Aviat Networks Reports 1.6% Revenue Growth in Q3 Fiscal 2025

Aviat Networks, Inc. reported its financial results for the third quarter of fiscal 2025, ending March 28, 2025, revealing total revenues of $112.6 million, a slight increase of 1.6% from $110.8 million in the same period last year. The company's product sales rose by 8.4% to $76.8 million, while service revenues decreased by 10.4% to $35.8 million. For the nine months ended March 28, 2025, total revenues reached $319.3 million, up 9.6% from $291.4 million in the prior year. The net income for the quarter was $3.5 million, or $0.28 per share, compared to $3.9 million, or $0.31 per share, in the same quarter of the previous year.

The company experienced notable changes in its financial performance compared to the previous fiscal period. The gross margin for the third quarter improved to 34.9%, up from 32.5% a year earlier, attributed to increased sales volume and a favorable product mix. However, the gross margin for the nine-month period decreased to 31.3% from 35.5%, primarily due to changes in customer and regional sales dynamics and the expected dilution from the recent NEC acquisition. Operating income for the quarter was $9.3 million, significantly higher than $5.7 million in the prior year, while the nine-month operating income fell to $1.7 million from $13.9 million.

Strategically, Aviat has made significant acquisitions, including the purchase of 4RF Limited for $18.2 million in July 2024, which enhances its offerings in industrial wireless access solutions. Additionally, the acquisition of NEC Corporation's wireless transport business, completed in November 2023, has expanded Aviat's scale and product portfolio. The company reported that these acquisitions are expected to contribute positively to future revenues and operational capabilities.

Operationally, Aviat's customer base has grown to over 3,000, with significant relationships across various sectors, including mobile operators and government agencies. The company has also seen geographic expansion, particularly in Africa and the Middle East, where revenues increased by 32.3% in the third quarter. However, revenue from Latin America and Asia Pacific decreased by 20.1% in the same period, primarily due to timing issues with capital expenditures from mobile operators. The company continues to focus on enhancing its product adoption rates and market share, particularly in the 5G and LTE sectors.

Looking ahead, Aviat Networks anticipates continued growth driven by its strategic acquisitions and a focus on expanding its product offerings. The company is also addressing challenges such as rising tariffs on foreign imports by optimizing its sourcing and operations. Despite the recent fluctuations in revenue and profitability, Aviat remains committed to its long-term growth strategy and believes its current liquidity position, with $49.4 million in cash and cash equivalents, will support its operational needs for the foreseeable future.