Key Highlights

  • Revenue was USD 14.04 million in the third quarter of 2026, up 19.4% from USD 11.8 million in the second quarter but down 23.6% from USD 18.4 million a year earlier.
  • Non-GAAP Operating Income was USD 0.7 million, or 4.9% of revenue, against a USD 2.2 million non-GAAP operating loss in the second quarter and USD 3.8 million a year ago.
  • Cash, equivalents and short-term bank deposits reached USD 111.4 million, up from USD 109.7 million at the end of June, with no Debt and positive Cash Flow of USD 1.7 million.
  • Management reaffirmed its revised 2026 Revenue outlook of USD 57 million to USD 63 million, and said a USD 20 million share repurchase program is cleared to begin after the blackout period.

Sequential Rebound Meets a Weak Year-on-Year Comparison

RADCOM (NASDAQ:RDCM), which sells cloud-native network assurance software to telecom operators, discussed its third-quarter results on a call dated November 11, 2026. Revenue of USD 14.04 million was 19.4% above the second quarter, yet 23.6% below the USD 18.4 million booked in the third quarter of 2025. Non-GAAP gross Margin was 73.8%. On a GAAP basis the company posted an operating loss of USD 0.9 million and Net Income of USD 441,000, or USD 0.03 per diluted share, against USD 3.5 million, or USD 0.21, a year earlier. Non-GAAP net income was USD 1.9 million, or USD 0.11 per diluted share, versus USD 4.9 million, or USD 0.29.

Server Costs Delay Deployments While Two New Logos Close

The CEO said earlier deployment delays are timing related and driven mainly by server infrastructure costs, not by weaker Demand for the product. The company said it won CETIN Networks in Slovakia and Vietnam Posts and Telecommunications Group, known as VNPT, both through competitive tenders that replaced incumbent vendors. Management said it has already received a couple of orders planned for early 2027, orders that it had originally expected in early 2026, which it read as an encouraging sign. Net Research and Development spending was USD 4.9 million, up 9.1%, helped along by a weaker dollar against the shekel, while sales and Marketing fell 23.5% to USD 3.5 million.

Buyback Cleared, Profit Targets Still Ahead

The board authorized a share repurchase of up to USD 20 million over up to 18 months. The CFO said the 30-day creditor objection period under Israeli law ended with no objections, and no shares were repurchased in the quarter. Management said it expects non-GAAP profitability for 2026, aims for positive free cash flow in the second half and sees a return to double-digit revenue growth in 2027. Tier-1 sales cycles are long and timing can shift, and the CEO described the pipeline of proofs of concept as higher single digits, so converting that pipeline into signed revenue remains the main execution risk to watch.

Where Things Stand

The jump is a rebound from a weak second quarter, not a recovery to last year's level. RADCOM (NASDAQ:RDCM) lifted revenue 19.4% sequentially and returned to non-GAAP operating profit, yet sales remain 23.6% below a year ago and profit margins are far thinner than the 20.9% non-GAAP Operating Margin of the prior-year quarter. A debt-free Balance Sheet and the buyback give room to wait. The next markers are the fourth-quarter result, the start of repurchases and whether the early 2027 orders arrive.