Clearfield, Inc. Q2 FY2026 earnings call

• Focused on consistent execution while investing in next phase of growth, building pipeline of opportunities beyond traditional broadband customer base, seeing increasing engagement in data center environments. - Hosted Fiber to the Future event showcasing BABA Ready cable extrusion capabilities and optical fiber termination solutions. - BEAD funding process pace is primary constraint on core business, expecting meaningful BEAD-related revenue in fiscal 2027. - Focused on understanding customer planning process and supporting them as projects take shape. - Increasingly focused on longer-term opportunities tied to distributed compute and edge infrastructure, Nova platform designed to address edge AI infrastructure needs, anticipating shipping in second half of fiscal year, with new product launches to come

Second quarter net sales were $34.4 million, within the guidance range of $32 to $35 million. Net loss per share was 4 cents, within guidance range. Backlog rose 39% sequentially with a book-to-bill ratio of 1.3 for the quarter. Year-to-date revenues in community broadband market up 5% over prior year. For the third fiscal quarter of 2026, net sales from continuing operations anticipated in range of $42 million to $46 million. Full year fiscal 2026 guidance for net sales from continuing operations in range of $160 million to $170 million, operating expenses as percentage of revenue consistent with fiscal 2025, net income per share in range of 48 cents to 62 cents

• Third fiscal quarter 2026 net sales from continuing operations expected to be in range of $42 million to $46 million, operating expenses relatively consistent with second quarter, net income per diluted share in range of 17 cents to 21 cents. - Full year fiscal 2026 net sales from continuing operations guidance in range of $160 million to $170 million, operating expenses as percentage of revenue consistent with fiscal 2025, net income per share in range of 48 cents to 62 cents

• BEAD funding process timing uncertainty delaying order activity. - Fiber availability from vendors and project financing match alignment obstacles. - Uncertainty in large regionals due to acquisitions by Tier 1s affecting purchase order placement

Q: Give more color on VEED, seeing if operators are engaging in projects.

A: BEAD beat is slower than expected, expected 27 revenue opportunity starting late fall/early winter into next year, seeing customers talking about planning cycles and network designs but challenges with fiber availability and project financing alignment.

Q: Updates on regional service providers.

A: Strong bill season in private financing for community broadband and large regionals, though large regionals acquired by Tier 1s had uncertainty in purchase orders but other large regionals are becoming more active