Key Highlights

  • Revenue was USD 167.34 million against a USD 170.00 million estimate, and EPS was USD 0.13 against USD -0.05.
  • GAAP net loss was USD 12.27 million, or USD 0.45 per share, compared with a loss of USD 4.78 million.
  • Gross Margin was 40.1% against 39.1%, and Enterprise exited the quarter with approximately USD 18 million of backlog.
  • Cash, cash equivalents and short-term investments were USD 242.1 million, and about USD 60.0 million remained authorized for repurchases.

NETGEAR, Inc. (NASDAQ:NTGR) reported third quarter Revenue of USD 167.34 million, against an estimate of USD 170.00 million, and EPS of USD 0.13, against an estimate of USD -0.05. The GAAP net loss was USD 12.27 million, or USD 0.45 per share. Management gave a qualitative outlook rather than numeric guidance.

Outlook Management Described

Management said its Enterprise segment continues to see underlying Demand for Pro AV managed switches, but that revenue is constrained by Manufacturing output at a contract manufacturer bringing a new factory online. It said the constraint would persist into the first quarter of 2027, that Enterprise revenue would increase modestly in the fourth quarter compared with the third, and that production improvements would still fall short of customer demand.

For Consumer, management said it would keep optimizing for gross profit, with growing component costs and some added Supply constraints, and that revenue would decline modestly compared with the third quarter. Service provider revenue would decline significantly against the prior-year period. Management said fourth quarter Research and Development and sales and Marketing expenses as a percentage of revenue, and general and administrative expenses in dollars, would be in line with the third quarter.

The Quarter in Detail

Net revenue was USD 167.34 million, down 9.3% from USD 184.56 million. Gross Profit was USD 67.09 million, or 40.1% of revenue, against USD 72.25 million, or 39.1%, which the company tied to a higher mix of Enterprise revenue and lower warranty costs, partly offset by memory chip price increases. Operating expenses were USD 80.79 million against USD 79.32 million, including restructuring and other charges of USD 5.55 million against USD 1.51 million.

The loss from operations was USD 13.70 million against USD 7.07 million, and other income, net was USD 1.04 million against USD 3.03 million. Net loss was USD 12.27 million against USD 4.78 million, or USD 0.45 per share against USD 0.17.

Enterprise, Consumer and Regions

Enterprise net revenue was USD 90.72 million, flat from USD 90.84 million, with contribution income of USD 22.25 million and a contribution margin of 24.5%. Growth in Pro AV managed switches in the Americas was offset by declines in EMEA and APAC. Consumer net revenue fell 18.2% to USD 76.63 million, with a contribution loss of USD 1.42 million against contribution income of USD 1.85 million, which management tied to lower service provider sales and softness in home networking retail.

The company approved a plan to close its Richmond, Canada office by the end of 2026.

Cash and Capital Returns

Cash, cash equivalents and short-term investments were USD 242.1 million at September 27, with approximately 34% held outside the U.S. Nine-month cash used in Operating Activities was USD 12.31 million, against USD 17.91 million, and cash used in financing activities was USD 62.23 million. The board authorized an incremental USD 75.0 million for repurchases on April 22, 2026, and about USD 60.0 million remained authorized at quarter end. The company repurchased approximately 2.2 million shares for approximately USD 47.9 million over nine months.

Quarter in Numbers

Revenue of USD 167.34 million sits alongside gross margin of 40.1%, a GAAP net loss of USD 12.27 million and cash and short-term investments of USD 242.1 million. Enterprise Backlog of approximately USD 18 million compares with Enterprise revenue of USD 90.72 million.

Management named a handful of items going forward: a modest Enterprise revenue increase in the fourth quarter, supply constraints into the first quarter of 2027, a modest Consumer decline, the Richmond office closure by the end of 2026 and the use of remaining repurchase authorization.