Extreme Networks (EXTR) AI Stock Analysis

• Market Cap: $2.35B
• Dividend Yield: N/A
• Average Volume (3M): 1.75M
• Price to Earnings (P/E): 277.0
• Beta (1Y): 1.77
• Revenue Growth: 14.31%
• EPS Growth: N/A
• Country: US
• Employees: 2,656
• Sector: Technology
• Sector Strength: 88
• Industry: Communication Equipment
• EPS (TTM): 0.22
• Shares Outstanding: 133,718,480
• 10 Day Avg. Volume: 944,972
• 30 Day Avg. Volume: 1,745,431
• PEG Ratio: 3.48
• Price to Book (P/B): 36.22
• Price to Sales (P/S): 2.08
• P/FCF Ratio: 18.66
• Enterprise Value/Market Cap: 1.20
• Enterprise Value/Revenue: 2.39
• Enterprise Value/Gross Profit: 3.94
• Enterprise Value/Ebitda: 41.40
• 1Y Price Target: $24.75
• Price Target Upside: 36.36% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 8
• EPS Forecast (FY): 0.99
• Revenue Forecast (FY): $1.26B

• Rating: 59 Neutral
• Price Target: $18.50 ▲(1.93% Upside)

Extreme Networks' overall stock score is primarily influenced by its financial performance and earnings call. The company shows stable revenue growth and strategic wins, but faces challenges with profitability and high leverage. Technical analysis indicates a bearish trend, and the high P/E ratio suggests overvaluation. The positive outlook from the earnings call provides some optimism for future growth.

Positive Factors

Revenue Growth

Consistent revenue growth over multiple quarters indicates strong market demand and effective sales strategies, supporting long-term business expansion.

SaaS ARR Growth

The significant increase in SaaS ARR reflects successful adoption of subscription models, providing a stable and recurring revenue stream.

Strategic Wins and Partnerships

Strategic partnerships and major project wins enhance market position and open new revenue opportunities, strengthening competitive advantage.

Negative Factors

High Leverage

High leverage can increase financial risk and limit flexibility, potentially impacting the company's ability to invest in growth opportunities.

Profitability Challenges

Low profitability margins highlight operational inefficiencies, which may hinder the company's ability to sustain long-term financial health.

Declining Free Cash Flow

Declining free cash flow can strain the company's ability to fund operations and growth initiatives, affecting long-term sustainability.

Extreme Networks Business Overview & Revenue Model

Company Description

Extreme Networks, Inc. provides software-driven networking solutions worldwide. It designs, develops, and manufactures wired and wireless network infrastructure equipment; and develops software for network management, policy, analytics, security, and access controls. The company offers ExtremeCloud IQ, an ML/AI powered, wired, and wireless cloud network management solution that offers advanced visibility and control over users, devices, and applications; ExtremeCloud IQ – Site Engine that provides task automation, access control, granular visibility with real-time analytics and multi-vendor device management; and ExtremeCloud IQ Essentials offers WIPS, location services, IoT, and guest management services. It also provides wireless access point products; ExtremeSwitching portfolio that includes access edge products that offer physical presentations along with options to deliver Ethernet or convergence-friendly Power-over-Ethernet (POE), including high-power universal POE; aggregation/core switches designed to address aggregation, top-of-rack, and campus core environments; and data center switches and routers. In addition, the company offers cloud native platforms and applications for service providers; and customer support and services. It markets and sells its products through distributors, resellers, and field sales organizations to healthcare, education, government, manufacturing, retail, and hospitality markets. Extreme Networks, Inc. was incorporated in 1996 and is headquartered in Morrisville, North Carolina.

How the Company Makes Money

Extreme Networks generates revenue through multiple streams, primarily from the sale of hardware, software, and services. Key revenue streams include the sale of network switches, routers, and wireless access points, which cater to organizations seeking robust networking solutions. Additionally, the company offers subscription-based software licenses for its management and analytics platforms, which provide ongoing revenue. Service and support contracts also contribute significantly to the company's earnings, providing maintenance, training, and technical support to clients. Strategic partnerships with other technology companies and service providers enhance its market reach and drive additional revenue opportunities, particularly in the cloud and managed services sectors.

Extreme Networks Financial Statement Overview

Summary

Extreme Networks demonstrates moderate financial health with stable revenue growth and profitability challenges. The high leverage poses a risk, but the company maintains a solid cash conversion rate. Improvements in operational efficiency and debt management could enhance financial stability.

Income Statement

Extreme Networks shows a moderate revenue growth rate of 3.6% in the TTM, with a gross profit margin of 61.6%. However, the net profit margin is low at 0.73%, indicating challenges in converting revenue into profit. The EBIT and EBITDA margins are also relatively low, suggesting room for improvement in operational efficiency.

Balance Sheet

The company has a high debt-to-equity ratio of 1.22 in the TTM, indicating significant leverage, which could pose financial risks. Return on equity is 13.46%, showing some profitability, but the equity ratio is low, suggesting a reliance on debt financing.

Cash Flow

Operating cash flow to net income ratio is 0.23, indicating moderate cash generation relative to net income. Free cash flow growth is negative at -18.55%, which is a concern. However, the free cash flow to net income ratio is strong at 86.36%, showing good cash conversion.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	1.18B	1.14B	1.12B	1.31B	1.11B	1.01B
Gross Profit	716.62M	709.13M	628.79M	752.67M	626.70M	573.41M
EBITDA	68.18M	39.42M	-19.61M	158.62M	120.07M	110.09M
Net Income	9.52M	-7.47M	-85.96M	78.07M	44.27M	1.94M
Balance Sheet
Total Assets	1.15B	1.15B	1.04B	1.14B	1.07B	1.01B
Cash, Cash Equivalents and Short-Term Investments	209.00M	231.75M	156.70M	234.83M	194.52M	246.89M
Total Debt	83.49M	223.44M	250.15M	275.46M	365.09M	409.59M
Total Liabilities	1.08B	1.09B	1.02B	1.02B	978.17M	955.63M
Stockholders Equity	68.56M	65.58M	25.28M	116.75M	90.34M	54.47M
Cash Flow
Free Cash Flow	94.80M	127.32M	37.37M	235.41M	112.74M	127.36M
Operating Cash Flow	119.45M	152.03M	55.49M	249.21M	128.18M	144.53M
Investing Cash Flow	-24.65M	-24.71M	-18.12M	-13.80M	-84.95M	-17.18M
Financing Cash Flow	-45.18M	-52.59M	-114.98M	-194.78M	-94.66M	-74.78M

Extreme Networks Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 18.15
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EXTR, the sentiment is Neutral. The current price of 18.15 is above the 20-day moving average (MA) of 17.42, below the 50-day MA of 18.88, and above the 200-day MA of 17.36, indicating a neutral trend. The MACD of -0.34 indicates Negative momentum. The RSI at 52.94 is Neutral, neither overbought nor oversold. The STOCH value of 81.42 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for EXTR.

Extreme Networks Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
DGII	77 Outperform	$1.68B	42.36	6.71%	―	1.46%	78.77%
VIAV	71 Outperform	$4.09B	278.84	2.13%	―	15.60%	―
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
COMM	60 Neutral	$4.25B	―	―	―	9.86%	99.11%
EXTR	59 Neutral	$2.35B	277.01	17.08%	―	14.31%	―
VSAT	56 Neutral	$4.73B	―	-11.04%	―	1.23%	-31.80%
ADTN	50 Neutral	$683.39M	―	-48.44%	―	14.33%	83.32%

Extreme Networks Corporate Events

Extreme Networks Holds Annual Stockholders Meeting

On November 12, 2025, Extreme Networks, Inc. held its annual meeting of stockholders where several key proposals were voted on. Seven director nominees were elected for a one-year term, executive officer compensation was approved, Grant Thornton LLP was ratified as the independent auditor for the fiscal year ending June 30, 2026, and an amendment to the 2013 Equity Incentive Plan was approved, adding 6,800,000 shares for issuance. These decisions reflect the company’s strategic direction and governance priorities, potentially impacting its operational and financial strategies.

Extreme Networks Announces 2026 Financial Guidance

On November 10, 2025, Extreme Networks announced its financial guidance for the fiscal year 2026, ending June 30, 2026, during its Investor Day. The company reaffirmed its fiscal second quarter 2026 outlook and provided detailed guidance for the full year, targeting total net revenue between $1,247 million and $1,264 million, with gross margins and operating margins outlined for both GAAP and non-GAAP measures. This announcement reflects Extreme Networks’ strategic positioning and expectations for continued growth, despite market conditions and competitive challenges.