Vistance Networks, Inc. Q1 FY2026 earnings call

• Announced entering into a definitive agreement to sell Ruckus Networks business to Belden for $1.846 billion, expected to close in second half of 2026, with plan to distribute excess cash to shareholders within 60 days of closing. - Business Networks results were generated by stronger than expected performance in both Aurora and Ruckus segments, on track to achieve 2026 adjusted EBITDA guideposts of $350 million to $400 million. - Aurora Networks saw continued deployment of DOCSIS 4.0 amplifier and node products, progress on unified products, and rollout of VC-CAP solution with Vodafone Germany. - Core Ruckus had strong revenue and adjusted EBITDA growth, customer wins like LAFC, growth in subscription product Ruckus One, and expansion of Pro AV ICX network switch portfolio. - Addressed DDR4 memory chip supply issue, managed tight supply and pricing in first quarter, and will continue to use levers to navigate market conditions.

Business Networks delivered net sales of $472 million, a year-over-year increase of 22%, and Core Adjusted EBITDA of $87 million, a year-over-year increase of 38%. Aurora Networks: net sales of $298 million were up 33% in the first quarter compared to the prior year, and adjusted EBITDA was up 32%. Core Ruckus Network's revenue was up 14% in the first quarter compared to prior year. Core Ruckus Adjusted EBITDA of $37 million was up 54% versus prior year.

• On track to achieve 2026 adjusted EBITDA guideposts of $350 million to $400 million. - Expect Aurora adjusted EBITDA to be down in 2026 vs 2025 due to legacy business decline, stranded costs, and memory chip drag, but second half expected stronger. - Vista's second quarter adjusted EBITDA expected to be essentially flat with first quarter, but down year-over-year. - Standalone Aurora's 2026 adjusted EBITDA guideposts in $225 million to $250 million range excluding Ruckus stranded costs.

DDR4 memory chip supply issue continuing to impact industry, limited visibility beyond second quarter from supply and pricing perspective.

Q: Questions about Aurora Network's EBITDA decline bridge, A: Explanation of drag from stranded costs, legacy business decline, memory chip issue offset by DOCSIS 4.0 growth.

Q: Thoughts on accretive acquisitions for Aurora, A: Looking for bolt-on acquisitions to expand product/customer base, well-positioned due to strong balance sheet.

Q: Tax treatment of special distribution, A: Expected to be return of capital.

Q: Aurora customer concentration and upgrade pacing, A: Top 3 customers represent 75% of revenue, upgrade pacing varies by customer, with long-term investment in DOCSIS 4.0 and pawn technologies.

Q: Nodes shipping in 2H 2026 and memory supply, A: Unified nodes allow customer optionality, memory supply managed in first quarter, working on designs for future options.

Q: Growth potential of Aurora's VC-CAP and pawn business, A: Less than 10% of revenue now, expected to grow substantially over next 3-4 years to offset legacy decline, with double-digit revenue growth expected for Aurora in 2026 despite EBITDA decline.