Ceragon Networks (NASDAQ:CRNT) provided a business update call to discuss preliminary fourth-quarter revenue expectations, drivers behind a late-quarter delivery shift at a major North American customer, and management’s initial outlook and profitability assumptions for full-year 2026.
Preliminary Q4 revenue range lowered due to delivery timing shift
CEO Doron (last name not provided in the transcript) said that in the final weeks of the fourth quarter, “a single large North American customer shifted a portion of deliveries that had been scheduled to be delivered within December into 2026.” The shift directly affected quarterly revenue compared with the company’s prior assumptions.
Management emphasized the change was “exclusively a timing matter,” adding that underlying demand from the customer “continues to be strong.” Ceragon said it received additional new orders “of significant value” from the same customer during Q4 and that orders in backlog “remained intact.” The company expects most of the delayed revenue to be recognized during 2026, and said the shift increased backlog entering 2026 as it coordinates delivery plans with the customer.
Backlog growth in North America and customer diversification efforts
Beyond the timing issue, Ceragon said bookings in North America remained strong in Q4. Management stated that its North America backlog exiting 2025 “almost doubled” compared with the level at the end of 2024, though the company declined to quantify the backlog in dollars when asked.
Management also highlighted progress in expanding its presence in private networks, increasing penetration within existing communications service provider (CSP) customers, and strengthening its position with new customers globally. During 2025, Ceragon said it added “more than 30 new customers,” with “over 75%” characterized as private network customers.
According to management, this customer expansion supports a strategic goal of reducing customer concentration and the impact that a small number of large projects can have on quarterly results. The company described this as a gradual transition toward a more diversified base intended to improve revenue visibility and stability over time.
2026 revenue outlook: $355 million to $385 million
For full-year 2026, Ceragon guided to revenue in a range of $355 million to $385 million. Management said its assumptions include the conversion of Q4 delayed deliveries, along with region-specific expectations:
- North America: Ceragon said it is entering 2026 with a “strong backlog” and continued progress across both CSPs and private networks, with multiple opportunities in “advanced stages” that it expects to convert to new business during 2026.
- India: The company said it begins 2026 with an annual revenue run rate of approximately $100 million, primarily driven by two main customers. Management said incremental expansion within those two customers is included in the low end of guidance, and it expressed optimism about winning a “significant portion” of other customers’ RFPs expected to be awarded in India in the first half of 2026.
- Rest of world: Ceragon said it is assuming a “measured recovery” in other regions, while acknowledging that the timing of closing and executing opportunities can work for or against results.
Profitability assumptions: gross margin improvement and forex headwind
While Ceragon said it will provide more details on its business model and profitability when it reports Q4 results in February, management outlined several high-level assumptions for 2026.
At the midpoint of the revenue range, Ceragon expects an additional gross margin improvement of approximately one percentage point for the full year, driven primarily by improved revenue mix between North America and India, along with additional cost-reduction initiatives. Management said quarterly gross margin could be “slightly volatile” depending on revenue level and geographic mix.
On the expense side, Ceragon cited foreign exchange pressure from the Israeli shekel. Management said the shekel exchange rate, if it remains similar to average levels seen in recent months, is expected to represent an approximate $5 million headwind for the full year compared with 2025. In Q&A, management clarified the $5 million figure applies across the year regardless of where revenue lands in the guidance range, unless there is a significant forex change.
Ceragon said it expects non-GAAP operating margin to be 6.5% to 7.5% at the midpoint of the revenue range, or 8% to 9% excluding the assumed shekel impact. Management also noted that a “big portion” of operating expense variability is tied to performance-related items, particularly bookings and operating profit achievements.
Product launches, investment focus, and business model evolution
Management said Ceragon continues to invest in R&D and in sales and marketing “based on the momentum” it sees in the market. The company plans to launch four new products in 2026 and expects initial revenue from some of them during the year, describing the product introductions as driven by specific demand observed in its addressable market and intended to support evolving use cases.
On sales and marketing, Ceragon said it has increased investment primarily in regions where it sees more growth opportunities, adding that a significant portion of the increase is tied to variable compensation and therefore “results-driven.”
In Q&A, management clarified that it is not shifting away from project-based business, but is seeking to diversify project sizes and revenue patterns through private network opportunities, which it characterized as often smaller projects with longer rollout timelines and more service elements that can smooth revenue recognition. Management also said the company is pushing business models such as managed services and connectivity-as-a-service, which could create a near-term revenue headwind during early execution but may reduce volatility over time.
Management also noted it had recruited a new Chief Technology Officer with experience in radio and chip domains and work on 6G research, aimed at strengthening technology leadership.
Finally, Ceragon said it continues to discuss capital allocation with its board, describing an intent to remain disciplined while prioritizing investments tied to its transformation, and continuing to evaluate potential returns of capital to shareholders and inorganic growth opportunities.
About Ceragon Networks (NASDAQ:CRNT)
Ceragon Networks Ltd. is a global provider of wireless backhaul solutions, specializing in high-capacity, low-latency connectivity for mobile operators and private networks. The company designs and manufactures a portfolio of microwave and millimeter-wave equipment that serves as a fiber alternative for carrying voice, data and video traffic between cell sites and core networks. Ceragon’s solutions are engineered to support the rigorous performance requirements of modern 4G and 5G deployments, with an emphasis on scalability, reliability and efficient spectrum utilization.
The company’s product lineup includes point-to-point and multi-point radio platforms, as well as software-driven network management tools that enable operators to plan, deploy and monitor end-to-end transport networks.
