# Extreme Networks Inc: Form 10-K for the period ended Jun 30, 2026 - Company: [Extreme Networks Inc](/companies/extr.md) (CIK 1078271) - Form: 10-K - Filed: 2026-08-17 - Accepted by EDGAR: Aug 14, 2026, 19:42 ET - Period: 2026-06-30 - Accession: 0001193125-26-352872 - Inline XBRL: yes - Main document: https://www.sec.gov/Archives/edgar/data/1078271/000119312526352872/extr-20260630.htm - All documents and exhibits: https://www.sec.gov/Archives/edgar/data/1078271/000119312526352872/ ## Figures reported in this filing Standardized XBRL line items for the period ended 2026-06-30. | Line item | Period | Value | XBRL concept | | --- | --- | ---: | --- | | Revenue | 12 months, 2025-07-01 to 2026-06-30 | $1.28bn | us-gaap:RevenueFromContractWithCustomerExcludingAssessedTax | | Cost of revenue | 12 months, 2025-07-01 to 2026-06-30 | $494.5m | us-gaap:CostOfGoodsAndServicesSold | | Gross profit | 12 months, 2025-07-01 to 2026-06-30 | $789.1m | us-gaap:GrossProfit | | Research and development | 12 months, 2025-07-01 to 2026-06-30 | $233.9m | us-gaap:ResearchAndDevelopmentExpense | | Operating income | 12 months, 2025-07-01 to 2026-06-30 | $62.7m | us-gaap:OperatingIncomeLoss | | Interest expense | 12 months, 2025-07-01 to 2026-06-30 | $13.8m | us-gaap:InterestExpense | | Income tax | 12 months, 2025-07-01 to 2026-06-30 | $9.4m | us-gaap:IncomeTaxExpenseBenefit | | Net income | 12 months, 2025-07-01 to 2026-06-30 | $42.1m | us-gaap:NetIncomeLoss | | Diluted EPS | 12 months, 2025-07-01 to 2026-06-30 | $0.31 | us-gaap:EarningsPerShareDiluted | | Basic EPS | 12 months, 2025-07-01 to 2026-06-30 | $0.32 | us-gaap:EarningsPerShareBasic | | Diluted shares (weighted) | 12 months, 2025-07-01 to 2026-06-30 | 134,970,000 shares | us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding | | Operating cash flow | 12 months, 2025-07-01 to 2026-06-30 | $123.2m | us-gaap:NetCashProvidedByUsedInOperatingActivities | | Capital expenditure | 12 months, 2025-07-01 to 2026-06-30 | $27.9m | us-gaap:PaymentsToAcquirePropertyPlantAndEquipment | | Share repurchases | 12 months, 2025-07-01 to 2026-06-30 | $87.0m | us-gaap:PaymentsForRepurchaseOfCommonStock | | Cash and equivalents | at 2026-06-30 | $211.8m | us-gaap:CashAndCashEquivalentsAtCarryingValue | | Current assets | at 2026-06-30 | $549.8m | us-gaap:AssetsCurrent | | Total assets | at 2026-06-30 | $1.18bn | us-gaap:Assets | | Current liabilities | at 2026-06-30 | $592.7m | us-gaap:LiabilitiesCurrent | | Long-term debt | at 2026-06-30 | $144.4m | us-gaap:LongTermDebtNoncurrent | | Current portion of debt | at 2026-06-30 | $19.3m | us-gaap:LongTermDebtCurrent | | Shareholders' equity | at 2026-06-30 | $88.6m | us-gaap:StockholdersEquity | ## Business As filed, 61,016 characters. ### Overview Extreme Networks, Inc. (EXTR) (collectively referred to as “Extreme,” “Company,” and as “we,” “us” and “our”) is a leader in AI-powered cloud-based networking, focused on delivering simple and secure solutions that help businesses address challenges and enable connections among devices, applications, and users. We push the boundaries of technology, leveraging artificial intelligence (“AI”), analytics, and automation in our industry-leading products and services. Tens of thousands of customers globally trust Extreme to drive value, foster innovation, and overcome extreme challenges. Extreme also designs, develops, and manufactures wired, wireless, and software-defined wide area network (“SD-WAN”) infrastructure equipment. Our Extreme Platform ONE™ solution, made generally available in July 2025, is a technology platform designed to reduce operational complexity for enterprises by integrating networking, security, and AI solutions into a single platform. In May 2026, we announced Extreme Agent ONE™, a unified AI experience within Extreme Platform ONE that is expected to operate across Coworker and Operator modes. The Coworker mode is expected to provide proactive, context-aware assistance, and the Operator mode is expected to support autonomous execution of certain operator-defined tasks, in each case subject to customer-defined rules, schedules, and governance. Our global footprint provides service to some of the world’s leading names in business across verticals such as large sports and entertainment venues, hospitality, retail, transportation and logistics, education, government, healthcare, manufacturing and service providers. We derive all our revenues from the sale of our networking equipment, software subscriptions, and related maintenance contracts. ### Industry Background Enterprises across every industry are navigating significant technology transformation driven by cloud adoption, application modernization, cybersecurity demands, and the rapid emergence of generative, multimodal, and agentic AI. AI technologies are increasingly being used to automate workflows, accelerate decision-making, and assist in the management of information technology (“IT”) environments. To support these workloads, organizations are rearchitecting their networks from the edge to the data center, requiring infrastructure that is intelligent, secure, and highly automated. As networks become more distributed and complex, traditional management approaches may be less effective in addressing operational requirements. IT teams increasingly seek automation, visibility, and integrated security capabilities to operate dynamic environments while reducing operational complexity. Enterprise networking serves as a foundational platform supporting digital experiences for customers, employees, students, patients, and connected devices. We believe the industry is entering a new era of enterprise networking, where AI-powered platforms leverage AI agents to move beyond monitoring and recommendations toward autonomous operations. AI agents represent the next major inflection point, enabling networks to proactively identify issues, automate routine tasks, optimize performance, and augment IT teams at scale. Organizations that embrace AI-native networking platforms will be better positioned to improve resilience, accelerate innovation, and reduce operating costs. The network has become the foundation for AI-powered enterprises. Organizations are modernizing infrastructure to support distributed users, connected devices, cloud applications, internet of things (“IoT”), and increasingly AI-driven workloads, while addressing growing operational complexity, cybersecurity threats, and IT talent shortages. We believe these trends are driving a multi-year infrastructure refresh cycle. Enterprises are accelerating adoption of Wi-Fi 7 to support higher device density, lower latency, AI-enabled applications, and richer digital experiences. As customers upgrade campus infrastructure, they are increasingly seeking integrated platforms that combine networking, security, and AI-driven automation. Extreme Platform ONE unifies network management, security, analytics, and AI agents into a single platform. Leveraging generative, multimodal, and agentic AI, it automates network design, deployment, operations, and troubleshooting, helping IT teams improve productivity, accelerate issue resolution, and reduce operational costs. In May 2026, we introduced Extreme Agent ONE, a unified AI experience designed to operate across Coworker and Operator modes, with the Coworker mode expected to become generally available in the third quarter of calendar 2026 and the Operator mode expected to be introduced in the fourth quarter of calendar 2026. Extreme also differentiates itself through its enterprise campus fabric architecture, which is designed to simplify network segmentation, provisioning, and policy management while improving resilience and security. By automating traditionally manual operations and virtualizing the campus network, fabric is intended to help customers deploy services more efficiently, reduce complexity, minimize downtime, and improve operational performance. As organizations modernize their infrastructure, cloud choice and deployment flexibility have become increasingly important. Extreme is uniquely positioned to give customers deployment choice through public, private, hybrid, and sovereign cloud management, all delivered through Extreme Platform ONE. This enables customers to meet regulatory, security, and operational requirements while centrally managing wired, wireless, fabric, SD-WAN, and network access control across distributed environments from a single platform. We believe the convergence of AI, Wi-Fi 7, campus modernization, cloud flexibility, and autonomous network operations represents one of the most significant networking technology transitions in over a decade. Extreme's integrated portfolio positions the Company to help customers modernize their infrastructure, simplify operations, strengthen security, and reduce both capital and operating costs. We estimate the total addressable market (“TAM”) for our networking solutions, consisting of cloud-managed networking, wireless local area networks (“WLAN”), campus Ethernet switching, data center switching, SD-WAN solutions, and elements of the Secure Access Service Edge (“SASE”), exceeded $46 billion in calendar year 2025. Based on data from 650 Group, demand is projected to grow at a five-year compound annual growth rate (“CAGR”) of approximately 11%, reaching $77 billion by 2030. Within this market, cloud-managed networking solutions are expected to grow at a CAGR of approximately 13% reaching $19 billion by 2030. And with Extreme Platform ONE, we are addressing AI Networking for the Campus, where spending is forecasted to grow at a 60% CAGR over the next five years. ### The Extreme Strategy Extreme is executing a platform-led strategy focused on simplifying enterprise networking through AI. Extreme Platform ONE is designed to unify networking, security, and AI into a single enterprise platform that enables IT teams to design, deploy, manage, and secure networks using AI-enabled capabilities. By automating routine operations and accelerating complex tasks, Extreme Platform ONE is designed to improve productivity while reducing operational complexity. We believe this approach positions us to compete more effectively in the large enterprise market, expand strategic customer relationships, and increase participation in larger opportunities. The platform is supported by simplified licensing and flexible deployment options across public, private, hybrid, and sovereign cloud environments. ### Key elements of Extreme’s strategy and differentiation include: - **Deliver AI that is fully integrated into the networking experience.** As IT environments grow in complexity, enterprises need simpler, smarter ways to manage their networks. Extreme Platform ONE is designed to deliver the following benefits: - AI-Powered Insight and Automation: Customers gain instant insights while the network adapts in real time to bandwidth spikes and security threats. Network administrators can set guardrails for policy, risk, and approvals, while AI agents act autonomously to optimize performance and reliability. - End-to-End Network Visibility: With real-time visualization of the network topology and lifecycle data, customers can improve compliance, simplify onboarding, and enable proactive planning for refreshes, expansions, or support alignment. Extreme Platform ONE eliminates fragmented snapshots of the network and delivers a complete view in one place. - Unified Operations Dashboard: Extreme Platform ONE consolidates license, contract, and asset management into a single, intuitive platform, delivering real-time visibility into usage, renewals, support coverage, and device inventory across all sites and product lines. - Integrated Experience: One integrated experience for everyone in an organization, including Network Operations, Security Operations, and related business teams, to access the tools and information they need from a fully customizable workspace. - Simplified licensing: Extreme Platform ONE is backwards compatible with ExtremeCloud IQ and is now bundled with support services to facilitate license to asset tracking. - **Redefine enterprise networking through autonomous operations.** With the introduction of Extreme Agent ONE into our cloud management platform, the Company is moving beyond traditional AI assistants to purpose-built AI agents that can proactively monitor, reason, recommend, and autonomously execute tasks within customer-defined governance frameworks. we expect these innovations to strengthen Extreme Platform ONE by helping customers reduce operational complexity, improve network resilience, and increase IT productivity through continuous, AI-driven automation. - **Provide a differentiated end-to-end cloud networking architecture.** Cloud-managed networking includes cloud-managed services and cloud-managed products, which are largely WLAN access points and Ethernet switches. Cloud management technology has evolved significantly over the past decade. Extreme offers: - Cloud Platform: A robust cloud management platform that delivers visibility, intelligence, and assurance from the network edge to the core, underpinned by AI infrastructure for reasoning, contextual intelligence, and agentic execution. - Cloud Choice: We provide hosting flexibility across a range of options including public, private, and on-premises edge cloud options. Our cloud networking solution is available on all major cloud providers (Amazon Web Services (“AWS”), Google Cloud Platform (“GCP”) and Microsoft Azure). - ExtremeCloud IQ: Our ExtremeCloud IQ offering conforms to ISO/IEC 27001, ISO/IEC 27017 and ISO/IEC 27701 standards for data privacy and protection as set forth by the International Standards Organization (“ISO”), and is CSA STAR certified. - Consumption Model and Commercial Flexibility: We offer a range of financing purchasing options for network related infrastructure. Our value-based subscription tiers provide customers with flexibility to grow, as well as offer pool-able and portable licenses that can be transferred between products (*e.g*., access points and switches) at one fixed price. - **Offer customers flexibility in how and where they choose to deploy their networks.** We leverage the cloud where it makes sense for our customers and provide on-premises solutions where customers need it and we also have a solution for those who want to harness the power of both. Our hybrid approach gives our customers options to adapt the technology to their business. At the same time, all of our solutions have visibility, control and strategic information built in, all tightly integrated with a single view across all of the installed products. Our customers can understand what is going on across their network and applications in real time – who, when, and what is connected to the network, which is critical for bring your own device (“BYOD”) and IoT usage. - **Offers universal platforms for enterprise class switching and wireless infrastructure.** We offer universal platforms which support multiple deployment use cases, providing flexibility and investment protection. - **Universal switches (8000 Series / 7000 Series / 5000 Series / 4000 Series / Industrial and other)** support fabric or traditional networking with a choice of cloud or on-premises (air-gapped or cloud connected) management. - **Universal Wi-Fi 6/6E/7 APs (300/400 Series / 3000 Series / 4000 Series / 5000 series)** support campus or distributed deployments with a choice of cloud or on-premises (air-gapped or cloud-connected) management. - **Universal licensing** with one portable management license for any device and for any type of management. For switches, operating system feature licenses are portable, and bulk activated through our platform. - **Enable a common fabric to simplify and automate the network.** Fabric technologies virtualize the network infrastructure (decoupling network services from physical connectivity) which enables network services to be provisioned faster, with lower likelihood of error. They make the underlying network much easier to design, implement, manage, and troubleshoot. - **Offer a frictionless experience for secure hybrid work.** Our layered security approach is managed from one cloud and secure by design. We offer tightly integrated security with network fabric and infrastructure. - **Extreme Platform ONE Security (Universal ZTNA)** integrates network, application, and device security within a single solution. By combining Cloud Network Access Control (“NAC”) and Zero Trust Network Access (“ZTNA”) into a single, easy-to-use software-as-a-service (“SaaS”) offering, we help customers ensure unified observability, frictionless user experiences and a consistent security policy for applications and devices as well as support secure hybrid work use cases for customers. As the virtual private network (“VPN”) market transitions to ZTNA, the proliferation of individual applications, each with their own policy and dashboard, is adding complexity and expense for enterprise customers. We expect the broadening of our security offering to drive significant traction for our business with growth opportunities. - **Extreme’s unique and highly differentiated network fabric** makes it simple to orchestrate applications and policy across the entire campus, from the core to the wireless edge, and across the wide area network. We bring enhanced security, the ability to segment networks and zero touch, automated provisioning, thus reducing confusion, complexity and the need for additional IT staff. - **End-to-End Portfolio.** Our cloud-based solutions provide visibility, control and strategic intelligence from the edge to the data center, across networks and applications. Our solutions include wired switching, wireless switching, wireless access points, WLAN controllers, routers, and an extensive portfolio of software applications that deliver AI-enhanced access control, network and application analytics, as well as network management. All can be managed, assessed, and controlled from a single pane of glass on premises or from the cloud. - **Provide high-quality insourced customer service and support.** We seek to enhance customer satisfaction and build customer loyalty through high-quality service and support. This includes a wide range of standard support programs to the level of service our customers require, from standard business hours to global 24-hour-a-day, 365-days-a-year real-time responsive support. - **Extend switching and routing technology leadership.** Our technological leadership is achieved by the development of innovative switching, routing and wireless products, the depth and focus of our market experience and our operating systems - the software that runs on all of our networking products. Our products reduce operating expenses for our customers and enable a more flexible and dynamic network environment that will help them meet the upcoming demands of IoT, mobile, and cloud. - **Expand Wi-Fi technology leadership.** Wireless is today’s network access method of choice and every business must deal with scale, density and BYOD challenges. The network edge landscape is changing as the explosion of mobile, IoT devices and now AI agents increase the demand for high-performance, transparent, and always-on wired to wireless edge services. The unified access layer requires distributed intelligent components to ensure that access control and resiliency of business services are available across the entire infrastructure and manageable from a single console. We are at a technology inflection point with the pending migration from Wi-Fi 6 solutions to Wi-Fi 6E and Wi-Fi 7, focused on providing more efficient access to the broad array of connected devices. We believe we have the industry’s broadest 6 GHz indoor and outdoor wireless portfolio. - **Offer actionable insights.** Our network-powered application analytics provide actionable business insights by capturing and analyzing context-based data about the network and applications to deliver meaningful intelligence about applications, users, locations and devices. With an easy to comprehend dashboard, our applications help businesses turn their network into a strategic business asset that helps executives make faster and more effective decisions. - **Expand market penetration by targeting high-growth markets.** Within the campus, we focus on the mobile user, leveraging our automation capabilities and tracking WLAN growth. Our data center approach leverages our product portfolio to address the needs of public and private cloud data center providers. We believe that the cloud networking compound annual growth rate will continue to outpace the compound annual growth rate for on-premises managed networking. Our focus is on expanding our technology foothold in cloud networking to accelerate cloud-based management adoption and subscription-based licensing consumption. - **Leverage and expand multiple distribution channels.** We distribute our products through select distributors, a large number of resellers and system-integrators worldwide, as well as several large strategic partners. We maintain a field sales force to support our channel partners and to sell directly to certain strategic accounts. As an independent networking vendor, we seek to provide products that, when combined with the offerings of our channel partners, create compelling solutions for end users. - **Maintain and extend our strategic relationships.** We have established strategic relationships with a number of industry-leading vendors to provide both increased and enhanced routes to market, to collaboratively develop unique solutions. ### Products Our products and services categories include: - **Cloud Networking Platform:** Core to our product portfolio and providing end-to-end visibility and control from the access edge to the data center is our industry-leading cloud platform and cloud management application, ExtremeCloud IQ. ExtremeCloud IQ is a machine learning (“ML”)/AI powered, wired and wireless cloud network management solution that offers advanced visibility and control over users, devices, and applications. ExtremeCloud IQ is designed to allow customers to keep operational costs low, adjust to customer demand, and deliver robust functionality for provisioning, management, troubleshooting and provide guaranteed data durability to assure access with 100% uptime. ExtremeCloud IQ is available in public, private, or on-premises deployment options that support one goal – to provide customers with maximum flexibility, continuous innovation and consistent user experience. It can be deployed in any major data center environment such as AWS, GCP and Azure, or local private cloud options. The ExtremeCloud IQ application already manages over three million devices and is run from multiple regional data centers, giving customers greater control over the location of their data and adding to the resiliency of the platform. Extreme Platform ONE, made generally available in July 2025, is a bold innovation designed to redefine the cloud networking landscape. This natively integrated platform brings together networking, security, and AI-driven automation into one cohesive solution, aligned with our long-term growth strategy. With simplified licensing and end-to-end visibility, it is designed to unlock new levels of operational efficiency and scalability. We believe the platform's generative, multimodal, and agentic AI capabilities position Extreme Networks as a leader in autonomous network management, creating value for customers and driving competitive advantage in a rapidly evolving market. - **Automation, Analytics, and Security Applications:** Our application portfolio delivers additional analytics, security, access control, and management insights both on-premises and in the cloud. ExtremeCloud IQ – Site Engine extends cloud management to non-cloud native and multi-vendor devices to provide one dashboard view of your entire network that can be managed in the cloud or on-premises. The application provides task automation, access control, granular visibility with real-time analytics and multi-vendor device management. ExtremeCloud IQ Essentials provides three key applications - Wireless Intrusion Prevention System (“WIPS”), location services, and guest management - for ExtremeCloud IQ Pilot license customers at no added cost, enabling organizations to take advantage of an all-in-one platform for wired and wireless management, business insights, location tracking, wireless security, seamless IoT onboarding and guest access through a single user interface. - **Wireless LAN AP:** One of the industry’s broadest and most comprehensive, Extreme’s wireless AP portfolio includes both indoor and outdoor Wi-Fi 7 and prior generation APs. Proven in some of the most demanding environments, ExtremeWireless delivers an exceptional experience for BYOD and mobile users wherever they may roam. Included in that portfolio are our custom stadium and large venue outdoor Wi-Fi 7 APs, which, when combined with ExtremeAnalytics, are the basis of our selection as the Official Wi-Fi Solutions Provider for the National Football League and Major League Baseball. In addition to powering large venues and stadiums, our Extreme APs also deliver flexible and scalable options for highly distributed environments for major companies globally. Our APs allow our customers to purchase universal hardware, starting with our Wi-Fi 7 AP portfolio, and choose the software mode option for the optimal deployment architecture in their environments. Our premier wireless security solution, Extreme AirDefense delivers intrusion detection and prevention capabilities across the wireless portfolio. Recently, we also introduced the first WIPS solution to incorporate support for Bluetooth and Bluetooth Low Energy (“BLE”) visibility and intrusion protection. This includes device location support and change detection, rogue BLE Beacon detection and unsanctioned BLE device detection. - **Wired for Edge, Campus, and Data Center:** Our switching portfolio includes products designed to make every connection effortless by enabling the deployment of high-speed performance at scale for access, high-density, campus, core, and data center environments. Within the Extreme Switching portfolio are Access Edge products offering connection speeds ranging from 100 Megabits per second to 25 Gigabits per second (“Gbps”) – including edge multi-rate 2.5Gbps and 5Gbps capabilities. These switches provide various physical presentations (copper and fiber) along with options to deliver traditional Ethernet or convergence-friendly Power-over-Ethernet (“PoE”), including high-power universal POE consisting of 90W power to support new classes of Ethernet-powered devices. These switching products, combined with our unique fabric capability, deliver automation and hyper-segmentation, as well as features, performance, and reliability required by our customers to deploy, operate and manage converged infrastructure, along with the ability to harden the perimeter of the network infrastructure. Our aggregation/core switches are designed to address the demanding needs of aggregation, top-of-rack, and campus core environments. Delivering 10G, 25G, 40G, 50G, and 100G connectivity with maximum throughput and reliability, these switches provide flexible Ethernet connectivity over a range of interface types and speeds and are available in both fixed and modular configurations. These switching platforms, in conjunction with our advanced operating systems and centralized management software, provide the density, performance, and reliability required to serve in a diverse range of environments, especially where application demands and uptime expectations are mission critical. Our campus switch portfolio also includes next-generation, low-profile, high-density Ethernet switches that empower the creation of versatile always-on campus solutions that are fabric-enabled and 25 to 100 gigabit-ready. The technologies supported by these innovative platforms can also leverage automated network attachment to proactively reduce operational burden and time-to-service. Extreme’s data center switches and routers provide high levels of reliability and throughput - specifically designed to address the exacting demands of high-performance enterprise and cloud data centers. These products are available in both fixed and modular chassis configurations and include a set of advanced features such as redundant management and fabric modules, hot-swappable line cards on our chassis-based platforms, as well as multi-speed stacking of up to 100G and flexible 10/25/40/50/100G port options on our fixed-form platforms, which makes these switches well-suited for enterprise data center environments. Both platform types also provide redundant power supplies and fan trays to ensure high hardware availability. These switches also provide key feature extensions for data centers through technologies that include Virtual Extensible LAN, MPLS/VPLS, and Shortest Path Bridging capabilities. Our industry-first integrated Extreme Fabric Automation simplifies and adds scalability to even the highest performance environments. In addition to these capabilities, our data center switches offer innovative traffic optimization enabling virtual machine mobility via Layer 3 Data Center Interconnect. Our architecture delivers tens of millions of flows for deep visibility and control over users, services, and applications to meet the analytic and policy demands of today’s business applications. - **SD-WAN:** ExtremeCloud SD-WAN is a software-defined wide area networks solution offered as an all-inclusive subscription, which includes hardware, the cloud-based SD-WAN service, support and maintenance, and customer success support. This helps customers reduce total cost of ownership as they deliver quality user experience for applications used in site-to-site and site-to-cloud environments. This solution detects and optimizes applications automatically and can apply performance-based dynamic WAN selection for quality and reliability. Included also are security options such as a built-in zone-based firewall, EdgeSentry (in partnership with Check Point) for cloud-based firewall as a service and other advanced security capabilities, and integration with Secure Web Gateway partners such as Palo Alto Networks, Zscaler, and Symantec. - **Cloud Native Platforms and Applications for Service Providers:** 5G is the first generation of cellular technologies built on cloud-native principles, and most traditional network visibility tools cannot be easily adapted for future use cases like autonomous vehicles or industrial IoT. Because many 5G use cases are still undefined, service providers need a composable solution that provides visibility into highly distributed environments and is flexible enough to be adjusted for specific purposes as they arise, without requiring expensive, time-consuming infrastructure upgrades. Extreme has introduced the 9000 series switches and related software, featuring the Extreme 9920 intelligent network visibility platform built with cloud-native design principles and a composable data pipeline to provide highly scalable traffic aggregation, packet filtering, replication, and advanced network packet processing for analytics tools in distributed network environments. The Extreme Visibility Manager has an intuitive graphical user interface to establish new rule sets and commands for all of Extreme's visibility devices. It provides full visibility into every aspect of the network, from a highly geographically dispersed environment with regions and zones to the services running on the system. - **Universal ZTNA.** ExtremeCloud Universal ZTNA is designed to be the easiest, most complete network access security solution for users everywhere. It is intended to deliver a frictionless user experience and consistent security policy for applications and devices, including IoT. We offer one secure access solution that uses a single identity-based zero trust policy engine for both networks and applications. As a result, customers could have just one solution to secure employees, guests and IoT devices. We offer automated security configuration and enforcement via cloud-managed Universal Devices and unified visualization and reporting for enhanced insight and simplified management. - **Customer Service and Support:** Our customers seek high reliability and maximum uptime for their networks. To that extent, we provide the following service offerings: - **Support services for end-users, resellers and distributors.** We meet the service requirements of our customers and channel partners through our Technical Assistance Centers (“TACs”), located in Morrisville, North Carolina; Salem, New Hampshire; Aurora, Illinois; San Jose, California; Reading, United Kingdom; Penang, Malaysia; Brno, Czech Republic; Bangalore and Chennai, India; Seoul, Korea; and Tokyo, Japan. Our TAC engineers and technicians assist in diagnosing and troubleshooting technical issues regarding customer networks. Development engineers work with the TACs to resolve product functionality issues specific to each customer. - **Premier services.** Premier Support is a proactive, high touch post-sale support service that assists customers in managing their Extreme Networks products and network. All resources and deliverables are designed to manage day-to-day technical needs, provide analysis and recommendations while building strong customer relationships, all focused on the network level. - **Professional services.** We provide consultative services to improve customer productivity in all phases of the network lifecycle – planning, design, implementation, operations and optimization management. Our network architects develop and execute customized software and service-led networking solutions for deployment plans to meet individualized network strategies. These activities may include the management and coordination of the design and network configuration, resource planning, staging, logistics, migration and deployment. We also provide customized training and operational best practices manuals to assist customers in the transition and sustenance of their networks. - **Education.** We offer classes covering a wide range of topics such as installation, configuration, operation, management and optimization – providing customers with the necessary knowledge and experience to successfully deploy and manage our products in various networking environments. Classes may be scheduled and available at numerous locations worldwide. We deliver training using our staff, on-line training classes and authorized training partners. In addition, we make much of our training materials accessible free-of-charge on our internet site for customers and partners to use in self-education. We believe this approach enhances the market’s ability to learn and understand the broad array of advantages of our products. ### Sales, Marketing and Distribution We conduct our sales and marketing activities on a worldwide basis through a channel that utilizes distributors, resellers and our field sales organization. As of June 30, 2026, our worldwide sales and marketing organization consisted of 910 employees. We have domestic sales offices located in five states within the United States and international sales offices located in 26 countries. We sell our products primarily through an ecosystem of channel partners who combine our infinite enterprise vision and product portfolio consisting of cloud-driven applications, wired, wireless, management and analytics software products with their vertical specific offerings to create compelling information technology solutions for end-user customers. We utilize our field sales organization to support our channel partners and to sell directly to certain end-user customers, including some large enterprise and service provider global accounts. ### The details of our sales and distribution channels are as follows: - **Original Equipment Manufacturers (“OEM”) and Strategic Relationships**. We have active alliance, OEM and strategic relationships with Barco NV, Ericsson Enterprise AB, Lenovo, Motorola Solutions, Schneider Electric, and Verizon as well as other global industry technology leaders in which our products are qualified to be included into an overall solution or reference architecture. These tested and validated solutions are then marketed and sold by the alliance, OEM or strategic partners into their specific verticals, market segments and customers as turnkey offerings. - **Distributors**. We have established several key relationships with leading distributors in the electronics and computer networking industries. Each of our distributors primarily resells our products to resellers. The distributors enhance our ability to sell and provide support to resellers who may benefit from the broad service and product fulfillment capabilities offered by these distributors. Extreme maintains distribution agreements with our largest distributors, Westcon Group Inc., TD Synnex Corporation and Jenne Inc. on substantially the same material terms as we generally enter into with each of our distribution partners. Distributors are generally given the right to return a portion of inventory to us for the purpose of stock rotation, to claim rebates for competitive discounts and participate in various cooperative marketing programs to promote the sale of our products and services. - **Resellers**. We rely on many resellers worldwide that sell directly to the end-user customer. Our resellers include regional networking system resellers, resellers who focus on specific vertical markets, value added resellers, systems integrators and wholesale resellers. We provide training and support to our resellers and our resellers generally provide the first level of contact to end-users of our products. Our relationships with resellers are on a non-exclusive basis. Our resellers are not given rights to return inventory and do not automatically participate in any cooperative marketing programs. - **Field Sales**. Our field sales organization is trained to sell solutions, support and develop leads for our resellers and to establish and maintain key accounts and strategic end-user customers. To support these objectives, our field sales force: - Assists end-user customers in finding solutions to complex network system and architecture problems; - Differentiates the features and capabilities of our products from competitive offerings; - Continually monitors and understands the evolving networking needs of enterprise and service provider customers; - Promotes our products and ensures direct contact with current and potential customers; and - Assists our resellers to drive business opportunities to closure. Although we compete in many vertical markets, we have focused on the specific verticals of healthcare, education, retail, manufacturing, government, sports, and entertainment venues. Years of experience and a track record of success in the verticals we serve enable us to address industry-specific problems. ### Customer Profiles Extreme’s customers are organizations facing complex IT challenges and/or undergoing digital transformation. These customers typically operate in verticals such as higher education, healthcare, government (federal, state, local, and education), manufacturing, hospitality, stadiums, and retail. These customers often struggle with constrained resources, talent and skill gaps, and rising operational costs, while also navigating a crowded network infrastructure vendor landscape and ambiguity around emerging technologies like AI. Within the Ethernet Switching and WLAN markets which Extreme serves, we categorize customers into three primary groups based on scale and infrastructure needs: **1. Mid-market customers—**typically with 500 to 999 employees, are regional or national in scope and possess moderate IT complexity and budgets. This segment represents an estimated TAM of $11 billion in 2026. **2. Enterprise customers—**defined as companies with 1,000 or more employees—operate global-scale infrastructures and require advanced security and compliance capabilities, representing a TAM of approximately $27 billion in 2026. **3. Service providers—**which include organizations delivering voice, data, or internet services to consumers and businesses, vary widely in sizes. This segment accounts for a TAM of approximately $2 billion in 2026. These classifications enable the company to tailor its go-to-market strategies and product offerings to better meet the distinct needs of each segment. From a network infrastructure standpoint, these types of organizations require robust networking solutions within the data center, as well as access and edge switching. These same customers are deploying enterprise-wide or campus Wi-Fi solutions. Security is a pervasive concern, and many are implementing ZTNA technology to secure their end-to-end network. They are also seeking solutions that make deployment and on-going management of the network not only secure but easier, smarter and more intuitive, thus they are seeking solutions including data center fabric automation, cloud/hybrid network management, and SD-WAN. Their IT environments are often a mix of legacy and modern systems, and they seek integrated, scalable solutions to simplify operations and enhance security. The typical decision-makers within these organizations include CIOs, VPs of IT, Directors of Infrastructure, Network Architects, CISOs, CFOs, and IT procurement specialists. Their top priorities revolve around reducing cost, risk, and complexity, achieving operational excellence, improving security posture, ensuring uptime, and maintaining compliance. These customers range from cloud-curious to cloud-mature and are actively exploring AI and automation to drive innovation and efficiency. ### International sales International sales are an important portion of our business. In fiscal 2026, sales to customers outside of the United States accounted for 55% of our consolidated net revenues, compared to 52% in fiscal 2025 and 48% in fiscal 2024. These sales are conducted primarily through foreign-based distributors and resellers managed by our worldwide sales organization. In addition, we have direct sales to end-user customers, including large global accounts. The primary markets for sales outside of the United States are countries in Europe and Asia, as well as Canada, Mexico, Central America and South America. We operate in one segment, the development and marketing of network infrastructure equipment and related software and subscriptions. Information concerning revenues, results of operations and revenues by geographic area is set forth under Item 7, “Management's Discussion and Analysis of Financial Condition and Results of Operations.” Information on risks attendant to our foreign operations is set forth below in Item 1A. “Risk Factors.” ### Marketing We continue to develop and execute a number of marketing programs to support the sale and distribution of our products by communicating the value of our solutions to our existing and potential customers, our distribution channels, our resellers and our technology alliance partners. Our marketing efforts include participation in industry tradeshows, conferences and seminars, publication of technical and educational articles in industry journals, communication across social media channels, frequent updates to our publicly available website, promotions, web-based training courses, advertising, analyst relations and public relations. We also submit our products for independent product testing and evaluation. Extreme participates in numerous industry analyst recognitions and placements including Gartner Magic Quadrants, Gartner Critical Capabilities, Gartner Peer Insights, Gartner Customer Choice, Forrester Waves and IDC MarketScapes. ### Backlog Our products are sold based on standard purchase orders and backlog represents confirmed orders with a purchase order for products to be fulfilled and billed to customers with approved credit status. Actual shipments of products depend on the then-current capacity of our contract manufacturers and the availability of materials and components from our vendors. Although, we believe the orders included in the backlog are firm, all orders are subject to possible rescheduling or cancellations by customers, which we may elect to allow on an exception basis. Therefore, we do not believe our backlog, as of any particular date is necessarily indicative of actual revenues for any future period. Our product backlog at June 30, 2026, net of anticipated back-end rebates for distributor sales, was $51.8 million, compared to $72.3 million at June 30, 2025. ### Seasonality Like many of our competitors, we historically have experienced seasonal fluctuations in customer spending patterns, which generally adversely affect our first and third fiscal quarters. This pattern should not be relied upon or be considered indicative of our future performance, as it has varied in the past. ### Manufacturing We utilize a global sourcing strategy that emphasizes procurement of materials and product manufacturing in competitive geographies. However, this strategy continues to face challenges from global supply chain disruptions, trade policy changes, and tariff uncertainties that impact cost, availability, and delivery timelines. Recent geopolitical tensions, including ongoing conflicts that have elevated fuel and transportation costs, further compound these challenges and impact the overall economics of our supply chain. We rely upon original design manufacturers (“ODM”), such as Alpha Networks, Inc., Lite-On Technology Corporation, Quanta Computer Inc., Senao Networks, Inc., Sercomm Corporation and Wistron Neweb Corporation to manufacture, support and ship our products, and therefore are exposed to risks associated with their businesses, financial condition, and geopolitical conflict in geographies in which they operate. Our arrangements with these manufacturing partners generally provide for quality, cost, and delivery requirements, as well as manufacturing process terms, such as continuity of supply; inventory management; flexible capacity, quality, and cost management; oversight of manufacturing; and conditions for use of our intellectual property that allow us to adjust more quickly to changing end-customer demand. We also leverage and depend on the strong Environmental, Social and Governance policies and standards of our manufacturing partners. The ODM manufacturing process uses automated testing equipment and burn-in procedures, as well as comprehensive inspection, testing, and statistical process controls, which are designed to help ensure the quality and reliability of our products. To mitigate security risks associated with conducting business across our interconnected supply chain we have a *Supply Chain* *and Information Security Policy* and related procedures for communicating our requirements to suppliers and conducting annual compliance assessments. Additionally, we have launched new product features such as Secure Boot, which are being designed to provide additional integrity assurance of the firmware and software running on our hardware platform by establishing an encrypted key-based chain-of-trust relationship in the boot process. The manufacturing processes and procedures are generally certified to ISO 9001 standards. The manufacturing process and material supply chains are flexible enough to allow us to mitigate, at least in part, risks arising from geopolitical conflicts that impact cost and delivery. We use a collaborative sales and operations planning forecast of expected demand based upon historical trends and analyses from our Sales and Product Management functions as adjusted for overall market conditions. Demand Planning, Supply Operations and our Distributors work closely using a ‘continuous planning’ methodology as part of our Sales and Operations Execution process to determine and position our material requirements to support customer demand. Our manufacturing partners procure the components needed to build our products based on our demand forecasts that cover material lead times. This allows us to leverage the expertise and purchasing power of our manufacturing partners. Our products rely on key components, including merchant silicon, integrated circuit components and power supplies purchased from a limited number of suppliers, including certain sole source providers. The current market environment continues to present persistent challenges. Extended lead times remain prevalent across multiple component categories, tariffs and trade disruptions show no signs of abatement, volatile commodity pricing shows sustained upward pressure, elevated energy and transportation costs driven by geopolitical instability persist, and component availability constraints continue to challenge the broader supply ecosystem. We continue to learn from the evolving global supply chain and build upon innovative strategies to enhance resilience and agility into our supply chain. We are utilizing technology brought forward from our ongoing Digital Transformation project, which has entailed integrating digital technology including artificial intelligence and advanced analytics tools, into all areas of our business, changing how we operate and deliver value to customers. These AI tools, systems and processes have given us enhanced visibility and control over inventory, improved demand forecasting accuracy, and greater ability to navigate complex supply chain scenarios. Collaborative partnerships with our ODMs and diversified sourcing strategies have also emerged, fostering greater flexibility and risk mitigation. Our product development efforts also depend upon continued collaboration with our key suppliers, including our merchant silicon vendors such as Broadcom, Inc.. As we develop our product roadmap and continue to expand our relationships with these and other merchant silicon vendors, it is critical that we work in tandem with our key vendors to ensure that their silicon includes improved features and that our products take advantage of such improved features. Further information on risks relating to our inventory forecasting and supply chain is set forth below in Item 1A. “Risk Factors.” We believe our sourcing and manufacturing strategy allows us to adjust quickly to changes in market demand, working with our ODM suppliers and developing direct relationships with key component suppliers to support the backlog. We continue to focus on optimizing product availability through multi-sourcing, visibility and control of key supply lines, rationalizing our supply chain, outsourcing or virtualizing certain activities, and consolidating distribution sites and service logistics partners. These efforts also include process optimization initiatives, such as vendor managed inventory, and other operational models and strategies designed to drive improved efficiencies in our sourcing, production, logistics and fulfillment. ### Research and Development The success of our products to date is due in large part to our focus on research and development. We believe that continued success in the marketplace relies on our ability to regularly bring to the market new and enhanced products employing leading-edge technology that provide business solutions affordably, securely, and effortlessly. Accordingly, we are undertaking development efforts with an emphasis on increasing the scalability, reliability, usability, and security while innovating our user and buyer experience reducing complexity and the overall network operating costs of customers. Our product research and development activities focus on solving the needs of customers in the enterprise campus edge and core by providing a unified wired, wireless, and SD-WAN cloud-driven network, enabling secure access from edge to public, hybrid, or private clouds in targeted verticals. Current activities include the continuing development of our innovative switching technology aimed at giving our customers flexibility in how they deploy, connect to the cloud, monitor, and configure instantly saving time and money. Our ongoing research activities cover a broad range of areas, including cloud native technologies and solutions, generative AI, agentic AI with a focus on Agent ONE autonomous network automation, network security, identity management, wired and wireless networking, switching, and routing, open standards interfaces, software defined networks, campus, and data center fabrics. In fiscal year 2026, we significantly expanded our autonomous AI focus, advancing Agent ONE capabilities to deliver self-driving network operations across our entire platform. In addition, we continue to invest in ML/AI technology solutions targeting autonomous anomaly detection and remediation, self-healing network infrastructure, Cloud Wi-Fi optimization, IoT anomaly detection, and intelligent user and application recommendations. We continue to enhance the functionality of our network operating systems which have been designed to provide high reliability, scale, and availability. This allows us to leverage a common operating system across different hardware and network chipsets. As of June 30, 2026, our research and development organization consisted of 1,050 employees. Research and development efforts are conducted in several of our locations, including Morrisville, North Carolina; San Jose, California; Salem, New Hampshire; Toronto, Canada; Hangzhou, China; and Bangalore and Chennai, India. ### Intellectual Property We rely on a combination of patent, copyright, trademark and trade secret laws and restrictions on disclosure to protect our intellectual property rights. As of June 30, 2026, we had 612 issued patents in the United States and 394 patents outside of the United States. The expiration dates of our issued patents in the United States range from calendar years 2026 to 2044. Although we have patent applications pending, there can be no assurance that patents will be issued from pending applications or that claims allowed on any future patents will be sufficiently broad to protect our technology. As of June 30, 2026, we had 27 registered trademarks in the United States and 340 registered trademarks outside of the United States. We enter into confidentiality, inventions assignment or license agreements with our employees, consultants and other third parties with whom we do business, and control access to, and distribution of, our software, documentation and other proprietary information. In addition, we provide our software products to end-user customers primarily under “clickwrap” license agreements. These agreements are not negotiated with or signed by the licensee, and thus these agreements may not be enforceable in some jurisdictions. Despite our efforts to protect our proprietary rights, unauthorized parties may attempt to copy or otherwise obtain and use our products or technology, particularly in foreign countries where the laws may not protect our proprietary rights as fully as in the United States. ### Competition The market for network switches, routers and software (including analytics), which is part of the broader market for networking equipment, is extremely competitive and characterized by rapid technological progress, frequent new product introductions, changes in customer requirements and evolving industry standards. We believe the principal competitive factors in this market are: - expertise and familiarity with network protocols, network switching/routing/wireless and network management; - consolidation in the market of networking solution providers; - robust, cloud-driven options that reduce the cost of acquisition, provisioning, and ongoing management of network management; - expertise and familiarity with application analytics software; - expertise with network operations and management software; - expertise in machine learning and artificial intelligence; - product performance, features, functionality and reliability; - price/performance characteristics; - timeliness of new product introductions; - adoption of emerging industry standards; - customer service and support; - size and scope of distribution network; - brand name; - breadth of product offering; - access to customers; and - size of installed customer base. We believe we compete with our competitors with respect to many of the foregoing factors. However, the market for network switching solutions is dominated by a few large companies, particularly Cisco Systems, Inc., Hewlett Packard Enterprise Company, and Huawei Technologies Co. Ltd. To a lesser extent, Extreme competes with products and solutions from Arista Networks Inc., RUCKUS Networks, Inc., Fortinet, Inc., and Ubiquiti Inc. Most of these competitors have greater name recognition, larger customer bases, broader product lines and substantially greater financial, technical, sales, marketing and other resources. We expect to face increased competition from both traditional networking solutions companies and cloud platform companies offering Infrastructure-as-a-Service (“IaaS”) and Platform-as-a-Service (“PaaS”) products to enterprise customers. In that regard, we expect to face increased competition from certain cloud computing companies such as Amazon, Microsoft, and Google providing a cloud-based platform of data center compute and networking services for enterprise customers. We believe Extreme is uniquely positioned to address its overarching vision of the future, the Infinite Enterprise, with its bet on industry-leading cloud solutions, automation and AI. Although we believe that our solutions and strategy will improve our ability to meet the needs of our current and potential customers, we cannot guarantee future success. ### Restructuring and Impairment #### Fiscal year 2026 During fiscal 2026, the Company continued to execute on the restructuring plans initiated in prior years and completed all the plans by the end of fiscal year. #### Fiscal year 2025 During fiscal 2025, the Company continued to execute the restructuring plans initiated in prior years. #### Fiscal year 2024 During fiscal year 2024, the Company initiated various restructuring plans, including the “Q1 2024”, “Q2 2024”, and “Q3 2024” Plans, to reorganize and rebalance the workforce to create greater efficiency and improve execution, in alignment with the Company's business and strategic priorities, reduce its ongoing operating expenses, and focus its sales and marketing efforts on specific geographies and industry segments with higher growth opportunities. The Q1 2024 Plan was completed in fiscal year 2024. ### Human Capital At Extreme, we manage our human capital guided by our core values of Candor, Transparency, Curiosity, Teamwork, Ownership, and Inclusion. We apply these principles to talent acquisition and management, compensation and benefits, and inclusion and engagement. As of June 30, 2026, we employed 2,894 people. Of these, 31.4% work in sales and marketing, 36.3% in research and development, 5.7% in operations, 14.4% in customer support and services and 12.2% in finance and administration. These employees were located worldwide, with 42.0% located in the United States, 9.5% in other locations in the Americas, 32.0% in the Asia Pacific region (“APAC”), which includes India, and 16.5% in the regions of Europe, Middle East and Africa (“EMEA”). None of our U.S. employees are subject to a collective bargaining agreement. In certain foreign jurisdictions, where required by local law or customs, some of our employees are represented by local workers’ councils and/or industry collective bargaining agreements. We consider our relationship with our employees to be good, and we have not experienced any work stoppages due to labor disagreements. *Talent Acquisition and Development.* We strive to attract and retain the most qualified employees for each role within the Company. We on-board new employees through the New Hire Orientation and encourage skill development throughout the employee journey utilizing various role-specific training programs, career development tools, manager training, coaching, and mentorship. We continue to develop our employees, for example, by providing a subscription to LinkedIn Learning for all employees. We provide regular feedback to our employees with performance management reviews. *Compensation and Benefits.* Our compensation philosophy is to offer a competitive compensation package designed to reward achievement of the Company’s goals. Our short-term bonus plan is designed to motivate employees to meet half-year goals, and our employee stock purchase plan and grants of restricted stock units to eligible employees reward longer-term stock price appreciation. Our U.S. benefits plan includes health benefits, life and disability insurance, various voluntary insurances, flexible time off and leave programs, an employee assistance plan, an educational assistance policy, and a 401(k) plan with a competitive employer match. Our international benefits plans are competitive locally and generally provide similar benefits. *Inclusion and Engagement.* We believe we gain valuable perspective that drives better decision making when we include all voices. To foster an inclusive environment, we support several employee-led employee resource groups, including Abilities Alliance (employees with disabilities), API (Asian Pacific Islanders), APEX (Aspiring Professionals @ Extreme), Black @ Extreme (Black/African American), LaRaza (Hispanic), Maitri (employees in India), Parents at Extreme Networks, Pride Alliance (LGBTQ+), Veterans Council, and Women in Networking. Our employee resource groups are open to all and provide regular programming to create connections between employees and enhance engagement within Extreme. To further build employee engagement, we request feedback from employees through our annual ECHO (Employees Communicate Honest Opinions) survey, an avenue for leadership to listen and then take action based on the feedback received. We also promote an open-door policy and encourage employees to provide feedback to leadership on an informal basis. ### Organization We were incorporated in California in May 1996 and reincorporated in Delaware in March 1999. Our corporate headquarters are located at 2121 RDU Center Drive, Suite 300, Morrisville, NC 27560 and our telephone number is (408) 579-2800. We have several corporate offices in the United States and in international locations. We electronically file our Securities and Exchange Commission (“SEC”) disclosure reports with the SEC and they are available free of charge at both www.sec.gov and at our website www.extremenetworks.com. Our corporate governance guidelines, the charters of our Audit Committee, our Compensation Committee, our Nominating and Corporate Governance Committee and our Code of Business Conduct and Ethics policy (including code of ethics provisions that apply to our principal executive officer, principal financial officer, controller and senior financial officers) are available on the Investor Relations section of our website at investor.extremenetworks.com under “Governance.” These items are also available to any stockholder who requests them by calling (408) 579-2800. ## Risk factors As filed, 98,758 characters. We face a number of risks and uncertainties which may have a material and adverse effect on our business, operations, industry, financial condition, operating results or future financial performance. While we believe we have identified and discussed below the material risk factors affecting our business, there may be additional risks and uncertainties that are not presently known or that are not currently believed to be significant that may materially adversely affect our business, financial condition, operating results, and future financial performance. ### Risks Related to Our Business, Operations, and Industry ***Geopolitical changes are creating uncertainty regarding economic and trade matters, potentially leading to adverse general economic conditions that may adversely impact our business, financial condition, and operating results.*** The ongoing unpredictability of U.S. economic and trade policies, including tariff actions and related government measures, continues to create significant uncertainty in the world economy, including inflationary pressures. In addition, various military actions, armed conflicts, and geopolitical tensions, including the Russia-Ukraine conflict, the Israel-Hamas conflict and related regional instability in the Middle East, and military actions involving the United States and Iran, have increased global uncertainty. Potential impacts of these policies and tensions could include decreased demand for our products, increased costs to us, supply chain limitations, and volatility of our stock price. A substantial portion of our business depends on the demand for enterprise-scale networking, which, in turn, is impacted by the overall economic health of our current and prospective end-customers. Volatility in the global economic market or other global or regional economic uncertainty, inflation, interest rate fluctuations, foreign exchange instability, limited availability of credit, a reduction in business confidence and activity, reductions in government spending, and other difficulties may affect one or more of the industries to which we sell our products and services. If economic conditions continue to be uncertain, many existing and prospective end-customers may delay or reduce their IT spending. This could result in reductions in sales of our products and services, longer sales cycles, slower adoption of new technologies, and increased price competition. While we have diversified our manufacturing presence and limited our reliance on imports from China, tariffs have been imposed and threaten to be increased on other countries where our products are manufactured, such as Taiwan, Vietnam, Thailand, and the Philippines. A majority of our products are currently excluded from the bulk of these tariffs, though we cannot predict that will continue to be the case. Any imposition of tariffs or new export controls affecting imports of our products to the United States may result in increased costs and potential delays. Additionally, global trade partners may continue to respond to U.S. tariffs with retaliatory measures. For instance, China has, in the past, made threats of restricting exports of critical raw materials, including rare earth minerals essential to several of our components. Such actions could disrupt our supply chain, elevate input costs, create delays as alternative suppliers are sought, and undermine the competitiveness of our offerings. Similarly, other countries could impose retaliatory tariffs against American imports, which could potentially increase the cost of our products to customers in those countries, making our products less competitive. Any one of these impacts, or the aggregate impact of them, could adversely affect our business, financial condition, and operating results. ***Intense competition and consolidation in the market for networking equipment and management solutions could prevent us from increasing revenues.*** The market for network switches, routers and software (including analytics) is intensely competitive and dominated primarily by Cisco Systems Inc., Hewlett Packard Enterprise Company, and Huawei Technologies Co. Ltd. To a lesser extent, Extreme competes with products and solutions from Arista Networks, Inc., RUCKUS Networks, Fortinet, Inc., and Ubiquiti Inc. Most of our competitors have greater name recognition, larger customer bases, broader product lines and substantially greater financial, technical, sales, marketing and other resources. As a result, these competitors are able to devote greater resources to the development, promotion, sale and support of their products. In addition, they have larger distribution channels, stronger brand names, access to more customers, a larger installed customer base, and a greater ability to make attractive offers to channel partners and customers than we do. Further, many of our competitors have made substantial investments in hardware networking capabilities and offerings as well as software and AI functionality to run and manage the networks. These competitors may be able to gain market share by leveraging their investments to attract customers at lower prices or with greater synergies. The pricing policies of our competitors impact the overall demand for our products and services. Some of our competitors are capable of operating at significant losses for extended periods of time or otherwise offer competitive products at lower prices, increasing pricing pressure on our products and services. If we do not maintain competitive pricing, the demand for our products and services, as well as our market share, may decline. From time to time, we may lower the prices of our products and services in response to competitive pressure. When this happens, if we are unable to reduce our component costs or improve operating efficiencies, our revenues and gross margins will be adversely affected. There has been a trend toward industry consolidation in our markets for several years, and we expect this trend to continue as companies attempt to strengthen or hold their market positions in an evolving industry and as companies are acquired or are unable to continue operations. As competitors merge or acquire additional lines of business, their expanded resources may make competition more difficult. In addition, companies that are strategic alliance partners in some areas of our business may acquire or form alliances with our competitors, thereby reducing their business with us. We believe industry consolidation may result in stronger competitors that are better able to compete as sole-source vendors for customers. This could lead to a loss of market share and revenue for us. Furthermore, particularly in the service provider market, rapid consolidation will lead to fewer customers, with the effect that loss of a major customer could have a material impact on results not anticipated in a customer marketplace composed of more numerous participants. We may also face increased competition from traditional networking solutions companies, companies in adjacent industries such as information security moving into networking, and cloud hyperscalers offering Infrastructure as a Service and Platform as a Service products to enterprise customers. In particular, AWS, Microsoft Azure, and GCP may provide enterprise customers with a cloud-based platform of data center computing and networking services that could compete with our services and adversely impact our market share and revenue. In addition, AI software vendors and platforms could leverage their AI model capabilities, integrations, and agentic workflows to address network-centric use cases that compete with traditional network management solutions. If these technologies enable customers to manage, analyze, and operate network infrastructure through AI-enabled interfaces, they could disrupt portions of the networking industry and adversely affect our competitive position, revenue, and growth prospects. One of our key differentiators is the quality of our support and services. Our failure to continue to provide high-quality support and services could materially adversely affect our business, financial condition, operating results, and future growth prospects. ***Supply chain issues such as concentration of suppliers and manufacturing partners, supplier disruptions, shipping delays, material or components shortages, quality control, regulatory impacts, and inability to reduce manufacturing costs could harm our business, financial condition, and operating results.*** We primarily rely on our manufacturing partners Alpha Networks, Inc., Senao Networks, Inc., Wistron Neweb Corporation, Sercomm Corporation, Quanta Computer Inc., Lite-On Technology Corporation, and select other partners to manufacture our products. In addition, we currently purchase some key components used in the manufacturing of our products from single or limited sources and are dependent upon supply from these sources to meet our needs. Our top six suppliers accounted for a significant portion of our purchases during the year. Given the concentration of our supply chain, particularly with certain sole or limited source providers, any significant disruption to any of the key suppliers or a termination of a relationship could temporarily impact our operations and our ability to meet customer orders. Because we may represent a relatively small portion of the overall business of certain suppliers or manufacturing partners, our orders may not receive priority in times of constrained capacity, which could limit our ability to obtain sufficient product or components. Such disruptions could be caused by natural disasters, public health emergencies such as pandemics, business interruption related to financial or operational factors, cyberattacks, geopolitical events such as the threat of political or military actions, energy constraints, regulatory constraints, labor or raw materials shortages, component price increases, quality issues, transportation or shipping delays, tariffs or other trade restrictions, or other events. Certain semiconductor components used in our products are manufactured in regions that are subject to heightened geopolitical risk. For example, a significant portion of the world’s advanced semiconductor manufacturing capacity is located in Taiwan, and any military conflict, blockade, trade disruption, or other instability affecting the region could further constrain component availability, increase costs, and adversely affect our ability to manufacture and deliver products. We have experienced in the past, and continue to experience, challenges obtaining components such as semiconductor chips due to high demand or limited supply. In particular, we rely on certain memory and semiconductor components that have experienced supply constraints, reduced production capacity, and significant price volatility as suppliers shift to newer technologies, resulting in increased costs, longer lead times, and potential allocation limitations that could adversely affect our ability to manufacture and deliver products. Some vendors are reallocating raw materials and production capacity away from enterprise-grade components toward more advanced technologies. For example, certain manufacturers have reduced or discontinued production of certain older-generation memory chips in order to devote capacity to newer, higher-demand memory and AI-related components. These disruptions could result in extended lead times, higher overall costs, expedited shipping expenses, component shortages or allocations, and delayed product introductions. Additional factors that may impact costs and availability include energy, raw material, and transportation costs. Our ability to deliver products to customers also depends on global transportation and logistics networks that are subject to disruption from factors such as labor disputes, port congestion, geopolitical events, natural disasters, severe weather, and other factors beyond our control. Disruptions to these transportation and logistics networks could result in shipping delays, increased freight and logistics costs, reduced product availability, and delays in fulfilling customer orders. Climate change may exacerbate the frequency or severity of certain weather-related and natural disaster events affecting our suppliers, manufacturing partners, transportation networks, and other aspects of our supply chain. While we maintain strong relationships with our manufacturing partners and suppliers, our agreements with them are generally of limited duration and pricing, quality, and volume commitments are negotiated on a recurring basis. Manufacturing partners and suppliers may be unable or unwilling to renew agreements with consistent terms, and could materially increase prices (including increases related to inflationary pressures) or reduce quantity, quality, volume, or service level standards. We may not be able to pass along increased costs to our customers, which could negatively impact gross margin. Reductions in quantity or quality of finished product could decrease the amount of product for sale and could negatively impact the Company’s operating results. Additionally, our operations are materially dependent upon the continued market acceptance and quality of these manufacturers’ products and their ability to continue to manufacture products that are competitive and comply with laws or our requirements relating to environmental and efficiency standards. Our inability to obtain products from one or more of these suppliers or a decline in market acceptance of these suppliers’ products could harm our reputation and make our products less competitive. As part of our cost-reduction efforts, we will need to realize lower per unit product costs from our manufacturing partners by means of volume efficiencies and the utilization of manufacturing sites in lower-cost geographies. However, we cannot be certain when or if such price reductions will occur, particularly in light of supply chain disruptions and inflationary pressures. The failure to obtain such price reductions would materially adversely affect our gross margin and operating results. Qualifying new suppliers to compensate for such shortages, delays, poor quality, increased costs, or other concerns may be time-consuming and costly and may increase the likelihood of errors in design or production as replacement suppliers may not meet the quality requirements of our customers, resulting in harm to our reputation and making our products less competitive. The Company actively works to reduce exposure to supply chain issues such as these, but is unable to completely eliminate them. If we are unable to mitigate these effects, this could materially adversely affect our business, financial condition, operating results, and future financial performance. ***System security risks, data breaches, cyberattacks, and other security incidents have occurred in the past and may occur in the future, potentially compromising our proprietary information, disrupting our internal operations, impacting services to customers, and harming public perception of our products, which could materially adversely affect our business, financial condition, operating results, and future growth prospects.*** In the ordinary course of business, we provide cloud-based services and store data, including personally identifiable information, as well as proprietary business information belonging to our business (such as trade secrets) and belonging to our customers, suppliers and business partners. We store such data on our computer systems, hardware, software, technology infrastructure and online sites and networks for both internal and external operations that are critical to our business (collectively, “IT Systems”). In addition, we store information through cloud-based services that may be hosted by third parties and in data center infrastructure maintained by third parties. We are also increasingly dependent on third-party service providers, including software-as-a-service providers and other vendors, for critical aspects of our operations. These providers may have short operating histories, fewer resources, or less mature security programs, which could increase the risk of service disruptions, security incidents, or operational failures affecting our business. We have experienced security incidents in the past, including incidents involving social engineering and unauthorized access to systems or information, and may experience similar or more significant incidents in the future. For example, this year, a threat actor was able to obtain temporary access to certain employee accounts through vishing. The non-material incident was contained, there was no impact on the functionality of our products and services, and we promptly engaged outside cybersecurity experts and notified law enforcement. We face numerous and evolving additional cybersecurity risks that threaten the confidentiality, integrity and availability of our IT Systems and data. These threats come from diverse threat actors, such as state-sponsored organizations, opportunistic hackers and hacktivists, as well as through diverse attack vectors, such as social engineering/phishing, malware (including ransomware), technological error, and as a result of bugs, misconfigurations or exploited vulnerabilities in software or hardware, including vulnerabilities in commercial software that is integrated into our (or our suppliers’ or service providers’) IT Systems, products or services. Usage of “legacy” products that have been determined to have reached an end-of-life engineering status but will continue to operate for a limited amount of time may subject us or our customers to vulnerabilities. Increasingly, companies, including us, are subject to a variety of attacks on their networks and/or cloud-based services on an ongoing basis. Geopolitical tensions and military conflicts may further increase the frequency and sophistication of cyberattacks, espionage, and other hostile activities directed at private-sector organizations. Additionally, any integration of AI in our or any third party’s operations, products, or services is expected to pose new or unknown cybersecurity risks and challenges. The number of sophisticated attacks continues to increase on a global scale in frequency and magnitude, and with the availability to bad actors of AI to assist them in perpetrating these attacks, we expect the speed and complexity of these attacks to continue to escalate. Attacks could include supply chain attacks targeting our suppliers and attempts to penetrate our systems or disrupt our services directly. In some cases, sophisticated hardware, operating system software, and software applications and services that we produce or procure from third parties may contain vulnerabilities in design or manufacture or security defects that could allow network intrusion or unexpectedly interfere with the operation of our systems, products or services we provide to customers. In addition, outages, disruptions, or security incidents affecting our services or those of our third-party providers could result in our failure to meet service level commitments, which may require us to provide service credits, refunds, or other remedies to customers, and could expose us to contractual liability. Further, employee error, malfeasance, or other disruptions can result in a security or data breach. Despite our security measures, we may not be able to effectively detect, prevent, or protect against or otherwise mitigate losses from all cyberattacks or prevent all security or data breaches. There can also be no assurance that our cybersecurity risk management program and processes, including our policies, controls, or procedures, will be fully implemented, complied with, or effective in protecting our IT Systems and data. Because the techniques and tools used by bad actors, many of whom are highly sophisticated and well-funded, to access or sabotage networks change frequently and generally are not recognized until after they are used, we may be unable to anticipate or immediately detect and remediate these techniques. Any such breach could compromise our networks, products, or cloud-based services by creating system disruptions, slowdowns or even shutdowns, and exploiting security vulnerabilities of our products, services, and the information stored as part of our operations could be accessed, publicly disclosed, lost or stolen. Remote and hybrid working arrangements at our company (and at many third-party providers) also increase cybersecurity risks due to the challenges associated with managing remote computing assets and security vulnerabilities that are present in many non-corporate and home networks. Additionally, because our products and services are integrated with our customers’ systems and processes, any circumvention or failure of our cybersecurity defenses or measures could compromise the confidentiality, integrity, and availability of our customers’ own IT Systems and/or our customers’ proprietary or other sensitive information. Any adverse impact to the availability, integrity, or confidentiality of our IT Systems, including any actual or perceived breach of network security involving our products, network, or the network of a customer of our networking products, regardless of whether the breach is attributable to our products, could harm the market perception of the effectiveness or security of our products. This could impede our sales efforts and impact our market share and future revenue. Such events require significant management attention and resources, impacting our expenses and resources available to commit to other efforts. In addition, the economic costs to us to eliminate, mitigate, or recover from, or remediate cyber or other security problems, such as bugs, viruses, worms, ransomware or other malware, and security vulnerabilities could be significant and may be difficult to anticipate or measure. Further, this could result in legal claims or proceedings (such as class actions), regulatory investigations and enforcement actions, fines and penalties. We cannot guarantee that any costs and liabilities incurred in relation to an attack or incident will be covered by our existing insurance policies or that applicable insurance will be available to us in the future on economically reasonable terms or at all. Any or all of the foregoing could materially adversely affect our business, operating results, and financial condition. ***If we fail to anticipate technological shifts, market needs and opportunities, and fail to develop products, product enhancements and business strategies that meet those technological shifts, needs and opportunities in a timely manner or if they do not gain market acceptance, we may not be able to compete effectively and our ability to generate revenues will suffer.*** The markets for our products are constantly evolving and characterized by rapid technological change, frequent product introductions, changes in customer requirements, evolving industry standards, and continuous pricing pressures. For example, cloud-based network management is among the fastest growing market categories within the networking industry. Our success may be impacted by our ability to provide cloud-based networking solutions that address the needs of our customers more effectively and economically than those of other competitors or existing technologies. If the cloud-based network management market does not develop in the way we anticipate, if our solutions do not offer significant benefits compared to competing legacy products, if end customers do not recognize the benefits that our solutions provide, or if we are unable to successfully execute on the transition to, and customer adoption of, our cloud-based networking solutions and related subscription offerings, then our growth prospects, including our ability to grow our subscription revenue, could be adversely affected. Because a portion of our revenues from cloud-based or subscription offerings is recognized over time, changes in customer bookings, renewals, or consumption levels may not be immediately reflected in our reported revenue, which could reduce visibility into the underlying performance of our business. If we are unsuccessful in integrating AI into the functionality of our products and achieving customer adoption of our AI-powered platform, our revenue growth could be limited. We may also face challenges accurately forecasting customer renewal rates, conversion rates from on-premises to cloud offerings, and levels of customer usage or consumption, which could result in volatility in our operating results. Our ability to grow subscription revenue also depends on our ability to attract new subscribers, retain existing customers, expand adoption of subscription and cloud offerings, and maintain favorable renewal and attach rates, any of which may be adversely affected by competition, customer budget constraints, pricing pressures, or changes in customer preferences. When we announce new products or product enhancements that have the potential to replace or shorten the life cycle of our existing products, customers may defer or cancel orders for our existing products; in addition, ending sales of existing products may cause customers to cancel or defer orders for our existing products. These actions could have a material adverse effect on our operating results by unexpectedly decreasing sales, increasing inventory levels of older products and exposing us to greater risk of product obsolescence. We cannot guarantee that we will be able to anticipate future technological shifts, market needs and opportunities or be able to develop new products, product enhancements and business strategies to meet such technological shifts, needs or opportunities in a timely manner or at all. If we fail to anticipate market requirements or opportunities or fail to develop and introduce new products, product enhancements or business strategies to meet those requirements or opportunities in a timely manner, it could cause us to lose customers, and such failure could substantially decrease or delay market acceptance and sales of our present and future products and services. Even if we are able to anticipate, develop, and commercially introduce new products and enhancements, we cannot assure that new products or enhancements will achieve widespread market acceptance. Any or all of the foregoing could materially adversely affect our business, financial condition, and operating results. ***We depend upon international sales for a significant portion of our revenues, which imposes a number of risks on our business.*** International sales constitute a significant portion of our net revenues. Our ability to grow will depend in part on the expansion of international sales. There are a number of risks arising from our international business, including: - the payment of operating expenses in local currencies, which exposes us to risks of currency fluctuations; - fluctuations in local economies which impact demand; - import tariffs imposed by the United States and the possibility of reciprocal tariffs by foreign countries; - compliance with trade compliance laws and regulations, including restrictions on trade with embargoed or sanctioned countries or with denied parties, and rules related to the export of encryption technology; - differing privacy regulations, data localization requirements, and restrictions on cross-border data transfers; - compliance with U.S. laws and regulations pertaining to the sale and distribution of products to customers in foreign countries, including anti-corruption laws such as the Foreign Corrupt Practices Act (“FCPA”) and the U.K. Bribery Act 2010; - compliance with regulatory requirements of foreign countries, including compliance with rapidly evolving environmental regulations; - difficulty in conducting due diligence with respect to business partners in certain international markets; - reduced or limited protection of intellectual property rights, particularly in jurisdictions that have less developed intellectual property regimes, such as China and India; - difficulties in managing operations across disparate geographic areas; - longer accounts receivable collection cycles; - higher credit risks requiring cash in advance or letters of credit; - potential adverse tax consequences; - increased complexity of accounting rules and financial reporting requirements; - difficulties associated with enforcing agreements through foreign legal systems; - systemic transportation issues could impact delivery of product around the world; - terrorism, war or other armed conflict; and - natural disasters, epidemics, and pandemics. Any or all of these factors could have a material adverse impact on our business, financial condition, and operating results. Substantially all of our international sales are U.S. Dollar-denominated. Fluctuations in exchange rates between the U.S. Dollar and foreign currencies could increase our operating expenses, which are often paid in local currency. In the future, we may elect to invoice a larger portion of our international customers in local currency, which would expose us to greater fluctuations in exchange rates between the U.S. Dollar and the particular local currency. If we do so, we may decide to engage in hedging transactions to minimize the risk of such fluctuations. We have entered into foreign exchange forward contracts to offset the impact of payment of operating expenses in local currencies to some of our operating foreign subsidiaries. However, if we are not successful in managing these foreign currency transactions, we could incur losses from these activities. ***If we are not able to effectively forecast demand or manage our inventory, we may be required to record write-downs for excess or obsolete inventory.*** We maintain sufficient inventory of finished goods and, to a lesser extent, raw materials and drive demand with our third-party manufacturers in amounts that we believe allow for timely fulfillment of sales. We estimate required levels of inventory based on current and anticipated demand, market conditions, and product development cycles. Our estimates are also based on inventory levels and sales data from our distributors, which are not always reliable or timely. The actual levels of inventory are subject to the impact of external factors such as supply shortages, macroeconomic conditions, technology shifts, or price changes. Distributors may increase or decrease the levels of inventory that they order to meet supply shortages or expected demand. If distributors increase orders to build up stock out of concern for product shortages, or to meet anticipated demand that does not materialize, we may have excess channel inventory, and subsequent inventory corrections by distributors or other channel partners may lead to reductions in future period orders and adversely affect our operating results. If we incorrectly forecast demand, we may accumulate excess inventory and incur write-downs for excess or obsolete inventory, including in connection with the end-of-life for specific products. We have recorded such write-downs in the past and may do so again in the future. Conversely, insufficient inventory could result in lost sales, reduced revenue, and harm to our distributor relationships. We enter into agreements with contract manufacturers and suppliers based on our anticipated demand, market conditions, and product development cycles. These contracts obligate us to purchase commitments for raw materials and finished goods. If demand for our products is lower than expected, we may be obligated to purchase excess product or raw materials from our suppliers, resulting in an adverse impact on our cash flows, operating expenses, financial condition, and operating results. For example, we have, in the past, recorded significant charges due to excess inventory and such commitments to our suppliers. Failure to accurately forecast demand has in the past, and could, in the future, require us to write-off the value of excess products or components inventory, causing our financial performance to suffer. If we are unable to manage our inventory or commitments to suppliers in the future, we could be required to record additional charges. Any or all of the foregoing could materially adversely affect our business, financial condition, and operating results. ***To successfully manage our business or achieve our goals, we must attract, retain, train, motivate, develop and promote key employees, and a failure to do so can harm us.*** Our success depends to a significant degree upon the continued contributions of our key management, engineering, sales and marketing, service, finance, and operations personnel, many of whom would be difficult to replace. We have experienced and may in the future experience significant turnover in our executive personnel. Changes in our management and key employees could affect our financial results, and our prior reductions in force may impede our ability to attract and retain highly skilled personnel. We believe our future success will also depend in large part upon our ability to attract and retain highly skilled managerial, engineering, sales and marketing, service, finance, and operations personnel. The market for such personnel is competitive in certain regions for certain types of technical skills, particularly AI-related skills. A number of our employees are foreign nationals who rely on visas and entry permits to legally work in the United States and other countries. Changes in immigration laws and enforcement could require us to incur additional unexpected labor costs and expenses or could restrain our ability to attract and retain skilled professionals. Any of these restrictions could have a material adverse effect on our business, financial conditions, and operating results. ***We rely on third-party providers for services needed to deliver our cloud solutions and other third-party providers for our internal operations. Any disruption in the services provided by such third-party providers could adversely affect our business and subject us to liability.*** We increasingly rely on third-party cloud providers, including AWS, GCP, and Azure, to host our cloud solutions and support a growing number of our products, services, and internal operations, including enterprise systems. We do not own or control the operation of the third-party facilities or equipment used to provide the cloud services. Our computing infrastructure service providers have no obligation to renew their agreements with us on commercially reasonable terms or at all. If we are unable to renew these agreements on commercially reasonable terms, or if one of our computing infrastructure service providers is acquired, we may be required to transition to a new provider and we may incur significant costs and possible service interruption in connection with doing so. In addition, such service providers could decide to close their facilities or change or suspend their service offerings without adequate notice to us. Moreover, any financial difficulties, such as bankruptcy, faced by such service providers may have negative effects on our business, the nature and extent of which are difficult to predict. Service outages, performance problems, or errors at these third-party providers could adversely affect customer experience. Our agreements with third-party computing infrastructure service providers may not entitle us to corresponding service level credits to those we offer to our customers. Any changes in third-party service levels at our computing infrastructure service providers or any related disruptions or performance problems with our solutions could adversely affect our reputation and impact our customers’ operations, result in lengthy interruptions in our services, or result in potential losses of customer data. Interruptions in our services might reduce our revenues, cause us to issue refunds to customers for prepaid and unused subscriptions, subject us to service level credit claims and potential liability, or adversely affect our renewal rates. Additionally, if a third-party service provider fails to maintain compliance with standards such as SOC2 or ISO27001, it could affect the underlying controls that we maintain, or that our customers rely upon. This could entail additional costs to compensate for the lost controls, or have a negative impact on revenue if our customers do not perceive our vendors as secure. ***The adoption, use, and development of AI products may result in reputational harm or liability.*** We incorporate artificial intelligence into various products that we offer, and we continue to develop additional use cases and products utilizing AI. The field of AI is rapidly developing, both technologically and from a regulatory and legal standpoint. Known challenges such as algorithmic bias, black box training sets, and “hallucinations” exist, as well as a dependence on the reliability of the underlying model. As we incorporate this technology into our products and our internal tools and systems, we may experience unexpected outcomes or impacts related to the technology, creating reputational, legal, and regulatory risks. The regulatory framework for AI is rapidly evolving as many federal, state, and foreign governments and regulatory bodies have introduced, and continue to consider, laws, regulations, and guidance governing the development, deployment, and use of AI. Laws regulating AI have been, and likely will continue to be, adopted in the United States and in non-U.S. jurisdictions, however the durability of these laws and the potential of additional state-level activity faces uncertainty in light of federal policy favoring a uniform, national AI regulatory framework. For example, the European Union’s Artificial Intelligence Act (the “EU AI Act”) establishes a comprehensive, risk-based regulatory framework for AI systems in the EU market, and various U.S. states and other jurisdictions have enacted or are considering AI-related legislation. These and other regulatory developments may impose additional compliance obligations, require changes to our products, services, internal processes, or use of third-party AI technologies, increase development and compliance costs, restrict certain AI use cases, or expose us to regulatory investigations, litigation, fines, or other liabilities. Additionally, existing laws and regulations may be interpreted in ways that may affect our development, deployment, or use of AI technologies. Because the regulatory environment remains uncertain and continues to evolve, we may not be able to anticipate or respond effectively to new legal, regulatory, technical, or industry requirements, which could adversely affect our ability to develop, use, commercialize, or compete using AI technologies. The adoption of AI technologies by our customers or competitors may also alter demand for our products and services or shift market expectations, which could adversely affect our business model, revenue mix, or competitive position. We also increasingly rely on third-party artificial intelligence technologies, including third-party models, tools, and platforms that may be integrated into our products or internal operations. These dependencies may introduce risks outside of our control, including risks related to model performance, security vulnerabilities, data handling practices, and compliance with applicable laws and regulations. We have instituted an internal AI Council to provide governance for our use of AI, and to help identify and mitigate risks associated with our and our vendors’ use of AI. In addition, certain of our AI-enabled offerings are designed to execute tasks autonomously within customer-defined governance frameworks. If these capabilities do not perform as intended, take erroneous or unintended actions, or are deployed in customer environments in ways we did not anticipate, they could disrupt customer networks, result in service outages or security exposures, give rise to contractual or other liability, and harm our reputation. We may also not achieve general availability of announced AI capabilities on the timelines we have communicated, or at all. However, we may not be able to anticipate or mitigate all risk. Our employees and contractors may use artificial intelligence tools in the course of their work. Improper or unauthorized use of such tools could result in the unintended disclosure of confidential or proprietary information, including trade secrets, or may expose us to intellectual property, data protection, or cybersecurity risks. Any investigation or litigation related to our use of AI could have an adverse impact on our results of operations due to the associated costs and any related fines, and could also have an adverse impact on our customer relationships and ability to grow revenue. ***If our products do not effectively interoperate with our customers’ networks and result in cancellations and delays of installations, our business, financial condition and operating results could be harmed.*** Our products are designed to interface with our customers’ existing networks, each of which may have different specifications and utilize multiple protocol standards, products from other vendors, third-party platforms, operating systems, cloud environments, applications, and applications that we do not control. Many of our customers’ networks contain multiple generations of products that have been added over time as these networks have grown and evolved. Our products must interoperate with many or all of these third-party products, as well as future products, to meet our customers’ requirements. If we identify errors in existing software, defects in hardware, changes to third-party platforms, modifications to application programming interfaces, delays in access to new releases, or restrictions on interoperability, we may need to modify our solutions to maintain compatibility, which could be costly and time consuming. In addition, if our products do not successfully interoperate with our customers’ networks or other third-party technologies, demand for our products could be adversely affected, orders could be delayed or canceled, and the functionality of our offerings could be impaired. This could materially adversely affect our business, financial condition, operating results, and future financial performance. ***When our products contain undetected errors, we may incur significant unexpected expenses and could lose sales.*** Network products frequently contain undetected errors when new products or new versions or updates of existing products are released to the marketplace. In the past, we have experienced such errors in connection with new products and product updates. We have experienced component problems in prior years that caused us to incur higher than expected warranty, service costs and expenses, and other related operating expenses. In the future, we expect that, from time to time, such errors or component failures will be found in new or existing products after the commencement of commercial shipments. These problems may have a material adverse effect on our business by causing us to incur significant warranty, repair and replacement costs, diverting the attention of our engineering personnel from new product development efforts, delaying the recognition of revenue, and causing significant customer relations problems. Further, if products are not accepted by customers due to such defects, such returns could exceed the amount we accrued for defective returns. Our products are used in conjunction with products from other vendors. As a result, when problems occur in a network, it may be difficult to identify the sources of these problems. The occurrence of system errors, whether or not caused by our products, could result in the delay or loss of market acceptance of our products and any necessary revisions may cause us to incur significant expenses. Any or all of the foregoing could have a material adverse effect on our business, operating results, and financial condition. ***We must continue to develop and increase the productivity of our indirect distribution channels to increase net revenues and improve our operating results.*** Our distribution strategy focuses primarily on developing and increasing the productivity of our indirect distribution channels. If we fail to develop and cultivate relationships with significant channel partners, if we are unable to meet their needs, or if these channel partners are not successful in their sales efforts, sales of our products may decrease and our operating results could suffer. Many of our channel partners also sell products from other vendors that compete with our products. Our channel partners may not continue to market or sell our products effectively or to devote the resources necessary to provide us with effective sales, marketing, and technical support. We may not be able to successfully manage our sales channels or enter into additional reseller and/or distribution agreements. Our failure to do any of these could limit our ability to grow or sustain revenues. Our operating results for any given period have and will continue to depend to a significant extent on large orders from a relatively small number of channel partners and other customers. However, we do not have binding purchase commitments from any of them. A substantial reduction or delay in sales of our products to a significant reseller, distributor or other customer could harm our business because our expense levels are based on our expectations as to future revenues and, to a large extent, are fixed in the short term. Some third-party distributors have contractual terms that allow them to return products to us, including unexpected returns. Any or all of the foregoing could materially adversely affect our business, financial condition, operating results, and future financial performance. ***The sales cycle for our products is long and we may incur substantial non-recoverable expenses or devote significant resources to sales that do not occur when anticipated.*** The purchase of our products represents a significant strategic decision by a customer regarding its communications infrastructure. The decision by customers to purchase our products is often based on the results of a variety of internal procedures associated with the evaluation, testing, implementation, and acceptance of new technologies. Accordingly, the product evaluation process frequently results in a lengthy sales cycle, typically ranging from three months to longer than a year, and as a result, our ability to sell products is subject to a number of significant risks, including risks that: - budgetary constraints and internal acceptance reviews by customers will result in the loss of potential sales; - there may be substantial variation in the length of the sales cycle from customer to customer, making decisions on the expenditure of resources difficult to assess; - we may incur substantial sales and marketing expenses and expend significant management time in an attempt to initiate or increase the sale of products to customers, but not succeed; - when a sales forecast from a specific customer for a particular quarter is not achieved in that quarter, we may be unable to compensate for the shortfall, which could harm our operating results; and - downward pricing pressures could occur during the lengthy sales cycle for our products. These factors could impact our inventory forecasting and revenue forecasting, which could materially adversely affect our business, financial condition, operating results, and future financial performance. ***Our sales to government and education customers may be adversely affected by public-sector procurement processes, budgetary constraints, and government contracting requirements.*** We sell our products and services to customers in the government and education sectors, including federal, state, local governmental entities and educational institutions in the United States and in foreign countries, directly and through distributors, resellers, systems integrators, and other channel partners. Public-sector procurement may be subject to competitive bidding and other procurement procedures, budget approvals, appropriations, funding programs, and changing policy priorities. These processes can result in longer sales cycles, delayed or canceled orders, reduced or deferred spending, and increased price competition, making the timing and amount of revenue from these customers difficult to forecast. Government procurement requirements vary across jurisdictions and may include local content requirements, cybersecurity certifications, data residency obligations, sovereignty requirements, and other regulatory conditions that can increase costs and complexity or limit our ability to compete for certain opportunities. Contracts with public-sector customers may also include requirements relating to product certifications, security, data handling, reporting, audits, performance, and other compliance matters. If we or our channel partners fail to satisfy these requirements, or if our products or services fail to meet a public-sector customer’s requirements, we could lose current or future business, experience delayed payment or contract termination, or become subject to claims, penalties, or other contractual remedies. Any of these events could materially adversely affect our business, financial condition, operating results, and future financial performance. ### Risks Related to Financial Matters ***We cannot assure future profitability, and our financial results may fluctuate significantly from period to period.*** We have not been consistently profitable. Even in years when we reported profits, we may not have been profitable in each quarter during those years. We anticipate continuing to incur significant sales and marketing, product development and general and administrative expenses. Any delay in generating or recognizing revenue could result in a loss for a quarter or full year. Even if we are profitable, our operating results may fall below guidance we provide and expectations of our investors, which could cause the price of our stock to fall. We may experience challenges or delays in forecasting, generating or recognizing revenue for a number of reasons and our revenues and operating results have varied significantly in the past and may vary significantly in the future due to a number of factors, including, but not limited to, the following: - our dependence on obtaining orders during a quarter and shipping those orders in the same quarter; - orders in our backlog could be cancelled by customers; - decreases in the prices of the products we sell; - the mix of products sold and the mix of distribution channels through which products are sold; - acceptance provisions in customer contracts; - our ability to deliver installation or customer acceptance by the end of the quarter; - seasonal fluctuations in demand for our products and services; - a disproportionate percentage of our sales occurring in the last month of a quarter; - reduced visibility into the implementation cycles for our products and our customers’ spending plans; - our ability to forecast demand for our products, which in the case of lower-than-expected sales, may result in excess or obsolete inventory in addition to non-cancelable purchase commitments for component parts; - our sales to the telecommunications service provider market, which represents a significant source of large product orders, being especially volatile and difficult to forecast; - product returns or the cancellation or rescheduling of orders; - announcements and new product introductions by our competitors; - our ability to develop and support relationships with enterprise customers, service providers and other potential large customers; - our ability to obtain sufficient supplies of sole- or limited-source components for our products on a timely basis; and - changes in funding for customer technology purchases in our markets. In addition to risks related to revenue, we are subject to risks related to costs, which may be influenced by a number of factors, including, but not limited to, the following: - our ability to achieve and maintain targeted cost reductions; - fluctuations in warranty or other service expenses actually incurred; - increases in the price of the components we purchase; - increases in costs associated with sourcing and shipping components and finished products, including tariffs; - general inflationary pressures, increasing the cost of all inputs; and - rising interest rates, increasing the cost of borrowing. We are subject to changes in general and specific macroeconomic conditions in the economy as a whole as well as in the networking industry, which could affect both revenue and costs. In particular, increases in interest rates could decrease demand for our products and services, as the cost and access to capital to fund large projects may be limited for certain customers. Due to the foregoing and other factors, many of which are described herein, period-to-period comparisons of our operating results should not be relied upon as an indicator of our future performance. ***Our stock price has been volatile in the past and may significantly fluctuate in the future.*** In the past, the trading price of shares of our common stock has fluctuated significantly. This could continue as we or our competitors announce new products, our results or those of our customers or competition fluctuate, conditions in the networking or semiconductor industry change, conditions in the U.S. or global economy change, or when investors change their sentiment toward stocks in the networking technology sector. In addition, fluctuations in our stock price and our enterprise value to sales valuation may make our stock attractive to momentum, hedge or day-trading investors who often shift funds into and out of stock rapidly, exacerbating price fluctuations in either direction, particularly when viewed on a quarterly basis. These fluctuations may adversely affect the trading price or liquidity of our common stock. Volatility in the trading price of our common stock has, in the past, resulted in securities class action litigation. Such suits, regardless of the merits or outcome, can result in substantial costs and divert management’s attention and resources. ***If we do not adequately manage and evolve our financial reporting and managerial systems and processes, our ability to manage and grow our business may be harmed.*** Our ability to successfully implement our business plan and comply with regulations requires an effective planning and management process. We need to continue improving our existing, and implement new, operational and financial systems, procedures and controls. Disruptions to our existing systems, procedures, or controls or any delay or disruption in the implementation of or the transition to new or enhanced systems, procedures, or controls, or any delay or disruption in the integration of acquired businesses, could have a significant impact on our business. Failure to properly or adequately address such issues could harm our ability to manage our business, meet our obligations to our customers, accurately forecast sales demand, manage our supply chain, record and report financial and management information on a timely and accurate basis, or forecast future results, which could result in a material adverse effect on our business, financial condition, and operating results. ***Our revenues may decline as a result of changes in public funding of educational institutions.*** A significant portion of our revenues comes from sales to both public and private K-12 educational institutions. A portion of our sales to educational institutions depends on government funding programs, including E-Rate. Changes in the availability, timing, or scope of such funding could adversely affect demand for our products. In addition, if state or local funding of public education is significantly reduced because of legislative or policy changes or by reductions in tax revenues resulting from economic conditions, our sales to educational institutions could be adversely impacted. Any reduction in spending on information technology systems by educational institutions could materially adversely affect our business, financial condition, operating results, and future financial performance. ***Our credit facilities impose financial and operating restrictions on us and if we fail to meet our payment or other obligations under our 2026 Credit Agreement, as amended from time to time and discussed in Item 7, “Liquidity and Capital Resources,” the lenders under such 2026 Credit Agreement could foreclose on, and acquire control of, substantially all of our assets.*** Our 2026 Credit Agreement imposes, and the terms of any future debt may impose, operating and other restrictions on us. These restrictions could affect, and in many respects limit or prohibit, among other items, our ability to: incur additional indebtedness; create liens; make investments; enter into transactions with affiliates; sell assets; guarantee indebtedness; declare or pay dividends or other distributions to stockholders; repurchase equity interests; change the nature of our business; enter into swap agreements; issue or sell capital stock of certain of our subsidiaries; and consolidate, merge, or transfer all or substantially all of our assets and the assets of our subsidiaries on a consolidated basis. Our 2026 Credit Agreement also requires us to achieve and maintain compliance with specified financial ratios. A breach of any of these restrictive covenants or the inability to comply with the required financial ratios or metrics could result in a default under our 2026 Credit Agreement. The lenders under our 2026 Credit Agreement also have the right in the event of a breach of the restrictive covenants to terminate any commitments they have to provide further borrowings. Reductions in earnings could increase our costs of borrowing, reduce our ability to comply with these covenants, or make extensions of credit unavailable to us. The 2026 Credit Agreement contains customary events of default, including failure to pay principal, interest, or fees when due, failure to comply with covenants, breaches in a material respect of representations and warranties, certain insolvency or receivership events, the occurrence of certain material judgments, the occurrence of certain ERISA events, the invalidity of the loan documents, and a change of control of the Company. Upon the occurrence of an event of default, amounts outstanding under the facility may be accelerated. Further, our 2026 Credit Agreement is jointly and severally guaranteed by us and certain of our subsidiaries. Borrowings under our 2026 Credit Agreement are secured by liens on substantially all of our assets, including the capital stock of certain of our subsidiaries, and the assets of our subsidiaries that are loan party guarantors. If we are unable to repay outstanding borrowings when due or comply with other obligations and covenants under our 2026 Credit Agreement, the lenders under our 2026 Credit Agreement will have the right to proceed against the pledged capital stock and take control of substantially all of our assets. ***Our cash requirements may require us to seek additional debt or equity financing and we may not be able to obtain such financing on favorable terms, or at all.*** Our 2026 Credit Agreement may not be sufficient for our future working capital, investments and cash requirements, in which case we would need to seek additional debt or equity financing or scale back our operations. In addition, we may need to seek additional financing to achieve and maintain compliance with specified financial ratios under our 2026 Credit Agreement. We may not be able to access additional capital resources due to a variety of reasons, including the restrictive covenants in our 2026 Credit Agreement and the lack of available capital due to global economic conditions. If our financing requirements are not met and we are unable to access additional financing on favorable terms, or at all, our business, financial condition, operating results, and future growth prospects could be materially adversely affected. ***Our indebtedness could expose us to interest rate risk to the extent of our variable rate debt.*** Our 2026 Credit Agreement provides for interest to be calculated based on the prime rate, the federal funds rate and/or the secured overnight financing rate. Increases in interest rates on which the 2026 Credit Agreement interest rates are based would increase interest rates on our debt, which could materially adversely impact our interest expense, operating results and cash flows. ***Our share repurchase program may not enhance stockholder value, and repurchases are subject to restrictions and may be suspended or discontinued.*** We have in the past repurchased, and may in the future repurchase, shares of our common stock under a repurchase program authorized by our Board. Repurchases reduce cash available for other purposes, may not offset dilution, and may not increase the market price of our common stock. The timing and amount of any repurchases are subject to market conditions, our liquidity, restrictions under our 2026 Credit Agreement, and applicable law, and our Board may suspend, modify, or discontinue the program at any time. In addition, net repurchases are subject to a federal excise tax equal to one percent of fair market value, which increases the cost of repurchases. ***We are exposed to the credit risk of our channel partners and direct customers, which could result in material losses.*** Most of our sales are on an open credit basis, with standard payment terms of 30 days in the United States and, because of local customs or conditions, longer in some markets outside the U.S. We monitor partners’ and direct end customers’ payment capability in granting such open credit arrangements, seek to limit such open credit to amounts we believe the end customers can pay and maintain reserves we believe are adequate to cover exposure for doubtful accounts. Any significant delay or default in the collection of significant accounts receivable could potentially result in an increased need for us to obtain working capital from other sources, possibly on less favorable terms than we could have negotiated if we had established such working capital resources prior to such delays or defaults. Any significant default could adversely affect our operating results and delay our ability to recognize revenue. A material portion of our sales is derived through our distributors, systems integrators, and value-added resellers. Some of our distributors, systems integrators and value-added resellers may experience financial difficulties, which could adversely affect our collection of accounts receivable. Our exposure to credit risks of our channel partners may increase if our channel partners and their end customers are adversely affected by global or regional economic conditions. One or more of these channel partners could delay payments or default on credit extended to them, either of which could materially adversely affect our business, financial condition, operating results, and future financial performance. Macroeconomic factors such as rising interest rates and increasing inflation could put additional financial pressures on some partners and customers, which could result in longer collection times or default on payment to us. ***We intend to invest in engineering, sales, services, marketing and manufacturing on a long-term basis, and delays or inability to attain the expected benefits may result in unfavorable operating results.*** While we intend to focus on managing our costs and expenses, over the long term, we also intend to invest in personnel and other resources related to our engineering, sales, services, marketing and manufacturing functions as we focus on our foundational priorities, such as leadership in our core products and solutions and architectures for business transformation. We are likely to recognize the costs associated with these investments earlier than some of the anticipated benefits and the return on these investments may be lower, or may develop more slowly, than we expect. If we do not achieve the benefits anticipated from these investments, or if the achievement of these benefits is delayed, our business, financial condition, and operating results may be adversely affected. ***We are required to evaluate the effectiveness of our internal control over financial reporting on an annual basis and publicly disclose any material weaknesses in our controls. Any adverse results from such evaluation could result in a loss of investor confidence in our financial reports and significant expense to remediate, and ultimately could have an adverse effect on our stock price.*** Section 404 of the Sarbanes-Oxley Act of 2002 requires our management to assess the effectiveness of our internal control over financial reporting and to disclose if such controls were unable to provide assurance that a material error would be prevented or detected in a timely manner. We have an ongoing program to review the design of our internal controls framework in keeping with changes in business needs, implement necessary changes to our controls design and test the system and process controls necessary to comply with these requirements. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within our Company will have been detected. If we or our independent registered public accounting firm identifies material weaknesses in our internal controls, the disclosure of that fact, even if quickly remedied, may cause investors to lose confidence in our financial statements and our stock price may decline. Remediation of a material weakness could require us to incur significant expenses and, if we fail to remedy any material weakness, our ability to report our financial results on a timely and accurate basis may be adversely affected, our access to the capital markets may be restricted, our stock price may decline, and we may be subject to sanctions or investigation by regulatory authorities, including the SEC or Nasdaq. We may also be required to restate our financial statements from prior periods. Execution of restatements creates a significant strain on our internal resources and could cause delays in our filing of quarterly or annual financial results, increase our costs and cause management distraction. Restatements may also significantly affect our stock price in a materially adverse manner. ***We may not fully realize the anticipated positive impacts to future financial results from our restructuring efforts.*** We have undertaken restructuring efforts in the past to streamline operations and reduce operating expenses. Our ability to achieve the anticipated cost savings and other benefits from our restructuring efforts within expected time frames is subject to many estimates and assumptions and may vary materially based on factors such as market conditions and the effect of our restructuring efforts on our work force. These estimates and assumptions are subject to significant economic, competitive, and other uncertainties, some of which are beyond our control. We cannot ensure that we will fully realize the anticipated positive impacts to future financial results from our current or future restructuring efforts. If our estimates and assumptions are incorrect or if other unforeseen events occur, we may not achieve the cost savings expected from such restructurings, and our business, financial condition, operating results and future financial performance could be materially adversely affected. ***We may not realize anticipated benefits of past or future acquisitions, divestitures and strategic investments, and the integration of acquired companies or technologies may negatively impact our business, financial condition and operating results or dilute the ownership interests of our stockholders.*** As part of our business strategy, we review acquisition and strategic investment prospects that we believe would complement our current product offerings, augment our market coverage or enhance our technical capabilities, or otherwise offer growth opportunities. In the event of any future acquisitions, we could: - issue equity securities which would dilute current stockholders’ percentage ownership; - incur substantial debt; - assume contingent liabilities; or - expend significant cash. These actions could have a material adverse effect on our business, financial condition, and operating results or the price of our common stock. There can be no assurance we will achieve the revenues, growth prospects, and synergies expected from any acquisition in the anticipated timeframe, or at all, and our failure to do so could have a material adverse effect on our business, financial condition, and operating results. Moreover, even if we do obtain benefits in the form of increased sales and earnings, these benefits may be recognized much later than the time when the expenses associated with an acquisition are incurred. This is particularly relevant in cases where it would be necessary to integrate new types of technology into our existing portfolio and new types of products may be targeted for potential customers with which we do not have pre-existing relationships. Our ability to realize the anticipated benefits of any current and future acquisitions, divestitures and investment activities also entail numerous risks, including, but not limited to: - difficulties in the assimilation and successful integration of acquired operations, sales functions, technologies, products, and/or personnel; - unanticipated costs, litigation or other contingent liabilities associated with the acquisition or investment transaction; - incurrence of acquisition- and integration-related costs, goodwill or in-process research and development impairment charges, or amortization costs for acquired intangible assets, that could negatively impact our business, financial condition, and operating results; - the diversion of management's attention from other business concerns; - adverse effects on existing business relationships with suppliers and customers; - risks associated with entering markets in which we have no or limited prior experience; - the potential loss of key employees of acquired organizations and inability to attract or retain other key employees; and - substantial charges for the amortization of certain purchased intangible assets, deferred stock compensation or similar items. If any of these risks occur, it could have a material adverse impact on our business, financial condition, operating results and future financial performance. ### Regulatory, Tax, and Legal Risks ***We are required to comply with complex export control laws, economic sanctions, and other trade regulations. If we fail to comply with these laws and regulations, we could incur penalties and sanctions from governments and could be restricted from exporting products.*** We are required to comply with laws, rules and regulations of the United States and other countries, as applicable, relating to export controls and economic sanctions, including, but not limited to, trade sanctions administered by the Office of Foreign Assets Control within the U.S. Department of the Treasury, as well as the Export Administration Regulations administered by the U.S. Department of Commerce. These regulations restrict our ability to market, sell, distribute or otherwise transfer our products or technology to prohibited countries or persons, or for prohibited end-uses. Military actions, armed conflicts, and geopolitical tensions may result in the expansion of sanctions programs, export control restrictions, or other trade measures that could further restrict our ability to market, sell, distribute, or transfer products and technology in certain markets. Violations of these regulations, laws, or key control policies by our employees, contractors, channel partners, or agents could result in the termination of contractual relationships, financial reporting problems, fines, and/or civil or criminal penalties for us, or prohibition on the importation or exportation of our products and could have a material adverse effect on our business, financial condition, and operating results. For example, on October 7, 2022, we submitted voluntary disclosures to the U.S. Treasury Department’s Office of Foreign Assets Control, the Bureau of Industry and Security’s Office of Export Enforcement, and the Department of Justice (collectively, the “Agencies”) regarding the potential export and sale of certain of our networking equipment to end users in Russia subject to U.S. sanctions and export control restrictions. We are continuing our review of the matter in conjunction with outside counsel. Given the uncertainty of the outcome of the investigation, and the potential outcome of the Agencies’ determination, we cannot estimate at this time the possible loss or range of loss that may result from this action. ***Our employees may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements, which could have a material adverse effect on our business.*** We are exposed to the risk of employee fraud or other misconduct. Local laws and customs in many countries differ significantly from, or conflict with, those in the United States or in other countries in which we operate. In many foreign countries, it is common for others to engage in business practices that are prohibited by our internal policies and procedures or U.S. regulations applicable to us. Although we have implemented policies, procedures and training designed to ensure compliance with these U.S. and foreign laws and policies, there can be no complete assurance that any individual employee, contractor, channel partner, or agent will not violate our policies, procedures or applicable law, for which we may be ultimately held responsible. Misconduct by employees could include intentional failures to: - comply with securities laws and regulations or similar regulations of comparable foreign regulatory authorities; - comply with export controls and sanctions laws and regulations or similar regulations of comparable foreign regulatory authorities; - comply with anti-corruption laws such as the FCPA and regulations or similar regulations of comparable foreign regulatory authorities; - comply with internal controls that we have established; - report financial information or data accurately; or - disclose unauthorized activities to us. The precautions we take to detect and prevent misconduct may not be effective in controlling unknown or unmanaged risks or losses or in protecting us from governmental investigations or other actions or lawsuits stemming from a failure to be in compliance with such laws or regulations. Violations of these regulations, laws, or key control policies by our employees, contractors, channel partners, or agents could result in termination of our relationship, financial reporting problems, fines, and/or civil or criminal penalties for us and could have a material adverse effect on our business, financial condition, and operating results. ### Our operating results may be negatively affected by legal proceedings. We have in the past, currently are and will likely in the future pursue or be subject to claims or lawsuits in the normal course of our business. In addition to the risks related to the intellectual property lawsuits described herein, we are currently parties to other litigation as described in Note 9, Commitments and Contingencies, in the Notes to Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K. Regardless of the result, litigation can be expensive, lengthy and disruptive to normal business operations. Moreover, the results of complex legal proceedings are difficult to predict. An unfavorable resolution of a lawsuit in which we are a defendant could result in a court order against us or payments to other parties that would have a material adverse effect on our business, financial condition, or operating results. Even if we are successful in prosecuting claims and lawsuits, we may not recover damages sufficient to cover our expenses incurred to manage, investigate and pursue the litigation. In addition, subject to certain limitations, we may be obligated to indemnify our current and former customers, suppliers, directors, officers and employees in certain lawsuits. We may not have adequate insurance coverage to cover all of our litigation costs and liabilities. ***Claims of infringement by others may increase and the resolution of such claims may materially adversely affect our business, financial condition, and operating results.*** Our industry is characterized by the existence of a large number of patents and frequent claims and related litigation regarding patents, copyrights (including rights to “open-source” software) and other intellectual property rights. As we have grown, we have, and may continue to, experience greater revenues and increased public visibility, which may cause competitors, customers, and governmental authorities to be more likely to initiate litigation against us. Because of the existence of a large number of patents in the networking field, the secrecy of some pending patents and the issuance of new patents at a rapid pace, it is not possible to determine in advance if a product or component might infringe the patent rights of others. Because of the potential for courts awarding substantial damages, or internationally prohibiting us from importing or exporting our products in or out of certain countries, the lack of predictability of such awards and the high legal costs associated with the defense of such patent infringement matters that would be expended to prove lack of infringement, it is not uncommon for companies in our industry to settle even potentially unmeritorious claims for very substantial amounts. Furthermore, the entities with whom we have or could have disputes or discussions include entities with extensive patent portfolios and substantial financial assets. These entities are actively engaged in programs to generate substantial revenues from their patent portfolios and are seeking or may seek significant payments or royalties from us and others in our industry. Litigation resulting from claims that we are infringing the proprietary rights of others has resulted and could in the future result in substantial costs and a diversion of resources and could have a material adverse effect on our business, financial condition and operating results. We previously received notices from entities alleging that we were infringing their patents and have been party to patent litigation in the past. Without regard to the merits of these or any other claims, an adverse court order or a settlement could require us, among other actions, to: - stop selling our products that incorporate the challenged intellectual property; - obtain a royalty-bearing license to sell or use the relevant technology, and that license may not be available on reasonable terms or available at all; - pay damages; - redesign those products that use the disputed technology; or - face a ban on importation or exportation of our products into the United States or into another country. In addition, our products include so-called “open-source” software. Open-source software is typically licensed for use at no initial charge but imposes on the user of the open-source software certain requirements to license to others both the open-source software as well as modifications to the open-source software under certain circumstances. Our use of open-source software subjects us to certain additional risks for the following reasons: - open-source license terms may be ambiguous and may result in unanticipated obligations regarding the licensing of our products and intellectual property; - open-source software cannot be protected under trade secret law; - suppliers of open-source software do not provide the warranty, support and liability protections typically provided by vendors who offer proprietary software; and - it may be difficult for us to accurately determine the developers of the open-source code and whether the acquired software infringes third-party intellectual property rights. We believe even if we do not infringe the rights of others, we will incur significant expenses in the future due to defense of legal claims, disputes or licensing negotiations, though the amounts cannot be determined. These expenses could materially adversely affect our business, financial condition, and operating results. ### We rely on the availability of third-party licenses. Some of our products are designed to include software or other intellectual property, including open-source software, licensed from third parties. It may be necessary in the future to seek or renew licenses relating to various aspects of these products. There can be no assurance that the necessary licenses would be available on acceptable terms, if at all. The inability to obtain certain licenses or other rights or to obtain such licenses or rights on favorable terms, could have a material adverse effect on our business, operating results, and financial condition. Moreover, the inclusion in our products of software or other intellectual property licensed from third parties on a nonexclusive basis could limit our ability to protect our proprietary rights in our products. Further, the failure to comply with the terms of any license, including free open-source software, may result in our inability to continue to use such license, which could materially adversely affect our business, financial condition, operating results, and future financial performance. ### Failure to protect our intellectual property could affect our business. We rely on a combination of patent, copyright, trademark and trade secret laws and restrictions on disclosure to protect our intellectual property rights. However, we cannot ensure that the actions we have taken will adequately protect our intellectual property rights or that other parties will not independently develop similar or competing products that do not infringe on our patents. We generally enter into confidentiality, invention assignment or license agreements with our employees, consultants and other third parties with whom we do business, and control access to and distribution of our intellectual property and other proprietary information. Despite our efforts to protect our proprietary rights, unauthorized parties may attempt to copy or otherwise misappropriate or use our products or technology, which could adversely affect our business, financial condition, and operating results. ***Our provision for income taxes and overall cash tax costs are affected by a number of factors, including reorganizations or restructurings of our business, jurisdictional revenue mix and changes in tax regulations or policy, all of which could materially adversely affect our business, financial condition and operating results.*** We are a U.S. multinational company subject to income tax as well as non-income-based taxes in various jurisdictions including Ireland, where we have an operating company supporting our business in most non-U.S. jurisdictions. Our income taxes are subject to volatility and could be adversely affected by a number of factors including earnings that are lower than anticipated in countries that have lower tax rates and higher than anticipated in countries that have higher tax rates, changes in tax laws and regulations and interpretations of those changes, expiration of or lapses in the research and development tax credit laws, changes in the valuation of our deferred tax assets and liabilities, transfer pricing adjustments related to our methods for valuing developed technology or intercompany arrangements, tax effects of nondeductible compensation, including stock-based compensation, a change in our decision to indefinitely reinvest certain foreign earnings, changes in accounting principles and imposition of withholding or other taxes on payments by subsidiaries or customers. Determination of our worldwide tax liability involves significant judgment in the interpretation of applicable tax laws in the jurisdictions in which we do business. In the ordinary course of business, there are many transactions where the ultimate tax determination is uncertain. In addition, our intercompany relationships are, and will continue to be, subject to complex transfer pricing rules in every jurisdiction in which we operate and will be subject to challenge by tax authorities. Although we believe our tax estimates are reasonable, there is no assurance that the final determination of our income tax liability will not be materially different than what is reflected in our income tax provisions and accruals. Due to shifting economic and political conditions, tax rates and policies in the United States as well as international jurisdictions may be subject to significant change. The application and interpretation of such policy changes and underlying regulations, including taxation of earnings internationally, transfer pricing adjustments related to certain acquisitions, including the license of acquired intangibles under our cost sharing arrangement, Base Erosion and Anti-abuse Tax laws, Global Intangible Low-Tax Income (“GILTI”) laws, and the disallowance of tax deductions for certain expenses, as well as changes that may be enacted in the future, could materially impact our tax provision, cash tax liability and effective tax rate. The Organization for Economic Co-operation and Development (“OECD”), an international association comprised of 38 countries including the U.S. and Ireland, has made changes to numerous long-standing tax principles in the form of its Pillar Two framework, which effectively imposes a minimum tax rate of 15% in each taxing jurisdiction globally. Many countries have adopted portions or all of these rules, and additional jurisdictions may do so in the future. Although we have assessed the impact of Pillar Two to date and do not believe it has had a material impact on our tax provision, the interpretation, implementation, and future adoption of these rules by additional jurisdictions could increase our tax obligations, compliance costs, or administrative burden and could materially adversely affect our provision for income taxes, cash tax liabilities, or effective tax rate. Many countries are also actively considering changes to existing tax laws and rates or have proposed or enacted new laws that could increase our tax obligations in countries where we do business or cause us to change the way we operate the business including taxes on digital services, withholding taxes on services and taxes on intercompany service charges. We have assessed the impacts of these rules in the countries where we currently operate and do not currently anticipate a material impact to our tax liabilities, however, given the lack of statutory guidance and historical precedent, we can provide no assurance that our tax liabilities will not be materially impacted in the future under these or similar initiatives. Finally, we are subject to the examination of our income tax returns by the Internal Revenue Service, Irish Revenue, and other tax authorities globally. Although we regularly assess the likelihood of adverse outcomes resulting from these examinations to determine the adequacy of our provision for income taxes, there is no assurance our assessments are, in fact, adequate. Changes in our effective tax rates or amounts assessed upon examination of our tax returns may have a material adverse impact on our business, financial condition, and operating results. ***Any actual or perceived failure to comply with new or existing laws, regulations and other requirements relating to the privacy, security and processing of personal information could adversely affect our business, results of operations, or financial condition.*** In connection with running our business, we receive, store, use and otherwise process information that relates to individuals and/or constitutes “personal data,” “personal information,” “personally identifiable information,” or similar terms under applicable data privacy laws (collectively, “Personal Information”), including from and about actual and prospective customers, as well as our employees and business contacts and information we process for or on behalf of our customers in the course of our business. We are therefore subject to laws, regulations and other requirements relating to the privacy, security, and handling of Personal Information either directly or where we are processing Personal Information for or on behalf of our customers or another third party. For example, the EU General Data Protection Regulation, U.S. state privacy laws, and other global privacy, cybersecurity, and data protection requirements impose disclosure obligations, security, retention, deletion, and other compliance requirements with respect to Personal Information and may allow for penalties for violations. We have invested, and continue to invest, human and technology resources in our efforts to comply with such requirements that may be time-intensive and costly. The application and interpretation of such requirements are constantly evolving and are subject to change, creating a complex compliance environment. In some cases, these requirements may be either unclear in their interpretation and application or may have inconsistent or conflicting requirements. Further, there has been a substantial increase in legislative activity and regulatory focus on data privacy and security, including in relation to artificial intelligence, data rights and cybersecurity incidents. In addition, some such requirements place restrictions on our ability to process Personal Information across our business or across country borders. It is possible that new laws, regulations and other requirements, or amendments to or changes in interpretations of existing laws, regulations and other requirements, may require us to incur significant costs, implement new processes, or change our handling of information and business operations, which could ultimately hinder our ability to grow our business and to develop, market and deliver our products and services efficiently. In addition, any failure or perceived failure by us to comply with laws, regulations and other requirements relating to the privacy, security, and handling of information could result in legal claims or proceedings (including class actions), regulatory investigations, or enforcement actions. We could incur significant costs in investigating and defending such claims and, if found liable, pay significant damages or fines or be required to make changes to our business. Such proceedings and any subsequent adverse outcomes may subject us to significant negative publicity and an erosion of trust. If any of these events were to occur, our business, results of operations, and financial condition could be materially adversely affected. ***Failure of our products to comply with evolving industry standards and complex government regulations may adversely impact our business.*** If we do not comply with existing or evolving industry standards, certifications, and government regulations, we may not be able to sell our products where these standards, certifications, or regulations apply. The networking industry in which we compete is characterized by rapid changes in technology and customers' requirements and evolving industry standards. As a result, our success depends on: - the timely adoption and market acceptance of industry standards, and timely resolution of conflicting U.S. and international industry standards; - our ability to influence the development of emerging industry standards and to introduce new and enhanced products that are compatible with such standards; and - in some cases, our ability to achieve and maintain certifications. In the past, we have introduced new products that were not compatible with certain technological standards, and in the future, we may not be able to effectively address the compatibility and interoperability issues that arise as a result of technological changes and evolving industry standards. Our products must also comply with various U.S. federal government regulations and standards defined by agencies such as the FCC, standards established by governmental authorities in various foreign countries and recommendations of the International Telecommunication Union. In some circumstances, we must obtain regulatory approvals or certificates of compliance before we can offer or distribute our products in certain jurisdictions or to certain customers. Complying with new regulations or obtaining certifications can be costly and disruptive to our business. Customers are increasingly demanding that products are certified to external standards, such as those promulgated by the International Organization for Standardization (“ISO”). If we do not comply with existing or evolving industry standards or government regulations, or achieve and maintain relevant certifications, we will not be able to sell our products where these standards or regulations apply or where such certifications are required, which may prevent us from sustaining our net revenues or achieving profitability. ***Provisions in our charter documents and Delaware law may delay or prevent an acquisition of Extreme, which could decrease the value of our common stock.*** Our certificate of incorporation and bylaws and Delaware law contain provisions that could make it more difficult for a third party to acquire us without the consent of our Board of Directors (“Board”). Delaware law also imposes some restrictions on mergers and other business combinations between us and any holder of 15% or more of our outstanding common stock. In addition, our Board has the right to issue preferred stock without stockholder approval, which could be used to dilute the stock ownership of a potential hostile acquirer. Although we believe these provisions of our certificate of incorporation and bylaws and Delaware law will provide for an opportunity to receive a higher bid by requiring potential acquirers to negotiate with our Board, these provisions apply even if the offer may be considered beneficial by some of our stockholders. Our bylaws, as amended, provide that, unless we consent in writing to an alternative forum, the Court of Chancery of the State of Delaware is the exclusive forum for any derivative action or proceeding brought on our behalf, any action asserting a breach of a fiduciary duty owed by any of our directors, officers, other employees or stockholders to us, any action asserting a claim against us arising pursuant to the Delaware General Corporation Law, our certificate of incorporation or our bylaws, any action to interpret, apply, enforce, or determine the validity of our certificate of incorporation or bylaws, or any action asserting a claim against us that is governed by the internal affairs doctrine. Our bylaws further provide that the federal district courts of the United States shall be the exclusive forum for any cause of action arising under the Securities Act of 1933, as amended (the “Securities Act”). The choice of forum provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers, other employees or stockholders, which may discourage such lawsuits against us and our directors, officers, other employees, and stockholders. Furthermore, the enforceability of similar choice of forum provisions in other companies’ certificates of incorporation has been challenged in legal proceedings, and it is possible that a court could find these types of provisions to be inapplicable or unenforceable. While the Delaware courts have determined that such choice of forum provisions are facially valid, a stockholder may nevertheless seek to bring a claim in a venue other than those designated in the exclusive-forum provisions, and there can be no assurance that such provisions will be enforced by a court in those other jurisdictions. If a court were to find the choice of forum provision contained in our amended and restated bylaws to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could materially adversely affect our business, financial condition, and operating results. ***Compliance with laws, rules and regulations relating to corporate governance and public disclosure may result in additional expenses.*** Federal securities laws, rules and regulations, as well as Nasdaq rules and regulations, require companies to maintain extensive corporate governance measures, impose comprehensive reporting and disclosure requirements, set strict independence and financial expertise standards for audit and other committee members and impose civil and criminal penalties for companies and their chief executive officers, chief financial officers and directors for securities law violations. These laws, rules and regulations and the interpretation of these requirements are evolving, and we continue to evaluate current practices to maintain compliance, which may require investments that may have a material adverse impact on our business, financial condition, and operating results. ## Cybersecurity As filed, 5,186 characters. ### Cybersecurity Risk Management and Strategy We have developed and implemented a cybersecurity risk management program intended to protect the confidentiality, integrity, and availability of our critical systems and information. We design and assess our program based on the National Institute of Standards and Technology Cybersecurity Framework (“NIST CSF”). This does not imply that we meet any particular technical standards, specifications, or requirements, only that we use the NIST CSF as a guide to help us identify, assess, and manage cybersecurity risks relevant to our business. Our cybersecurity risk management program is integrated into our overall enterprise risk management program, and shares common methodologies, reporting channels and governance processes that apply across the risk management program to other legal, compliance, strategic, operational, and financial risk areas. Key elements of our cybersecurity risk management program, include, but are not limited to the following: - risk assessments designed to help identify material cybersecurity risks to our critical systems and information; - a security team principally responsible for managing (1) our cybersecurity risk assessment processes, (2) our security controls, and (3) our response to cybersecurity incidents; - the use of external service providers, where appropriate, to assess, test or otherwise assist with aspects of our security processes; - cybersecurity awareness training of our employees, including incident response personnel and senior management; - a cybersecurity incident response plan that includes procedures for responding to cybersecurity incidents; and - a third-party risk management process for key service providers based on our assessment of their criticality to our operations and respective risk profile. We have not identified risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that have materially affected or are reasonably likely to materially affect us, including our operations, business strategy, results of operations, or financial condition. We face risks from cybersecurity threats that, if realized, are reasonably likely to materially affect us, including our operations, business strategy, results of operations, or financial condition. See “Risk Factors – *System security risks, data breaches, and cyberattacks could compromise our proprietary information, disrupt our internal operations, impact services to customers, and harm public perception of our products, which could materially adversely affect our business, financial condition, operating results, and future growth prospects”.* ### Cybersecurity Governance Our Board considers cybersecurity risk as part of its risk oversight function and has delegated to the Audit Committee oversight of cybersecurity and other information technology risks, including oversight of management’s implementation of our cybersecurity risk management program. The Audit Committee receives regular reports from our Chief Information Security Officer (“CISO”) regarding cybersecurity risks, including any significant cybersecurity incidents, as well as any incidents with lesser impact potential. The Chief Information and Customer Officer (“CICO”) and CISO periodically report to the full Board regarding cybersecurity risks and our cyber risk management program. Board members periodically receive presentations on cybersecurity topics from our CICO, our CISO, or external experts as part of the Board’s continuing education on topics that impact public companies. Our management team, including our CICO and our CISO, is responsible for assessing and managing our material risks from cybersecurity threats. The team has primary responsibility for our overall cybersecurity risk management program and supervises both our internal cybersecurity personnel and our retained external cybersecurity consultants. Our CICO has more than 25 years of information technology leadership experience, including serving as Chief Information Officer at multiple technology companies, where she was responsible for overseeing enterprise technology strategy, operations, and governance. Our CISO has more than 20 years of cybersecurity and risk management experience, including designing and overseeing cybersecurity programs, security operations, compliance frameworks, and risk management initiatives aligned with recognized industry standards and evolving threat landscapes. Additionally, our CISO holds Certified Information Security Manager and Certified in Risk and Information Systems Control certifications. Our CICO and CISO are assisted by a cross-functional Information Security Steering Committee. Our management team takes steps to stay informed about and monitor efforts to prevent, detect, mitigate, and remediate cybersecurity risks and incidents through various means, which may include briefings from internal security personnel; threat intelligence and other information obtained from governmental, public or private sources, including external consultants engaged by us; and alerts and reports produced by security tools deployed in the IT environment. ## Properties As filed, 1,169 characters. Our corporate headquarters is located in Morrisville, North Carolina where we currently lease approximately 54,530 square feet of space under a lease agreement that expires in fiscal year 2031. In addition to our headquarters in Morrisville, we lease additional sites in the United States, including in Salem, New Hampshire and San Jose, California for research and development, sales and marketing and administrative purposes. Outside the United States, we also lease facilities in other geographic locations for research and development, sales and service personnel and administration, including other cities in the Americas, EMEA and APAC, such as Bangalore, India; Chennai, India; Markham, Canada; Reading, United Kingdom; Shannon, Ireland; and other locations. As of June 30, 2026, we have an aggregate of approximately 0.5 million square feet of leased space with various expiration dates between fiscal year 2027 and fiscal 2033. We are continuously evaluating our leased locations. As leases expire, we analyze key metrics such as attendance and usage when determining whether to extend the lease, reduce the size of the facility or allow the lease to expire. ## Legal proceedings As filed, 250 characters. The information set forth under the heading “Legal Proceedings” in Note 9, *Commitments and Contingencies*, in the Notes to Consolidated Financial Statements in Item 8 of Part II of this Annual Report on Form 10-K is incorporated herein by reference. ## Management's discussion and analysis As filed, 49,246 characters. ### Business Overview *The following discussion should be read with the Consolidated Financial Statements and the related notes in Part II, Item 8 of this Annual Report on Form 10-K.* The following discussion is based upon our Consolidated Financial Statements included elsewhere in this Annual Report on Form 10-K, which have been prepared in accordance with U.S. generally accepted accounting principles. In the course of operating our business, we routinely make decisions as to the timing of the payment of invoices, the collection of receivables, the manufacturing and shipment of products, the fulfillment of orders, the purchase of supplies, and the building of inventory and service parts, among other matters. Each of these decisions has some impact on the financial results for any given period. In making these decisions, we consider various factors including contractual obligations, customer satisfaction, competition, internal and external financial targets and expectations, and financial planning objectives. For further information about our critical accounting estimates, see “*Critical Accounting Estimates”* included in this “Management's Discussion and Analysis of Financial Condition and Results of Operations.” Extreme is a leader in AI-powered cloud networking, focused on delivering simple and secure solutions that help businesses address challenges and enable connections among devices, applications, and users. We push the boundaries of technology, leveraging the powers of artificial intelligence, analytics, and automation and have industry leading support services. Tens of thousands of customers globally trust Extreme to drive value, foster innovation, and overcome extreme challenges. Extreme also designs, develops, and manufactures wired, wireless, and SD-WAN infrastructure equipment. Our Extreme Platform ONE solution, made generally available in July 2025, is a technology platform that is designed to reduce the complexity for enterprises by seamlessly integrating networking, security and AI solutions into a single platform. AI-powered automation includes conversational, interactive and autonomous AI agents—to assist, advise and accelerate the productivity of networking, security and business teams—reducing the time to complete complex tasks. Our global footprint provides service to some of the world’s leading names in business across verticals such as large sports and entertainment venues, hospitality, retail, transportation and logistics, education, government, healthcare, manufacturing and service providers. We derive all our revenues from the sale of our networking equipment, software subscriptions, and related maintenance contracts. ### Fiscal Year The Company uses a fiscal calendar year ending on June 30. All references herein to “fiscal 2026” or “2026”; “fiscal 2025” or “2025”; “fiscal 2024” or “2024” represent, respectively, the fiscal years ended June 30, 2026, June 30, 2025 and June 30, 2024. ### Key Business Metrics: ### SaaS Annual Recurring Revenue (“SaaS ARR”) SaaS ARR is an operating metric used by management to measure the annualized value of customer arrangements for our software solutions, which are delivered via cloud-based subscription (such as Extreme Platform ONE, generally available July 2025, and ExtremeCloud IQ) or term-based software deployed on-premises by the customer. We include term-based license arrangements in SaaS ARR because they provide time-bound access to our software solutions and are operationally and economically similar to our cloud-based subscriptions, even though they are accounted for differently under U.S. GAAP. SaaS ARR is calculated using the annualized value of quarterly subscription revenue plus the trailing twelve months of the software license portion of term-based license arrangements, which includes revenue recognized during the applicable period with respect to multi-year term-based license arrangements. The Company has not adjusted SaaS ARR to allocate revenue from these multi-year term-based license arrangements over their contractual term because they have historically been immaterial to SaaS ARR and doing so would not be expected to materially affect reported SaaS ARR or related growth rates. For those software solutions that include embedded support as part of a bundled offering, including Extreme Platform ONE and term-based license arrangements, the quarterly revenue recognized in the period with respect to the support portion of the offering is annualized and included in SaaS ARR. SaaS ARR excludes perpetual licenses, professional services revenue, support revenue associated with hardware or standalone maintenance contracts, and other non-recurring or non-subscription revenue streams. Management evaluates and manages support revenues from maintenance contracts primarily through analysis of the related GAAP revenue trends, renewal activity, and customer support operations, together with broader business performance indicators, rather than through a single standalone metric, in part due to the Company’s go-to-market model in which many customers transact through distributors and resellers, limiting consistent visibility into end-customer usage and renewals. Management uses SaaS ARR to evaluate the scale and trajectory of the Company’s subscription-based offerings and progress against customer adoption initiatives. We believe this metric is useful to investors for the same reasons, as it provides insight into our ability to acquire new customers and to maintain and expand our existing customer relationships. SaaS ARR should be considered independently of revenue or deferred revenue under U.S. GAAP, does not have a standardized meaning, and is not a substitute for, or a forecast of, revenue. As of June 30, 2026, our SaaS ARR was $244.3 million, which was 17.7% higher than our SaaS ARR of $207.6 million as of June 30, 2025. The increase in SaaS ARR was primarily due to continued growth in our subscription business as a result of increased adoption of our cloud network management solutions, including Extreme Platform ONE. Support revenues from maintenance contracts included in Subscription and support revenues but excluded from SaaS ARR were $235.3 million and $234.2 million, representing 49.6% and 53.8% of total Subscription and support revenues, respectively, for the years ended June 30, 2026 and 2025. ### Results of Operations The following is a summary of our results of operations during the fiscal year ended June 30, 2026: - Net revenues of $1,283.6 million, increased 12.6% from fiscal 2025 net revenues of $1,140.1 million. - Product revenues of $809.6 million, increased 14.9% from fiscal 2025 product revenues of $704.5 million. - Subscription and support revenues of $474.0 million, increased 8.8% from fiscal 2025 subscription and support revenues of $435.6 million. - Total gross margin of 61.5% of net revenues in fiscal 2026, compared to 62.2% in fiscal 2025. - Operating income of $62.7 million in fiscal 2026, compared to operating income of $16.9 million in fiscal 2025. - Net income of $42.1 million in fiscal 2026, compared to net loss of $7.5 million in fiscal 2025. - Cash flow provided by operating activities of $123.2 million, compared to cash flow provided by operating activities of $152.0 million in fiscal 2025, a decrease of $28.8 million. Cash and cash equivalents were $211.8 million as of June 30, 2026, a decrease of approximately $20.0 million, compared to $231.7 million at the end of fiscal 2025. ### Net Revenues The following table presents net product and subscription and support revenues for the fiscal years ended June 30, 2026, 2025 and 2024 (in thousands, except percentages): | Net revenues: | Year Ended June 30, 2026 | June 30, 2025 | $ Change | % Change | Year Ended June 30, 2025 | June 30, 2024 | $ Change | % Change | | --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | | Product | $809,624 | $704,462 | $105,162 | 14.9% | $704,462 | $699,257 | $5,205 | 0.7% | | Percentage of net revenues | 63.1% | 61.8% | | | 61.8% | 62.6% | | | | Subscription and support | 473,969 | 435,605 | 38,364 | 8.8% | 435,605 | 417,946 | 17,659 | 4.2% | | Percentage of net revenues | 36.9% | 38.2% | | | 38.2% | 37.4% | | | | Total net revenues | $1,283,593 | $1,140,067 | $143,526 | 12.6% | $1,140,067 | $1,117,203 | $22,864 | 2.0% | We generate product revenues from sales of our networking equipment. We derive subscription and support revenues from sales of our subscription and support offerings which includes SaaS offerings, maintenance contracts, professional services and training for our products. Product revenues increased $105.2 million or 14.9% for the year ended June 30, 2026, compared to fiscal 2025. The product revenues increase for the year ended June 30, 2026 as compared to fiscal 2025 was driven by average selling price improvements as a result of price increases implemented during fiscal 2026 and changes in product mix. Product revenues increased $5.2 million or 0.7% for the year ended June 30, 2025, compared to fiscal 2024. The product revenues increase for the year ended June 30, 2025 as compared to fiscal 2024 was driven by higher bookings and shipments in the second half of fiscal 2025 than in the corresponding period in fiscal 2024 which was impacted by elongated sales cycles to end customers and lower channel sell-through caused by macroeconomic conditions. Subscription and support revenues increased $38.4 million or 8.8% for the year ended June 30, 2026, compared to fiscal 2025. The increase in subscription and support revenues was driven by increased adoption of our cloud network management solutions, including Extreme Platform ONE. Subscription and support revenues increased $17.7 million or 4.2% for the year ended June 30, 2025, compared to fiscal 2024. The increase in subscription and support revenues was due to increased adoption of our cloud network management solutions and continued growth in our subscription business. We operate in three regions: Americas, EMEA (Europe, Middle East and Africa) and APAC (Asia Pacific). The following table presents the total net revenues geographically for the fiscal years ended June 30, 2026, 2025 and 2024 (in thousands, except percentages): | Net Revenues Americas: | Year Ended June 30, 2026 | June 30, 2025 | $ Change | % Change | Year Ended June 30, 2025 | June 30, 2024 | $ Change | % Change | | --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | | United States | $576,200 | $547,658 | $28,542 | 5.2% | $547,658 | $581,141 | $(33,483) | (5.8)% | | Other | 49,341 | 49,047 | 294 | 0.6% | 49,047 | 46,578 | 2,469 | 5.3% | | Total Americas | 625,541 | 596,705 | 28,836 | 4.8% | 596,705 | 627,719 | (31,014) | (4.9)% | | Percentage of net revenues | 48.8% | 52.3% | | | 52.3% | 56.2% | | | | EMEA | 534,304 | 451,649 | 82,655 | 18.3% | 451,649 | 421,966 | 29,683 | 7.0% | | Percentage of net revenues | 41.6% | 39.6% | | | 39.6% | 37.8% | | | | APAC | 123,748 | 91,713 | 32,035 | 34.9% | 91,713 | 67,518 | 24,195 | 35.8% | | Percentage of net revenues | 9.6% | 8.1% | | | 8.1% | 6.0% | | | | Total net revenues | $1,283,593 | $1,140,067 | $143,526 | 12.6% | $1,140,067 | $1,117,203 | $22,864 | 2.0% | ### Cost of Revenues and Gross Profit The following table presents the gross profit on product and subscription and support revenues and the gross profit percentage of net revenues for the fiscal years ended June 30, 2026, 2025 and 2024 (in thousands, except percentages): | Gross profit: | Year Ended June 30, 2026 | June 30, 2025 | $ Change | % Change | Year Ended June 30, 2025 | June 30, 2024 | $ Change | % Change | | --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | | Product | $457,974 | $403,631 | $54,343 | 13.5% | $403,631 | $333,498 | $70,133 | 21.0% | | Percentage of product revenues | 56.6% | 57.3% | | | 57.3% | 47.7% | | | | Subscription and support | 331,167 | 305,496 | 25,671 | 8.4% | 305,496 | 297,333 | 8,163 | 2.7% | | Percentage of subscription and support revenues | 69.9% | 70.1% | | | 70.1% | 71.1% | | | | Total gross profit | $789,141 | $709,127 | $80,014 | 11.3% | $709,127 | $630,831 | $78,296 | 12.4% | | Percentage of net revenues | 61.5% | 62.2% | | | 62.2% | 56.5% | | | Cost of product revenues includes costs of materials, amounts paid to third-party original design manufacturers, costs related to warranty obligations, charges for excess and obsolete inventory, scrap, distribution, product certification, amortization of developed technology intangibles, royalties under technology license agreements, and internal costs associated with manufacturing overhead, including management, manufacturing engineering, quality assurance, development of test plans, and document control. We outsource substantially all of our manufacturing. We conduct supply chain management, quality assurance, manufacturing, engineering, and document control at our facilities in San Jose, California, Salem, New Hampshire, Taiwan, Vietnam, Thailand and the Philippines. Product gross profit increased $54.3 million or 13.5% for the year ended June 30, 2026 as compared to the corresponding period in fiscal 2025. The increase in product gross profit was due to the increase in product revenues of $105.2 million, partially offset by a proportional increase in direct product costs and, to a lesser extent, increased distribution costs of $8.2 million and an increase in purchase price variances of $10.6 million driven by higher memory component costs. Product gross profit increased $70.1 million or 21.0% for the year ended June 30, 2025 as compared to the corresponding period in fiscal 2024. The increase in product gross profit was due to higher product revenues as well as lower provisions for excess and obsolete inventory and lower warranty costs, partially offset by higher overhead and distribution costs related to increased purchases of inventory. Our cost of subscription and support revenues consist of labor, overhead, repair and freight costs and the cost of service parts used in providing support under customer maintenance contracts as well as third-party professional services costs, data center costs and cloud hosting service costs. Subscription and support gross profit increased $25.7 million or 8.4% for the year ended June 30, 2026, as compared to the corresponding period in fiscal 2025. The increase in subscription and support gross profit was due to higher subscription revenues of $38.4 million related to increased adoption of our Extreme Platform ONE subscription, partially offset by $10.0 million of higher subscription hosting costs and $3.9 million in higher personnel costs. Subscription and support gross profit increased $8.2 million or 2.7% for the year ended June 30, 2025, as compared to the corresponding period in fiscal 2024. The increase in subscription and support gross profit was due to higher subscription revenues, partially offset by higher personnel costs and increased cloud service costs. ### Operating Expenses The following table presents operating expenses for the fiscal years ended June 30, 2026, 2025 and 2024 (in thousands, except percentages): | | Year Ended June 30, 2026 | June 30, 2025 | $ Change | % Change | Year Ended June 30, 2025 | June 30, 2024 | $ Change | % Change | | --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | | Research and development | $233,878 | $221,459 | $12,419 | 5.6% | $221,459 | $211,931 | $9,528 | 4.5% | | Sales and marketing | 364,305 | 327,563 | 36,742 | 11.2% | 327,563 | 345,802 | (18,239) | (5.3)% | | General and administrative | 125,277 | 139,621 | (14,344) | (10.3)% | 139,621 | 99,938 | 39,683 | 39.7% | | Restructuring and related charges | 1,265 | 1,492 | (227) | (15.2)% | 1,492 | 36,321 | (34,829) | (95.9)% | | Amortization of intangible assets | 1,721 | 2,043 | (322) | (15.8)% | 2,043 | 2,041 | 2 | 0.1% | | Total operating expenses | $726,446 | $692,178 | $34,268 | 5.0% | $692,178 | $696,033 | $(3,855) | (0.6)% | The following table highlights our operating expenses and operating income as a percentage of net revenues for the fiscal years ended June 30, 2026, 2025 and 2024: | | Year Ended June 30, 2026 | June 30, 2025 | June 30, 2024 | | --- | ---: | ---: | ---: | | Research and development | 18.2% | 19.4% | 19.0% | | Sales and marketing | 28.4% | 28.7% | 31.0% | | General and administrative | 9.8% | 12.2% | 8.9% | | Restructuring and related charges | 0.1% | 0.1% | 3.3% | | Amortization of intangible assets | 0.1% | 0.2% | 0.2% | | Total operating expenses | 56.6% | 60.7% | 62.3% | | Operating income (loss) | 4.9% | 1.5% | (5.8)% | ### Research and Development Expenses Research and development expenses consist of personnel costs (which includes compensation, benefits and stock-based compensation), consultant fees and engineering expenses related to the design, development, and testing of our products. Research and development expenses increased by $12.4 million or 5.6% for the year ended June 30, 2026 as compared to fiscal 2025, due to a $5.7 million increase in personnel costs due to increased compensation and benefits costs, a $4.0 million increase in information technology costs, and a $2.7 million increase in other costs primarily related to engineering project costs. Research and development expenses increased by $9.5 million or 4.5% for the year ended June 30, 2025 as compared to fiscal 2024, due to a $10.5 million increase in personnel costs due to increased compensation and benefits costs, a $2.9 million increase in other costs primarily related to software costs, professional service fees, non-recurring engineering project costs and travel costs and a $2.6 million increase in information technology costs, offset by a $6.5 million decrease in contractor costs. ### Sales and Marketing Expenses Sales and marketing expenses consist of personnel costs (which includes compensation, benefits and stock-based compensation) and related expenses for personnel engaged in marketing and sales functions, as well as trade shows and promotional expenses. Sales and marketing expenses increased by $36.7 million or 11.2% for the year ended June 30, 2026, as compared to fiscal 2025, due to a $17.2 million increase in personnel costs due to increased compensation and benefits costs, a $9.9 million increase in sales and marketing costs due to higher sales commissions, a $5.5 million increase in information technology costs, and a $4.1 million increase in other cost primarily related to professional service fees and travel costs. Sales and marketing expenses decreased by $18.2 million or 5.3% for the year ended June 30, 2025, as compared to fiscal 2024, due to a $9.8 million decrease in personnel costs due to lower head count, a $3.1 million decrease in contractor costs and professional fees, a $2.6 million decrease in information technology and facilities costs, a $2.3 million decrease in travel costs, and $0.4 million in other expenses primarily related to lower depreciation expense. ### General and Administrative Expenses General and administrative expenses consist of personnel costs (which includes compensation, benefits and share-based compensation), legal and professional service costs, travel and facilities and information technology costs. General and administrative expenses decreased by $14.3 million or 10.3% for the year ended June 30, 2026, as compared to fiscal 2025, due to a $25.9 million decrease in expense for legal costs related to litigation matters, a $9.5 million decrease in other costs primarily related to allocated information technology costs and depreciation, partially offset by a $9.0 million increase in personnel costs due to higher compensation and benefits costs, a $5.2 million increase in amortization of cloud computing implementation costs, a $3.3 million increase in professional fees, a $2.6 million increase in software licensing costs, and a $1.0 million increase in other costs primarily related to system transition costs. General and administrative expenses increased by $39.7 million or 39.7% for the year ended June 30, 2025, as compared to fiscal 2024, due to a $16.3 million increase in system transition costs, a $6.8 million increase in personnel costs due to higher compensation and benefits costs, a $24.2 million increase in expense for legal costs related to litigation matters and a $1.5 million increase in other costs primarily related to third-party licensing fees, information technology and travel costs, partially offset by a $5.2 million decrease in professional service fees and a $4.0 million decrease in depreciation expense. ### Restructuring and Related Charges During the fiscal years ended June 30, 2026, 2025 and 2024, we recorded restructuring and related charges of $1.3 million, $1.5 million and $36.3 million, respectively. #### Fiscal year 2026 During fiscal 2026, we completed the restructuring plans initiated in prior years and incurred restructuring charges of $0.5 million related to severance and benefits costs and asset disposal costs related to those plans. Additionally, we recorded approximately $0.7 million in restructuring charges related to a one-time early termination fee for a facility lease exit. Refer to Note 14, *Restructuring and Related Charges,* in the Notes to Consolidated Financial Statements included elsewhere in this Report for additional information. #### Fiscal year 2025 During fiscal 2025, we recorded $1.5 million of restructuring charges which were related to severance and benefits costs and professional services fees associated with the reduction-in-force actions related to the “Q2 2024 Plan” and “Q3 2024 Plan”, each as described in Note 14, *Restructuring and Related Charges,* in the Notes to Consolidated Financial Statements included elsewhere in this Report. #### Fiscal year 2024 During fiscal 2024, we recorded $36.3 million of restructuring charges which were related to severance and benefits costs and professional services fees associated with the reduction-in-force actions related to the “Q1 2024 Plan”, “Q2 2024 Plan”, and “Q3 2024 Plan”, each as described in Note 14, *Restructuring and Related Charges,* in the Notes to Consolidated Financial Statements included elsewhere in this Report. ### Amortization of Intangible Assets We recorded $1.7 million, $2.0 million and $2.0 million of amortization expense in operating expenses for intangible assets related to certain intangibles from previous acquisitions for the fiscal years ended June 30, 2026, 2025 and 2024, respectively. There were no acquisitions or impairments of intangible assets during fiscal years ended June 30, 2026, 2025 and 2024. ### Interest Income Interest income was $4.2 million, $4.3 million and $4.6 million for fiscal years ended June 30, 2026, 2025 and 2024, respectively. The decrease in interest income between each fiscal year was driven by lower interest earned on cash deposits. ### Interest Expense We recorded $13.8 million, $15.9 million, and $17.0 million of interest expense for fiscal years ended June 30, 2026, 2025 and 2024, respectively. The decrease in interest expense between each fiscal year was driven by lower interest rates on lower outstanding balances under the Amended Credit Agreement. ### Other Income (Expense), net We had other expense, net of $1.6 million and $1.1 million and other income, net of less than $0.1 million in fiscal years ended June 30, 2026, 2025 and 2024, respectively. The other income (expense), net for fiscal years ended June 30, 2026, 2025 and 2024 was due to foreign exchange gains or losses from the revaluation of certain assets and liabilities denominated in foreign currencies into U.S. Dollars. ### Provision for Income Taxes We are subject to income taxes in the United States and numerous foreign jurisdictions. Our effective tax rate differs from the U.S. federal statutory rate of 21% primarily due to the impact of (i) Global Intangible Low-Tax Income (“GILTI”), (ii) the full valuation allowance against our deferred tax assets in the U.S. and certain foreign jurisdictions, (iii) foreign income taxes of our international subsidiaries, and (iv) U.S. state taxes. For the fiscal years ended June 30, 2026, 2025 and 2024, we recorded income tax provisions of $9.4 million, $11.7 million, and $8.5 million, respectively. For fiscal years 2026, 2025 and 2024, our tax provision is primarily related to (i) taxes on our foreign operations, including foreign withholding taxes remitted to foreign tax authorities by customers on our behalf, (ii) US federal taxes resulting from our US operations, (iii) tax expense related to the establishment of a U.S. deferred tax liability for amortizable goodwill resulting from the acquisition of Enterasys Networks, Inc., the WLAN Business, the Campus Fabric Business and the Data Center Business and (iv) state taxes in states where we have exhausted available net operating losses or are subject to certain franchise taxes qualifying as income tax under the relevant tax accounting guidance. For a full reconciliation of our effective tax rate to the U.S. federal statutory rate and for further explanation of our provisions for income taxes, see Note 15, *Income Taxes*, in the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K. ### Critical Accounting Estimates The preparation of consolidated financial statements in accordance with generally accepted accounting principles requires management to make estimates, assumptions and judgments that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the period reported. By their nature, these estimates, assumptions and judgments are subject to an inherent degree of uncertainty. We base our estimates, assumptions and judgments on historical experience, market trends and other factors that are believed to be reasonable under the circumstances. Estimates, assumptions and judgments are reviewed on an ongoing basis and the effects of revisions are reflected in the consolidated financial statements in the period they are determined to be necessary. Actual results may differ from these estimates under different assumptions or conditions. We believe the critical accounting estimates described below, among others, require more significant judgments and estimates when used in the preparation of our consolidated financial statements. Historically, our assumptions, judgments and estimates relative to these areas have not differed materially from actual results. #### Revenue Recognition We derive the majority of our revenue from sales of our networking equipment, with the remaining revenues generated from sales of subscription and support, which primarily includes software subscriptions delivered as software as a service (“SaaS”) and additional revenues from maintenance contracts, professional services and training for the products we offer. We sell our products and SaaS and maintenance contracts direct to customers and to partners in two distribution channels, or tiers. The first tier consists of a limited number of independent distributors that stock our products and sell primarily to resellers. The second tier of the distribution channel consists of non-stocking distributors and value-added resellers that sell primarily to end-users. Products and services may be sold separately or in bundled packages. We consider customer purchase orders, which in some cases are governed by master sales agreements, to be the contracts with a customer. For each contract, we consider the promise to transfer products and services, each of which is distinct, to be the identified performance obligations. In determining the transaction price, we evaluate whether the price is subject to refund or adjustment to determine the net consideration to which we expect to be entitled. We generally do not grant return privileges and pricing credits to our value-added resellers, non-stocking distributors and end-user customers, except for defective products during the warranty period. We may provide sales incentives and other programs to these customers which are considered to be a form of variable consideration and we maintain estimated accruals and allowances using the historical actuals. Our stocking distributors are allowed certain price adjustments in the form of rebates and limited stock rotation rights. In determining the transaction price, we consider these rebates to be variable consideration which are estimated based on an analysis of historical claims at the distributor level. Stock rotation rights grant the distributor the ability to return certain specified amounts of inventory. Stock rotations are an additional form of variable consideration and are estimated based on an analysis of historical return rates. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. Certain of our contracts have multiple performance obligations, as the promise to transfer individual goods or services is separately identifiable from other promises in the contracts and, therefore, is distinct. For contracts with multiple performance obligations, we allocate the contract’s transaction price to each performance obligation based on our relative standalone selling price. The stand-alone selling prices are determined based on the prices at which we separately sell these products. For items that are not sold separately, we estimate the stand-alone selling prices using other observable inputs. Our performance obligations are satisfied at a point in time or over time as the customer receives and consumes the benefits provided. Substantially all of our product revenues are recognized at a point in time and our subscription and support revenues are recognized over time. For revenues recognized over time, we use an input measure, days elapsed, to measure progress. See Note 3, *Revenues*, in the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K for additional information. #### Inventory Valuation and Purchase Commitments We write down inventory and record purchase commitment liabilities for estimated excess and obsolete inventory equal to the difference between the cost of inventory and the estimated market value based upon the forecast of future product demand, product transition cycles, and market conditions. Any significant unanticipated changes in demand or technological development could have a significant impact on the value of our inventory and purchase commitments and our reported results. If actual market conditions are less favorable than those projected, additional inventory write-downs, purchase commitment liabilities, and charges against earnings may be required. #### New Accounting Pronouncements See Note 2, *Summary of Significant Accounting Policies*, in the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K for a full description of new accounting pronouncements, including the respective expected dates of adoption and effects on results of operations and financial condition. ### Liquidity and Capital Resources The following summarizes information regarding our cash and cash equivalents (in thousands): | | June 30, 2026 | June 30, 2025 | | --- | ---: | ---: | | Cash and cash equivalents | $211,758 | $231,745 | As of June 30, 2026, our principal sources of liquidity consisted of cash and cash equivalents of $211.8 million, accounts receivable, net of $164.6 million, and available borrowings under our 2023 Revolving Facility (as defined below) of $135.6 million. As described below under “2026 Credit Agreement,” on July 29, 2026 we terminated the Amended Credit Agreement and entered into a new $500.0 million revolving credit facility, under which $300.0 million of revolving commitments remained available for borrowing as of the closing date. We anticipate our principal uses of cash and cash equivalents for fiscal 2027 will be purchases of raw materials and finished goods inventory from our contract manufacturers, payroll, share repurchases, payments under debt obligations and related interest, payments under lease obligations, purchases of property and equipment and other operating expenses related to the development and marketing of our products. We believe that our existing cash and cash equivalents, cash flows from operations, and the availability of borrowings under the 2026 Revolving Facility will be sufficient to fund our planned operations for at least the next 12 months. We are not currently aware of any material cash requirements beyond the next 12 months other than those described above for fiscal 2027 and our known contractual obligations. See the section titled “*Contractual Obligations”* below. On February 18, 2025, we announced that our Board had authorized management to repurchase up to $200.0 million of shares of the Company's common stock over a three-year period, commencing July 1, 2025 (the “2025 Repurchase Program”). Under these repurchase programs, purchases may be made from time to time in the open market or pursuant to a 10b5-1 plan or through accelerated share repurchase agreements. The manner, timing and amount of any future purchases will be determined by our management based on their evaluation of market conditions, stock price, Extreme’s ongoing determination that it is the best use of available cash and other factors. The 2025 Repurchase Program does not obligate us to acquire any shares of our common stock, and it may be suspended or terminated at any time without prior notice and will be subject to regulatory considerations. During the year ended June 30, 2026, we repurchased a total of 5,377,808 shares of our common stock, at a total cost of $87.0 million, with an average price of $16.18 per share. As of June 30, 2026, we had $113.0 million available under the 2025 Repurchase Program. On June 22, 2023, we entered into the Second Amended and Restated Credit Agreement (the “2023 Credit Agreement”) by and among Extreme, as borrower, BMO Harris Bank, N.A., as an issuing lender and swingline lender, Bank of America N.A., JPMorgan Chase Bank, N.A., PNC Bank, National Association and Wells Fargo Bank, National Association as issuing lenders, the financial institutions or entities party thereto as lenders, and Bank of Montreal, as administrative agent and collateral agent, which amended and restated the 2019 Credit Agreement. The 2023 Credit Agreement provided for i) a $200.0 million first lien term loan facility in an aggregate principal amount (the “Term Facility”), ii) a $150.0 million five-year revolving credit facility (the “2023 Revolving Facility”) and, iii) an uncommitted additional incremental loan facility in the principal amount of up to $100.0 million plus an unlimited amount that is subject to pro forma compliance with specified Consolidated Leverage Ratio tests. We may use proceeds of the loans for working capital and general corporate purposes. At our election, the initial term loan (the “Initial Term Loan”) under the 2023 Credit Agreement may be made as either a base rate loan or a Secured Overnight Financing Rate (“SOFR loan”). The applicable margin for base rate loans ranges from 1.00% to 1.75% per annum, and the applicable margin for SOFR loans ranges from 2.00% to 2.75%, in each case based on the Company’s Consolidated Leverage Ratio. All SOFR loans are subject to a floor of 0.00% per annum and spread adjustment of 0.10% per annum. The 2023 Credit Agreement requires the Company to maintain certain minimum financial ratios at the end of each fiscal quarter. The 2023 Credit Agreement also includes covenants and restrictions that limit, among other things, the Company’s ability to incur additional indebtedness, create liens upon any of its property, merge, consolidate or sell all or substantially all of its assets. The 2023 Credit Agreement also includes customary events of default which may result in acceleration of the outstanding balance. On August 14, 2024, we entered into an Amendment Number One to the 2023 Credit Agreement (the 2023 Credit Agreement as amended by that certain Amendment Number One, the “Amended Credit Agreement”). Under the Amended Credit Agreement, we modified the definition of the consolidated EBITDA for the purposes of evaluating compliance with financial covenants under the Amended Credit Agreement. The amended definition of consolidated EBITDA modified the amount and type of add-backs that are allowable to better align with our operations and activities. During the year and as of June 30, 2026, we were in compliance with all the terms and financial covenants under the Amended Credit Agreement. The Amended Credit Agreement was terminated on July 29, 2026 in connection with our entry into the 2026 Credit Agreement described below. On July 29, 2026, we entered into a Credit Agreement (the “2026 Credit Agreement”) with the lenders party thereto and JPMorgan Chase Bank, N.A., as administrative agent. The 2026 Credit Agreement provides for a five-year revolving loan facility in an aggregate principal amount of $500.0 million (the “2026 Revolving Facility”). The 2026 Revolving Facility includes an uncommitted accordion feature, pursuant to which we may request incremental revolving loan commitments and/or incremental term loans in an aggregate amount not to exceed the sum of (A) the greater of (i) $175.0 million and (ii) 100.0% of Consolidated EBITDA, plus (B) an amount equal to any voluntary prepayments (in the case of voluntary prepayments of revolving indebtedness, accompanied by a permanent reduction to the related revolving commitments) of indebtedness under the 2026 Revolving Facility and other first lien indebtedness, plus (C) an unlimited amount subject to pro forma compliance with our consolidated total net leverage ratio and consolidated interest charge coverage ratio financial covenants. Borrowings under the 2026 Revolving Facility will bear interest at a fluctuating rate per annum equal to, at our option, either the Alternate Base Rate (as defined in the 2026 Credit Agreement) or the Adjusted Term SOFR Rate (as defined in the 2026 Credit Agreement) in each case, plus an applicable margin that is calculated based on our consolidated total net leverage ratio from time to time and ranges from 1.25% to 2.00% in the case of loans accruing interest based on the Adjusted Term SOFR Rate and from 0.25% to 1.00% in the case of loans accruing interest based on the Alternate Base Rate (it being understood that the Adjusted Term SOFR Rate as defined can be no lower than 0.00% and the Alternate Base Rate as defined can be no lower than 1.00%). In addition, we have agreed to pay to the lenders under the 2026 Credit Agreement certain customary fees, including a commitment fee on the average daily unused portion of the revolving commitments under the 2026 Revolving Facility, which ranges from 0.20% to 0.25% based on our consolidated total net leverage ratio from time to time. Financial covenants under the 2026 Credit Agreement require us to maintain (i) a consolidated interest charge coverage ratio of at least 3.00 to 1.00 at the end of each fiscal quarter, commencing with the fiscal quarter ending September 30, 2026, and (ii) a consolidated total net leverage ratio not to exceed 3.75 to 1.00 (with a step-up to 4.25 to 1.00 for a specified period of time upon consummation of a material acquisition) at the end of each fiscal quarter, commencing with the fiscal quarter ending September 30, 2026. The 2026 Credit Agreement also includes covenants and restrictions that limit, among other things, our ability to incur additional indebtedness, create liens upon any of its property, merge, consolidate, or sell all or substantially all of its assets. On the closing date of the 2026 Credit Agreement, we repaid all outstanding indebtedness under the Amended Credit Agreement, together with all accrued and unpaid interest and fees. At closing, we borrowed $200.0 million under the 2026 Revolving Facility and used the proceeds to repay the outstanding indebtedness under the Amended Credit Agreement and to pay fees and expenses related to the 2026 Revolving Facility. As of the closing date, $200.0 million of revolving loans were outstanding under the 2026 Revolving Facility and $300.0 million of revolving commitments remained available for borrowing thereunder. #### Key Components of Cash Flows and Liquidity A summary of the sources and uses of cash and cash equivalents is as follows for the fiscal years ended June 30, 2026, 2025 and 2024 (in thousands): | | Year Ended June 30, 2026 | June 30, 2025 | June 30, 2024 | | --- | ---: | ---: | ---: | | Net cash provided by operating activities | $123,182 | $152,031 | $55,486 | | Net cash used in investing activities | (27,941) | (24,713) | (18,121) | | Net cash used in financing activities | (114,500) | (52,586) | (114,978) | | Foreign currency effect on cash and cash equivalents | (728) | 314 | (514) | | Net increase (decrease) in cash and cash equivalents | $(19,987) | $75,046 | $(78,127) | Cash and cash equivalents were $211.8 million at June 30, 2026, representing a decrease of approximately $20.0 million from $231.7 million at June 30, 2025. This decrease was due to cash used in financing activities of $114.5 million mainly as a result of payments for borrowings under the Amended Credit Agreement and share repurchases as well as cash used in investing activities of $27.9 million for purchases of property and equipment and capitalized software development costs, offset by cash provided by operating activities of $123.2 million. Cash and cash equivalents were $231.7 million at June 30, 2025, representing an increase of $75.0 million from $156.7 million at June 30, 2024. This increase was due to cash provided by operating activities of $152.0 million, offset by cash used in financing activities of $52.6 million mainly as a result of payments for borrowings under the Amended Credit Agreement and share repurchases as well as cash used in investing activities of $24.7 million for purchases of property and equipment. #### Net Cash Provided by Operating Activities Cash provided by operating activities during the fiscal year ended June 30, 2026 was $123.2 million. Factors contributing to cash provided by operating activities were net income of $42.1 million and non-cash expenses of $129.5 million for items such as amortization of intangible assets, amortization of cloud computing implementation costs, stock-based compensation, depreciation, reduction in carrying amount of right-of-use assets, provision for excess and obsolete inventory and interest. Other sources of cash for the period included a decrease in inventories and increases in accounts payable, accrued compensation and benefits and deferred revenue. This was partially offset by increases in net accounts receivable and prepaid expenses and other assets, and decreases in operating lease liabilities and other current and long-term liabilities. Cash provided by operating activities during the fiscal year ended June 30, 2025 was $152.0 million. Factors contributing to cash provided by operating activities were the net loss of $7.5 million and non-cash expenses of $118.1 million for items such as amortization of intangible assets, stock-based compensation, depreciation, reduction in carrying amount of right-of-use assets, provision for excess and obsolete inventory and interest. Other sources of cash for the period included a decrease in inventories and increases in accounts payable, accrued compensation and benefits, deferred revenue and other accrued liabilities. This was partially offset by increases in net accounts receivable and prepaid expenses and other assets, and a decrease in operating lease liabilities. Cash provided by operating activities during the fiscal year ended June 30, 2024 was $55.5 million. Factors contributing to cash provided by operating activities were the net loss of $86.0 million and non-cash expenses of $187.6 million for items such as amortization of intangible assets, stock-based compensation, depreciation, reduction in carrying amount of right-of-use assets, deferred income taxes, provision for excess and obsolete inventory and interest. Other sources of cash for the period included a decrease in accounts receivable and increases in deferred revenue and other current liabilities. These amounts were partially offset by increases in inventories and prepaid expenses and other assets and decreases in accounts payable, accrued compensation and benefits, and operating lease liabilities. #### Net Cash Used in Investing Activities Cash used in investing activities during the fiscal year ended June 30, 2026 was $27.9 million for purchases of property and equipment and capitalized software development costs. Cash used in investing activities during the fiscal year ended June 30, 2025 was $24.7 million for purchases of property and equipment. Cash used in investing activities during the fiscal year ended June 30, 2024 was $18.1 million for purchases of property and equipment. #### Net Cash Used in Financing Activities Cash used in financing activities during the fiscal year ended June 30, 2026 was $114.5 million due to share repurchases of $87.0 million, debt repayments of $15.0 million and $12.5 million in payments for taxes on vested and released stock awards net of proceeds from the issuance of shares of our common stock under our Employee Stock Purchase Plan (“ESPP”) and through exercise of stock options. Cash used in financing activities during the fiscal year ended June 30, 2025 was $52.6 million due to share repurchases of $38.0 million, debt repayments of $10.0 million and $3.9 million in payments for taxes on vested and released stock awards net of proceeds from the issuance of shares of our common stock under our ESPP and through the exercise of stock options. Cash used in financing activities during the fiscal year ended June 30, 2024 was $115.0 million due primarily to share repurchases of $49.9 million, payments on the 2023 Revolving Facility of $55.0 million, debt repayments of $10.0 million and a $30.1 million payment for taxes on vested and released stock awards net of proceeds from the issuance of shares of our common stock under our ESPP. The amounts were partially offset by cash received of $30.0 million from borrowings under the 2023 Revolving Facility. #### Foreign Currency Effect on Cash and cash equivalents Foreign currency effect on cash and cash equivalents decreased in 2026, primarily due to changes in exchange rates between the U.S. Dollar and the Indian Rupee, U.K. Pound, and the Euro. #### Contractual Obligations As of June 30, 2026, we had contractual obligations for debt obligations, purchase obligations, lease obligations and other obligations. Our debt obligations relate to amounts owed under our Amended Credit Agreement. As of June 30, 2026, we have $165.0 million of debt outstanding which is payable in quarterly installments through our fiscal year 2028. We are subject to interest on our debt obligations and unused commitment fee. See Note 7, *Debt,* in the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K for additional information regarding our debt obligations. Our unconditional purchase obligations represent the purchase of long lead-time component inventory that our contract manufacturers procure in accordance with our forecast. We expect to honor the inventory purchase commitments within the next 12 months. As of June 30, 2026, we have non-cancelable commitments to purchase $112.5 million of inventory. See Note 9, *Commitments and Contingencies,* in the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K for additional information regarding our purchase obligations. We lease facilities under operating lease arrangements at various locations that expire at various dates through our fiscal year 2033. As of June 30, 2026, the value of our obligations under operating leases was $30.8 million. See Note 8, *Leases*, in the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K for additional information regarding our lease obligations. We have contractual commitments with our suppliers which represent commitments for future services. As of June 30, 2026, we have contractual commitments of $21.5 million that are due through our fiscal year 2029. We have immaterial income tax liabilities related to uncertain tax positions and we are unable to reasonably estimate the timing of the settlement of those liabilities. We do not have any material commitments for capital expenditures as of June 30, 2026. #### Off-Balance Sheet Arrangements We did not have any off-balance sheet arrangements as of June 30, 2026. ## Market risk As filed, 4,450 characters. ### Interest Rate Sensitivity Our exposure to market risk for changes in interest rates relates primarily to our financial debt and foreign currencies. As of June 30, 2026, we did not have any financial investments that were exposed to interest rate risk. ### Debt At certain points in time we are exposed to the impact of interest rate fluctuations, primarily in the form of variable rate borrowings from the Amended Credit Agreement, which is described in Note 7, *Debt*, in the Notes to Consolidated Financial Statements included in Item 8 of this Annual Report on Form 10-K. As of June 30, 2026, we had $165.0 million of debt outstanding, all of which was from the Amended Credit Agreement. Through the end of our fiscal year 2026, the average daily outstanding amount was $182.6 million with a high of $205.0 million and a low of $165.0 million. As of June 30, 2026 we have not entered into any derivative instruments to hedge the impact of the changes in variable interest rates under our Amended Credit Agreement. The following table presents hypothetical changes in interest expense for the year ended June 30, 2026, on the outstanding borrowings under the Amended Credit Agreement as of June 30, 2026, that are sensitive to changes in interest rates (in thousands): | Description | Change in interest expense given a decrease in interest rate of X bps\* (100 bps) | (50 bps) | Average outstanding as of June 30, 2026 | Change in interest expense given an increase in interest rate of X bps\* 100 bps | 50 bps | | --- | ---: | ---: | ---: | ---: | ---: | | Debt | $(1,826) | $(913) | $182,634 | $1,826 | $913 | **\*** Underlying interest rate was 5.77% as of June 30, 2026. ### Exchange Rate Sensitivity A majority of our sales and our expenses are denominated in U.S. Dollars. While we conduct sale transactions and incur certain operating expenses in foreign currencies and expect to continue to do so, we do not anticipate that foreign exchange gains or losses will be significant, in part because of our foreign exchange risk management process discussed below. #### Foreign Exchange Forward Contracts We record all derivatives on the balance sheet at fair value. From time to time, we enter into foreign exchange forward contracts to mitigate the effect of gains and losses generated by the foreign currency forecast transactions related to certain operating expenses and re-measurement of certain assets and liabilities denominated in foreign currencies. Changes in the fair value of these foreign exchange forward contracts are offset largely by re-measurement of the underlying foreign currency denominated assets and liabilities. As of June 30, 2026 and June 30, 2025, foreign exchange forward currency contracts not designated as hedging instruments had the total notional principal amounts of $68.0 million and $57.2 million, respectively. Changes in the fair value of derivatives are recognized in “other income (expense), net.” For the fiscal years ended June 30, 2026, 2025, and 2024, the consolidated statements of operations included net losses of $4.0 million, net gains of $1.0 million, and net losses of $0.3 million, respectively from these contracts. There were no foreign exchange forward currency contracts that were designated as hedging instruments at June 30, 2025 and 2024. #### Zero-Cost Collar Contracts Changes in the fair value of our zero-cost collar contracts are recorded as a component of “Accumulated other comprehensive loss” in the consolidated balance sheets. Amounts recorded in “Accumulated other comprehensive loss” related to the changes in the fair value of these derivatives are reclassified to the consolidated statement of operations in the same period that the underlying hedged transaction affects earnings. As of June 30, 2026, zero-cost collar contracts designated as cash flow hedges had a total notional principal amount of $82.5 million and unrealized losses of $1.8 million. For the year ended June 30, 2026, these contracts had realized net losses of $0.7 million that were reclassified to the consolidated statement of operations. As of June 30, 2025, there were no outstanding zero-cost collar contracts that were designated as hedging instruments. #### Foreign Currency Transactions For the fiscal years ended June 30, 2026, 2025 and 2024 we recognized foreign currency transaction net gains of $2.5 million, net losses of $1.8 million, and net gains of $0.6 million, respectively. ## Controls and procedures As filed, 5,622 characters. ### Evaluation of Disclosure Controls and Procedures Disclosure controls and procedures are controls and procedures designed to reasonably assure that information required to be disclosed in our reports filed under the Exchange Act, such as this Annual Report on Form 10-K, is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and to reasonably assure that such information is accumulated and communicated to our management, including the Chief Executive Officer (“CEO”) and the Chief Financial Officer (“CFO”), as appropriate to allow timely decisions regarding required disclosure. Under the supervision and with the participation of our management, including our CEO and CFO, we evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this Annual Report on Form 10-K. Based on this evaluation, our CEO and CFO concluded that our disclosure controls and procedures were effective as of June 30, 2026. ### Management’s Report on Internal Control over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over our financial reporting. There are inherent limitations in the effectiveness of any system of internal control, including the possibility of human error and the circumvention or overriding of controls. Accordingly, even effective internal controls can provide only reasonable assurances with respect to financial statement preparation. Further, because of changes in conditions, the effectiveness of internal control may vary over time. We assessed the effectiveness of our internal control over financial reporting as of June 30, 2026. In making this assessment, we used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework (2013). Based on our assessment using those criteria, we concluded that, as of June 30, 2026, our internal control over financial reporting is effective. Our independent registered public accounting firm, Grant Thornton LLP, has audited the consolidated financial statements as of and for the year ended June 30, 2026 included in this Annual Report on Form 10-K and has issued its report on our internal control over financial reporting as of June 30, 2026. ### Changes in Internal Control over Financial Reporting During the year ended June 30, 2026, we completed the implementation of a new enterprise resource planning (“ERP”) system. In connection with this implementation, we made certain changes to our internal control over financial reporting related to the affected processes. These changes significantly affected our internal control over financial reporting during fiscal 2026. We have tested the design and operating effectiveness of the new and modified controls and concluded that our internal control over financial reporting was effective as of June 30, 2026. We will continue to evaluate further changes, if any, to our internal control over financial reporting in subsequent periods to confirm that our internal control over financial reporting remains effective. Other than changes resulting from the ERP implementation, there were no changes in our internal control over financial reporting (as defined in Rules 13a–15(f) and 15d–15(f) under the Exchange Act) during the fourth quarter of fiscal 2026 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. ### Inherent Limitations on Effectiveness of Controls Our management, including the CEO and CFO, does not expect that our disclosure controls or our internal control over financial reporting will prevent or detect all error and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. Our controls and procedures are designed to provide reasonable assurance that our control system’s objective will be met, and our CEO and CFO have concluded that our disclosure controls and procedures are effective at the reasonable assurance level. The design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Further, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, within Extreme have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Controls can also be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls is based in part on certain assumptions about the likelihood of future events. Projections of any evaluation of the effectiveness of controls in future periods are subject to risks. Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with policies or procedures. Notwithstanding these limitations, our disclosure controls and procedures are designed to provide reasonable assurance of achieving their objectives. Our CEO and CFO have concluded that our disclosure controls and procedures are, in fact, effective at the “reasonable assurance” level. Filed Aug 17, 2026. Source: SEC EDGAR, the filing index for accession 0001193125-26-352872. Last ingested by Listed: Nov 6, 2026, 18:19 ET. No prices; not investment advice.