Key Highlights

  • Revenue rose 16% to USD 30.6 million, a fifth straight quarter of double-digit growth.
  • Non-GAAP Operating Margin was 13%, and quarterly cash generation reached USD 7.4 million.
  • SECaaS annual recurring Revenue reached USD 39 million, up more than 40% year over year.
  • Cash position of USD 112 million is the highest in over four years.

Allot (NASDAQ:ALLT) reported third-quarter 2026 revenue of USD 30.6 million, against an estimate of USD 30.03 million. Earnings Per Share were USD 0.09, against an estimate of USD 0.09. Revenue rose 16% year over year, the fifth consecutive quarter of double-digit growth.

The company sells network-native security and intelligence solutions to telecommunications operators through two Business lines, SECaaS, its security-as-a-service offering, and SMART. Management said both lines grew at double-digit rates in the quarter.

Profitability, Cash and Recurring Revenue

The non-GAAP operating margin was 13%, an improvement from the first two quarters of 2026. Cash generation was USD 7.4 million for the quarter, bringing the cash position to USD 112 million, the highest level in more than four years.

SECaaS annual Recurring Revenue reached USD 39 million at the end of September, up more than 40% year over year. The company said recurring revenue broadens its base and improves visibility into future revenue. Management said it is progressing against the objectives it set for 2026, with profitable growth led by SECaaS and supported by the SMART business.

In SMART, the company won several expansion orders from existing customers during the quarter. The chief executive said returning customers are one of the more efficient ways for the company to grow.

Telco Wins, IoT Security and the Quantum Consortium

Allot won a new SECaaS deal in Southeast Asia, adding to its roster of telco partners that offer Cybersecurity services to their subscribers. Management said the pipeline is broad and that existing SECaaS customers continue to grow subscriber uptake, which drives the growth in annual recurring revenue.

The company described the threat environment as changing quickly, with attackers using AI to target individuals and businesses at scale. It cited a May 2026 report from Google Threat Intelligence Group that identified what it assessed to be an AI-developed zero-day exploit intended for mass exploitation, and noted that threat actors are using AI in vulnerability research on embedded IoT devices, including router firmware.

Allot said its network-native security service lets operators protect subscribers from within the network without upfront Capital expense for the operator, and that the company shares revenue from the service with the telco. It recently announced new capabilities for securing SIM-enabled IoT devices with Allot NetworkSecure, giving telcos a network-based way to apply firewall security to business IoT traffic across 4G and 5G networks without software installed on each device.

During the quarter, Allot also announced that it is a founding member and chair of a new Post-Quantum Communications Consortium supported by the Israel Innovation Authority. The group brings together technology companies, including NVIDIA, and academic institutes to develop technologies that secure networks and data against future Quantum Computing threats.

Items Management Pointed To for Coming Periods

Management characterized the company as a profitable, cash-generating, recurring-revenue-led business and referred to growth into 2027 and beyond. The reported markers behind that framing are SECaaS annual recurring revenue of USD 39 million, a 13% non-GAAP operating margin, quarterly cash generation of USD 7.4 million and a USD 112 million cash balance.

The chief financial officer covered the financial summary after the chief executive's remarks, and the call included a question session for investors.