NetScout Systems Reports $210.4 Million Revenue, 13% Increase, and $21.8 Million Net Income

NetScout Systems, Inc. reported a total revenue of $210.4 million for the quarter ended June 30, 2026, marking a 13% increase from $186.7 million in the same period last year. This growth was driven by a 18% rise in product revenue, which reached $86.0 million, and a 9% increase in service revenue, totaling $124.4 million. The company also achieved a net income of $21.8 million, a significant turnaround from a net loss of $3.7 million in the prior year, primarily due to increased revenue and a favorable product mix.

The financial performance reflects notable changes compared to the previous fiscal period. The gross profit margin improved to 79% from 77%, attributed to higher product revenue and a more favorable product mix. Operating expenses increased slightly to $151.5 million, primarily due to higher employee-related costs, including variable incentive compensation, and increased headcount following the acquisition of DigiCert's DDoS protection business on May 1, 2026, for $55 million. This acquisition is expected to contribute approximately $20 million in annualized revenue.

Operationally, NetScout's customer base and engagement metrics showed positive trends. U.S. revenue surged by 24%, while international revenue saw a slight decline of 1%. The company reported a total deferred revenue balance of $472.3 million, with $313.3 million expected to be recognized in the next 12 months. The total backlog decreased to $32.9 million from $50.8 million at the end of the previous quarter, indicating a shift in customer demand and order fulfillment timing.

NetScout's cash and cash equivalents, along with marketable securities, totaled $668.5 million at the end of the quarter, down from $705.1 million at the end of March 2026. The decrease was primarily due to the cash outflow related to the DigiCert acquisition and tax withholdings on restricted stock units. The company maintains a strong liquidity position, supported by a $600 million revolving credit facility, which remains untapped, providing flexibility for future investments and operational needs.

Looking ahead, NetScout remains focused on driving product innovation and sustaining revenue growth while managing costs amid ongoing macroeconomic challenges. The company anticipates that its strategic initiatives, including the integration of the DigiCert acquisition and continued investment in cybersecurity solutions, will position it well for future growth.