Ceragon published its second quarter results on 11 August 2026.
Errors or inaccuracies are possible. Spotted something that looks wrong? Write to me and I will correct it.
The Quarter
| The quarter | A year ago | |
|---|---|---|
| Revenue | $93.9 million | $82.3 million |
| Change | +14.2% | |
| Gross profit | $29.7 million | |
| Gross margin | 31.7% | 34.6% |
| GAAP operating income | $0.2 million | $2.2 million |
| GAAP net loss | $2.1 million | $1.3 million |
| GAAP loss per diluted share | $0.02 | $0.01 |
| Non-GAAP gross margin | 32.2% | |
| Non-GAAP operating profit | $4.0 million | |
| Non-GAAP net income | $1.7 million | |
| Non-GAAP diluted EPS | $0.02 |
And cash and cash equivalents fell to $34.8 million, from $38.4 million on 31 December 2025.
The Geographic Breakdown Explains Everything
| Region | Share of quarterly revenue |
|---|---|
| India | 48% |
| North America | 22% |
| EMEA | 13% |
| Latin America | 9% |
| APAC | 8% |
Almost half of revenue comes from a single country.
This is the quarter in which growth and profitability moved in opposite directions.
Revenue rose 14.2%. The gross margin fell 290 basis points. GAAP operating income fell from $2.2 million to $0.2 million - meaning it was almost entirely wiped out.
And the net loss widened, from $1.3 million to $2.1 million.
The company sold more and earned less.
And this is where geography enters the picture. The company explicitly cites sequentially higher revenue in India, and about $120 million of announced year-to-date bookings there as of July. India is the growth engine, and it is also 48% of revenue.
And in emerging markets, market share is usually bought at a price.
The Guidance, and This Is the Line I Consider Most Important
The company updated its guidance for full-year 2026:
| Updated guidance | Previous guidance | |
|---|---|---|
| Revenue | $355 to $385 million | |
| Non-GAAP gross margin | 33.5% to 34.5% | 35.5% |
| Non-GAAP operating margin | 5% to 6% | 6.5% to 7.5% |
Both margin guidance figures were lowered.
And that is what turns this quarter from an instance into a phenomenon. One weak quarter can be timing, mix, or a deferred order. Management lowering full-year margin guidance is saying it expects this to continue.
And an operating margin of 5%-6% instead of 6.5%-7.5% is a cut of roughly a quarter of expected operating profitability - on the same revenue line.
And What Is Good in the Report
Demand itself is healthy, and there is numerical evidence for it.
In India: sequentially higher revenue, and about $120 million of bookings announced year to date as of July - which increases visibility for the remainder of 2026. The company notes particular interest in E-band solutions.
And in North America: demand remained robust, with record quarterly bookings in private networks.
And CEO Doron Arazi notes a successful field trial of the 5G FR2 (mmWave) product with a new Tier 1 North American carrier. He also explicitly notes near-term industry-wide cost and supply chain pressures.
הזווית שלי
דעה אישית של אילן אברמוב - לא ייעוץ ולא המלצה
This is a report that illustrates the difference between growth and growth that pays.
Ceragon sold 14.2% more, and that is a real number. The bookings in India are real, the record private-network bookings in North America are real, and demand here is not the problem.
The problem is what remains of it.
The gross margin fell from 34.6% to 31.7%, and GAAP operating income fell from $2.2 million to $0.2 million. In a company selling close to $94 million in a quarter, operating income of $0.2 million is effectively zero.
And what makes this significant is that management itself confirmed it is not an isolated quarter. It lowered both its full-year gross margin guidance and its operating margin guidance. A company does not cut margin guidance because of a quarter it considers anomalous.
And from the figures in front of me, the most plausible explanation is the geographic mix. India is 48% of revenue and it is also the source of growth. Growth coming mainly from one large, competitive market usually comes at a lower margin - and that is exactly what the numbers show. I should stress that the company did not say this explicitly in the release, so this is my reading, not its statement. It did cite near-term industry-wide cost and supply chain pressures.
And what I put an asterisk on is the concentration. When almost half of revenue comes from one country, the company is exposed not only to demand there but also to currency, regulation, and the capital budgets of a small number of customers. The visibility the bookings provide is a real asset, but it is visibility into that same point of concentration.
And the practical question for coming quarters is simple: does the margin stabilise around the new range, or does it keep falling as India grows. If it stabilises, this is simply a business with lower profitability and higher growth, and that is a legitimate trade. If it keeps falling, then the company is buying revenue with money - and that can only be done for a limited time.
