Ribbon's Third-Quarter Sales Rebound Extends Into Profit

The Tip Desk · October 27, 2026 · 2 min read

Revenue reached $219 million, up 14% from the second quarter, as GAAP operating income swung to $6 million and Adjusted EBITDA more than doubled.

Ribbon Communications Inc. (RBBN), a provider of voice communications software, IP routing, and optical networking, reported third-quarter 2026 revenue of $219 million, a 14% sequential increase after an 18% sequential rise in the second quarter.

GAAP operating income was $6 million, compared with a $12 million operating loss in the second quarter. Non-GAAP Adjusted EBITDA was $27 million, more than doubling from $12 million in the prior quarter.

Chief Executive Officer Bruce McClelland said the company had meaningful sequential increases in revenue and profitability in both operating segments, consistent with second-quarter commentary.

IP Optical Networks revenue increased 17% sequentially, led by new wins in North America. The company said the business posted record third-quarter sales, growing 5% year over year, and included two new U.S. Tier 2 Internet Service Provider customers. McClelland said a strong bookings trend in the first half of the year translated into that record.

Cloud and Edge revenue increased 11% sequentially, led by U.S. Tier 1 network modernization. Service Provider revenue grew 15% sequentially, supported by a 50% increase in sales to the largest customer, with further growth in Enterprise and Government.

Product revenue was $121 million, up from $96 million in the second quarter. Service revenue was $97 million. GAAP gross margin was 48.2%, and Non-GAAP gross margin was 50.3%.

GAAP net loss was $9 million, or $0.05 a share, versus a $12 million loss, or $0.07 a share, a year earlier. Non-GAAP net income was $12 million, or $0.07 a share. Non-GAAP operating expenses remained at $88 million, Chief Financial Officer Rick Marmurek said.

The company said it is encouraged by a growing pipeline of data center and AI-related opportunities. Looking to 2027, McClelland cited further growth drivers with the adoption of voice-enabled Enterprise AI applications, new solutions to mitigate AI-generated voice-phishing cyber-attacks, and broader demand for data center fiber infrastructure.

For the fourth quarter of 2026, Ribbon projects revenue of $233 million to $247 million. Non-GAAP gross margin is projected at 53.5% to 54.5%. Adjusted EBITDA is projected at $40 million to $47 million.

The company said the outlook is based on current indications for its business, which are subject to change. GAAP earnings guidance is not provided.