted between $1,120.0 million and $1,138.0 million[15] - GAAP revenues for Q2 2024 were $279.355 million, a decrease from $296.377 million in Q2 2023, representing a decline of 5.4%[44] - Non-GAAP gross profit for Q2 2024 was $177.190 million, compared to $185.176 million in Q2 2023, reflecting a decrease of 4.3%[44] - Non-GAAP operating income for Q2 2024 was $41.153 million, up from $43.932 million in Q2 2023, indicating a decline of 6.3%[44] - GAAP net income for Q2 2024 was $7.382 million, compared to $3.988 million in Q2 2023, showing an increase of 85.0%[45] - Non-GAAP net income for Q2 2024 was $28.573 million, down from $31.475 million in Q2 2023, a decrease of 9.1%[45] Cash Flow and Assets - The company generated net cash flow from operations of $21.5 million and free cash flow of $16.1 million in Q2[11] - Cash and cash equivalents increased to $170,322 thousand as of December 31, 2024, from $156,699 thousand at the end of June 2024, marking an increase of 8.3%[23] - The company reported a net cash provided by operating activities of $40,118 thousand for the six months ended December 31, 2024, down from $109,865 thousand in the same period of 2023[27] - Total current assets increased to $495,289 thousand as of December 31, 2024, compared to $466,926 thousand as of June 30, 2024, an increase of 6.1%[23] Expenses and Liabilities - Research and development expenses for the six months ended December 31, 2024, were $109,334 thousand, slightly down from $110,849 thousand in the same period of 2023[25] - Total liabilities increased to $1,029,736 thousand as of December 31, 2024, compared to $1,017,312 thousand as of June 30, 2024[23] Margins and Profitability - The gross margin for Q2 was 62.7%, an increase from 61.9% year-over-year[9] - Non-GAAP gross margin percentage for Q2 2024 was 63.4%, an increase from 62.5% in Q2 2023[44] - Non-GAAP operating margin for Q2 2024 was 14.7%, slightly down from 14.8% in Q2 2023[44] Future Expectations - The company expects better than seasonal revenue for Q3, with improved cash flow generation anticipated[4] - The company has excluded certain items from its non-GAAP financial measures, which include share-based compensation and amortization of intangibles, to provide additional insight into its operations[19] - The company expects to incur share-based compensation expenses in future periods, which are non-cash and not reflective of ongoing cash requirements[35] New Initiatives - The company introduced Extreme Platform ONE, integrating networking, security, and AI to enhance productivity[3]