01—Abstract
Summary
Summary of the 10-Q filed November 7, 2025. Cited figures are marked; the original filing is the authoritative source.
Ubiquiti Inc. reported results for the quarter ended September 30, 2025 (fiscal 2026 first quarter).
Revenues were $733.8 milliona, up from $550.3 million a year earlier, driven primarily by Enterprise Technology, which rose to $657.1 million from $470.2 million, while Service Provider Technology declined to $76.6 million from $80.2 million. Gross profit was $337.4 million versus $231.6 million, and the filing attributes the improvement in gross margin (46.0% versus 42.1%) mainly to favorable product mix, partly offset by higher tariff costs. Income from operations rose to $261.7 million from $169.2 million, and net income reached $207.9 million, or $3.43 diluted per share, compared with $128.0 million, or $2.12, a year earlier.
Cash flow and balance sheet activity show a company generating strong operating cash flow of $198.5 millionb while returning capital and reducing debt. During the quarter, the company repaid $116.3 million of Term Loan principal and paid $48.4 million in common dividends ($0.80 per share). Cash and cash equivalents rose to $177.2 million, and the Term Loan balance fell to $133.8 million, with the $700.0 million Revolving Facility undrawn.
The filing notes that the credit facilities mature in March 2026 and that the company intends to enter into a new facility before then. Inventories were $680.7 millionc and purchase commitments with contract manufacturers were $1,249.8 million. The filing also highlights ongoing risks, including tariffs on imports from China and Vietnam, supply constraints, and geopolitical tensions involving Russia-Ukraine and China-Taiwan.
The company has an open patent suit from Intellectual Ventures I LLC, for which it cannot estimate a possible loss. A Hong Kong tax audit involves $60.8 milliond of deposits, and an IRS matter could result in an incremental tax liability of approximately $50.0 million excluding interest and penalties, though no reserve has been recorded for the IRS matter. Subsequent to quarter end, the Board approved a quarterly dividend of $0.80 per share payable November 24, 2025.
02—Key points
Key Highlights
- Revenue rose to $733.8 million from $550.3 million, with Enterprise Technology up to $657.1 million from $470.2 million and Service Provider Technology down to $76.6 million from $80.2 million.
- Gross margin widened to 46.0% from 42.1%, which the filing attributes primarily to favorable product mix, partly offset by higher tariff costs.
- Net income increased to $207.9 million, or $3.43 per diluted share, from $128.0 million, or $2.12 per diluted share.
- Operating cash flow was $198.5 million, and cash and cash equivalents ended at $177.2 million.
- Debt was reduced: the Term Loan balance fell to $133.8 million after $116.3 million of principal repayments, and the $700.0 million Revolving Facility was undrawn.
- Dividends of $48.4 million were paid, and the company declared a $0.80 per share quarterly dividend payable November 24, 2025.
- The credit facilities mature in March 2026, and the company states it intends to enter a new borrowing facility before that date.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q1 FY2026, Ubiquiti kept $0.28.
- Revenue$733.8M100.0%
- Cost of revenue−$396.4M54.0%
- Gross profit$337.4M46.0%
- Operating costs−$75.7M10.3%
- Operating income$261.7M35.7%
- Interest, other & tax−$53.8M7.3%
- Net income$207.9M28.3%
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2026filed November 7, 2025Financial Statements
Q1 FY2026 against Q1 FY2025
| Line item | Q1 FY2026Q1 FY2025 | Change |
|---|---|---|
| Revenue | $733.77M$550.34M | +33.3% |
| Cost of Revenue | $396.36M$318.73M | +24.4% |
| Gross Profit | $337.41M$231.62M | +45.7% |
| R&D Expenses | $48.54M$38.00M | +27.8% |
| SG&A Expenses | $27.14M$24.41M | +11.2% |
| Operating Expenses | $75.69M$62.41M | +21.3% |
| Operating Income | $261.72M$169.21M | +54.7% |
| Net Income | $207.88M$127.99M | +62.4% |
| EPS (Basic) | $3.44$2.12 | +62.3% |
| EPS (Diluted) | $3.43$2.12 | +61.8% |
| Shares Outstanding (Basic) | 60.50M60.47M | 0.0% |
| Shares Outstanding (Diluted) | 60.56M60.49M | +0.1% |
05—Questions
Frequently Asked Questions
What drove the increase in revenue this quarter?
The filing states that the increase was primarily driven by Enterprise Technology, which grew $187.0 million, or 40%, to $657.1 million, across all regions. Service Provider Technology declined $3.5 million, or 4%, to $76.6 million.
How did margins and profitability change?
Gross profit margin increased to 46.0% from 42.1%, mainly due to favorable product mix and lower shipping costs, indirect operating expenses, and excess and obsolete inventory charges as a percentage of revenue, partly offset by higher tariff costs. Income from operations rose to $261.7 million from $169.2 million.
What is the status of the company's debt and credit facilities?
As of September 30, 2025, $133.8 million was outstanding on the Term Loan Facility and nothing was drawn on the $700.0 million Revolving Facility. The facilities mature in March 2026, and the company says it intends to enter a new credit facility before then.
What are the main legal and tax exposures disclosed?
The company faces a patent infringement lawsuit from Intellectual Ventures I LLC, for which it cannot estimate a possible loss. For tax, the filing estimates an incremental liability of approximately $50.0 million, excluding interest and penalties, related to an IRS proposed adjustment, with no reserve recorded. Separately, $60.8 million of deposits with the Hong Kong Inland Revenue Department are expected to be refunded upon completion of the audit.
What did the company do with its cash this quarter?
The company used $165.8 million in financing activities, including $116.3 million of Term Loan principal repayments and $48.4 million of dividends. It used $5.2 million in investing activities, primarily capital expenditures. It made no share repurchases under the $500 million 2025 August Program during the quarter.
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