Adtran’s Q2 optical uptick buoyed by U.S. service provider spending

Stanton said its new customers reflect the diverse application demands for optical networking gear.

“There are multiple application demand drivers fueling the investment in optical networks, including the build-out of private compute infrastructure, the expansion of wholesale service providers to connect AI infrastructure, ongoing 5G densification and upgrading critical infrastructure,” he said. “Combining these application demands with new customer wins and a return to more normalized service provider buying patterns gives us optimism for sustained growth in this category.”

Tier 2s ramp optical, access

In the optical networking side, Adtran is gaining greater traction with Tier 2 service providers and competitive providers.

Stanton estimated that about 50% of the new business was from customers buying either optical or fiber access platforms.

“This was good to see because that was kind of the premise of the acquisition that we did three quarters ago or three years ago,” he said. “Tier 2, Tier 3s, we added somewhere around 10 or 11 carriers during the quarter just for fiber access alone.”

In tandem with optical and fiber access, Adtran saw an uptick in fiber access and subscriber platforms from traditional providers.

“We added somewhere around 10 or 11 carriers during the quarter just for fiber access alone. And I mentioned we added 20 customers on the subscriber space,” Stanton said. “The majority of those were carriers.”

He added, “the next largest segment was in government municipalities,” which “continues to be very active.”

Adtran is bullish about its third-quarter opportunities for optical and access.  

“The biggest driver right now is the upgrade of the network for residential broadband,” Stanton said. “That's driving the most significant piece of our kind of revenue growth over the last few quarters. The next most considerable driver will be optical, returning to normality.”

Optical and access lead revenue

Led by its optical networking unit, Adtran saw sequential and year-over-year revenue growth across three of its categories.

Adtran reported $265.1 million in second-quarter revenue, up 17% year-over-year, which Stanton said “was above the high end of our previous guidance range.”

Overall, Adtran saw growth across all its categories.

Network Solutions reported $219 million in revenue, while Services and Support reported $46 million. Within its three main categories—Subscriber Solutions, Access & Aggregation Solutions and Optical Networking Solutions—Adtran saw gains.

Subscriber Solutions was $83.8 million or 32% of total revenue, increasing 2% year-over-year, while Access and Aggregation Solutions were $91.2 million.

On a geographic basis, International led the way with $145 million and the U.S. with $ 120.3 million.

“All three revenue categories delivered sequential growth,” Stanton said. “And for the second straight quarter, each revenue category generated year-over-year gains. This broad-based momentum reinforces the strong competitive positioning of our optical transport, fiber access and subscriber solutions portfolios.”

For the third quarter of 2025, the company expects revenue to be in the range of $270 million to $280 million.

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