Aviat Networks reported second quarter fiscal 2026 sales and profitability that exceeded consensus estimates, driven by robust demand for its microwave transport solutions in North America and Asia-Pacific. The company’s non-GAAP operating income margin expanded by 240 basis points year-over-year, reflecting disciplined cost management and higher software revenues, while adjusted EBITDA reached a record $18.7 million, up 22% from the prior year period.

During the quarter Aviat generated $16.3 million of free cash flow, marking the fifth consecutive quarter of positive cash conversion. As a result, net debt declined by more than 50% compared with the end of fiscal Q1, falling to $19.5 million. Cash and short-term investments increased to $42.8 million, providing ample liquidity to fund growth initiatives and potential strategic acquisitions without issuing new equity.

The company achieved a quarterly bookings record, with new orders totaling $105 million, representing a 28% increase year-over-year and driven by multi-year framework agreements secured with tier-one service providers in Europe and Latin America. Backlog rose to $89 million at quarter-end, up 35% sequentially, underpinning revenue visibility into fiscal Q3 and Q4.

On the earnings call, management reaffirmed full-year guidance and signaled that sustained cash generation and strong backlog conversion should support a double-digit increase in free cash flow for fiscal 2026. Aviat’s leadership team highlighted planned investments in R&D—approximately 15% of revenues—to accelerate next-generation microwave portfolio rollout, and emphasized the potential for margin expansion as software and service revenues scale.