Vistance Networks (VISN) 2026 年第三季法說會: 調降 EBITDA 財測指引

重點摘要

• 2026 年第三季淨營收為 3.2 億美元，年減 1,800 萬美元或 5%，主因 DOCSIS 4.0 出貨量增加被傳統產品銷售下滑所抵銷。
• 調整後 EBITDA 為 5,700 萬美元。受惠於變動薪酬降低，Aurora Networks 部門調整後 EBITDA 成長 5%；而在 U.S. GAAP 分攤成本表達方式下，持續營運業務之調整後 EBITDA 則大幅成長 128%。
• 由於記憶體成本上升，加上客戶在控管庫存與部署時程時延後放大器訂單，Vistance Networks 將全年調整後 EBITDA 財測下調至 1.8 億至 2 億美元。
• Aurora 訂單動能年增 41%，在手訂單達 4.1 億美元，成長 3%。管理層表示，儘管採購時程可能仍會波動，但潛在升級需求依然穩健。
• 該公司預計在 2026 年向股東返還約 40 億美元。特別分紅總計每股 16.50 美元，截至 10 月 30 日，已斥資 2.25 億美元買回 2,890 萬股。
• 總裁兼執行長 Charles Treadway 將於 2 月 1 日卸任。公司已啟動接班人選遴選程序，並表示他將持續專注於業務執行與平穩過渡。

關鍵財務數據

業務與營運表現

DOCSIS 4.0 仍是主要成長動能。Vistance Networks 指出，其智慧型放大器、節點與虛擬 CMTS 產品持續取得進展。與 Comcast 的 FDX 部署持續推進，同時次世代 ESD 放大器正向多家北美大型 MSO 出貨。管理層預期 ESD 出貨量將於 2027 年顯著放量。

Aurora Networks 亦宣布與 Ziggo 展開大規模統一 DOCSIS 4.0 節點部署。該架構結合了 Aurora 的光學節點平台、統一 DAA 模組、vCCAP Evo 虛擬化核心平台與 ServAssure NXT 領域管理器。此外，該公司還獲得了 O2 的 vCCAP Evo 部署專案，預計將於三年內分階段推展。

記憶體晶片仍是龐大的成本壓力來源。管理層估計 2026 年的影響約為 4,000 萬美元，部分壓力將延續至 2027 年。公司正與客戶協商定價、與供應商密切合作，並研發替代設計方案。

Vistance Networks 亦積極開發其 PON 產品組合，包括 50G PON 與電信級 PON。其 PKI 安全業務預計將在 2026 年貢獻約 1,000 萬美元營收。管理層估計其 PKI 產品的總可服務市場 (TAM) 約為 7 億美元，年複合成長率約 15%，目前正著手敲定該業務的投資策略。

管理層財測指引

Vistance Networks 將其 2026 全年調整後 EBITDA 財測下調至 1.8 億至 2 億美元。此修正反映了記憶體價格與供應緊張的壓力，以及客戶將部分放大器資本支出推遲至 2027 年。

在 11 月支付特別分紅後，管理層預期年底現金為 2.75 億至 3 億美元。此預估不包含新授權的 1 億美元庫藏股計畫下的回購，並計入提前於 2026 年取得的 6,000 萬美元退稅款。其餘 1 億美元退稅款預計將於 2027 年入帳。

該公司預期與 CCS 和 Ruckus 業務分割相關的大部分擱淺成本將於 2027 年前消除，所有擱淺成本則將於 2028 年前全數消除。2026 年擱淺成本影響金額約為 2,000 萬美元。

風險與關注焦點

• 預期未來數季記憶體價格將逐步上漲，不過管理層預期漲幅將趨緩。預估的 4,000 萬美元成本衝擊中，有部分將延續至 2027 年。
• 客戶集中度較高，使業績對採購排程、庫存水位、安裝效率及部署時程的變動極為敏感。
• 庫存居高不下反映了記憶體市況，以及因客戶推遲訂單而受影響的製成品。管理層預期 2027 年上半年將部分恢復正常，但無法完全回到先前的庫存水準。
• 傳統產品營收持續下滑，亟需依賴 DOCSIS 4.0 的成長來抵銷此壓力。
• 2027 年客戶部署時程仍具不確定性，管理層表示目前提供具體的 2027 年展望為時過早。

分析師問答重點

管理層表示，記憶體供貨目前在可控範圍內，價格才是主要問題。Vistance Networks 不打算透過預先過度採購庫存進行投機；該公司每年採購約 150 萬至 200 萬顆記憶體晶片，並根據客戶需求調整採購節奏。

針對客戶訂單遞延問題，管理層認為這純屬時程問題，而非需求消失。部署速度、施工團隊效率、天候與客戶庫存目標都可能影響採購進度。公司預期部分遞延業務將移至 2027 年，但並未提供該年度具體的 EBITDA 或自由現金流財測。

在營運資金方面，管理層表示與遞延訂單相關的庫存應會在 2027 年上半年開始恢復正常。然而，受記憶體相關壓力影響，預計庫存水準仍將高於完全正常化時的水位。

Treadway 表示，在他完成策略性業務分割、償還債務及贖回特別股後，公司的組織架構變得更加精簡且專注，這促成了他的離職計畫。在董事會尋找下一任領導人期間，他將留任總裁兼執行長至 2 月 1 日。

電話會議完整逐字稿

完整財報電話會議逐字稿

管理層陳述

Operator

[Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker, Ginny Thompson. Ma'am, please go ahead.

Jenny Thompson

Good morning, and thank you for joining us today to discuss Vistance Networks' 2026 third quarter results. I'm Ginny Thompson, Vice President of Investor Relations for Vistance Networks, and with me on today's call are Chuck Treadway, President and CEO, and Kyle Lorentzen, Executive Vice President and CFO. You can find the slides that accompany this report on our Investor Relations website.

Please note that some of our comments today will contain forward-looking statements based on the current view of our business, and actual future results may differ materially. Please see our recent SEC filings, which identify the risks and uncertainties that could affect future performance.

Before I turn the call over to Chuck, I have a few housekeeping items to review. Today we will discuss certain adjusted or non-GAAP financial measures which are described in more detail in this morning's earnings materials. Reconciliations of non-GAAP financial measures and other associated disclosures are contained in our earnings materials and posted on our website. All references during today's discussion will be to our adjusted results. All quarterly growth rates described during today's presentation are on a year-over-year basis unless otherwise noted.

I'll now turn the call over to our President and CEO, Chuck Treadway.

Charles Treadway

Thank you, Ginny, and good morning, everyone. Thank you for joining our third quarter 2026 earnings call. Before we discuss our results, I'd like to briefly address the announcement made this morning. After 6 years as CEO of CommScope, I will be stepping down as President and CEO on February 1. When I joined CommScope, we had $9 billion of revenue, four large business segments, and 30,000 employees around the world. Today we are a much smaller and much more focused company. It has been a privilege to lead CommScope and Vistance Networks through such an important moment of transformation.

We set out to unlock value for our shareholders, and our team delivered. We completed a series of strategic divestitures, repaid all of our debt, and redeemed all of our preferred equity. I am proud of what this team has accomplished and believe now is the right time to initiate this succession plan to identify a leader for the company's next chapter. My focus is unchanged. I remain committed to executing our plan, serving our customers, and delivering on our commitments, and I will work closely with the Board to ensure a smooth transition.

Now turning to Slide 3, before discussing our third quarter results, I'd like to discuss our recent activity around our use of excess cash resulting from the Ruckus transaction. As indicated on our second quarter earnings call, we expected to have between $700 million and $750 million of cash at year-end. This cash balance reflected the payment of our special distribution of $5 per share in August. Subsequent to the end of last quarter and payment of the $5 per share special distribution, we have implemented two additional actions to utilize a significant portion of our excess cash. The first was our recently announced additional special distribution of $1.50 per share.

This distribution will result in a cash outlay of approximately $300 million and will be paid on November 6. This special distribution, along with the $10 per share distribution in April and the $5 per share special distribution in August, will result in total cash distributions to shareholders of $16.50 per share. As indicated, following the sale of our CCS business, a key objective was to return cash to shareholders, and we believe that $16.50 per share achieves that objective.

In addition to the special cash distributions, during the quarter, the company also announced the Board of Directors authorized a share repurchase of $250 million. I'm pleased to report that through October 30, we have utilized approximately $225 million of that program, resulting in 28.9 million shares repurchased. This is a reduction of approximately 13% of the outstanding shares at the end of the second quarter of 2026, including any shares vested as part of the Ruckus transaction. In addition to the $250 million previously authorized, the Board of Directors has authorized an additional $100 million buyback program, bringing the total authorization to $350 million.

We believe this is a balanced use of our excess cash. Including the November distribution and buybacks completed to date, we will have returned approximately $4 billion to shareholders in 2026. Before any repurchases under the new $100 million authorization, we expect to end the year with $275 million to $300 million of cash. This cash balance and strong balance sheet, along with expected cash generation in future years, positions the company for continued investment in the business and a hedge against future volatility.

Now on to the third quarter results on Slide 4. Vistance Networks delivered net sales of $320 million and adjusted EBITDA of $57 million. Revenue was down 5% year-over-year, and adjusted EBITDA was up 5%. Adjusted EBITDA was slightly higher than our expectations as a result of lower variable compensation in the quarter. Overall, it was a solid quarter as we continue to see DOCSIS 4.0 upgrades and the adoption of our next-generation intelligent amplifiers.

The business continues to be impacted by two major items: memory chips and timing of upgrades for our largest customers. On memory chips, the annual impact is approximately $40 million, of which a portion will roll out next year. We continue to deal with availability and pricing associated with memory chips. In the third quarter, we experienced another memory price increase. Despite the challenges, we continue to work with our suppliers and customers to improve availability and manage costs. In addition, we are also working on alternative designs to minimize the impact of memory supply and demand challenges.

We are also seeing some large customers managing inventory and adjusting the timing of their amplifier orders as they evaluate deployment schedules and inventory positions. Given our customer concentration, changes in purchasing patterns can have a significant impact on near-term results. As certain customers have pushed some spending into 2027, we have revised our full-year adjusted EBITDA guidance to between $180 million and $200 million. We remain confident in the underlying demand for our products, although the timing of certain customer deployments remains uncertain.

The market for DOCSIS 4.0 products continues to expand as we deploy our suite of products, including intelligent amplifiers, nodes, and virtual CMTS. Our FDX deployment with Comcast continues to go well. Also, we continue to make headway with our suite of next-generation ESD amplifiers and are now shipping to multiple large North American MSOs. We expect ESD shipments to ramp up in 2027.

At the SCTE TechExpo last month, we showcased our entire suite of products and solutions that help customers upgrade their networks in the most agile ways possible. On display were DOCSIS 4.0 unified solutions, including the RPDs and intelligent amplifiers. Prior to the show, we jointly announced with Ziggo the first large-scale deployment of Unified DOCSIS 4.0 nodes in a live network.

The full solution combines Aurora's optical node platform, its unified DAA module configured for Remote PHY operation, vCCAP Evo Virtualized Core Platform, and ServAssure NXT Domain Manager. This architecture allows operators to deploy flexible network infrastructure that supports evolving DOCSIS standards while simplifying network upgrades. While Ziggo's deployment is based on DOCSIS 4.0 ESD, the unified module supports both ESD and FDX configurations, providing flexibility for different operator network architectures and future requirements.

For Ziggo, this architecture provides a flexible and scalable foundation to evolve its existing HFC network, supporting greater capacity, reliability, and future customer needs while making use of its existing infrastructure. ServAssure NXT Domain Manager enhances and simplifies management of both Remote PHY and virtual CCAP and introduces network automation capabilities. The deployment highlights Aurora Networks' leadership in next-generation broadband infrastructure and demonstrates the readiness of its DOCSIS 4.0 ecosystem for large-scale commercial operation.

In addition, we were awarded another vCCAP Evo win at O2. This deployment will modernize and upgrade their network to Remote PHY. It will roll out over the next 3 years. As stated before, we believe Aurora is well positioned with decades of knowledge of our customers' ecosystems and a broad array of new products for service providers to continue to take advantage of the latest DOCSIS 4.0 upgrade cycle, as well as expanding their current DOCSIS 3.1 networks. We feel our amplifier position, with millions of installed amplifiers requiring upgrades, is valuable as MSOs require upgrades to stay competitive. In addition, with each intelligent amplifier supporting an average of approximately 20 homes passed, we are well positioned to drive edge compute as our current intelligent amplifier has built-in AI machine learning capabilities.

With the Ruckus transaction complete, we're focused on executing in our core cable business and investing organically in select product lines. Our strategy takes advantage of our position in the HFC network and the need for MSOs to continue to upgrade their networks to stay competitive. While cable is under pressure, our customers have large installed bases that have significant value and will require upgrades well into the future. We believe our products are well positioned to be at the leading edge of current and existing upgrades. In particular, our intelligent amplifiers will be at the forefront of upgrade cycles as cable moves towards 25 gigabits. Our intelligent amplifier portfolio includes the only amplifier in the market with AI machine learning capabilities. In the current and future upgrade cycles, we believe amplifiers will be the largest part of the market, and we are the leader in amplifiers. Although we may see some cyclicality, we're confident in the long-term demand for our products.

In addition to continuing to support the required cable upgrades well into the future, we will continue to develop our PON portfolio of products, including Telco PON. Although it's a competitive market, we believe that our product range, including 50G PON and our technology partnerships, will allow us to win market share. We're also finalizing an investment strategy to take advantage of our industry-leading security solution products, specifically PKI. The PKI products provide end-to-end device security, digital certificate provisioning, and software licensing for IoT devices, smart networks, and digital video systems.

Our current PKI business has been internally focused as we have used PKI in our own products. It only represents approximately $10 million of our overall revenue in 2026. However, we have provisioned over 7 billion device credentials and have more than 40 years of security experience. Based on strategic work we have done, our PKI technology is very competitive, and we believe we can grow this business with focused go-to-market investments. Our estimate of addressable market for our products is approximately $700 million, growing at roughly 15% per year. We see this as an attractive opportunity to create long-term value.

We look forward to socializing more of our strategy over the next few quarters as our strategic plans are finalized. And with that, I'd like to turn things over to Kyle to talk more about our third quarter results.

Kyle Lorentzen

Thank you, Chuck, and good morning, everyone. I'll start with an overview of our third quarter results on Slide 5. For Vistance Networks' continuing operations, net sales ended at $320 million, down $18 million or 5% year-over-year, and adjusted EBITDA was up $32 million or 128% to $57 million. Adjusted EPS for the third quarter was up 283% to $0.23 per share versus $0.06 in the third quarter of 2025. It should be noted that the continuing operations presentation reflects the required U.S. GAAP treatment of shared costs. We believe our segment results provide a better insight into the underlying operating performance of the business.

Turning now to our third quarter segment highlights on Slide 6. Aurora Networks' third quarter net sales of $320 million were down 5% from the prior year as increased shipments of our DOCSIS 4.0 products were offset by a decline in our legacy product sales. Aurora Networks' adjusted EBITDA of $57 million was up $3 million, or 5% from the prior year, driven by considerably lower variable compensation in the current quarter, partially offset by lower legacy product revenues, memory chip pricing, and higher stranded costs.

Our stranded cost impact in 2026 is approximately $20 million. We expect the majority of stranded costs associated with the CCS and Ruckus divestitures to be eliminated by 2027, with all stranded costs eliminated by 2028. Aurora order rates were up 41% in the third quarter of 2026 versus prior year. Aurora backlog ended the third quarter at $410 million, up $11 million or 3% versus the end of the third quarter of 2025. Aurora remains well positioned to take advantage of upgrade cycles while offsetting declines in the legacy business. However, timing of upgrades may be cyclical, driven by large customer concentration and timing of their purchases.

Turning to Slide 7 for an update on cash flow. We ended the quarter with $683 million of cash on hand. As expected in the quarter, cash flow from operations was a use of $57 million and free cash flow was a use of $58 million due to working capital needs. Subsequently, after the end of the third quarter, the Board approved a special distribution of $1.50 per share, or approximately $300 million. The distribution will be paid on November 6 from cash on hand and is expected to be treated as a return of capital for tax purposes. With the latest $1.50 per share special distribution, in total, we will have provided special distributions of $16.50 per share in 2026.

Turning to Slide 8 for an update on our liquidity and capital structure. During the third quarter, our cash and liquidity remained strong. As indicated, we ended the quarter with $683 million in cash on hand. The Board of Directors approved an additional buyback of up to $150 million in August 2026 for a total of $250 million in authorized share repurchases. Through October 30, we purchased 28.9 million shares, totaling $225 million against our buyback authorization. The buybacks equated to approximately 13% of our outstanding shares at the end of the second quarter, including any shares vested as part of the Ruckus transaction.

It should be noted that since repurchases occurred ahead of special distributions, the net amount after adjustments for distributions is approximately $140 million, including all commissions and excise tax. In addition to the previously approved $250 million of buybacks, the Board of Directors has authorized an additional $100 million of buybacks. This brings our total authorized buybacks to $350 million.

The company ended the quarter with no outstanding debt. At the end of the third quarter, the current availability under our existing line of credit was $159 million. Based on our cash on hand, cash flow expectations, and leverage capability, we have ample opportunity to invest in growth and value creation and hedge against volatility. Based on our projections, after the $1.50 per share special distribution, we expect to end 2026 with cash on hand between $275 million and $300 million. This does not include any repurchases under the newly authorized $100 million buyback program.

As a result of making certain tax elections, we were able to accelerate $60 million of the previously announced $160 million tax refund into 2026. This $60 million is reflected in the cash estimate for the end of 2026. We still expect to receive the remaining $100 million in 2027. This provides us with a strong balance sheet, allowing for incremental investment and a hedge against volatility.

I will conclude my prepared remarks with commentary around our expectations for the remainder of 2026. We delivered solid execution in the first 3 quarters. However, memory pricing and availability continues to pressure the business. In addition, certain customers are adjusting the timing of amplifier orders as they manage inventory and deployment schedules. As a result, we are lowering our full-year adjusted EBITDA guidance to $180 million to $200 million. We remain confident in the long-term demand for our products, although customer concentration and deployment timing may continue to drive variability in the near term.

We are very pleased with the return of $16.50 per share in 2026, as well as our buyback program. We feel this represents a proper balance of returning cash to our shareholders as well as investing in future value creation. We look forward to continuing to develop and implement the Vistance Networks strategy focused on taking advantage of continued long-term investment in HFC network, PON, and security solutions. And with that, I'll turn it back to Chuck.

Charles Treadway

Thank you, Kyle. In closing, I'm pleased with our progress this year. We've extinguished all of our long-term debt, redeemed our preferred equity, and returned approximately $4 billion in cash to our shareholders through our special distributions and stock buybacks. Although we are dealing with some short- and medium-term challenges with memory chips and volatility of large customer demand, we are well positioned to take advantage of the DOCSIS 4.0 build over the next several years.

Beyond DOCSIS 4.0, we believe that the cable infrastructure market will continue to require upgrades, and we are currently working with our key customers to develop new products, including next-generation intelligent amplifiers, PON, and PKI security solutions. With that, we'll now open the line up for questions.

Operator

[Operator Instructions] Our first question is going to come from the line of George Notter with Wolfe Research. Please go ahead.

分析師問答

George Notter

Chuck, it's been great working with you [ in the ] future going forward. Again, it's been great. All right, my question is on memory pricing. Obviously, there are some real pressures here. I guess I'm just curious about the outlook for 2027 memory pricing. What are you guys seeing? Do you have an ability to offset that memory cost incrementally with surcharges or price increases? What does that look like right now? Thanks a lot.

Charles Treadway

Yes, I would start out by saying I think we're going to see gradual price increases continuing for the next several quarters, but probably not at the same rate as it was—probably a little less, a little flatter, at least that's what we're believing. And in terms of passing costs through, we are working with our customers to push price through there. And obviously, as prices go higher, we're able to push more to them. So, we did call out that the impact would be about $40 million this year to us, with some rolling out next year.

George Notter

Got it. Okay. And then I assume availability is still okay for you guys in terms of memory, or is this just really a pricing impact?

Charles Treadway

I'd agree with that at this point.

George Notter

Okay, cool. And then the customer pushout, I assume this is one of your large customers. Is it related to CapEx pressures? Is it related to component supply? Is it budget-related or project timing? Any more you could tell us on that pushout would be great.

Charles Treadway

I would say it's really more dependent on their deployment schedules and how fast they install, in addition to levels of inventory that they want to hold. Right now, their installation schedules can be impacted by many things. Think about how fast they're installing, productivity of their crews, weather, such like that. I don't really see anything causing them not to do work. It's just how fast they can move. Obviously, we're going to listen to Charter's report tomorrow. We'll learn more from them. But I would say we're working with them on schedules and timing and how they're viewing what's going to be installed.

George Notter

Okay, thanks very much. Good luck.

Charles Treadway

Thank you.

Operator

And our next question will come from the line of Amit Daryanani with Evercore ISI. Please go ahead.

Amit Daryanani

I guess just first off, on the memory pricing, how much are you guys able to buy ahead of some of these price increases? It seems like you guys have been talking about pricing continuing to rise for a couple of quarters here. I guess, you know, you've had some additional cash on hand, just thinking about why not buy a bit more now.

Charles Treadway

Well, we're obviously not going to be speculating on memory. We buy approximately 1.5 million to 2 million—I mean, 1.5 million to 2 million memory chips a year, which is big numbers. So we have to work very closely with the suppliers, very close to the suppliers of that. And we tie it to their demand, not necessarily looking at, hey, we don't want to be holding the bag if the prices go the other way. I would say that, yes.

Amit Daryanani

And Chuck, maybe just touch on, you know, why now are you stepping down, given that it seems like Aurora is now in a good spot to keep operating by itself?

Charles Treadway

Yes, look, I would say the business is just at a much smaller scale than what I took over in 2020. You know, we delivered on the commitments that we made to the Board. I've agreed with the Board that this is just the right time to identify a next leader. It's a more focused business, and I'm going to remain in this role until February 1 and committed to a smooth transition. Thank you, guys.

Operator

And our next question will come from the line of Joseph Cardoso with JPMorgan. Please go ahead.

Joseph Cardoso

This is Mark on for Joseph Cardoso. I guess with regards to the customer pushout commentary, it seems like that's mostly being described as a timing factor rather than a demand factor. So should we expect that that business comes back in '27? I guess, with regards to the '27 outlook itself, do you see that potentially improving EBITDA and free cash flow year-over-year as well?

Charles Treadway

Look, I'd say to your question and in your comment, I do believe the demand is real and it's going to stay, it's just pushed out. And in terms of what are we thinking for '27, I would say we see this as, first of all, because of our concentration of customers, there will be some cyclicality there, but we do believe that they're going to move forward with redoing and upgrading their networks. What we've seen so far is some delays related to inventory adjustments, but I would say that it's really too early to be specific for 2027.

Joseph Cardoso

Got it, got it. And then maybe just to follow up regarding the free cash flow outlook, as we think about the inventory build that you have going into '27, should we think about these elevated inventory levels maybe as the new normal given an uncertain cost environment, or do you also maybe expect some degree of normalization in '27 there?

Kyle Lorentzen

Yes, I think we're seeing really two impacts on inventory. One is the memory pricing, and Chuck talked about that. I don't think we feel like that's going away anytime soon, so I think we'll continue to see elevated levels. To be honest with you, the larger driver of the inventory is some of these timing issues, right? So we've built product that's now being pushed out. We would expect to see some normalization of that inventory in the first half of '27. So I don't think this is going back to a completely normalized level, but I think we will see some gain back in inventory in the first half of '27, just based on some inventory that we're holding related to some of these pushouts.

Joseph Cardoso

Got it. Thank you.

Operator

Thank you, and I would now like to hand the conference back over to Chuck Treadway for closing remarks.

Charles Treadway

Thank you for your time today, and I appreciate your interest in our company. Have a great rest of your week. Thank you.

Operator

This concludes today's conference call. Thank you for participating, and you may now disconnect. Everyone, have a great day.

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