Earnings call transcript: Vecima tops revenue forecast in Q4 2026, EPS misses

Vecima Networks reported a record fourth-quarter fiscal 2026 revenue of CAD 91 million, up 36% from the previous year, while its adjusted earnings per share (EPS) of $0.21 fell short of the $0.255 forecast by $0.045, or 17.65%. Despite the EPS miss, revenue beat Wall Street's expectations by $6.17 million, or 7.28%. The company's adjusted EBITDA more than tripled to CAD 18.9 million, boosting the margin to 20.8%. Gross margins expanded to 45.4% from 26.3% a year earlier, driven by a higher mix of more profitable products.

Management highlighted that the results represented Vecima's strongest quarter on record, driven by the Video and Broadband Solutions segment, which generated CAD 80.1 million in sales, up 38% year over year. Entra DAA products contributed CAD 77.3 million, while the Content Delivery and Storage segment added CAD 10.8 million. Operating income improved to CAD 12.3 million, up from a loss of CAD 17.1 million in the prior quarter, and net income reached CAD 5.4 million, compared to a loss of CAD 13.3 million in the same period last year.

The company's broader customer base, now including 150 broadband engagements, should help mitigate concentration risk and support stable growth. Vecima expects revenue growth of 30% to 35% in fiscal 2027, with adjusted EBITDA margins near 20%. The outlook includes early contributions from new products such as vCMTS, DOCSIS 4.0 remote PHY devices, and XGS-PON, as well as continued growth from its Entra product line and commercial video platform, Terrace IQ.