Shrew格兰， Texas, USA, November 5, 2026 / PRNewswire / -- Applied Optoelectronics, Inc. (Nasdaq ticker: AAOI, hereinafter referred to as “AOI”) today announced its financial results for the third quarter ending September 30, 2026. The company is a leading provider of advanced optical communications and HFC network products that support AI.
AOI Founder, President, and CEO Thompson Lin Dr. stated: "We are delighted to achieve record revenue for the sixth consecutive quarter and to resume GAAP profitability in the third quarter. We have made substantial progress in expanding our manufacturing capacity, especially in the 800G and 1.6T products, to meet what we believe is the accelerating growth in demand for AI related optical technologies. We recently signed a multi-year strategic agreement with a tier-one hyperscale data center customer, which we believe provides us with clearer long-term visibility and enhances our confidence in future opportunities, as the demand for high-bandwidth, energy-efficient optical interconnection products continues to grow."
AOI Chief Financial Officer and Chief Strategy Officer, Dr. Stefan Murry, stated: "We have once again delivered a solid quarter, with accelerated revenue growth and improved profitability, which is mainly due to the strong demand for data centers and CATV services, as well as manufacturing expansion. Our current total manufacturing capacity is nearly 330,000 units per month. Due to the longer time required than anticipated to obtain the necessary power supply and other construction-related issues, we expect that the completion of our capacity expansion plan in the United States for 2027 will take longer than originally planned. As these construction issues are gradually resolved, we now anticipate that by the end of 2026, the installed manufacturing equipment will be sufficient to produce over 500,000 units of 800G and 1.6 Tb products per month; and we expect to increase the manufacturing capacity for 800G and 1.6 Tb transceivers to over 1 million units per month by the end of 2027. We continue to focus on executing our capacity expansion plan and believe that the company is well-prepared for the next phase of deployment in AI data centers."
2026 Third Quarter Financial Summary
- GAAP reported revenue of $269.9 million, an increase from $118.6 million in the third quarter of 2025 and $191.9 million in the second quarter of 2026.
- The gross profit margin for GAAP is 28.2%, which is higher than 28.0% in the third quarter of 2025 and also higher than 27.7% in the second quarter of 2026. The gross profit margin for non-GAAP is 28.7%, which is lower than 31.0% in the third quarter of 2025 and also lower than 29.8% in the second quarter of 2026.
- GAAP reported a net profit of $6.3 million, with a basic earnings per share of $0.07; in the same period last year, there was a net loss of $17.9 million, with a basic earnings per share loss of $0.28; in the second quarter of 2026, there was a net loss of $22.8 million, with a basic earnings per share loss of $0.28.
- Non-GAAP reported a net profit of $14.8 million, with diluted earnings of $0.17 per share; in the same period last year, there was a non-GAAP net loss of $5.4 million, with basic losses of $0.09 per share; in the second quarter of 2026, there was a non-GAAP net profit of $5.5 million, with diluted earnings of $0.06 per share.
The adjustments between all the above GAAP information and non-GAAP information are shown in the table below. For explanations regarding these non-GAAP financial indicators, please refer to the section "Non-GAAP Financial Indicators" further down.
Business Outlook for the Fourth Quarter of 2026 (+)
For the fourth quarter of 2026, the company currently expects:
- Revenues range between $385 million and $420 million.
- The gross profit margin for non-GAAP products ranges between 29.5% and 31%.
- Non-GAAP net profit ranges from $45.9 million to $60.4 million, and non-GAAP earnings per share range from $0.48 to $0.63, based on a calculation of 96 million shares.
(+) Please refer to the notes below regarding forward-looking statements and related risks, as well as the notes regarding non-GAAP financial indicators.
Telephone Conference Arrangement
The company will hold a conference call and webcast today, November 5, 2026, for analysts and investors to discuss its financial results for the third quarter of 2026 and outlook for the fourth quarter of 2026. The meeting time is 4:30 PM Eastern Time / 3:30 PM Central Time. The meeting is open to the public; investors can join by calling 888-880-3330 (within the United States) or 646-357-8766 (internationally). A live audio webcast of the conference call and additional financial information are also available on the company's website at investors.ao-inc.com. After the live broadcast, an archived version will be available on the website for one year. A replay of the conference call will be provided one hour after the meeting ends and will be available for five working days. Investors can access the replay by calling (800) 770-2030 (within the United States) or (609) 800-9909 (internationally) and entering the password 4754976#.
Forward-looking Information
This press release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. In certain instances, you can identify forward-looking statements by words such as “believes,” “may,” “estimates,” “continues,” “expects,” “intends,” “should,” “can,” “will,” “aims,” “seeks,” “is intended to,” “predicts,” “considers,” “targets,” “optimistic,” “new,” “priority,” “strategy,” “potential,” “may,” “will,” “expect,” “momentum,” “plans,” “project,” “allows,” “positions,” and similar expressions that convey uncertainty about future events or results. These statements include management’s views and expectations regarding the fourth quarter of 2026 and the remainder of the year. Such forward-looking statements reflect management’s views at the time of making them and involve risks and uncertainties, as well as assumptions and current expectations, which could lead to significant differences between the company’s actual results and those anticipated in the forward-looking statements.These risks and uncertainties include, but are not limited to: a decrease in the scale or volume of customer orders; changes in demand for the company's products due to industry conditions; changes in manufacturing operations; fluctuations in manufacturing costs; delays in product delivery; disruptions in the supply chain; changes in the success rate of designs or customers' acceptance of new products; a high degree of revenue dependence on a few customers; potential pricing pressures; a decline in customer demand for products or a slowdown in the deployment speed of those products; general conditions in the internet data center, cable television (CATV), broadband, telecommunications, or fiber-to-the-home (FTTH) markets; changes in the global economic situation, particularly in the United States and China; changes in international trade regulations and taxes, including the imposition of tariffs; exchange rate fluctuations; seasonal adverse effects; and other risks and uncertainties more fully described in the documents submitted or provided by the company to the U.S. Securities and Exchange Commission, including the annual report 10-K for the year ending December 31, 2025, and the quarterly report 10-Q for the quarter ending September 30, 2026. For information regarding these and other risks that may affect the company's business, please refer to the "Risk Factors" section in the company's quarterly and annual reports submitted to the U.S. Securities and Exchange Commission. You should not regard forward-looking statements as predictions of future events. All forward-looking statements in this press release are based on information available to the company as of the date of issuance and are subject to the limitations stated above. Except as required by law, the company has no obligation to update forward-looking statements after issuance to make them consistent with actual results or expected changes in the company's circumstances.
Non-GAAP financial indicators
The company provides non-GAAP gross margin, non-GAAP net profit (loss), non-GAAP earnings per share (loss), and non-GAAP adjusted EBITDA to exclude items that the company believes do not reflect the overall operating performance. To determine the non-GAAP gross margin, the company excludes equity incentive expenses, expenses related to discontinued products, and non-recurring (income) expenses (if any) from the GAAP gross margin. To calculate the non-GAAP net profit (loss), the company removes amortization of intangible assets, equity incentive expenses, expenses related to discontinued products, non-cash expenses related to discontinued products, non-recurring (income) expenses, unrealized foreign exchange losses (gains), and non-GAAP tax gains (expenses) from the GAAP net profit (loss). In the third quarters of 2026 and 2025, the company's non-recurring expenses included employee severance costs (if any), legal fees related to litigation, as well as certain legal and consulting fees related to the termination of acquisitions or patent protection. When calculating the non-GAAP income tax gain (expense), the company uses an estimated annual effective tax rate and applies it to the pre-tax net profit. The company's non-GAAP adjusted EBITDA is calculated by excluding depreciation expenses, non-GAAP tax gains (expenses) and interest (income) expenses from the GAAP net profit (loss), as well as other items mentioned. The company's non-GAAP diluted earnings per share (loss) is calculated by dividing the non-GAAP net income (loss) by the fully diluted number of shares (during periods when the non-GAAP net profit is positive) or the basic number of shares (during periods when the non-GAAP net profit is negative).
The company believes that non-GAAP indicators are helpful for investors to assess its performance for the following reasons:
- The company believes that it is appropriate to exclude amortization of intangible assets, equity incentive expenses, non-recurring income and expenses, losses from the disposal of idle assets, unrealized foreign exchange gains and losses, and depreciation of certain equipment that is being reconfigured, as the treatment of these items may vary for reasons unrelated to the overall business performance;
- The company believes that it is appropriate to exclude expenses related to discontinued products, including depreciation and losses due to obsolete inventory, as these expenses do not reflect the ongoing operations of the business;
- The company believes that estimating non-GAAP income tax is helpful for comparison with historical periods and provides additional information regarding the potential formation of future deferred tax assets;
- The company believes that non-GAAP indicators allow for better comparison with the company's past financial performance, results over different periods, and those of its peers, as many peers also use similar non-GAAP financial indicators; moreover,
- The company expects that investors and securities analysts will use the non-GAAP indicators as a complement to the GAAP indicators in assessing overall business performance.
The company has provided a reconciliation table for the third quarter of 2026, showing the differences between GAAP net profit (loss), GAAP total gross profit, GAAP earnings per share (loss) and non-GAAP net profit (loss), non-GAAP total gross profit, adjusted EBITDA and earnings per share (loss). There is also a corresponding reconciliation for the third quarter of 2025.
Indicators that are not GAAP should not be considered as substitutes for gross profit, net profit (loss), earnings per share (loss), or any other financial performance indicators calculated and presented under GAAP. Since other organizations may not calculate similar indicators in the same manner, the company's non-GAAP indicators may not be comparable to those of other organizations with the same names. The company has not adjusted the non-GAAP indicators included in this guidance with the corresponding GAAP financial indicators, as the GAAP indicators cannot be reasonably determined on a forward-looking basis. Items that may affect the company's non-GAAP financial indicators include stock-based incentive expenses, non-recurring expenses, amortization of intangible assets, unrealized exchange losses (gains), asset impairment losses, gains and losses from disposal of idle assets, and changes in the fair value of convertible notes. Since these GAAP items cannot be reasonably predicted and may directly affect the company's non-GAAP gross margin, non-GAAP net profit, and non-GAAP fully diluted earnings per share, it is not possible to provide an adjustment between the non-GAAP guidance and the corresponding GAAP indicators without making unreasonable efforts. In addition, some of these items are beyond the company's control.
About Applied Optoelectronics
Applied Optoelectronics, Inc. (AOI) is a leading developer and manufacturer of advanced optical communications and HFC network products. These products are essential components of global AI data centers, CATV networks, and broadband fiber access networks. AOI supplies these critical infrastructure products to frontline customers in the cloud computing, CATV broadband, telecommunications, and FTTH markets. The company has research and development facilities in Atlanta, Georgia, as well as engineering and manufacturing facilities in Shugran, Texas, Taipei, Taiwan, and Ningbo, China. For more information, please visit www.ao-inc.com.
