QUANTUM CORP /DE/ Q3 FY2026 earnings call

Hugues mentioned Q3 revenue EBITDA exceeded forecast range, efforts to execute strategy with improved revenue, pipeline, backlog, and financial foundation through restructuring. AI-driven demand strains supply chains. Tape sales doubled as customers pivot to reduce component dependence. StorNext offers opportunity to move data to tape. North America sales model realigned. William discussed revenue, GAAP and non-GAAP financial results, debt and liquidity, and Q4 outlook with caution due to supply chain challenges.

Revenue in the third quarter was $74.6 million, an increase over prior quarters and the prior year quarter. Tape sales doubled quarter-over-quarter. StorNext is a leading data movement platform. Primary systems started the year slow but saw strength across product lines in Q3. Services still in adjustment. GAAP gross margin for Q3 was 38.8%, up sequentially but impacted by component pricing volatility which affects the 40% margin target in the near term.

Due to industry-wide supply chain challenges, Q4 revenue expected to be approx $68 million ±$2 million. Non-GAAP operating expenses for Q4 expected to be approx $27 million ±$2 million. Non-GAAP adjusted net loss per share for Q4 anticipated to be negative $0.33 ±$0.10. Adjusted EBITDA for Q4 expected to be breakeven ±$2 million.

Industry AI use cases accelerate, putting pressure on global supply chains. Critical components like memory, disk, flash are difficult to procure, prices are rising, and lead times are extending, with uncertainty in stabilization.

Q: Congrats on good results for Q3 and healthy guide for Q4, ask about primary systems, backlog, services, gross margin.

A: Primary systems started slow but Q3 strong, backlog driven by strong demand and component shortages, services need better execution on pricing, gross margin hard to guide due to supply chain price and lead time issues.

Q: Tape sales doubled, ask about demand from hyperscalers vs non-hyperscalers, multimillion dollar deals, backlog composition.

A: Tape demand across board, multimillion deals in backlog, strength in enterprise and hyperscalers.

Q: Supply worsening, backlog trajectory, long-term margin structure.

A: Backlog will grow at guidance level, long-term margin possible but supply chain needs normalize after near-term challenges