Results
~ Record Revenues of $937.3 million ~
Fourth Quarter Fiscal 2026 Financial Summary
Revenues of $937.3 million
GAAP diluted EPS of $4.70
Non-GAAP diluted EPS of $4.73
Full Fiscal 2026 Financial Summary
Revenues of $3.3 billion
GAAP diluted EPS of $15.85
Non-GAAP diluted EPS of $15.95
Additional Financial Highlights
Capital return
The Company's Board of Directors (the "Board") declared a $1.00 per share cash dividend payable on September 8, 2026 to shareholders of record at the close of business on August 31, 2026.
The Company intends to pay regular quarterly cash dividends of at least $1.00 per share during each quarter of fiscal year 2027, although all subsequent dividends, and the establishment of record and payment dates, are subject to final determination by the Board each quarter after its review of the Company’s financial performance and results of operations, available cash and cash flow, capital requirements, applicable corporate legal requirements, and other factors.
The Company has extended the expiration date of its previously announced stock repurchase program, authorizing the Company to repurchase up to $500 million of its common stock through September 30, 2027, as disclosed in the Form 8-K filed on August 21, 2026.
Results
Financial Highlights ($, in millions, except per share data)
(Unaudited)
Income Statement Items
Revenues
5Revenues for the fourth quarter of fiscal 2026 were $937.3 million, representing an increase from the prior quarter of 18.9% and an increase from the comparable prior year period of 23.5%.
1On a full year basis, revenues for fiscal 2026 were $3.3 billion, representing a 27.2% increase compared to full year fiscal 2025.
The growth in revenues over the prior quarter and the comparable prior year periods were driven by increase in revenue from our Enterprise Technology platform, offset in part by a decrease in revenues from our Service Provider Technology platform.
Gross Profit Margin-Gross Profit as a percentage of Revenue
During the fourth quarter of fiscal 2026, GAAP gross profit was $429.3 million.
6GAAP gross margin of 45.8% decreased by 1.2% as compared to the prior quarter GAAP gross margin of 47.0% and increased by 0.7% as compared to the comparable prior year period GAAP gross margin of 45.1%.
On a full year basis, fiscal 2026 GAAP gross profit was $1,511.4 million.
2Fiscal 2026 GAAP gross margin of 46.2% increased by 2.8% as compared to fiscal 2025 GAAP gross margin of 43.4%.
The decrease in gross profit margin as compared to the prior quarter was primarily driven by higher costs of components and higher shipping costs, offset in part by lower other indirect costs.
The increase in gross profit margin as compared to the comparable prior year period was primarily driven by lower other indirect costs, offset in part by unfavorable product mix, higher shipping costs and higher costs of components.
The increase in gross profit margin for full fiscal 2026 as compared to full fiscal 2025 was primarily driven by favorable product mix, lower other indirect costs offset in part by higher tariff costs.
Management commentary
During the fourth quarter of fiscal 2026, the Company experienced an increase in certain component costs.
Component costs may continue to rise and availability may remain constrained.
These factors may result in near-term pressure on our gross profit margins, particularly to the extent we are unable to offset higher component costs through pricing or other measures.
In addition, ongoing supply constraints could limit our ability to meet customer demand and negatively impact our revenues and gross profit margins.
Results
Research and Development
During the fourth quarter of fiscal 2026, research and development ("R&D") expenses were $53.0 million.
This reflects an increase as compared to the R&D expenses of $51.8 million in the prior quarter and R&D expenses of $47.5 million in the comparable prior year period.
7On a full year basis, fiscal 2026 R&D expenses were $204.2 million, representing an increase of $34.5 million as compared to R&D expenses of $169.7 million for fiscal 2025.
The increase in R&D expenses as compared to the prior quarter was primarily driven by higher prototype-related expenses and software expenses, offset in part by lower employee-related expenses.
The increase in R&D expenses as compared to the comparable prior year period was primarily driven by higher employee-related expenses, software expenses and facility costs.
The increase in R&D expenses for fiscal 2026 compared to fiscal 2025 was primarily driven by higher employee-related expenses, prototype-related expenses, facility costs and software expenses, offset in part by lower depreciation.
The Company’s sales, general and administrative ("SG&A") expenses for the fourth quarter of fiscal 2026 were $36.3 million.
This reflects an increase as compared to the SG&A expenses of $28.1 million in the prior quarter and an increase compared to the SG&A expenses of $33.9 million in the comparable prior year period.
3On a full year basis, fiscal 2026 SG&A expenses were $121.8 million, reflecting an increase of $10.3 million as compared to SG&A expenses of $111.5 million for fiscal 2025.
The increase in SG&A costs as compared to the prior quarter was primarily attributable to higher professional fees, higher credit card processing fees associated with incremental webstore sales, employee-related expenses and marketing expenses.
The increase in SG&A costs as compared to the comparable prior year period was primarily due to higher professional fees, higher credit card processing fees arising from incremental webstore sales, marketing expenses and employee-related expenses, offset in part by lower reserves taken against accounts receivables.
The increase in SG&A costs for fiscal 2026 compared to fiscal 2025 was primarily attributable to higher credit card processing fees associated with incremental webstore sales, higher professional fees, marketing expenses, employee-related expenses and software expenses, offset in part by lower reserves taken against accounts receivables.
Interest Expense (Income) and Other, net
During the fourth quarter of fiscal 2026, the company reported Interest expense (income) and other, net ("I&O") income of $3.1 million.
In the prior quarter and the comparable prior year period the company had reported I&O expense of $0.7 million and $3.2 million, respectively.
4On a full year basis, fiscal 2026 I&O expenses were $2.4 million, reflecting a decrease of $28.3 million as compared to the I&O expenses of $30.6 million for fiscal 2025.
The increase in I&O income compared to the prior quarter was primarily attributable to higher interest income and lower interest expense, driven by a decrease in outstanding debt and lower foreign exchange losses.
The increase in I&O income compared to comparable prior year period was primarily driven by higher interest income and lower interest expense due to a decrease in outstanding debt.
This was partially offset by higher foreign exchange losses.
8The decline in I&O expense for fiscal 2026 as compared to fiscal 2025 was primarily driven by lower interest expense driven by a decrease in outstanding debt and lower interest rates and higher interest income on invested cash, offset in part by higher foreign exchange losses.
Income Taxes
The fourth quarter fiscal 2025 GAAP provision for income taxes reflected a benefit of $8.5 million, primarily as a result of an intercompany transfer of intangible properties.
Please see pages 7 and 8 of this press release for non-GAAP adjustments to our financial results, including adjustments arising from this transaction.
Net Income and Earnings Per Share
During the fourth quarter of fiscal 2026, GAAP net income was $284.9 million and non-GAAP net income was $286.5 million.
This reflects an increase in GAAP net income and non-GAAP net income from the comparable prior year period by 6.8% and 33.6%, respectively.
The primary factors contributing to this growth were higher revenues and increased gross profit.
Fourth quarter fiscal 2026 GAAP earnings per diluted share was $4.70, and non-GAAP earnings per diluted share was $4.73.
Both measures increased from the comparable prior year period, with GAAP and non-GAAP earnings per diluted share increasing by 6.6% and 33.6% respectively.
As discussed elsewhere in this press release, the difference between GAAP net income and non-GAAP net income for the fourth quarter of fiscal 2025 is primarily driven by the immediate recognition under GAAP of the $53.7 million deferred tax asset described in the prior paragraph.
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