Revenue of $73.7M; Gross Margin 44.9%; Adjusted EBITDA of $10.6M
-- Consolidated revenue grew 3.5% YoY and 3.7% QoQ
-- Gross margin percentage strengthened to 44.9%, from 36.4% in Q2 fiscal
2025 and 42.1% in Q1 fiscal 2026
-- CDS sales of $12.3M up 20.7% YoY and 9.7% QoQ
-- Consolidated revenue momentum forecast to ramp in next twelve months as
larger scale adoption of Vecima's next-generation Broadband solutions
gets underway and expands
VICTORIA, British Columbia--(BUSINESS WIRE)--February 12, 2026--
Vecima Networks Inc. (TSX: VCM) today reported financial results for the three and six months ended December 31, 2025.
FINANCIAL HIGHLIGHTS
(Canadian dollars in millions except percentages, employees, and per share data) Q2 FY26 Q1 FY26 Q2 FY25 --------------------------------------------------- ------- ------- ------- Revenue $73.7 $71.1 $71.2 --------------------------------------------------- ------- ------- ------- Gross Margin 44.9% 42.1% 36.4% --------------------------------------------------- ------- ------- ------- Net Income (Loss) $0.1 $0.2 $(7.9) --------------------------------------------------- ------- ------- ------- Earnings (Loss) Per Share(1) $0.00 $0.01 $(0.32) --------------------------------------------------- ------- ------- ------- Adjusted Gross Margin(2,3) 46.4% 43.9% 35.6% --------------------------------------------------- ------- ------- ------- Adjusted Earnings (Loss) Per Share(1,2,4,5) $0.04 $0.05 $(0.30) --------------------------------------------------- ------- ------- ------- Adjusted EBITDA(2) $10.6 $11.5 $(0.3) --------------------------------------------------- ------- ------- ------- Employees 611 600 590 --------------------------------------------------- ------- ------- ------- (1) Based on weighted average number of shares outstanding. (2) Adjusted Gross Margin, Adjusted Earnings Per Share and Adjusted EBITDA do not have a standardized meaning under IFRS and therefore may not be comparable to similar measures provided by other issuers. Starting in Q4 fiscal 2025, we have changed our definition and calculation of Adjusted EBITDA and Adjusted Earnings Per Share. For a reconciliation of Adjusted Earnings Per Share, investors should refer to Vecima's Management's Discussion and Analysis for the three and six months ended December 31, 2025. (3) Adjusted gross margin adds back the impact of a non-cash write-down of inventories to net realizable value and warrant expense (recovery) of $1.0 million and nil, respectively, for the three months ended December 31, 2025, and $0.3 million and ($0.9) million, respectively, for the three months ended December 31, 2024. (4) Adjusted earnings per share includes non-cash share-based compensation of $0.4 million or $0.02 per share for the three months ended December 31, 2025, and $0.5 million or $0.02 per share for the three months ended December 31, 2024. The non-cash share-based compensation primarily reflects certain performance-based vesting thresholds achieved under the Company's Performance Share Unit Plan. (5) Adjusted earnings per share and Adjusted EBITDA include foreign exchange loss of $1.4 million or $0.06 per share for the three months ended December 31, 2025, and $4.3 million or $0.18 per share for the three months ended December 31, 2024. ------------------------------------------------------------------------------
"This was a rewarding second quarter that delivered significant customer progress and improved operating performance across our business," said Sumit Kumar, Vecima's President and Chief Executive Officer. "Consolidated second quarter sales of $73.7 million were up 3.5% compared to Q2 fiscal 2025 and 3.7% sequentially from Q1 fiscal 2026, reflecting solid performance in our VBS segment and significantly higher results in our CDS segment. Year-over-year profitability also rose sharply, with gross margin increasing 850 basis points to 44.9%, driven by a higher-margin product mix and increased operating efficiency with adjusted EBITDA climbing $10.9 million to 14.4% of sales. Our strategy, close collaboration with customers, and patient approach to deployment timing not only drove this strong second quarter performance, but have also laid the groundwork for significant new growth."
"Based on customer developments and market dynamics, we believe deployments of our next-generation technology are approaching a major growth inflection. With a lead North American Tier 1 BSP (Broadband Service Provider) customer on the verge of ramping up its large-scale rollout of our next-generation DAA technologies, another North American Tier 1 customer preparing for a broad upgrade to our new TerraceIQ commercial video platform, demand expected to remain strong for our high-margin, market-leading Entra Optical line of fiber-access solutions, and new products continuing to roll out, our visibility and confidence in forward growth has sharpened as we enter calendar 2026."
"Based on customer indications, we now expect next-twelve-month revenue to increase in the range of 20% to 30%, compared to calendar 2025, driven by Vecima's portfolio strength, major customer design wins, and essential DAA-based gigabit upgrades globally. The anticipated demand profile also positions adjusted EBITDA margins to break through 20% for the same period, driving adjusted EBITDA growth of 70% to 85% compared to calendar 2025."
"While recent industry consolidation activity, as previously discussed, could still constrain deliveries in the third quarter of fiscal 2026, the impact is now expected to be modest and further mitigated by a favorable product mix in the quarter. Demand is expected to ramp up sharply beginning in the fourth quarter."
"The anticipated growth and profitability expansion build on our recent achievements," added Mr. Kumar. "In our VBS segment, our solid second quarter revenue performance was paired with significantly improved gross margins. The segment's topline continued to benefit from strong uptake of our EN9000, the industry's only Generic Access Platform $(GAP)$ Node, while improved bottom-line performance reflected ongoing strength in our Entra Optical platforms for fiber-to-the-home, as well as our roll out of new DAA products, including our EN3400 compact GAP node and innovative new Entra Power Holdover Modules driving a more favorable product mix. Highlights of the quarter included continued excellent progress with our new vCMTS solutions as we move closer to deployments with our lead customer and continue to significantly increase vCMTS program engagements with customers worldwide."
"In our CDS segment, a significant increase in managed IPTV network expansions and early rollout of our new Dynamic Ad Insertion (DAI) solutions contributed to a 20.7% year-over-year improvement in segment sales paired with a very strong 65.1% gross margin. And as always, our Telematics segment was a consistent, highly profitable contributor to our Q2 results."
"As we move forward, Vecima is performing strongly and sharply focused on responding to the demand growth our customers are forecasting. While our next-generation Entra DAA cable-access products, Entra Optical fiber-access products and TerraceIQ Commercial Video solutions are expected to be at the forefront of near-term growth, we see additional multi-year opportunities for vCMTS, and in our CDS segment, IPTV and DAI. Our strategy of building the industry's broadest and deepest portfolio of innovative, interoperable next-generation fiber and cable access products and IPTV solutions, paired with our growing focus on software-centric products and platforms that will prepare customers for the 50G future, has positioned Vecima for upcoming sustained growth and strong profitability," concluded Mr. Kumar.
Financial and Corporate
-- Increased second quarter consolidated sales to $73.7 million, up 3.5%
from $71.2 million in Q2 fiscal 2025 and 3.7% from $71.1 million in Q1
fiscal 2026.
-- Second quarter gross margin increased to 44.9% (adjusted gross margin
of 46.4%), from 36.4% (adjusted gross margin of 35.6%) in Q2 fiscal 2025
and 42.1% (adjusted gross margin of 43.9%) in Q1 fiscal 2026.
-- Generated strong adjusted EBITDA (non-IFRS) of $10.6 million, compared
to an adjusted EBITDA loss of $0.3 million in Q2 fiscal 2025, and
adjusted EBITDA of $11.5 million in Q1 fiscal 2026.
-- Net income of $0.1 million or $0.00 cents per share (adjusted net
income of $0.9 million or $0.04 cents per share) improved significantly
from a net loss of $7.9 million or $0.32 cents per share (adjusted net
loss of $7.3 million or $0.30 cents per share) in Q2 fiscal 2025, and was
slightly lower than net income of $0.2 million or $0.01 cents per share
(adjusted net income of $1.2 million or $0.05 cents per share) in Q1
fiscal 2026.
-- Ended the second quarter in a strong financial position with working
capital of $49.3 million at December 31, 2025, compared to $51.2 million
at June 30, 2025. Continued focus on debt reduction lowered net debt to
$66.9 million in Q2 fiscal 2026, from a high of $92.0 million in Q3
fiscal 2024.
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