Ubiquiti Inc. — Fourth Quarter Fiscal 2026 Earnings Summary

Financial Performance

• Q4 Fiscal 2026 revenues reached $937.3 million, a 23.5% increase year-over-year (YoY) and an 18.9% increase quarter-over-quarter (QoQ).
• Full year Fiscal 2026 revenues totaled $3.3 billion, representing a 27.2% increase compared to Fiscal 2025.
• Q4 Fiscal 2026 GAAP diluted EPS was $4.70, up 6.6% YoY; Non-GAAP diluted EPS was $4.73, up 33.6% YoY.
• Full year Fiscal 2026 GAAP diluted EPS was $15.85; Non-GAAP diluted EPS was $15.95.
• Q4 Fiscal 2026 GAAP net income was $284.9 million, a 6.8% increase YoY; Non-GAAP net income was $286.5 million, a 33.6% increase YoY.
• Q4 Fiscal 2026 GAAP gross profit was $429.3 million with a gross margin of 45.8%, down 1.2% QoQ but up 0.7% YoY.
• Full year Fiscal 2026 GAAP gross profit was $1,511.4 million with a gross margin of 46.2%, up 2.8% compared to Fiscal 2025.
• Q4 Fiscal 2026 total operating expenses were $89.3 million, compared to $81.3 million in the prior year quarter.
• Q4 Fiscal 2026 Income from Operations was $340.0 million, compared to $261.4 million in the prior year quarter.
• Q4 Fiscal 2026 Interest (income) expense and other, net was an income of $3.1 million, compared to an expense of $3.2 million in the prior year quarter.
• Full year Fiscal 2026 Interest (income) expense and other, net was an expense of $2.4 million, a decrease of $28.3 million compared to Fiscal 2025.

Business Segments and Product Lines

• Enterprise Technology revenue for Q4 Fiscal 2026 was $868.3 million, up from $680.1 million in the prior year quarter.
• Service Provider Technology revenue for Q4 Fiscal 2026 was $69.0 million, down from $79.0 million in the prior year quarter.
• Full year Fiscal 2026 Enterprise Technology revenue was $2.97 billion, up from $2.25 billion in Fiscal 2025.
• Full year Fiscal 2026 Service Provider Technology revenue was $301.9 million, down from $319.3 million in Fiscal 2025.
• Revenue growth in Q4 was driven by the Enterprise Technology platform, partially offset by declines in Service Provider Technology.

Market and Competitive Landscape

• North America generated $507.4 million in Q4 Fiscal 2026 revenue, up from $379.9 million in the prior year quarter.
• Europe, the Middle East and Africa generated $331.6 million in Q4 Fiscal 2026 revenue, up from $303.8 million in the prior year quarter.
• Asia Pacific generated $69.4 million in Q4 Fiscal 2026 revenue, up from $47.3 million in the prior year quarter.
• South America generated $28.9 million in Q4 Fiscal 2026 revenue, up from $28.1 million in the prior year quarter.
• The company operates in over 200 countries and territories, focusing on professional networking products powered by UISP and UniFi software platforms.

Risks and Challenges

• Component costs increased in Q4 Fiscal 2026 and may continue to rise, potentially pressuring gross profit margins if not offset by pricing.
• Ongoing supply constraints could limit the ability to meet customer demand and negatively impact revenues and gross profit margins.
• U.S. tariffs may impact operations and financial results.
• Risks include reliance on a limited number of distributors, dependence on chipset suppliers without short-term alternatives, and potential counterfeiting.
• Foreign exchange losses and fluctuations in operating results remain key risks.
• The company faces risks related to geopolitical conditions, including the military conflict between Russia and Ukraine and tension between China and Taiwan.

Management Commentary and Tone

• Management noted that the decrease in gross margin compared to the prior quarter was driven by higher component and shipping costs, offset by lower indirect costs.
• The increase in gross margin compared to the prior year was driven by lower indirect costs, offset by unfavorable product mix, higher shipping costs, and higher component costs.
• Full year gross margin improvement was driven by favorable product mix and lower indirect costs, offset by higher tariff costs.
• R&D expenses increased in Q4 to $53.0 million, driven by higher prototype-related and software expenses.
• SG&A expenses increased in Q4 to $36.3 million, driven by higher professional fees, credit card processing fees, and marketing expenses.
• The decline in Interest (income) expense and other, net for the full year was driven by lower interest expense due to decreased outstanding debt and lower interest rates, offset by higher foreign exchange losses.

Other Key Points

• The Board declared a $1.00 per share cash dividend payable on September 8, 2026, to shareholders of record on August 31, 2026.
• The Company intends to pay regular quarterly cash dividends of at least $1.00 per share during fiscal year 2027, subject to Board determination.
• The Company extended its stock repurchase program, authorizing up to $500 million of common stock repurchases through September 30, 2027.
• A $53.7 million deferred tax asset related to an intercompany transfer of intangible properties impacted the GAAP provision for income taxes in the prior year quarter.
• Non-GAAP measures exclude share-based compensation, the tax effects of non-GAAP adjustments, and the deferred tax benefit from the intangibles realignment transaction.