European momentum
Europe was a key driver in Adtran’s third-quarter results.
While the company did not specify the service provider, Adtran saw an uptick in Optical Networking and Subscriber Solutions, while anticipating that Access & Aggregation could produce positive results in 2026.
“The quarter was led by strong results in Optical Networking and Subscriber Solutions, while Access & Aggregation reflected anticipated buying patterns of 2 large European customers,” Stanton said. “We expect those customers to come back online either early--late in the fourth quarter or early next year. We remain confident in the overall market for the remainder of this year, however.”
He added that the optical agreement came “incredibly quick,” but “the access portion will take longer.”
Another potential opportunity Adtran is pursuing is in Germany, where the government has mandated service providers to "rip and replace" Huawei equipment from their wireline and wireless 5G networks due to national security concerns.
The German government is now considering using public funds to subsidize the costly replacement process for telecom operators like Deutsche Telekom. This follows a government decision in July 2024 to phase out Chinese 5G network components from its infrastructure.
Other than acknowledging the German government’s mandate, Stanton did not elaborate on any specific activity it had with any carrier in the country.
“There's been a lot of talk over the last few weeks about trying to accelerate that process in Germany,” he said. “I don't think there's been any material rip and replace at this point. I think what they've been trying to do is effectively cap utilization on an ongoing basis.”
Optical leads Q3 revenues
Optical networking solutions were the star performer in its revenue mix, growing 47% year-over-year and 15% sequentially, due to strong momentum in Europe, including deployments with a new large service provider.
Adtran added 15 new optical customers in the quarter, reflecting what Stanton said was “continued share gains and the expanding reach of our portfolio.”
He added that the demand for optical networking solutions “is robust and geographically diverse, supporting an array of applications, including national networks throughout Europe, secure connectivity for major enterprises and government clients worldwide, with high-capacity interconnects for large-scale content providers.”
The company also saw strength in Access & Aggregation with revenue growing 12% year-over-year, supported by ongoing fiber access investments among regional operators in the U.S. and Europe.
“While revenues from our small and medium service providers in the U.S. were substantially up, this increase was offset by the seasonal buying pattern of 2 major European customers,” Stanton said. “We added 14 new customers for our fiber access and Ethernet aggregation platforms, demonstrating continued traction across both new and existing markets.”
Finally, Adtran’s Subscriber Solutions revenue grew 12% year-over-year and 21% sequentially, driven by demand for both residential and wholesale applications.
Stanton said that it “added 18 new Subscriber Solutions customers during the quarter as service providers continued expanding fiber reach and upgrading Wi-Fi capabilities.”
From an overall revenue perspective, it reported $279.4 million, reflecting year-over-year growth across all three revenue categories.
Stanton said these results mark “the fifth consecutive quarter of sequential growth and fourth consecutive quarter of year-over-year improvement, proof points that our portfolio strategy and market positioning are driving sustainable momentum.”
Adtran’s total third quarter revenue was $279.4 million, up 23% year-over-year, finishing at the high end of the company’s guidance.
For the fourth quarter of 2025, Adtran expects revenue to be within the range of $275 million to $285 million.
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