Harmonic (HLIT)
NASDAQ:HLIT
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Harmonic
(NASDAQ:HLIT)
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Rating:66Neutral
Price Target:
$16.50
▲(57.14% Upside)
Action:Reiterated
Date:05/30/26
The score is driven primarily by mixed financial performance (TTM losses and revenue decline) balanced by solid margins, manageable leverage, and positive free cash flow. Technicals are supportive with strong price trend and momentum. Earnings-call guidance and backlog visibility are a notable positive, while valuation is pressured by a negative P/E and no stated dividend yield.
Positive Factors
Margin and cash generation
Harmonic maintains a durable core margin structure with ~50% gross margin and positive operating/EBITDA margins, which underpin cash generation. Positive TTM free cash flow (~$45M) and operating cash (~$56M) support reinvestment, debt service, and share repurchases, improving resilience over coming quarters.
Negative Factors
High customer concentration
Reliance on two customers for the majority of revenue creates durable downside risk: contract changes, pricing pressure, or spending shifts by either customer could materially impact revenue, margins and cash flow, limiting predictability and negotiating leverage over the medium term.
Read all positive and negative factors
Positive Factors
Negative Factors
Margin and cash generation
Harmonic maintains a durable core margin structure with ~50% gross margin and positive operating/EBITDA margins, which underpin cash generation. Positive TTM free cash flow (~$45M) and operating cash (~$56M) support reinvestment, debt service, and share repurchases, improving resilience over coming quarters.
Read all positive factors
Harmonic (HLIT) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.84B
Dividend YieldN/A
Average Volume (3M)2.96M
Price to Earnings (P/E)―
Beta (1Y)1.28
Revenue Growth-27.47%
EPS Growth-181.91%
CountryUS
Employees901
SectorTechnology
Sector Strength88
IndustryCommunication Equipment
Share Statistics
EPS (TTM)-0.37
Shares Outstanding108,496,440
10 Day Avg. Volume5,517,537
30 Day Avg. Volume2,958,244
Financial Highlights & Ratios
PEG Ratio0.12
Price to Book (P/B)2.93
Price to Sales (P/S)3.12
P/FCF Ratio11.60
Enterprise Value/Market Cap1.01
Enterprise Value/Revenue3.73
Enterprise Value/Gross Profit7.39
Enterprise Value/Ebitda35.97
Forecast
1Y Price Target
$16.60Price Target Upside58.10% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering5
EPS Forecast (FY)0.56
Revenue Forecast (FY)$469.58M
Harmonic Business Overview & Revenue Model
Company Description
Harmonic Inc., together with its subsidiaries, provide video delivery software, products, system solutions, and services worldwide. The company operates in two segments, Video and Cable Access. The Video segment sells video processing, production,...
How the Company Makes Money
Harmonic makes money primarily by selling and supporting video and broadband delivery products and services. Revenue is generated from (1) product and solution sales, including software and purpose-built/virtualized platforms used for video stream...
Harmonic Earnings Call Summary
Earnings Call Date:May 11, 2026
(Q1-2026)
| % Change Since: |
Next Earnings Date:Aug 03, 2026
Earnings Call Sentiment Positive
The call conveyed strong operational and financial momentum: robust Q1 results (43% broadband revenue growth), record backlog (up 87%), expanding rest-of-market traction (78% growth), raised full-year guidance, solid cash generation and active capital returns. Challenges noted include supply-chain and memory cost pressures that compress second-half margins (net ~$6M memory impact), continued revenue concentration (two customers = 58% of revenue), stranded costs tied to the video sale, and component availability risks that prompted conservative sequential guidance. On balance, the company demonstrated clear execution, improving visibility and a plan to mitigate risks while pursuing growth in DOCSIS 4.0, fiber and network intelligence.Positive Updates
Strong Broadband Revenue Growth
Q1 broadband revenue rose 43% year-over-year to $121.7 million, exceeding guidance ($100M-$105M) and reflecting broad customer adoption.
Negative Updates
Memory and Supply-Chain Pressure on Margins
Elevated memory costs and new product ramps are expected to reduce gross margins in the second half; management cites an approximate $6 million net memory impact on the second half and built-in full-year tariff impact of ~$2.3 million.
Read all updates
Q1-2026 Updates
Positive
Negative
Strong Broadband Revenue Growth
Q1 broadband revenue rose 43% year-over-year to $121.7 million, exceeding guidance ($100M-$105M) and reflecting broad customer adoption.
Read all positive updates
Company Guidance
Harmonic raised full‑year 2026 broadband revenue guidance to $475–$495M (up ~$25M, +5.4% vs. prior midpoint) and guided Q2 broadband revenue of $115–$125M (Q1 was $121.7M, above prior $100–$105M range); full‑year gross margin is expected at 50–51.5% (Q2 52–53%), operating profit $87–$101M (Q2 $23–$28M) and non‑GAAP EPS $0.57–$0.67 (Q2 $0.15–$0.19; Q1 $0.17), roughly $0.07 (13.8%) higher vs. the prior midpoint. Guidance factors include an estimated tariff headwind of ~$2.3M for the year (Q2 < $1M), stranded costs of ~ $10M for the year (including ~$2.3M in Q1, ~30% of which management expects to be temporary), a non‑GAAP tax rate of 24.5%, and a roughly $6M net memory cost impact in H2 plus margin pressure from new product ramps. The company also cited a record broadband backlog and deferred revenue of $582.1M (up 87% y/y, ~60% expected to convert in 12 months), strong rest‑of‑market momentum (rest‑of‑market revenue +78% y/y, 42% of total), book‑to‑bill ~1.0, Q1 free cash flow $30.3M, cash $109M, $82M undrawn revolver and expected gross video sale proceeds of ~$145M, and ongoing share repurchases ($43M in Q1; $122M repurchased under the $200M program).Harmonic Financial Statement Overview
Summary
Income Statement
48
Neutral
Balance Sheet
63
Positive
Cash Flow
58
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 500.34M | 360.52M | 678.72M | 607.91M | 624.96M | 507.15M |
| Gross Profit | 252.63M | 163.66M | 365.92M | 312.55M | 315.88M | 259.74M |
| EBITDA | 51.90M | 28.11M | 77.40M | 34.09M | 61.65M | 32.55M |
| Net Income | -41.94M | -43.31M | 39.22M | 83.99M | 28.18M | 13.25M |
Balance Sheet | ||||||
| Total Assets | 705.31M | 718.48M | 796.51M | 768.21M | 710.02M | 693.69M |
| Cash, Cash Equivalents and Short-Term Investments | 109.00M | 124.11M | 101.46M | 84.27M | 89.59M | 133.43M |
| Total Debt | 131.06M | 147.84M | 148.31M | 156.05M | 160.78M | 190.21M |
| Total Liabilities | 350.15M | 335.24M | 331.25M | 331.33M | 385.51M | 396.89M |
| Stockholders Equity | 355.15M | 383.25M | 465.26M | 436.87M | 324.51M | 296.80M |
Cash Flow | ||||||
| Free Cash Flow | 45.44M | 96.89M | 52.73M | -1.42M | -3.77M | 28.04M |
| Operating Cash Flow | 56.05M | 107.97M | 61.92M | 7.06M | 5.48M | 41.02M |
| Investing Cash Flow | -10.61M | -11.08M | -9.19M | -8.47M | -1.29M | -12.97M |
| Financing Cash Flow | -89.86M | -81.39M | -33.27M | -4.99M | -43.13M | 7.94M |
Harmonic Technical Analysis
Positive
10.50
Price Trends
11.28
Positive
10.67
Positive
10.31
Positive
Market Momentum
1.35
Negative
63.75
Neutral
78.16
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HLIT, the sentiment is Positive. The current price of 10.5 is below the 20-day moving average (MA) of 13.44, below the 50-day MA of 11.28, and above the 200-day MA of 10.31, indicating a bullish trend. The MACD of 1.35 indicates Negative momentum. The RSI at 63.75 is Neutral, neither overbought nor oversold. The STOCH value of 78.16 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for HLIT.
Harmonic Risk Analysis
Harmonic disclosed 37 risk factors in its most recent earnings report. Harmonic reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Harmonic Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
86 Outperform | $1.29B | 21.59 | 28.54% | 4.38% | 11.12% | 9.16% | |
70 Outperform | $2.57B | 58.15 | 6.72% | ― | 13.48% | 0.69% | |
67 Neutral | $634.63M | -74.94 | -3.40% | ― | -23.56% | -362.44% | |
66 Neutral | $1.84B | -39.52 | -10.31% | ― | -27.47% | -181.91% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
60 Neutral | $1.37B | -37.23 | -24.02% | ― | 18.84% | 77.12% |
* Technology Sector Average
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Harmonic Corporate Events
Business Operations and StrategyM&A Transactions
Harmonic Signs Agreement to Sell Video Business Unit
Neutral
Mar 23, 2026
Harmonic Inc. has moved ahead with the sale of its Video Business to Leone Media Inc., doing business as MediaKind, for $145 million in cash, subject to customary working capital and debt adjustments. After completing the required French employee ...
Business Operations and StrategyFinancial DisclosuresM&A Transactions
Harmonic Advances Broadband Focus After Video Business Divestiture
Neutral
Mar 12, 2026
On December 8, 2025, Harmonic Inc. entered into a Put Option Agreement to sell its Video business to LeoneMedia Inc. (MediaKind), with the transaction expected to close in the first half of 2026, subject to customary conditions including French wo...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.