Key Highlights

  • Record Revenue was USD 301.7 million, up 3% sequentially and 14% year over year, while non-GAAP gross Margin was 53.5%.
  • Software and service revenue reached a record USD 51.9 million, up 19%, at a non-GAAP gross margin of 67.2%.
  • Remaining performance obligations hit a record USD 395.7 million, up 12% year over year and 2% sequentially.
  • Fourth-quarter revenue is guided to USD 311 million to USD 317 million, implying about 19% growth for 2026.

Record Revenue

Calix, Inc. (NYSE:CALX) reported record third-quarter 2026 revenue of USD 301.7 million, up 3% sequentially and 14% from a year earlier. Software and service revenue grew to a record USD 51.9 million, up 3% sequentially and 19% year over year, with non-GAAP software and service gross margin at a record 67.2%. Non-GAAP gross margin was 53.5%, at the top of the guidance range, with memory surcharges partially offsetting higher component costs.

Net income per diluted common share was near the high end of guidance.

Platform Momentum

Management said the quarter marked a shift from AI enablement to AI execution. Every Calix Cloud customer has been live on the Calix One platform since March 2026, and Calix One contracts signed in the third quarter more than doubled from the previous quarter. Remaining performance obligations reached a record USD 395.7 million, up 2% sequentially and 12% year over year. At its ConneXions conference the company introduced an AI Control Center, agentic workflows across marketing, service and operations, a Subscriber Agent in the CommandIQ app and the public release of its Communications Language Model, which underlies specialized open-weight models planned for 2027.

Non-GAAP operating expenses were USD 124.0 million, or 41% of revenue, down from 42% the prior quarter. Customer examples included Chariton Valley, which cut operating costs by nearly USD 500,000 year to date, accelerated subscriber activation by 80% and resolved nearly 65% of service tickets remotely; ALLO Communications, whose operations agent cut the time to understand an intermittent subscriber issue from about 15 minutes to 30 seconds; and Wecom Fiber, where about 80% of orders flow from checkout to technician without human intervention. Tri-Co Go raised revenue per subscriber by about USD 0.75 within five months, with its 4-gig offering reaching about 11% adoption against a 5% target.

Cash Deployment and Guidance

The company prioritized continuity of supply, increasing component and finished goods inventory by USD 14.6 million, and generated free Cash Flow of USD 3.4 million. It repurchased 1.4 million shares for USD 50.0 million in the quarter, bringing year-to-date repurchases to 6.3 million shares for USD 290.2 million, and in October its board added USD 100 million to the repurchase authorization.

Fourth-quarter revenue is guided to USD 311 million to USD 317 million, up 4% at the midpoint from the prior quarter, and full-year 2026 growth is approximately 19% at that midpoint, above the 15% to 20% range set at the start of the year. Non-GAAP operating expenses are guided to USD 129.5 million to USD 131.5 million, reflecting the ConneXions conference and five additional days in the quarter, and the non-GAAP effective tax rate is projected at 23% to 25%.

Factors Shaping 2027

Items to track include Calix One contract signings, software and service margin, component costs and memory surcharges, and repurchase pace.