Ceragon Networks Ltd. ((CRNT)) has held its Q3 earnings call. Read on for the main highlights of the call.
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Ceragon Networks Ltd. Earnings Call: A Balanced Outlook with Optimism for Future Growth
Ceragon Networks Ltd. demonstrated a balanced sentiment in their latest earnings call, reflecting both resilience and challenges. The company exceeded revenue expectations in North America, showcasing advancements in technology and projects. However, they faced a decline in revenue and operating income compared to the previous year, alongside foreign exchange impacts. Despite these challenges, there is optimism for growth in 2026.
Revenue Exceeds Expectations
Ceragon Networks reported Q3 2025 revenue of $85.5 million, surpassing expectations. North America played a pivotal role, contributing $36 million, primarily driven by Tier 1 customer deployments.
High Non-GAAP Gross Margin
The company maintained a high non-GAAP gross margin of 35%, slightly up from the previous year, largely due to successful operations in North America.
Positive Free Cash Flow
Ceragon generated $3.3 million in free cash flow for the quarter, underscoring the resilience and stability of its business model.
Advancements in E-Band Technology
Ceragon completed three proof of concept E-band deployments with T1 operators and ISPs, highlighting the potential to enhance network capacity and reduce costs.
Smart City and Private Network Projects
The company is advancing in smart city projects, with phase one in Latin America potentially generating $7 to $8 million in recurring revenue. Additionally, a major e-commerce company in the US is utilizing Ceragon’s 60 GHz solution for video security.
Managed Services and Digital Twin Expansion
Ceragon secured a contract with a major Colombian mobile operator for end-to-end managed services, showcasing its expanded capabilities in network reliability.
Strong Performance in North America
North America led the company’s growth, delivering record revenue and bookings, primarily driven by Tier 1 customer deployments.
Revenue Decline Compared to Previous Year
Despite surpassing expectations, Q3 2025 revenue of $85.5 million was down 16.7% from $102.7 million in Q3 2024.
Decline in Operating Income
Non-GAAP operating income for Q3 2025 was $5.3 million, down from $15.8 million in Q3 2024, impacted by the absence of a $5.1 million credit loss recovery benefit.
Foreign Exchange Impact
Non-GAAP EPS was negatively impacted by $0.02 due to a $1.5 million foreign exchange fluctuation related to a project in India.
Challenges in India
Revenue in India remained flat compared to Q2, though visibility has increased with resumed order flow from a major carrier.
Forward-Looking Guidance
Ceragon Networks is optimistic about its $340 million revenue projection for 2025 and anticipates growth in 2026, driven by expanding demand in North America and recovering activity in India. The company is capitalizing on increased investments in AI and 5G infrastructure, which are driving the need for high-capacity, low-latency connectivity solutions. Their strategic focus includes enhancing network capacity and resiliency, supported by innovative E-band and 60 GHz technologies, and leveraging private network opportunities.
In summary, Ceragon Networks Ltd. presented a balanced sentiment in their earnings call, highlighting both achievements and challenges. The company exceeded revenue expectations and demonstrated strong performance in North America, while facing declines in revenue and operating income compared to the previous year. With optimism for future growth, Ceragon is strategically positioned to leverage advancements in technology and expanding market opportunities.