10-Q · May 4, 2026
Aviat Networks reported a disappointing third quarter for fiscal 2026 with revenue of $100 million, missing estimates by 5.9% and down 11.2% year-over-year. The gross margin fell significantly to 29.3%, a decrease of…
Earnings analysis · 10-K
AVNW earnings analysis
Filed August 27, 2026 · Our reading of the company's report
The latest report
Aviat delivered modest fiscal 2026 growth, with revenue up 1.2% to $439.7 million and operating income up to $19.2 million, supported by cost reductions, software growth and stronger Europe and Africa results. The…
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Aviat delivered modest fiscal 2026 growth, with revenue up 1.2% to $439.7 million and operating income up to $19.2 million, supported by cost reductions, software growth and stronger Europe and Africa results. The trajectory remains mixed: gross margin declined to 31.5%, services revenue fell to $125.5 million from $146.9 million, and the effective tax rate rose to 81%, limiting net income to $2.5 million. Liquidity and operating cash flow improved, but tariffs, technology substitution, AI execution risk and the new NEC arbitration create meaningful uncertainty around the outlook.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $0.19
What stood out
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Specialized network portfolio and service moat
Aviat describes itself as a global supplier of microwave and access networking solutions with more than 3,000 customers and more than 300 patents. It competes on total cost of ownership, microwave radio expertise and mission-critical communications, while its turnkey and after-sale support services are described as a business differentiator.
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Cost actions supported operating recovery
Fiscal 2026 revenue increased 1.2% to $439.7 million, led by a 10% increase in software and licenses and a 6% increase in equipment sales. Research and development expense declined 20.6% to $28.4 million and selling and administrative expense declined 1.1% to $88.5 million due primarily to cost-management initiatives.
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Operating profit and EPS improved
Operating income increased to $19.2 million from $10.6 million, while diluted EPS increased to $0.19 from $0.10. However, gross margin declined to 31.5% from 32.1%, primarily because of lower service revenue and mix.
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Europe and Africa drove regional growth
Geographic growth was strongest in Europe, where revenue increased 32.6% to $42.0 million, and Africa and the Middle East, where revenue increased 17.2% to $58.0 million. North America increased 6.0% to $220.0 million, partly offsetting an 18.0% decline in Latin America and Asia Pacific to $119.7 million.
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Liquidity and operating cash flow improved
Net cash provided by operating activities improved to $13.6 million from $5.7 million, helped by improved working capital. Cash and cash equivalents increased to $72.8 million, while the company also had $84.2 million of available credit under its Credit Facility.
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Modest buybacks; no dividend
Aviat repurchased 151,229 shares for $2.7 million in fiscal 2026, with $3.7 million remaining under its $10.0 million repurchase authorization. The company paid no cash dividends and stated that it intends to retain earnings for use in the business.
What to watch
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New AI/ML execution and liability risk
The company identifies AI and machine-learning deployment as a new operational, competitive, legal and reputational risk. Aviat plans to incorporate AI and ML into products and network-management software, but states that development requires significant investment and specialized personnel and that competitors may adopt the technologies more rapidly or effectively.
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Tariffs and geopolitical supply disruption
Aviat states that the scope and level of tariffs and other trade measures affecting imported products and components have increased significantly in recent periods and have adversely affected costs, supply chains and pricing. The company may be unable to pass through higher costs, which could erode gross margins; fiscal 2026 gross margin was already down to 31.5% from 32.1%.
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New NEC arbitration exposure
NEC filed arbitration requests on August 13, 2025 and October 21, 2025 asserting, among other claims, that Aviat must purchase $19.0 million of additional component parts and pay other alleged obligations related to the 2023 acquisition. Aviat has denied the allegations and recorded no loss accrual because it cannot predict the outcome, creating potentially unquantified litigation exposure.
Management's outlook
The 10-K provides no quantitative annual revenue or EPS guidance. Management states that remaining performance obligations were approximately $132.3 million at July 3, 2026, with approximately 50% expected to be recognized in fiscal 2027, 45% in fiscal 2028, and 5% thereafter.
Earlier filings 4
10-K · September 10, 2025
Aviat Networks positions itself as a specialist provider of microwave and millimeter-wave wireless transport and access solutions emphasizing a low total cost of ownership (TCO), software-enabled services and an…
10-Q · November 5, 2024
Aviat Networks reported a modest revenue increase to $88,429,000 for the quarter (up from $86,909,000 year‑ago) but swung to an operating loss of $(15,568,000) and a net loss of $(11,879,000) (diluted EPS $(0.94) vs…
10-K · October 4, 2024
Aviat Networks presents a stable order backlog (~$292 million) and a broad product roadmap (WTM 4800 up to 20 Gbps, MB-XD extending 10 Gbps to 20 km) aimed at 5G, rural broadband and private networks while investing in…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.