Harmonic Inc.

What they do

Harmonic supplies broadband access equipment and software to cable and telecom operators, including its cOS virtualized cable access platform, fiber products such as Pearl-1XL and Oyster+, and SeaStar MDU deployments. Following the June 16, 2026 completion of the Video divestiture, the company operates as a single reportable segment, Broadband. The company is headquartered in San Jose, California and trades on Nasdaq under HLIT.

Revenue drivers

• Broadband (sole segment) — All continuing revenue comes from broadband access products and software; Q2 2026 Broadband revenue was $133.5 million, up from $86.9 million in Q2 2025.
• cOS platform — Commercially deployed with 161 customers serving 48.2 million CPE devices, with ongoing expansion across all tier-1 accounts.
• Rest-of-Market — Non-tier-1 customers represented approximately 60% of total Q2 bookings and grew 44% year over year.
• Fiber products (Pearl-1XL, Oyster+, SeaStar MDU) — Newly announced fiber access products that secured multi-million dollar orders and a first SeaStar MDU deployment in Q2 2026.

Recent performance

Q2 2026 total company revenue was $173.0 million, with Broadband continuing-operations revenue of $133.5 million versus $86.9 million in Q2 2025, a 54% increase. Broadband GAAP operating profit was $23.6 million and non-GAAP operating profit was $31.3 million, including approximately $2.3 million of stranded Video divestiture costs. Total company GAAP net loss per share was $(0.02), while non-GAAP net income per share was $0.24. Backlog and deferred revenue reached $587.6 million, up 71% from $344.2 million a year earlier, and cash rose to $231.9 million from $124.1 million at December 31, 2025.

Strategy

Management is focused on growing the remaining Broadband business after completing the Video sale to MediaKind for $137.9 million in cash at closing. The company raised its full-year 2026 outlook to reflect Broadband revenue of $505 million to $525 million. Harmonic is investing in fiber products and its cOS platform while expanding across tier-1 accounts and diversifying into Rest-of-Market customers. Management stated the Video sale gives it capital and focus to accelerate broadband growth.

Risks

• Video divestiture execution — The Disposition was completed June 16, 2026, but remaining transition activities, post-closing adjustments, and French works council or regulatory matters could still affect results.
• Failure to achieve divestiture benefits — The company may not realize anticipated benefits from selling the Video business, and constraints imposed by the Disposition could continue to affect strategy execution and operating results.
• Stranded costs — Q2 2026 Broadband results included approximately $2.3 million of stranded costs associated with the Video divestiture.
• Customer concentration and macro factors — The 10-K cites concentration of revenue sources, macroeconomic conditions, tariffs, supply chain disruptions, and geopolitical events as risks to the business.

Outlook

Management raised its full-year 2026 outlook to reflect Broadband revenue of $505 million to $525 million, citing strong bookings led by Rest-of-Market. The company expects to benefit from the completed sale of the Video business, which leaves it with cash of $231.9 million and a single Broadband segment. Harmonic says it has the capital and focus to further accelerate broadband growth.