Extreme Networks (NASDAQ:EXTR – Get Free Report) issued its quarterly earnings data on Wednesday. The technology company reported $0.32 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.29 by $0.03, FiscalAI reports. The company had revenue of $338.55 million during the quarter, compared to the consensus estimate of $332.49 million. Extreme Networks had a net margin of 1.30% and a return on equity of 81.88%. The firm’s revenue was up 10.3% compared to the same quarter last year. During the same quarter in the prior year, the firm earned $0.25 earnings per share. Extreme Networks updated its FY 2027 guidance to 1.280-1.330 EPS and its Q1 2027 guidance to 0.270-0.290 EPS.
Here are the key takeaways from Extreme Networks’ conference call:
- Fiscal 2026 revenue rose 13% and EPS increased 26%, while fourth-quarter revenue of $339 million and EPS of $0.32 exceeded the company’s guidance and consensus. Gross margin improved to 62.7% and full-year EBITDA increased 20%.
- Extreme reported continued momentum in moving upmarket, with 187 customers generating more than $1 million in bookings versus 168 a year earlier. The company also cited a mid-teens increase in both the number and size of large opportunities in its funnel.
- Platform ONE adoption is accelerating, accounting for nearly half of subscription bookings in the fourth quarter, and management expects half of its installed base to be on the platform by the end of fiscal 2027. The company expects Agent ONE AI capabilities and platform migration to support higher-margin recurring revenue growth.
- SaaS ARR growth slowed to 18% year over year from 24% a year earlier, partly because of difficult comparisons from large prior-year wins. Management expects growth to return to the mid-20% range, but the transition from legacy service contracts to Platform ONE is temporarily affecting recurring-revenue growth.
- Management secured component supply into fiscal 2028 and beyond, positioning Extreme to benefit from competitors’ longer lead times. Fiscal 2027 guidance calls for $1.38 billion-$1.40 billion in revenue and $1.28-$1.33 in EPS, implying more than 20% EPS growth.
Extreme Networks Stock Down 19.0%
Shares of NASDAQ EXTR traded down $6.15 during mid-day trading on Wednesday, hitting $26.19. The company had a trading volume of 4,354,307 shares, compared to its average volume of 1,720,917. The company has a market capitalization of $3.43 billion, a PE ratio of 218.25, a price-to-earnings-growth ratio of 1.99 and a beta of 1.79. The firm has a 50-day simple moving average of $30.36 and a two-hundred day simple moving average of $21.80. The company has a current ratio of 0.91, a quick ratio of 0.78 and a debt-to-equity ratio of 1.89. Extreme Networks has a one year low of $13.48 and a one year high of $33.73.
Wall Street Analysts Forecast Growth
Check Out Our Latest Analysis on EXTR
Insider Buying and Selling
In other Extreme Networks news, Director Kathleen M. Holmgren sold 19,521 shares of the business’s stock in a transaction that occurred on Friday, May 15th. The stock was sold at an average price of $24.78, for a total transaction of $483,730.38. Following the transaction, the director owned 219,308 shares of the company’s stock, valued at $5,434,452.24. The trade was a 8.17% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available through this link. Also, CEO Edward Meyercord sold 50,000 shares of the company’s stock in a transaction that occurred on Monday, August 3rd. The stock was sold at an average price of $29.79, for a total value of $1,489,500.00. Following the sale, the chief executive officer owned 1,596,475 shares in the company, valued at approximately $47,558,990.25. This represents a 3.04% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Over the last ninety days, insiders have sold 422,182 shares of company stock worth $11,905,205. Insiders own 3.60% of the company’s stock.
Hedge Funds Weigh In On Extreme Networks
A number of institutional investors have recently added to or reduced their stakes in EXTR. Alyeska Investment Group L.P. raised its stake in Extreme Networks by 301.9% in the fourth quarter. Alyeska Investment Group L.P. now owns 2,971,718 shares of the technology company’s stock valued at $49,479,000 after buying an additional 2,232,373 shares during the period. Jain Global LLC bought a new stake in Extreme Networks in the 4th quarter valued at about $17,361,000. Millennium Management LLC boosted its stake in shares of Extreme Networks by 163.0% in the first quarter. Millennium Management LLC now owns 1,260,362 shares of the technology company’s stock valued at $16,675,000 after buying an additional 781,103 shares during the period. Southernsun Asset Management LLC grew its holdings in shares of Extreme Networks by 46.9% during the 4th quarter. Southernsun Asset Management LLC now owns 1,970,886 shares of the technology company’s stock worth $32,815,000 after purchasing an additional 629,486 shares in the last quarter. Finally, Cubist Systematic Strategies LLC acquired a new stake in Extreme Networks during the second quarter worth about $11,265,000. 91.05% of the stock is currently owned by institutional investors and hedge funds.
Trending Headlines about Extreme Networks
Here are the key news stories impacting Extreme Networks this week:
- Positive Sentiment: Extreme Networks reported fourth-quarter adjusted earnings of $0.32 per share, exceeding the $0.29 consensus estimate and rising from $0.25 a year earlier. Revenue of $338.55 million also surpassed expectations of $332.49 million and increased 10.3% year over year. Extreme Networks Q4 Earnings and Revenues Beat Estimates
- Positive Sentiment: Management’s first-quarter fiscal 2027 outlook was stronger than consensus, calling for earnings of $0.27-$0.29 per share versus $0.26 expected and revenue of $334 million-$339 million versus $332.3 million. Full-year EPS guidance of $1.28-$1.33 also exceeded the $1.21 analyst consensus.
- Positive Sentiment: Needham lowered its price target to $35 from $38 but maintained a “buy” rating, implying substantial potential upside from the recent trading level. The broader analyst consensus remains “Moderate Buy,” with an average target of $32.83. Benzinga
- Neutral Sentiment: CEO Edward Meyercord sold 50,000 shares for approximately $1.49 million, reducing his direct ownership by 3.04%. The transaction was executed under a pre-arranged Rule 10b5-1 plan, which reduces its significance as a current bearish signal. Extreme Networks CEO Insider Sale
- Negative Sentiment: The stock’s reaction suggests investors may have expected an even stronger outlook or are locking in gains after a sharp run-up. Extreme Networks also trades at a high earnings multiple, leaving the shares vulnerable to disappointment despite the quarterly beat.
- Negative Sentiment: Needham’s target reduction from $38 to $35 introduces a more cautious valuation signal, even though the firm retained its buy rating.
Extreme Networks Company Profile
Extreme Networks, Inc (NASDAQ: EXTR) is a global provider of end-to-end networking solutions designed to support enterprise, data center, and service provider environments. The company’s product portfolio encompasses high-performance wired and wireless access switches, routers, network security appliances, and software-defined networking (SDN) tools. Driven by a cloud-native management architecture, Extreme’s Intelligent Edge Platform integrates network analytics, automation and orchestration capabilities to help organizations optimize performance, reduce operational complexity and strengthen security.
Since its founding in the mid-1990s and subsequent public listing in 1999, Extreme Networks has expanded its technology footprint through targeted acquisitions.
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