Adtran’s CEO expects the BEAD program's impact to become more meaningful
Key Highlights
- Adtran expects the BEAD program to positively impact its Access and Aggregation unit starting in the fourth quarter of 2026.
- The company's revenue was $286.1 million in Q1 2026, with strong growth in the US and Europe, driven by fiber deployment and service provider investments.
- Subscriber solutions revenue increased by 22%, supported by fiber-to-the-home, Wi-Fi 7, and carrier Ethernet investments.
- Optical networking solutions saw a 24% year-over-year increase, reflecting broad demand for cloud connectivity and higher bandwidth services.
- Market expansion is supported by equipment replacement initiatives in Europe and demand from cloud and hyperscaler customers.
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Adtran is hopeful that as more states begin receiving their Broadband Equity Access and Deployment Program (BEAD) funding allocations, this will positively impact its Access and Aggregation unit.
Driven by broad-based strength across the US and Europe, Access and Aggregation solutions revenue was $90.5 million in the first quarter, up 2% year-over-year and 14% sequentially.
Speaking to investors during its first-quarter 2026 earnings call, Tom Stanton, CEO of Adtran, said it will see the benefits of the BEAD program in the fourth quarter.
“In the US, BEAD deployment funding is beginning to reach operators in select states,” he said. “And while we are seeing early orders from several customers, we expect the impact to become more meaningful as we move towards the back half of the year.”
BEAD visibility
As BEAD program funding is allocated to states, Adtran is seeing more of its customers putting together their deployment plans.
“Now what you're seeing is kind of individual customers deciding how they want to roll out,” Stanton said. “We have some customers who have already placed purchase orders, and they're rolling out and/or at least making sure that they've got supplies to be able not to be hamstrung.”
However, how quickly its customer base rolls out network plans related to the BEAD program depends on its size as well as local issues, such as the ability to get permits for rights-of-way inside cities and towns approved.
“The smaller the customer, the easier that is,” Stanton said. “For larger customers, the biggest pull is deploying the fiber itself, which is why we've been saying the end of this year is probably when you start seeing that.”
While he could not provide a specific estimate for BEAD because there are too many customers and too many unknowns about the program, Stanton said, “BEAD definitely will be helpful” to its Access and Aggregation unit.
Access, optical lead revenue mix
Driven by gains across its key segments—Access and Aggregation, Optical Networking and Subscriber solutions, Adtran’s first quarter revenue was $286.1 million, up 15.5% year-over-year and returning to what the company said is a more normalized seasonal pattern.
From a geographic perspective, U.S. revenue was $146.2 million, representing 51% of total revenue, up 42% year over year and 7% sequentially. Non-US revenue was $139.9 million or 49% of total revenue.
Stanton said that “these results reflect the continued strength of our core markets and the operating leverage we have now firmly established across the business.”
Access and aggregation solutions revenue was $90.5 million or about 32% of total revenue, up 2% year over year and 14% sequentially.
Driven by broad-based strength across the US and Europe, Stanton said, “We expect steady progress across our European business through the remainder of the year” for access and aggregation.
Adtran also made gains in subscriber solutions, with revenue of $98.2 million in the first quarter, up 22% year-over year. “Demand remains healthy, supported by continued investment in fiber-to-the-home, multi-gig Wi-Fi 7 and carrier Ethernet applications,” Stanton said. “In recent weeks, our SDG Wi-Fi 7 portfolio received conditional FCC approval, exempting our platforms from covered list restrictions.”
Finally, Optical networking solutions also saw a boost with $97.3 million in revenue or 34% of total revenue, up 24% year over year.
Stanton noted that while sales to its larger customers and hyperscaler data center providers “were offset by seasonal declines with smaller customers and government sales, across our service provider base, demand remains healthy.”
“Operators across all geographies are expanding wholesale optical capacity to support growing demand for cloud connectivity and higher bandwidth services, reflecting a broad-based trend,” he said.
He added that in Europe, equipment replacement initiatives “continue to add to that demand with growing strength among our cloud and hyperscaler customers, and a positive outlook across our service provider base.”
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Sean Buckley
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