NETGEAR(US:NTGR)2025-10-29 20:29Financial Performance - Q3 2025 net revenue was $184.6 million, an increase of 0.9% from Q3 2024[5] - Non-GAAP operating income was $3.8 million, compared to $1.6 million in Q3 2024, marking the first positive non-GAAP operating income this year[5] - Net revenue for the three months ended September 28, 2025, was $184,561 thousand, an increase from $182,854 thousand for the same period in 2024, representing a growth of 0.4%[28] - Total revenue for the three months ended September 28, 2025, was $184,561,000, an increase from $170,532,000 in the previous quarter, with the Americas contributing $128,085,000, representing 69% of total revenue[37] - For the nine months ended September 28, 2025, net revenue reached $517,153,000, a rise from $491,340,000 in the same period last year, marking a 5.2% increase[40] Gross Margin and Profitability - GAAP gross margin reached 39.1%, up 820 basis points from 30.9% in Q3 2024; non-GAAP gross margin was 39.6%, up 850 basis points from 31.1% in Q3 2024[5] - Gross profit for the three months ended September 28, 2025, was $72,252 thousand, with a gross margin of 39.1%, compared to a gross profit of $56,483 thousand and a margin of 30.9% in the same period last year[28] - Non-GAAP gross margin for the three months ended September 28, 2025, was 39.6%, compared to 37.8% in the previous quarter[31] - Gross profit for the nine months ended September 28, 2025, was $194,176,000, with a gross margin of 37.5%, compared to a gross profit of $137,765,000 and a margin of 28.0% in the prior year[40] Operating Expenses and Losses - Operating expenses for the three months ended September 28, 2025, totaled $79,321 thousand, up from $39,325 thousand in the same period last year, primarily driven by increases in research and development and sales and marketing expenses[28] - The net loss for the three months ended September 28, 2025, was $4,777 thousand, compared to a net income of $85,074 thousand for the same period in 2024[28] - GAAP operating income for the nine months ended September 28, 2025, was $(29,408,000), while non-GAAP operating income was $(4,000) for the same period[31] - The company reported a loss before income taxes of $14,233,000 for the nine months ended September 28, 2025, compared to a profit of $36,349,000 in the same period last year[40] Cash Flow and Assets - Cash and cash equivalents decreased to $203,480 thousand as of September 28, 2025, down from $286,444 thousand at the beginning of the period[30] - Total assets decreased to $810,806 thousand as of September 28, 2025, from $850,230 thousand at the end of 2024[26] - The company reported a cash outflow from operating activities of $17,902 thousand for the nine months ended September 28, 2025, compared to a cash inflow of $143,315 thousand for the same period in 2024[30] - Cash, cash equivalents, and short-term investments decreased to $326,383,000 as of September 28, 2025, down from $363,472,000 in the previous quarter[36] Shareholder Actions - Share repurchases totaled $20 million at an average price of $24.55, with approximately 815,000 shares repurchased[6] Segment Performance - The Enterprise segment revenue was $90.8 million, up 15.7% year over year, with a non-GAAP gross margin of 51.0%, up 630 basis points year over year[9] - Home Networking segment achieved $37.9 million in annual recurring revenue (ARR), up 17.2% from the prior year[7] - The Home Networking segment is seeing growth from its WiFi 7 product portfolio, with share growth in the U.S. market[7] - Total service provider net revenue for the three months ended September 28, 2025, was $17,097,000, compared to $15,491,000 in the previous quarter[38] Future Outlook - The company expects Q4 2025 net revenue to be in the range of $170 million to $185 million[12] - Anticipated headwind to gross margins of about 150 basis points due to rising memory costs[12] - The company plans to launch a new cybersecurity solution based on the Exium acquisition and enhance its software development capabilities[6]