NTCT 10-K & 10-Q changes, risk factors and insider trading
Netscout Systems Inc. · Nasdaq · Services-Computer Integrated Systems Design · CIK 1078075 · All filings on SEC.gov
At a glance
What changed in the latest 10-K
Risk Factors
New heading “Summary of Risk Factors”
New heading “If we are unable to effectively use or integrate AI, or if our use of AI exposes us to significant risks, we may not achieve intended benefits and our results of operations could be adversely affected.”
New heading “A portion of our revenue is generated by sales to government entities, which are subject to a number of challenges and risks.”
New heading “International trade policies, including trade protection measures such as tariffs, sanctions, and trade barriers may adversely affect our business, financial condition, results of operations, and prospects.”
New heading “Our business is subject to laws, regulations and expectations relating to sustainability, human capital, governance and other corporate responsibility matters, which could increase costs and expose us to additional risks.”
New heading “If we fail to maintain effective disclosure controls and procedures and internal control over financial reporting, investor confidence in our financial statements could decline, which could negatively impact the market price of our stock or our ability to raise capital.”
Removed heading “International trade policies, including trade protection measures such as tariffs, sanctions and trade barriers may adversely affect our business, financial condition, results of operations and prospects.”
Removed heading “Our ability to quickly and successfully recover from a disaster, public health crisis, or other business continuity event could affect our ability to deliver our products and negatively impact our business reputation.”
Removed heading “Our business is subject to evolving ESG laws, regulations and expectations that could expose us to numerous risks, including risks to our reputation, business, financial performance and growth.”
Removed heading “Our disclosure controls and procedures and internal control over financial reporting may not be effective.”
Largest changes
see in full comparisonWe could be materially adversely affected by increased regulation of the Internet and Internet commerce in any country where we operate, as well as access to or commerce conducted on the Internet. Further, governments may change or increase regulation or restriction of sales, licensing, distribution, and exporting or importing of certain technologies to certain countries.The adoption of additionalregulationregulations of the Internetand Internet commercecould decrease demand for our products, and, at the same time, increase the cost of selling our products, which could have a material and adverse effect on our financial condition and results of operations.Failure to comply with governmental laws and regulations related to evolving technologies, such as AI, could harm our business.Our business is subject to regulation by various federal, state, local and foreign governments. In certain jurisdictions, these regulatory requirements may be more stringent than those in the United States. These laws and regulations may also impact our innovation and business drivers in developing or using new and emerging technologies, including those related to AI and machine learning.Noncompliance with applicable regulations or requirements could subject us to investigations, sanctions, enforcement actions, lost profits, fines, damages, civil and criminal penalties, injunctions or other consequences. If any governmental sanctions are imposed, or if we do not prevail in any possible civil or criminal litigation, our business, reputation, results of operations, and financial condition could be materially adversely affected. In addition, responding to any action will likely result in a significant diversion of management’s attention and resources.
“The use of AI by third parties or us may increase the risk of cybersecurity incidents or unauthorized access and could expose sensitive, confidential, proprietary, or personal data. In addition, while we have policies, protocols, and procedures in place, our use of AI may increase the risk of claims that our use of data, training materials, or outputs violates contractual, legal, or ethical standards, including with respect to intellectual property. …”see in full comparison
“We are subject to stringent and evolving U.S. state, local, and federal, and foreign laws, regulations, and rules, contractual obligations, industry standards, policies, and other obligations related to data privacy and security. Our actual or perceived failure to comply with such obligations (or such failure by third parties with whom we work) could lead to regulatory investigations or actions; litigation; fines and penalties; disruptions of our business, results of operations; reputational harm; loss of revenue or profits; and other adverse business consequences.”see in full comparison
“Failure to comply with applicable laws and regulations governing Internet access could subject us to investigations, sanctions, enforcement actions, lost profits, fines, damages, civil and criminal penalties, injunctions or other consequences, and could materially adversely affect our business, reputation, results of operations and financial condition. In addition, responding to any action will likely result in a significant diversion of management’s attention and resources.”see in full comparison
“Trade disputes, trade restrictions (including export control laws and regulations and tariffs) and political tensions between the U.S. and other countries may also exacerbate unfavorable macroeconomic conditions, including inflationary pressures, foreign exchange volatility, financial market instability and economic recessions or downturns, which may in turn negatively impact customer demand for our products and services, delay renewals, or limit expansion opportunities with existing customers or otherwise negatively impact our business and operations. …”see in full comparison
“If our information technology systems, or those of third parties with whom we work, or our data are or were compromised, we could experience adverse consequences resulting from such compromise, including but not limited to regulatory investigations or actions; litigation; fines and penalties; disruptions of our business operations; reputational harm; loss of revenue or profits; and other adverse consequences.”see in full comparison
Full comparison: every changed paragraph (167)
You should carefully consider the risks and uncertainties described below, together with the information included elsewhere in this Annual Report and in our other documentsSEC we file with the SEC.filings. The risks and uncertainties described below are those that we have identified as material; but they are not theexhaustive; only risks and uncertainties facing us. Our business is also subject to general risks and uncertainties that affect many other companies. Additionaladditional risks and uncertainties not currently known to us or that we currently believe are immaterial may also impair our business, including our results of operations, liquidity, and financial condition.
Summary of Risk Factors
Unfavorable and uncertain conditions in our industry, our customers' industries, the global economy, or reductions in information technology spending could limit our ability to grow or maintain our business and negatively affect our results of operations.
Potential product vulnerabilities or critical security defects, prioritization decisions regarding remedying vulnerabilities or security defects, or customers not deploying security releases or deciding not to upgrade products, services, or solutions could result in claims of liability against us, damage our reputation, or otherwise harm our business.
If our products contain material errors or quality issues, such issues may be costly to correct, revenue may be delayed, we could be sued, and our reputation could be harmed.
If our information technology systems, or those of third parties with whom we work, or our data are or were compromised, we could experience adverse consequences resulting from such compromise, including but not limited to regulatory investigations or actions; litigation; fines and penalties; disruptions of our business operations; reputational harm; loss of revenue or profits; and other adverse consequences.
If we fail to introduce new products and solutions or enhance our existing products and solutions to keep up with rapid technological change, demand for our products and solutions may decline.
If we are unable to effectively use or integrate AI, or if our use of AI exposes us to significant risks, we may not achieve intended benefits and our results of operations could be adversely affected.
Disruptions in our global supply chain and our reliance on sole or limited source suppliers could adversely impact our business.
A portion of our revenue is generated by sales to government entities, which are subject to a number of challenges and risks.
Increased customer demands on our technical support services may adversely affect our relationships with our customers and our financial results.
The success of our business depends, in part, on the continued growth in the market for and the continued commercial demand for enterprise network observability, carrier service assurance, cybersecurity, and DDoS protection solutions.
Failure to manage growth properly and to implement enhanced automated systems, including systems with AI, could adversely impact our business.
Our success depends, in part, on our ability to manage and leverage our distribution channels. Disruptions to, or our failure to effectively develop and manage, these partners and the processes and procedures that support them could adversely affect our ability to generate revenues from the sale of our products and services. Managing these distribution channels and relationships requires experienced personnel, and lack of sufficient expertise could lead to a decrease in sales of our products and services, which could cause our operating results to suffer.
International trade policies, including trade protection measures such as tariffs, sanctions, and trade barriers may adversely affect our business, financial condition, results of operations, and prospects.
Our business and operations, and the operations of our customers, partners, and/or suppliers, may be adversely affected by significant business continuity events.
Necessary licenses for third-party technology may not be available to us on commercially reasonable terms or at all.
Our success depends on our ability to protect our intellectual property rights.
Others may claim that we infringe on their intellectual property rights.
Any current or future indebtedness may limit our operations and our use of our cash flow, and any failure to comply with the covenants that apply to any indebtedness could adversely affect our liquidity and financial condition.
Any failure to meet our debt obligations could damage our business.
We may fail to secure necessary additional financing.
The failure to recruit and retain qualified personnel and plan for and manage the succession of key executives could hinder our ability to successfully manage our business, which could have a material adverse effect on our financial position and operating results.
We may not successfully complete acquisitions or integrate acquisitions we do make, which could impair our ability to compete and could harm our operating results.
We face significant competition from other technology companies.
Uncertainties in the regulation of the Internet could have a material and adverse impact on our financial condition and results of operations.
We are subject to stringent and evolving U.S. state, local, and federal, and foreign laws, regulations, and rules, contractual obligations, industry standards, policies, and other obligations related to data privacy and security. Our actual or perceived failure to comply with such obligations (or such failure by third parties with whom we work) could lead to regulatory investigations or actions; litigation; fines and penalties; disruptions of our business, results of operations; reputational harm; loss of revenue or profits; and other adverse business consequences.
If we violate the U.S. Foreign Corrupt Practices Act or applicable anti-bribery laws in other countries, or if we fail to comply with U.S. export controls and government contracting laws, our business could be harmed.
Our business is subject to laws, regulations and expectations relating to sustainability, human capital, governance and other corporate responsibility matters, which could increase costs and expose us to additional risks.
Our actual operating results may differ significantly from our guidance.
Our effective tax rate may fluctuate, which could increase our income tax expense and reduce our net income.
We may be impacted by changes in taxation, trade, tariffs, and other regulatory requirements.
Foreign currency exchange rates may adversely affect our financial statements.
Our estimates and judgments related to critical accounting policies could be inaccurate.
If we fail to maintain effective disclosure controls and procedures and internal control over financial reporting, investor confidence in our financial statements could decline, which could negatively impact the market price of our stock or our ability to raise capital.
Our stock price has been subject to fluctuations, and will likely continue to be subject to fluctuations, which may be volatile and due to factors beyond our control.
Unfavorable and uncertain conditions in our industry, our customers' industries, the global economy, or reductions in information technology spending,spending could limit our ability to grow or maintain our business and negatively affect our results of operations.
Unfavorable and uncertain conditions in the economy both in the United States and abroad, including conditions resulting from financial and credit market fluctuations, high interest rates, inflation, bank failures, international trade policies (including trade protection measures, such as tariffs, sanctionssanctions, and other trade barriers), politicaldomestic and international geopolitical unrest and turmoil, a shifting regulatory landscape, changes in government spending patterns, natural catastrophes, outbreaks of contagious diseases, armed conflicts or warfare, including in Ukraine, and terrorist attacks on the United States, Europe, the Asia Pacific region or elsewhere,attacks, could cause a decrease in business investments, including spending on information technology,technology (IT), and negatively affect the growth of our business and our results of operations. In addition, we serve certain industries that have historically been cyclical and have experienced periodic downturns that have had a material adverse impact on demand for the products, software, and services that we offer. Many of our customers are concentrated in certain industries, including financial services, public sector, healthcare, and the service provider market. Furthermore, consolidation in certain industries may result in reduced overall spending on our products and solutions. We cannot predict the timing, strength, or duration of any economic slowdown, instability, or recovery, generally or how any such event may impact our business.
International trade policies, including trade protection measures such as tariffs, sanctions and trade barriers may adversely affect our business, financial condition, results of operations and prospects.
The recent announcements of new tariffs and restrictive trade policies have created a dynamic and unpredictable trade landscape, which may adversely impact our business. Although our current business model is not directly reliant on the import or export of physical goods, trade policies may indirectly adversely impact our business and operations. In addition, many of our customers operate businesses that may be impacted by trade policies, which may result in decreased demand for our products and services or extended sales cycles as customers assess the impact of evolving trade policies on their operations and face increased costs or decreased revenue due to tariffs and trade restrictions.
Trade disputes, trade restrictions, tariffs, and other political tensions between the U.S. and other countries may also exacerbate unfavorable macroeconomic conditions including inflationary pressures, foreign exchange volatility, financial market instability, and economic recessions or downturns, which may also negatively impact customer demand for our services, delay renewals or limit expansion opportunities with existing customers, limit our access to capital, or otherwise negatively impact our business and operations. Ongoing tariff and macroeconomic uncertainty has and may continue to contribute to volatility in the price of our common stock.
While we continue to monitor international trade developments, the ultimate impact of these risks remains uncertain and any prolonged economic downturn or escalation in trade tensions could materially and adversely affect our business, results of operations, financial condition and prospects. In addition, tariffs and other trade developments have and may continue to heighten the risks related to the other risk factors described elsewhere in this report.
The products and services we sell or license to customers, including our cloud-based solutions and our service offerings,customers may contain vulnerabilities or critical security defects which have not been identified or remedied. We may also make prioritization decisions in determining which vulnerabilities or security defects to fix, and the timing of these fixes, which could result in exploitation that compromises security.
In addition, advances in tools and automation, including artificial intelligence (“AI”), may both increase the speed and sophistication with which vulnerabilities are identified or exploited and influence how vulnerabilities are detected, prioritized, and remediated.
Cyber-attacks, malicious internet-based activity, fraud, and similar activities threaten the confidentiality, integrity, and availability of our sensitive, proprietary, and confidential information, including personal information, business data, trade secrets, intellectual property, and confidential third-party data, and information technologyIT systems, and those of the third parties with whom we work. Such threats are prevalent and continue to rise, are increasingly difficult to detect,detect and increasingly sophisticated, including through the use of automation and AI, and come from a variety of sources, including traditional computer "hackers," threat actors, "hacktivists" promoting certain causes, organized criminal threat actors, personnel (such as through theft or misuse or unintentional disclosure), sophisticated nation states, and nation-state-supported actors.
We have experienced cyber incidents in the past, and we expect to continue to face such risks that could cause us to experience cyber incidents in the future. We and the third parties with whom we work arehave been, and continue to be, subject to a variety of evolving threats, including but not limited to social-engineering attacks (including phishing attacks), malicious code (such as viruses and worms), malware (including advanced persistent threat intrusions), denial-of-service attacks, credential stuffing, credential harvesting, personnel misconduct or human error, ransomware attacks, supply-chain attacks, software bugs, server malfunctions, software or hardware failures, loss of data or other information technologyIT assets, telecommunications failures, and other similar threats, including attacks enhanced or facilitated through the use of ArtificialAI, Intelligencesuch ("AI").as AI-enabled social engineering attacks. Severe ransomware attacks are also prevalent and could lead to significant interruptions in our operations, ability to provide our products or services, loss of sensitive data and income, reputational harm, and diversion of funds for us and our customers.
In addition, some of our customers are subject to the EU's Digital Operational Resilience Act and similar UK regulatory requirements on operational resilience which may obligate such customers to impose contractual provisions on us, including certain mandatory third-party risk management provisions. If we fail to materially comply with these contractual requirements, we may be subject to investigations, auditsaudits, or other adverse consequences.
Our reliance on third parties couldexposes alsous introduceto cybersecurity risks and vulnerabilities, including supply-chain attacks, and other threats to our business operations due to security incidents or other interruptions they experience. For example, we rely on third parties and technologies to operate some of our business systems and process sensitive data in a variety of contexts, including, without limitation, cloud-based infrastructure, data center facilities, encryption and authentication technology, employee email, content delivery to customers, and other information systems. We also rely on third-party service providers to provide other products, services, or parts to our customers. While we have instituted a third-party risk management process that is designed to account for third party specific risks, ourOur ability to monitor these third parties' information security practices is limited. Third parties may not sufficiently maintain their information security measures or may change them without our knowledge or delay notification to us in a timely manner. If the third parties we rely on are subject to a security breach or otherwise suffer disruptions that affect the services we use, as has occurred in the past, the integrity and availability of our internal information could be compromised causing the loss of confidential or proprietary information, damage to our reputation, and economic loss. In addition, supply-chain attacks have increased in frequency and severity, and we cannot guarantee that third parties' infrastructure in our supply chain or the supply chains of third parties with whom we work have not been compromised. While we may be entitled to damages ifIf a third party with whom we work fails to satisfy their data privacy or security-related obligations to us, we cannot be certain that our applicable contracts with these third parties will adequately limit our data privacy or security-related liability to them or others, be sufficient to allow us to obtain indemnification or recovery from them, or be sufficient to cover all or any of our damages.
Although we have multiple and layered controls and security measures designed to prevent, detectdetect, and respond to cyberattacks, experienced computer hackers are increasingly organized and sophisticated, and we cannot guarantee that our security measures will be sufficient to protect against unauthorized access to our IT networks, softwaresoftware, and systems. Malicious attack efforts operate on a large-scale and sometimes offer targeted attacks as a paid-for service. In addition, the techniques used to obtain access or sabotage networks change frequently, and we may be unable to anticipate such techniques, implement adequate preventative measures, or detect and stop security breaches that may arise from such techniques. As a provider of security solutions, we may be a more attractive target for such attacks. Other individuals or entities, including personnel or vendors, may also intentionally or unintentionally provide unauthorized access to our IT environments.
Any of the previously identified or similar threats couldcan cause a security incidentincidents or other interruptioninterruptions that could result in unauthorized, unlawful, or accidental acquisition, modification, destruction, lossloss, alternation,alteration, encryption, disclosure of, or access to our sensitive data or our information technologyIT systems, or those of the third parties with whom we work. A security incident or other interruption could disrupt our ability (and that of third parties with whom we work) to provide our products and services.
Applicable data privacy and security obligations have required, and may in the future require us, or we may voluntarily choose, to notify relevant stakeholders, including affected individuals, customers, regulators and investors, of security incidents, or take other actions, such as providing credit monitoring and identity theft protection services.actions. Such disclosures and related actions cancould be costly, and the disclosure or the failure to comply with such applicable requirements could lead to adverse consequences.
If we, or a third party with whom we work, experience a security incident or are perceived to have experienced a security incident, we may experience adverse consequences, such as government enforcement actions; additional reporting, disclosure, notification and/or oversight requirements; restrictions on processing sensitive data; litigation; indemnification obligations; negative publicity; reputational harm; interruptions in our operations (including availability of data); financial loss; and other similar harms. Security incidents and attendant consequences may cause customers to stop using our services, deter new customers from using our services, and negatively impact our ability to grow and operate our business.
negative publicity; reputational harm; interruptions in our operations (including availability of data); financial loss; and other similar harms. Security incidents and attendant consequences may cause customers to stop using our services, deter new customers from using our services, and negatively impact our ability to grow and operate our business.
Our ability to quickly and successfully recover from a disaster, public health crisis, or other business continuity event could affect our ability to deliver our products and negatively impact our business reputation.
The occurrence of a natural disaster, public health crisis, or an act of war or terrorism, or a decision or need to close any of our facilities without adequate notice or time for making alternative arrangements could result in interruptions in the delivery of our products and services. Our central business functions, including administration, human resources, finance services, legal, development, manufacturing and customer support depend on the proper functioning of our computer, telecommunication and other technology systems and operations, some of which are operated or hosted by third parties.
While we have business continuity programs in place, a disruption or failure of systems or operations because of a disaster, public health crisis or other business continuity event could cause data to be lost or otherwise delay our ability to complete sales and provide products and services and provide the highest level of service to our customers. In addition, we could have difficulty producing accurate financial statements on a timely basis, which could have an impact on our ability to make timely disclosures and could adversely affect the trading value of our stock. Although we endeavor to ensure there is redundancy in these systems and that they are regularly backed-up, there is no guarantee that data recovery in the event of a disaster would be effective or occur in an efficient and timely manner. Our operations are dependent upon our ability to protect our technology infrastructure against damage from business continuity events that could have a significant disruptive effect on our operations. We could experience material adverse interruptions to our operations or delivery of services to our clients in a disaster recovery scenario.
The market for application andenterprise network performanceobservability, management,carrier service assurance, cybersecurity solutions,cybersecurity, and businessDDoS intelligenceprotection solutions is highly competitive and characterized by rapid changes in technology, including AI, evolving industry standards, changes in customer requirements, a current high level of and increasing competition, and frequent product introductions and enhancements. Our success is dependent upon our ability to meet our customers' needs, which are driven by changes in technologies, new application technologies, new security risks and the emergence of new industry standards. In addition, new technologies may shorten the life cycle for our products and solutions or could render our existing or planned products and services less competitive or obsolete. We must address demand from our customers for advancements in our products and services applications to support our customers' growing needs and requirements in complex networks. To meet this challenge and remain competitive in the market, we must introduce new enhancements and additional form factors to our existing product lines and service offerings. If we are unable to develop, introduce and communicate new enterprise network observability, carrier service assurance, cybersecurity, and applicationDDoS performance management and service assurance products, network security products, business intelligence products, andprotection solutions or products ,or enhancements to existing solutions or products in a timely and successful manner, this inability could have a material and adverse impact on our business, operating results and financial condition.
As our success depends in part on our ability to develop product enhancements and new products and solutions that keep pace with continuing changes in technology, cyber risk and customer preferences, we must devote significant resources to research and development, development and introduction of new products and enhancements on a timely basis, and obtaining market acceptance for our existing products and new products. We have introduced and intend to continue to introduce new products and solutions, including ongoing migration to "software as a service" as well as cybersecurity products.solutions. If the introduction of these products and solutions is significantly delayed or if we are unsuccessful in bringing these products and solutions to market, our business, operating results, and financial condition could be materially and adversely impacted. We are developing and are already deploying a number of new products as well as enhancements to our existing products and offerings, as well as additional software only solutions and products available in multiple form factors for most of our existing solutions.
If we are unable to effectively use or integrate AI, or if our use of AI exposes us to significant risks, we may not achieve intended benefits and our results of operations could be adversely affected.
We have integrated, and plan to further integrate, AI technologies developed by third parties and open-source communities into our products, services, and internal operations. These AI-related initiatives, whether successful or not, could require us to incur substantial costs and could result in delays in developing, enhancing, or releasing products and services.
Management's Discussion & Analysis (MD&A)
Largest changes
“Goodwill impairment. During fiscal year 2024, we recorded $217.3 million in goodwill impairment charges as a result of the sustained decrease in our stock price and overall market capitalization. During the first quarter of fiscal year 2025, due to the continued decrease in our stock price and overall market capitalization, along with other qualitative considerations including the continued impact from the conditions in the macroeconomic environment, it was determined a Triggering Event occurred, indicating goodwill may be impaired. …”see in full comparison
“Net loss for the fiscal year ended March 31, 2025 was $366.9 million, as compared with net loss for the fiscal year ended March 31, 2024 of $147.7 million. …”see in full comparison
“Net income for the fiscal year ended March 31, 2026 was $95.5 million as compared with net loss for the fiscal year ended March 31, 2025 of $366.9 million. The increase of $462.5 million in net income was primarily due to the absence of goodwill impairment charges in 2026, compared to $427.0 million in goodwill impairment charges in fiscal year 2025, as well as a $36.8 million increase in revenue, a $19.6 million decrease in restructuring charges, a $5.5 million decrease in interest expense, and a $3.1 million increase in interest income. …”see in full comparison
“The key assumption in the market approach used in the quantitative impairment test performed during the first quarter of fiscal year 2025 was the company-specific control premium, which was estimated using expected synergies that would be realized by a hypothetical buyer. We also compared its implied control premium to recent control premiums paid in the industry, as evidenced by guideline public company comparable transactions. This information corroborated that the company-specific control premium was within the range of premiums for other companies operating in the industry. …”see in full comparison
“Net cash provided by operating activities was $217.7 million during the fiscal year ended March 31, 2025, compared to $58.8 million during the fiscal year ended March 31, 2024. …”see in full comparison
“Goodwill impairment. During the first quarter of fiscal year 2025, due to a decrease in our stock price and overall market capitalization, along with other qualitative considerations including the continued impact from the conditions in the macroeconomic environment, it was determined a Triggering Event occurred, indicating goodwill may be impaired. Accordingly, we conducted an interim quantitative impairment test of our goodwill at June 30, 2024 using the market approach to estimate the fair value of its reporting unit. …”see in full comparison
Full comparison: every changed paragraph (81)
We are an industry leader with over four decades of experience in providing enterprise network observability, carrier service assuranceassurance, cybersecurity, and cybersecurityDDoS, protection solutions. Our unique visibility platform and solutions that are basedpowered onby our pioneering deep packet inspectionDPI, technology at scale, which is used by many Fortune 500 companies to protect their digital business services against disruption. Service providers and enterprises, including local, state and federal government agencies, rely on our solutions to achieve the visibility and protection necessary to optimize network performance, ensure the delivery of high-quality, mission-critical applications and services, gain timely insight into the endend-user user experienceexperience, and to protect their networks from attack. The majority of our solutions are designed to provide Smart Data, a high-fidelity, decision-grade data foundation derived from real-time network activity across legacy, hybrid, and cloud-native environments. This data enables a unified view of performance, availability, and security, supports faster root-cause analysis and operational decision-making, and is increasingly used to inform broader observability platforms and automated and AI-driven workflows. With our offerings, customers can quickly, efficiently and effectively identify and resolve issues that result in downtime, interruptionsservice to services,interruptions, poor service qualityquality, or compromised data, thereby reducing meantime-to-resolutionmean time to resolution of issues and driving compelling returns on their investments in their networks and broader technology initiatives. Some of the more significantSignificant technology trends and catalysts for our business include the evolution of customers' digital transformation initiativesinitiatives, such as the migration to cloud environments and to the edges of their networks,networks; the rapidly evolving cybersecurity threat landscape,landscape; advancements in artificial intelligence and business analytics advancements,that can enhance observability and are increasing the need for high-quality, real-time data to support automated and AI-driven operations; and the continued evolution and potential opportunities related to 5G technology evolution inacross both the service provider and enterprise customer verticals.
Our operating results are influenced by a number of factors, including, but not limited to,to the volume, mix, and quantity of products and services sold,sold; pricing, costs and availability of materials used in our products,products; growth in employee-related costs, including commissions,commissions; and the expansion of our operations. Factors that affect our ability to maximize our operating results include, but are not limited to,to: our ability to introduce and enhance existing products,products; the marketplace acceptance of those new or enhanced products,products; continued expansion into international markets,markets; expansion into new or adjacent markets,markets; development of strategic partnerships,partnerships; competition,competition; successful acquisition and integration efforts,efforts; and our ability to control costs and make improvements in a highly competitive industry.
We continue to closely monitor current global and macroeconomic conditions, including the impacts of thearmed ongoingconflicts warsor in Ukraine and the Middle East,warfare, global geopolitical tension, stock market volatility, industry-specific capital spending trends, exchange rate fluctuations, inflation, interest rates, international trade relations (including trade protection measures, such as tariffs and other trade barriers), and the risk of a recession, including the manner and extent to which they have impacted and could continue to impact our business, customers, employees, supply chain, and distribution network. In addition, our industry is experiencing AI-related supply-chain dynamics which could influence the timing and size of certain customer orders. The full extent of the impacts of these global and macroeconomic conditions remain uncertain.dynamic. InWe responseremain tooptimistic thebut warcognizant inof Ukraine, we ceased business operations in Russia, including sales, support on existing contracts and professional services. Theongoing macroeconomic environmentdynamics remains challenging withand constrained customer spending in the service provider market and firmly focused on driving product innovation, sustaining annual revenue growth, and enhancing margins through continued disciplined cost management as we expectnavigate thisthe tocurrent persistmacroeconomic during fiscal year 2026.landscape. As a result, we have continued our efforts to manage discretionary costs and align spending with the current environment while we continue to execute on our long-term strategic plans.
Though we continue to monitor the impacts of evolving global and macroeconomic conditions on our business, we believe our current cash reserves and access to capital through our revolving credit facility leave us well-positioned to manage our business in today's environment. We expect net cash provided by operations combined with cash, cash equivalents, marketable securities and investments and borrowing availability under our revolving credit facility to provide sufficient liquidity to fund current obligations, capital spending, debt service requirements and working capital requirements over at least the next twelve months. We continue to take actions to manage costs and increase productivity throughout our company, including managing discretionary spending and hiring activities, but are continuing to invest in areas that advance our business for the future. In addition to our cash equivalents, based on covenant levels at March 31, 2025,2026, we had an incremental $600 million available to us under our revolving credit facility.
Total revenue increased $36.8 million, or 4% for the fiscal year ended March 31, 2026, compared to the fiscal year ended March 31, 2025, driven by increases in both product and service revenue. Growth was supported by higher demand for service assurance and cybersecurity offerings across enterprise and service provider customer verticals. International revenue increased 8% and U.S. revenue increased 2%.
Total revenue decreased $6.8 million for the fiscal year ended March 31, 2025 as compared to total revenue for the fiscal year ended March 31, 2024. In the aggregate, the decline was primarily attributable to the Test Optimization business (TO Business) we divested in September of 2024. Additionally, fiscal year 2024 benefited from approximately $48 million of backlog-related revenue that created a headwind for fiscal year 2025 and a challenging comparison. Adjusting for these two factors, revenue would have increased on a year-over-year basis. The decrease in total revenue for the fiscal year ended March 31, 2025 as compared to total revenue for the fiscal year ended March 31, 2024 reflected lower revenue from both service provider and enterprise customers from service assurance offerings, including radio frequency propagation modeling projects, due to industry-specific capital spending constraints, as well as a decrease in revenue from service provider customers from cybersecurity offerings, partially offset by an increase in revenue from enterprise customers from cybersecurity offerings.
Our gross profit percentage increased by one percentage point to 78%79% during the fiscal year ended March 31, 20252026 as compared with the fiscal year ended March 31, 20242025 primarily driven by a two percentage point increase to 86% in product gross profit percentage due to lowera employee-relatedmore expensesfavorable inproduct fiscalmix yearassociated 2025.with increased licensing of our software products.
Net income for the fiscal year ended March 31, 2026 was $95.5 million as compared with net loss for the fiscal year ended March 31, 2025 of $366.9 million. The increase of $462.5 million in net income was primarily due to the absence of goodwill impairment charges in 2026, compared to $427.0 million in goodwill impairment charges in fiscal year 2025, as well as a $36.8 million increase in revenue, a $19.6 million decrease in restructuring charges, a $5.5 million decrease in interest expense, and a $3.1 million increase in interest income. The increases to net income were partially offset by a $21.8 million increase in income tax expense, and a $17.9 million increase in employee-related expenses primarily due to an increase in variable incentive compensation.
Net loss for the fiscal year ended March 31, 2025 was $366.9 million, as compared with net loss for the fiscal year ended March 31, 2024 of $147.7 million. The increase of $219.2 million in net loss was primarily due to a $209.7 million increase in goodwill impairment charges, a $20.1 million increase from restructuring charges, a $6.8 million decrease in revenue, a $6.7 million increase in expenses related to trade shows, user conferences, and other events, a $5.6 million decrease in other income mainly due to the change in fair value of a foreign equity investment, a $5.6 million increase in legal fees mainly due to a favorable decision related to the Packet Intelligence LLC appeal recorded during the fiscal year ended March 31, 2024, a $3.8 million gain on the divestiture of the TO business recognized in fiscal year 2024, a $2.5 million increase in commissions expense, a $2.0 million increase from software licenses, and a $1.6 million increase in other marketing related expenses. These increases to net loss were partially offset by a $21.0 million net decrease in employee related expenses as a result of a decrease in headcount, partially offset by an increase in variable incentive compensation, a $7.0 million decrease in amortization expense of intangible assets, a $4.0 million decrease from depreciation expense, a $1.9 million decrease in advertising expense, a $1.6 million decrease in rent and other facilities related costs, a $1.5 million decrease in interest expense, a $1.3 million decrease in direct material costs, a $1.3 million decrease in the cost of materials used to support customers under service contracts, and a $1.1 million increase in interest income.
At March 31, 2025,2026, we had cash, cash equivalents, and marketable securities and investments (current and non-current) of $492.5$705.1 million.million . This represents an increase of $68.4$212.7 million compared to the fiscal year ended March 31, 2024.2025. This increase was primarily due to $217.7$294.5 million of net cash provided by operations, $67.9 million proceeds from maturity of marketable securities, $11.8 million proceeds from sale of an equity investment, partially offset by a net $100.0$163.4 million used to repaypurchase long-termof debt,marketable $25.3securities, $60.8 million used to repurchase shares of our common stock, $13.9$15.9 million used for tax withholdings on restricted stock units, $5.4and $9.1 million used for capital expenditures, $2.8 million used for the payment of debt issuance costs, and $1.3 million used to acquire technology licenses during the fiscal year ended March 31, 2025.2026.
We supplement the United States generally accepted accounting principles (GAAP) financial measures we report in quarterly and annual earnings announcements, investor presentations and other investor communications by reporting the following non-GAAP measures: non-GAAP gross profit, non-GAAP income from operations, non-GAAP net income, non-GAAP diluted net income per share (diluted)share, and non-GAAPadjusted earnings before interest and other expense, income taxes, depreciation, and amortization (Non-GAAP EBITDA) from operations.EBITDA. Non-GAAP gross profit removes expenses related to the amortization of acquired intangible assets, share-based compensation expense, and acquisition-related depreciation expense.expense from gross profit (GAAP). Non-GAAP income from operations includes the aforementioned adjustments related to non-GAAP gross profit and also removes restructuring charges, goodwill impairment charges, gainexecutive ontransition the divestiture of a business,costs, and legalrestructuring charges from income (benefitloss) expensefrom relatedoperations to civil judgments.(GAAP). Non-GAAP net income includes the foregoing adjustments related to non-GAAP income from operations, and also removes the income tax effects of such adjustments as well as any loss on extinguishment of debt,debt and change in fair value of derivative instrument,from net of related income tax(loss) effects.(GAAP). Non-GAAP diluted net income per share is non-GAAP net income divided by total outstanding shares on a diluted basis. Adjusted EBITDA includes the foregoingaforementioned adjustments related to non-GAAP net income.income Non-GAAPand also removes interest and other expense, income taxes, and non-acquisition related depreciation from net income (GAAP). Beginning in the third quarter of fiscal year 2026, we have renamed non-GAAP EBITDA from operations includesto adjusted EBITDA. We now reconcile this metric to GAAP net income, however, the aforementionedadjustments itemsincluded, relatedand the resulting amounts are unchanged from prior periods. This change is intended to non-GAAPalign incometerminology fromwith operationscommon andmarket also removes non-acquisition related depreciation expense.practice.
These non-GAAP measures are not prepared in accordance with GAAP, should not be considered an alternative for measures prepared in accordance with GAAP (revenue, gross profit, operatingincome margin,(loss) from operations, net incomeincome, and diluted net income per share), and may have limitations because they do not reflect all our results of operations as determined in accordance with GAAP. These non-GAAP measures should only be used to evaluate our results of operations in conjunction with the corresponding GAAP measures. The presentation of non-GAAP information is not meant to be considered superior to, in isolation from, or as a substitute for results prepared in accordance with GAAP. These non-GAAP measures should not be used to evaluate our results of operations against those of our peers or other companies, as the definitions and calculations of our non-GAAP measures may not be the same as those used by other companies, even if the measures share the same name.
Management believes these non-GAAP financial measures will enhance the reader's overall understanding of our current financial performance and our prospects for the future by providing a higher degree of transparency for certain financial measures and providing a level of disclosure that helps investors understand how wemanagement planplans and measuremeasures our business. We believe that providing these non-GAAP measures affordsto investors provides them with a view of our operating results that may be more easily compared to peer companies and also enables investors to consider our operating results on both a GAAP and non-GAAP basis during and following the integration period of our acquisitions. Presenting the GAAP measures on their own may not be indicative of our core operating results. Furthermore, management believes that the presentation of non-GAAP measures when shown in conjunction with the corresponding GAAP measures provides useful information to management and investors regarding present and future business trends relating to our financial condition and results of operations.
We derive revenues primarily from the sale of network management tools and cybersecurity solutions for service provider and enterprise customers, which include hardware, software, and service offerings. Our product sales consist of software only offerings and offerings which include hardware appliances with embedded software that are essential to providing customers the intended functionality of the solutions.solutions, and software only offerings.
We account for revenue once a legally enforceable contract with a customer has been approved by the parties and the related promises to transfer products or services have been identified. A contract is defined by us as an arrangement with commercial substance identifying payment terms, each party's rights and obligations regarding the products or services to be transferred and the amount we deem probable of collection. Customer contracts may include promises to transfer multiple products and services to a customer. Determining whether the products and services are considered distinct performance obligations that should be accounted for separately or as one combined performance obligation may require significant judgment. Revenue is recognized when control of the products or services areis transferred to our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for products and services.
Bundled arrangements are concurrent customer purchases of a combination of our product and service offerings that may be delivered at various points in time. We allocate the transaction price among the performance obligations in an amount that depicts the relative standalone selling prices (SSP) of each obligation. Judgment is required to determine the SSP for each distinct performance obligation. We use a range of amounts to estimate SSP for each of the products and services sold, based primarily on the performance obligation's historical pricing. We also consider our overall pricing objectives and practices across different sales channels and geographies, and market conditions. Generally, we have established SSP for a majority of our service performance obligations based on historical standalone sales. In certain instances, we have established SSP for services based upon an estimate of profitability and the underlying cost to fulfill those services. SSP has primarily been established for product performance obligations as the average or median selling price the performance obligation was recently sold for, whether sold alone or sold as part of a bundle transaction. We review sales of the product performance obligations on a quarterly basis and update, when appropriate, SSP for such performance obligations to ensure that it reflects recent pricing experience. Our products are distributed through our direct sales force and indirect distribution channels through alliances with resellers and distributors. Revenue arrangements with resellers and distributors are recognized on a sell-in basis; that is, when control of the product transfers to the reseller or distributor. We record consideration given to a customer as a reduction of revenue to the extent we have recorded revenue from the customer. With limited exceptions, our return policy does not allow product returns for a refund. Returns have been insignificant to date. In addition, we have a history of successfully collecting receivables from our resellers and distributors.
Goodwill is not amortized but is subject to annual impairment tests; or more frequently if events or circumstances occur (a "Triggering Event") that would indicate the fair value of our reporting unit is below its carrying value. We perform the assessment annually during the fourth quarter and on an interim basis if potential impairment indicators arise.
Total revenue increased $36.8 million, or 4% for the fiscal year ended March 31, 2026, compared to the fiscal year ended March 31, 2025, driven by increases in both product and service revenue. Service revenue increased 6%, primarily due to the timing and composition of maintenance and contract renewals and continued expansion of cloud and subscription services. Product revenue increased 3%, driven by increased service provider demand for cybersecurity offerings, as well as increased U.S. Government agency orders across both service assurance and cybersecurity offerings. International revenue increased 8%, benefiting from increased enterprise and service provider demand, and U.S. revenue increased 2%, benefiting from increased enterprise demand. By product line, cybersecurity revenue increased 8% and service assurance revenue increased 3%, both supported by the timing of maintenance renewals. The increase in revenue from the cybersecurity product line compared to the same period last year was due to an increase in revenue from service provider and enterprise customers. The increase in revenue from the service assurance product line compared to the same period last year was due to an increase in revenue from enterprise customers, partially offset by a decrease in service provider product revenue. From a customer-vertical perspective, service provider revenue increased 3%, driven by an increase in service revenue. Enterprise revenue increased 5%, driven by an increase in both product and service revenue.
Revenue
Product revenue consists of sales of our hardware products and licensing of our software products. Service revenue consists of customer support agreements, consulting, training and stand-ready software as a service offerings. During the fiscal years ended March 31, 2025 and 2024, no direct customer or indirect channel partner accounted for more than 10% of our total revenue.
Product. The $0.6 million decrease in product revenue compared with the same period last year was due to a decrease in revenue from service provider customers from service assurance and cybersecurity offerings, partially offset by an increase in revenue from enterprise customers from service assurance and cybersecurity offerings. The results for the fiscal year ended March 31, 2024 benefited from approximately $48 million of backlog-related revenue. Excluding backlog-related revenue, as well as revenue related to the divested TO business, total revenue for the fiscal year ended March 31, 2025 compared with the same period last year would have increased year over year.
Service. The 1%, or $6.2 million, decrease in service revenue compared with the same period last year was primarily due to a decrease in revenue from maintenance contracts and professional service contracts primarily related to the service assurance product line.
United States revenue decreased 1%, or $4.9 million, compared with the same period last year primarily due to a decrease in revenue from service assurance offerings from enterprise customers, including the impact from the divested TO business. International revenue decreased 1%, or $1.9 million, compared to the same period last year primarily driven by lower revenue from service provider customers from both service assurance and cybersecurity offerings, partially offset by an increase in revenue from enterprise customers from both service assurance and cybersecurity offerings.
The 4%, or $24.7 million, decrease in revenue from the service assurance product line was due to a decrease in revenue from both enterprise and service provider customers, including the impact from the divested TO business, as well as lower revenue from radio frequency propagation modeling projects. The 7%, or $18.0 million, increase in revenue from the cybersecurity product line was due to an increase in revenue from enterprise customers, partially offset by a decrease in revenue from service provider customers.
The 10%, or $39.5 million, decrease in revenue from the service provider customer vertical was due to a decrease in product and service revenue from both the service assurance and cybersecurity product lines. The 7%, or $32.7 million, increase in revenue from the enterprise customer vertical was due to an increase in product and service revenue from the cybersecurity product line, partially offset by a decrease in the service assurance product line.
Product. The 10%, or $6.6 million, decrease in cost of product revenue for the fiscal year ended March 31, 2025 compared to the same period last year was primarily due to a $3.1 million decrease in the amortization of intangible assets, a $1.7 million decrease in employee-related costs associated with the timing of certain projects, a $1.3 million decrease in direct material costs, a $0.9 million decrease in inventory obsolescence charges, and a $0.5 million decrease in inventory related expenses. These decreases were partially offset by a $0.9 million increase in costs related to the delivery of radio frequency propagation modeling projects. The product gross profit percentage increased by two percentage points to 84% during the fiscal year ended March 31, 2025 as compared to the same period in the prior year. The 2%, or $6.0 million, increase in product gross profit corresponds with the 10%, or $6.6 million, decrease in cost of product revenue, partially offset by the $0.6 million decrease in product revenue.
Service. The 2%, or $2.1 million, decrease in cost of service revenue for the fiscal year ended March 31, 2025 compared to the same period last year was primarily due to a $1.8 million decrease in employee-related expenses largely driven by a decrease in costs due to a reduction in headcount partially offset by an increase in variable incentive compensation as well as the timing of certain projects, a $1.3 million decrease in the cost of materials used to support customers under service contracts, and a $0.5 million decrease in depreciation expense. These decreases were partially offset by a $1.1 million increase in contractor fees, and a $1.1 million increase in allocated overhead. The service gross profit percentage remained flat at 74% during the fiscal year ended March 31, 2025 compared to the same period in the prior year. The 1%, or $4.1 million, decrease in service gross profit corresponds with the 1%, or $6.2 million, decrease in service revenue, partially offset by the 2%, or $2.1 million, decrease in cost of services revenue.
TotalProduct. grossThe profit.12%, Ouror total gross profit increased $1.9$6.9 million, decrease in cost of product revenue for the fiscal year ended March 31, 20252026, despite a 3% increase in total product revenue compared to the same period last year.year, Thiswas increaseprimarily isdriven attributablea tomore thefavorable 5%,product ormix $8.7associated million,with decreaseincreased in costlicensing of revenue,our partiallysoftware offsetproducts. byOur the 1%, or $6.8 million, decrease in revenue. Theproduct gross profit percentage increased by onetwo percentage point to 78%points during the fiscal year ended March 31, 20252026 compared to the same period in the prior year.year, primarily due to favorable product mix.
Service. The 4%, or $5.1 million, increase in cost of service revenue for the fiscal year ended March 31, 2026 compared to the same period last year was primarily driven by a $26.6 million, or 6% increase, in service revenue, and an increase in employee-related variable incentive compensation. Our service gross profit percentage remained consistent at 74% during the fiscal year ended March 31, 2026 compared to the same period in the prior year.
The 5%,4%, or $8.3$6.6 million, decreaseincrease in research and development expenses for the fiscal year ended March 31, 20252026 compared to the same period last year was primarily due to aan $6.6 million decreaseincrease in employee-related expensevariable largelyincentive as a result of a reduction in headcount, a $2.2 million decrease from depreciation expense, and a $0.8 million decrease in contractor fees. These decreases werecompensation, partially offset by a $2.0$1.4 million decrease in depreciation expense and a $1.2 million increase in allocatedsoftware overhead.capitalization.
The 1%, or $2.9$3.5 million, decrease in sales and marketing expenses for the fiscal year ended March 31, 20252026 compared to the same period last year was primarily due to ana $11.4$1.9 million decrease in expenses associated with events and a $1.8 million decrease in employee-related expenses asdue to a result of a decreasereduction in headcount and a decrease in variable incentive compensation, a $1.9 million decrease in advertising expense, a $0.5 million decrease in travel expense, and a $0.5 million decrease in rent expense. These decreases wereheadcount, partially offset by a $6.7 million increase related to trade shows, user conferences and other events, a $2.5 millionan increase in commissionsemployee-related expense,variable aincentive $1.6 million increase in other marketing related costs, and a $0.9 million increase in contractor fees.compensation.
The 1%,7%, or $0.8$6.5 million, increase in general and administrative expenses for the fiscal year ended March 31, 20252026 compared to the same period last year was primarily due to an increase in employee-related variable incentive compensation, a $5.6$1.8 million increase in legal-relatedprofessional expenses asservices, a result$1.0 of a favorable decision related to the Packet Intelligence LLC appeal recorded during the fiscal year ended March 31, 2024. Thismillion increase wasin software expenses, partially offset by a $1.7$2.3 million decrease in contractor fees, a $0.8 million decrease in depreciation, a $0.7 million decrease in allocated overhead, a $0.6 million decrease in the allowance for credit losses, and a $0.5 million decreaseincrease in software maintenance fees.capitalization.
Amortization of acquired intangible assets. Amortization of acquired intangible assets consists primarily of amortization of customer relationships, definite-lived trademark and trade names, and leasehold interests related to our acquisition of Danaher Corporation's communication business (Comms Transaction), Network General Corporation, Avvasi Incorporated and Efflux Systems, Inc.
The 8%, or $3.9 million, decrease in amortization of acquired intangible assets for the fiscal year ended March 31, 2025 compared to the same period last year was primarily due to a decrease in the amortization of intangible assets acquired as part of the Comms Transaction and the Network General Corporation transaction.
Restructuring charges. During the first quarter of fiscal year 2025, we implemented a voluntary separation program (VSP) for employees who met certain age and service requirements to reduce overall headcount. As a result of the related workforce reduction, during the fiscal year ended March 31, 2025, we recorded restructuring charges totaling $19.6 million related to one-time termination benefits for one hundred forty-two employees who voluntarily terminated their employment with us during that period. During the third quarter of fiscal year 2025, we also entered into transition agreements that provided termination benefits for certain employees to ensure an orderly transition of responsibilities for continuity purposes. As a result of these related workforce changes, during the fiscal year ended March 31, 2026 and 2025, we recorded restructuring charges in each year totaling $0.9 million.million, respectively.
Goodwill impairment. During the first quarter of fiscal year 2025, due to a decrease in our stock price and overall market capitalization, along with other qualitative considerations including the continued impact from the conditions in the macroeconomic environment, it was determined a Triggering Event occurred, indicating goodwill may be impaired. Accordingly, we conducted an interim quantitative impairment test of our goodwill at June 30, 2024 using the market approach to estimate the fair value of its reporting unit. As a result of that interim impairment test, we recorded a $427.0 million goodwill impairment charge during the fiscal year ended March 31, 2025.
Goodwill impairment. During fiscal year 2024, we recorded $217.3 million in goodwill impairment charges as a result of the sustained decrease in our stock price and overall market capitalization. During the first quarter of fiscal year 2025, due to the continued decrease in our stock price and overall market capitalization, along with other qualitative considerations including the continued impact from the conditions in the macroeconomic environment, it was determined a Triggering Event occurred, indicating goodwill may be impaired. Accordingly, we conducted a quantitative impairment test of our goodwill at June 30, 2024. We estimated the implied fair value of our goodwill using a market approach. As a result of the quantitative impairment test performed during the first quarter of fiscal year 2025, we determined goodwill was impaired and recorded a goodwill impairment charge of $427.0 million during the three months ended June 30, 2024. The additional impairment charge recorded in the first quarter of fiscal year 2025 was primarily due to the continued decrease in our stock price from March 31, 2024 to June 30, 2024, an increase in our weighted-average cost of capital, and the refinement to the expected cost synergies that could be realized by a hypothetical buyer as a result of the VSP we implemented in the first quarter of fiscal year 2025, which impacted the company-specific control premium used to determine the fair value of the reporting unit under the market approach. During fiscal year 2025, our annual impairment test was completed as of January 31, 2025 using the qualitative assessment, which indicated that goodwill was not impaired. At September 30, 2024, December 31, 2024, and March 31, 2025, we performed a Triggering Event assessment and concluded no event or circumstances occurred that indicated goodwill was further impaired.
The key assumption in the market approach used in the quantitative impairment test performed during the first quarter of fiscal year 2025 was the company-specific control premium, which was estimated using expected synergies that would be realized by a hypothetical buyer. We also compared its implied control premium to recent control premiums paid in the industry, as evidenced by guideline public company comparable transactions. This information corroborated that the company-specific control premium was within the range of premiums for other companies operating in the industry. Changes in the estimates or assumptions used in its quantitative impairment test could materially affect the determination of fair value and the associated goodwill impairment assessment. Potential events and circumstances that could have an adverse impact on our estimates and assumptions include, but are not limited to, continued increases in costs, and high interest rates and other macroeconomic factors. An increase or decrease of 1% in the company-specific control premium used in the determination of the fair value of the reporting unit under the market approach would have resulted in an increase or decrease in the goodwill impairment recorded during the fiscal year ended March 31, 2025 of approximately $13.0 million.
We will continue to monitor relevant facts and circumstances, including future changes in our stock price. We may be required to record additional goodwill impairment charges. While management cannot predict if or when additional goodwill impairments may occur, future goodwill impairments could have material adverse effects on our results of operations and financial condition.
Gain on Divestiture of a Business. During the fiscal year ended March 31, 2024, we recorded a $3.8 million gain on the divestiture of the Test Optimization business.
Interest and Other Income (Expense),Income, Net
Interest and other income (expense),income, net includes interest earned on our cash, cash equivalents and marketable securities, interest expense and other non-operating gains or losses.
The 380%, or $6.9 million, increase in interest and other income, net for the fiscal year ended March 31, 2026 compared to the same period last year was primarily due to a $5.5 million decrease in interest expense and a $3.1 million increase in interest income. This increase was partially offset by a $1.6 million increase in foreign exchange expense.
The 66%, or $3.5 million, decrease in interest and other income (expense), net was primarily due to a $6.2 million decrease in other income largely due to a decrease in the fair value of the equity investment in Napatech A/S (Napatech), partially offset by a $1.5 million decrease in interest expense due to debt repayments on the credit facility during the fiscal year ended March 31, 2025, and a $1.1 million increase in interest income.
In 2021, the Organization for Economic Co-operation and Development announced an Inclusive Framework on Base Erosion and Profit Shifting including Pillar Two Model Rules defining the global minimum tax, which calls for the taxation of large multinational corporations at a minimum rate of 15%. Subsequently multiple sets of administrative guidance have been issued.issued, including the release of a comprehensive Side-by-Side Package announced by the OECD in January 2026. Many non-US tax jurisdictions have either recently enacted legislation to adopt certain components of the Pillar Two Model Rules beginning in 2024 with the adoption of additional components in later years or announced their plans to enact legislation in future years. Considering we do not have material operations in jurisdictions with tax rates lower than the Pillar Two minimum, these rules are not expected to materially increase our global tax costs. There remains uncertainty as to the final Pillar Two model rules. We are continuing to evaluate the impacts of enacted legislation and pending legislation to enact Pillar Two Model Rules in the non-US tax jurisdictions we operate in.
The annual effective tax rate for the fiscal year ended March 31, 20252026 was 0.3%,19.4%, compared to an annual effective tax rate of 2.2%0.3% for the fiscal year ended March 31, 2024.2025. The effective tax rate for the fiscal year ended March 31, 20252026 is lowerdifferent than the effective rate for the fiscal year ended March 31, 2024,2025, primarily due to a significant nondeductible goodwill impairment charge, a discrete benefit related to the finalization of our tax return filings, and a charge related to stock compensation, and a significant nondeductible goodwill impairment charge.compensation.
We account for claims and contingencies in accordance with authoritative guidance that requires us to record an estimated loss from a claim or loss contingency when information available prior to issuance of our consolidated financial statements indicates that it is probable that a liability has been incurred at the date of the consolidated financial statementsstatements, and the amount of the loss can be reasonably estimated. If we determine that it is reasonably possible, but not probable, that an asset has been impaired or a liability has been incurred, or if the amount of a probable loss cannot be reasonably estimated, then, in accordance with the authoritative guidance, we disclose the amount or range of estimated loss if the amount or range of estimated loss is material. Accounting for claims and contingencies requires us to use our judgment. We consult with legal counsel on those issues related to litigation and seek input from other experts and advisors with respect to matters in the ordinary course of business.
Legal - From-From time to time, we aremay be subject to legal proceedings and claims in the ordinary course of business. In the opinion of management, the amountnone of ultimate expense with respect to anyour current legal proceedings and claims, if determined adversely,adversely willand notbased on the information known to the management as of the date of this Annual Report, is expected to have a material adverse effect on our financial condition, results of operations or cash flows.
As previously disclosed, in March 2016, Packet Intelligence LLC (Packet Intelligence or Plaintiff) filed a Complaint against NetScout and two subsidiary entities in the United States District Court for the Eastern District of Texas asserting infringement of five United States patents. Plaintiff's Complaint alleged that legacy Tektronix GeoProbe products, including the G10 and GeoBlade products, infringed these patents. NetScout filed an Answer denying Plaintiff's allegations and asserting that Plaintiff's patents were, among other things, invalid, not infringed, and unenforceable due to inequitable conduct. In October 2017, a jury rendered a verdict finding in favor of the Plaintiff and that Plaintiff was entitled to $3.5 million for pre-suit damages and $2.3 million for post-suit damages. In September 2018, the Court entered judgment and "enhanced" the jury verdict in the amount of $2.8 million as a result of a jury finding. The judgment also awarded pre- and post-judgment interest, and a running royalty on the G10 and GeoBlade products until the expiration of the patents at issue, the last date being June 2022. Following the entry of final judgment, NetScout appealed, and in July 2020, the Court of Appeals for the Federal Circuit (Federal Circuit) issued a decision vacating the $3.5 million pre-suit damages award, affirming the $2.3 million post-suit damages award, vacating the $2.8 million enhancement award, and remanding to the district court to determine what, if any, enhancement should be awarded. In March 2021, NetScout filed a petition for a writ of certiorari to the United States Supreme Court, which was denied, challenging, among other issues, the basis for enhanced damages and the patentability of the claimed technology. On September 8 and 9, 2021, in proceedings initiated by third parties that did not involve NetScout, the Patent Trial and Appeal Board (PTAB) invalidated all the patent claims that were also asserted against NetScout in this case. After the PTAB decisions were issued, NetScout moved, among other things, to dismiss the case and enter judgment in its favor on the grounds that the PTAB decisions invalidating the asserted claims precluded Plaintiff from continuing to assert its patent infringement causes of action and from seeking damages from NetScout. The District Court denied NetScout’s motion with respect to its request to dismiss the case and enter judgment in its favor. The District Court entered an amended final judgment awarding Plaintiff $2.3 million in post-suit damages, $1.1 million in enhanced damages, pre- and post-judgment interest, and a running royalty on the G10 and GeoBlade products until the expiration of the patents at issue, the last expiration date being June 2022. On July 20, 2022, NetScout filed a notice of appeal to the Federal Circuit from, among other things, the amended final judgment. On May 2, 2024, in a separate action the Federal Circuit affirmed the PTAB decisions, which as a result found that all of the patent claims asserted by Packet Intelligence against NetScout were invalid. Also on May 2, 2024, the Federal Circuit ruled in NetScout's favor in its appeal, vacating the District Court's final judgment and remanding the case to the District Court to dismiss the case against NetScout as moot. As a result, during the year ended March 31, 2024, NetScout concluded that the risk of loss associated with damages that may result from this case was remote and recorded a $4.6 million reduction in contingent liabilities and legal fees. On June 26, 2024, the District Court issued its Order dismissing the case against NetScout.
Warranty and Indemnification- We warrant that our software and hardware products will substantially conform to the documentation accompanying such products on their original date of shipment. For software, which also includes firmware, the standard warranty commences upon shipment and generally expires 60 to 90 days thereafter. With regard to hardware, the standard warranty commences upon shipment and generally expires 60 days to 12 months thereafter. Additionally, this warranty is subject to various exclusions which include, but are not limited to, non-conformance resulting from modifications made to the software or hardware by a party other than NetScout; customers' failure to follow our installation, operation or maintenance instructions; and events outside of our reasonable control. We also warrant that all support services will be performed in a good and workmanlike manner. We believe that our product and support service warranties are consistent with commonly accepted industry standards. Warranty cost information is presentedpresented, and no material warranty costs are accrued since service revenue associated with warranty is deferred at the time of sale and recognized ratably over the warranty period.
At March 31, 2025,2026, cash, cash equivalents, marketable securities and investments (current and non-current) totaled $492.5$705.1 million. This represents an increase of $68.4$212.7 million from $424.1$492.5 million at March 31, 2024.2025. This increase was primarily due to $217.7$294.5 million of net cash provided by operations, $67.9 million proceeds from maturity of marketable securities, $11.8 million proceeds from sale of equity investment, partially offset by a net $100.0$163.4 million used to repaypurchase long-termmarketable debt,securities, $25.3$60.8 million used to repurchase shares of our common stock, $13.9$15.9 million used for tax withholdings on restricted stock units, $5.4and $9.1 million used for capital expenditures, $2.8 million used for the payment of debt issuance costs, and $1.3 million used to acquire technology licensesexpenditures during the fiscal year ended March 31, 2025.2026.
Net cash provided by operating activities of $294.5 million for year ended March 31, 2026, was primarily attributable to net income, as adjusted for share-based compensation expense, depreciation and amortization, deferred income taxes, operating lease right-of-use assets, and a $99.8 million working capital inflow. The working capital inflow was primarily driven by a $49.2 million increase in deferred revenue, a $35.1 million increase in accrued compensation, a $12.4 million decrease in accounts receivable, a $10.9 million decrease in prepaid expenses, a $4.7 million increase in accounts payable, partially offset by a $11.6 million decrease in operating lease liabilities.
Net cash provided by operating activities was $217.7 million during the fiscal year ended March 31, 2025, compared to $58.8 million during the fiscal year ended March 31, 2024. This $158.9 million increase in net cash provided by operating activities was due in part to a $209.7 million increase from goodwill impairment charges recorded during the fiscal year ended March 31, 2025 as compared to the fiscal year ended March 31, 2024, a $77.0 million increase from accounts receivable, a $54.2 million increase from accrued compensation and other expenses, a $24.5 million increase from deferred revenue, an $8.4 million increase from deferred income taxes, a $5.1 million increase from accounts payable, a $5.0 million increase from the change in the fair value of an equity investment, a $3.8 million increase related to the gain recorded in the fiscal year ended March 31, 2024 for the divestiture of a business, a $3.7 million increase from income taxes payable, a $3.6 million increase from prepaid expenses and other assets, and a $1.1 million increase from the loss on extinguishment of debt. These increases were partially offset by a $219.2 million decrease from the change in net loss, an $11.2 million decrease from depreciation and amortization expense, and a $6.0 million decrease from share-based compensation expense during the fiscal year ended March 31, 2025 as compared with the fiscal year ended March 31, 2024. Accounts receivable days sales outstanding was 68 days at March 31, 2025 compared to 81 days at March 31, 2024.
Net cash used in investing activities increased by $85.8 million to $92.8 million of net cash used in investing activities during the fiscal year ended March 31, 2026, compared to $7.0 million of net cash used in investing activities during the fiscal year ended March 31, 2025. The $85.8 million increase in net cash used in investing activities was partially due to an additional $118.3 million in purchase of marketable securities, and an additional $3.7 million used to purchase of fixed assets during the fiscal year ended March 31, 2026, compared with the fiscal year ended March 31, 2025. These increases in cash were partially offset by an additional $23.1 million in proceeds from maturity of marketable securities, and an $11.8 million in proceeds from the sale of our entire Napatech equity investment during the fiscal year ended March 31, 2026, compared with the fiscal year ended March 31, 2025.
Net cash (used in) provided by investing activities decreased by $20.4 million to $7.0 million of net cash used in investing activities during the fiscal year ended March 31, 2025, compared to $13.4 million of net cash provided by investing activities during the fiscal year ended March 31, 2024. The $20.4 million decrease in net cash (used in) provided by investing activities was due in part to a $12.3 million net decrease in cash inflow from the purchase and sale of marketable securities during the fiscal year ended March 31, 2025 when compared with the fiscal year ended March 31, 2024, a $7.8 million decrease in proceeds due to the divestiture of the Test Optimization business during the fiscal year ended March 31, 2024, and $1.3 million in cash used to acquire technology licenses during the fiscal year ended March 31, 2025. These decreases in cash were partially offset by a $1.0 million decrease in cash used to purchase fixed assets during the fiscal year ended March 31, 2025, compared with the fiscal year ended March 31, 2024.
Our investments in property and equipment consist primarily of computer equipment,equipment and internal use software, demonstration units, office equipment and facility improvements. We plan to continue to invest in capital expenditures to support our infrastructure in our fiscal year 2026.2027.
Net cash used in financing activities increaseddecreased $72.6$65.3 million to $142.0$76.7 million during the fiscal year ended March 31, 2025,2026, compared to $69.4$142.0 million of net cash used in financing activities during the fiscal year ended March 31, 2024.2025.
During the fiscal year ended March 31, 2025,2026, we repurchased aapproximately total2.5 of 1,362,205million shares of our common stock for $25.3$60.8 million in the open market under our 2022 Share Repurchase Program. During the fiscal year ended March 31, 2024,2025, we repurchased a total of 1,209,153approximately 1.4 million shares of our common stock for $33.6$25.3 million in the open market under our twenty-five million share repurchase program authorized in 2017 (2017 Share Repurchase Program), and 614,516 shares for $16.4 million in the open market under the 2022 Share Repurchase Program.
In connection with the delivery of common stock upon vesting of restricted stock units, we have withheld 703,727 shares for $13.9 million, and 653,645 shares for $19.4 million related to minimum statutory tax withholding requirements on these restricted stock units during the fiscal years ended March 31, 2025 and 2024, respectively. These withholding transactions do not fall under the repurchase program described above, and therefore do not reduce the amount that is available for repurchase under that program.
There was no debt outstanding during the fiscal year ended March 31, 2026. During the fiscal year ended March 31, 2025, we repaid a net $100.0 million of borrowings under the Third Amended and Restated Credit Agreement, and we paid $2.8 million in debt issuance costs related to the execution of our Third Amended and Restated Credit Agreement.
What changed in the latest 10-Q
Risk Factors
In addition to the other information set forth in this report, you should carefully consider the factors discussed in Part I, Item 1A. “Risk Factors” in our Annual Report. The risks discussed in our Annual Report could materially affect our business, financial condition and future results. There have been no material changes to those risk factors since we filed our Annual Report. The risks described in our Annual Report are not the only risks facing us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially and adversely affect our business, financial condition or operating results.
Largest changes
In addition to the other information set forth in this report, you should carefully consider the factors discussed in Part I, Itemsee in full comparison1A1A.of“Risk Factors” in our AnnualReport and Part II, Item 1A of our Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2025 (Fiscal 2026 Second Quarterly Report).Report. The risks discussed in our AnnualReport and Fiscal 2026 Second QuarterlyReport could materially affect our business, financial condition and future results. There have been no material changes to those risk factors since we filed our AnnualReport and Fiscal 2026 Second QuarterlyReport. The risks describedhere andin our AnnualReport and Fiscal 2026 Second QuarterlyReport are not the only risks facing us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially and adversely affect our business, financial condition or operating results.
Full comparison: every changed paragraph (1)
In addition to the other information set forth in this report, you should carefully consider the factors discussed in Part I, Item 1A1A. of“Risk Factors” in our Annual Report and Part II, Item 1A of our Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2025 (Fiscal 2026 Second Quarterly Report).Report. The risks discussed in our Annual Report and Fiscal 2026 Second Quarterly Report could materially affect our business, financial condition and future results. There have been no material changes to those risk factors since we filed our Annual Report and Fiscal 2026 Second Quarterly Report. The risks described here and in our Annual Report and Fiscal 2026 Second Quarterly Report are not the only risks facing us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially and adversely affect our business, financial condition or operating results.
Management's Discussion & Analysis (MD&A)
Removed heading “Nine Months Ended December 31, 2025 and 2024”
Removed heading “Cost of Revenue and Gross Profit”
Removed heading “Operating Expenses”
Removed heading “Interest and Other Income (Expense), Net”
Removed heading “Income Tax Expense”
Largest changes
Net income for thesee in full comparisonninethree months endedDecemberJune31,30,20252026 was$77.3$21.8 million, as compared with a net loss for theninethree months endedDecemberJune31,30,20242025 of$385.5$3.7 million. Thedecreaseincrease of$462.8$25.5 million in netlossincome was primarily due to a$427.0 million decrease in goodwill impairment charges, a $38.8$23.7 million increase in revenue,$19.0$3.7 milliondecreaseincreasefrominrestructuringtaxcharges,benefit,$5.1$3.4 milliondecreaseincrease ininterestcapitalizedexpense,software,a $3.0 million decrease in direct material costs, and a $1.8$1.1 million increase in interestincome. These decreases to net loss wereincome, partially offset bya $16.3$11.8 million increase inincome tax expense, a $10.8 million increase toemployee-related expenses primarily due to an increase in variable incentivecompensation, and a $5.5 million decrease in other income primarily due to the change in fair value of the equity investment in Napatech that was sold in August 2025.compensation.
“Goodwill impairment. During the first quarter of fiscal year 2025, due to a decrease in our stock price and overall market capitalization, along with other qualitative considerations including the continued impact from the conditions in the macroeconomic environment, it was determined a Triggering Event occurred, indicating goodwill may be impaired. Accordingly, we conducted an interim quantitative impairment test of its goodwill at June 30, 2024 using the market approach to estimate the fair value of its reporting unit. …”see in full comparison
Net cash provided by operating activities ofsee in full comparison$142.3$50.8 million forninethree months endedDecemberJune31,30,2025,2026, was primarily attributable to a $25.5 million increase in net income, as adjusted for share-based compensation expense, depreciation and amortization, deferred income taxes,goodwilloperatingimpairment,lease right-of-use asset, and a$14.4$1.5 million working capital outflow. The working capital outflow was primarily driven by$70.6a $31.7 million decrease in accrued compensation, a $31.6 million decrease in deferred revenue, a $7.6 million increase inaccountsinventoriesreceivable,and deferred costs, a $6.5 million increase in prepaid expenses and other assets, and a$9.0$2.5 million decrease in operating leaseliabilitiesliabilities, partially offset by$37.2 million increase in deferred revenue, $19.0 million increase in accrued compensation anda$9.4$79.0 million decrease inprepaidaccountsexpenses.receivable and unbilled costs, primarily impacted by the timing of customer fulfillment.
“Our effective tax rates were 18.8% and 0.4% for the nine months ended December 31, 2025 and 2024, respectively. The effective tax rate for the nine months ended December 31, 2025 differed from the effective rate for the nine months ended December 31, 2024, primarily related to a decrease in the research and development tax credit and an increase in foreign derived intangible income deduction. …”see in full comparison
We supplement the United States GAAP financial measures we report in quarterly and annual earnings announcements, investor presentations and other investor communications by reporting the following non-GAAP measures: non-GAAP gross profit, non-GAAP income from operations, non-GAAPsee in full comparisonoperating margin, non-GAAPnet income, non-GAAP diluted net income per share, and adjusted EBITDA. Non-GAAP gross profit removes expenses related to the amortization of acquired intangible assets, share-based compensation expense, and acquisition-related depreciationexpense.expense from gross profit (GAAP). Non-GAAP income from operations includes the aforementioned adjustments related to non-GAAP gross profit and also removesgoodwill impairment charges,executive transition costs, and restructuringcharges.chargesNon-GAAP operating margin is non-GAAPfrom income (loss) from operationsexpressed as a percentage of revenue.(GAAP). Non-GAAP net income includes the foregoing adjustments related to non-GAAP income from operations, and also removes the income tax effects of such adjustmentsasfromwellnetasincomeany(loss)loss on extinguishment of debt.(GAAP). Non-GAAP diluted net income per share is non-GAAP net income divided by total outstanding shares on a diluted basis. Adjusted EBITDA(formerly non-GAAP EBITDA from operations)includes the aforementioned adjustments related to non-GAAP net income and also removes interest and other expense, incometaxes,tax expense, and non-acquisition related depreciation from net income (GAAP). Beginningthisinquarter,the third quarter of fiscal year 2026, we have renamed non-GAAP EBITDA from operations to adjusted EBITDA. We now reconcile this metric to GAAP netincome,income; however, the adjustments included, and the resulting amounts are unchanged from prior periods. This change is intended to align terminology with common market practice.
We continue to closely monitor current global and macroeconomic conditions, including the impacts ofsee in full comparisonthearmedongoingconflictswarorin Ukraine and hostilities in the Middle East,warfare, global geopolitical tension, stock market volatility, industry-specific capital spending trends, exchange rate fluctuations, inflation, interest rates, international trade relations (including trade protection measures, such as tariffs and other trade barriers), and the risk of a recession, including the manner and extent to which they have impacted and could continue to impact our business, customers, employees, supply chain, and distribution network. In addition, our industry is experiencing AI-related supply-chain dynamics which could influence the timing and size of certain customer orders. The full extent of the impacts of these global and macroeconomic conditionsremainremains dynamic.In response to the war in Ukraine, we ceased business operations in Russia, including sales, support on existing contracts and professional services.We remain optimistic but cognizant of ongoing macroeconomic dynamics and constrained customer spending in the service provider market and firmly focused on driving product innovation,returning tosustaining annual revenue growth, and enhancing margins through continued disciplined cost management as we navigate the current macroeconomiclandscape that may persist through fiscal year 2026.landscape. As a result, we have continued our efforts to manage discretionary costs and align spending with the current environment while we continue to execute on our long-term strategic plans.
Full comparison: every changed paragraph (80)
You should read the following discussion and analysis of our financial condition and results of operations in conjunction with the condensed consolidated financial statements and notes thereto included elsewhere in this Quarterly Report and in our Annual Report on Form 10-K for the fiscal year ended March 31, 2025,2026, filed with the Securities and Exchange Commission (SEC) on May 15,14, 20252026 (Annual Report). This discussion contains forward-looking statements that involve risks and uncertainties. When reviewing the discussion below, you should keep in mind the substantial risks and uncertainties that could impact our business. In particular, we encourage you to review the risks and uncertainties described in Part I, Item 1A "Risk Factors" in our Annual Report and Part II, Item 1A of our Quarterly Report on From 10-Q for the fiscal quarter ended September 30, 2025, filed with the SEC on November 6, 2025.Report. These risks and uncertainties could cause actual results to differ significantly from those projected in forward-looking statements contained in this report or implied by past results and trends. Forward-looking statements are statements that attempt to forecast or anticipate future developments in our business, financial condition or results of operations. See the section titled "Cautionary Statement Concerning Forward-Looking Statements" that appears at the beginning of this Quarterly Report. These statements, like all statements in this report, speak only as of the date of this Quarterly Report (unless another date is indicated), and, except as required by law, we undertake no obligation to update or revise these statements in light of future developments.
We are an industry leader with over four decades of experience in providing enterprise network observability, carrier service assurance, AIOps, cybersecurity, and Distributed-Denial-Of-Service, or DDoS, protection solutions. Our unique visibility platform and solutions are powered by our pioneering deep packet inspectionDPI, technology at scale, which is used by many Fortune 500 companies to protect their digital business services against disruption. Service providers and enterprises, including local, state and federal government agencies, rely on our solutions to achieve the visibility and protection necessary to optimize network performance, ensure the delivery of high-quality, mission-critical applications and services, gain timely insight into the endend-user user experienceexperience, and to protect their networks from attack. The majority of our solutions are designed to provide Smart Data, a high-fidelity, decision-grade data foundation derived from real-time network activity across legacy, hybrid, and cloud-native environments. This data is designed to enable a unified view of performance, availability, and security, support faster root-cause analysis and operational decision-making, and is increasingly used to inform broader observability platforms and automated and AI-driven workflows. With our offerings, customers can quickly, efficiently and effectively identify and resolve issues that result in downtime, interruptionsservice to services,interruptions, poor service qualityquality, or compromised data, thereby reducing meantime-to-resolutionmean time to resolution of issues and driving compelling returns on their investments in their networks and broader technology initiatives. Some of the more significantSignificant technology trends and catalysts for our business include the evolution of customers' digital transformation initiativesinitiatives, such as the migration to cloud environments and to the edges of their networks,networks; the rapidly evolving cybersecurity threat landscape,landscape; advancements in artificial intelligence and business analytics advancements that can help enhance observability,observability and are increasing the need for high-quality, real-time data to support automated and AI-driven operations; and the continued evolution and potential opportunities related to 5G technology evolution inacross both the service provider and enterprise customer verticals.
Our operating results are affected by a variety of factors, including customer demand, product and services mix, pricing, operating costs, competition, and our ability to successfully execute our growth and strategic initiatives. See Part I, Item 1A, “Risk Factors” in our Annual Report for additional information regarding factors that may affect our business and operating results.
On May 1, 2026, the Company acquired the assets and certain liabilities comprising DigiCert, Inc.'s DDoS protection business pursuant to an Asset Purchase Agreement (the "Acquisition"). The Digicert DDoS protection business acquisition enhances the Company’s cybersecurity offerings and enables the integration of certain infrastructure of the Company’s Arbor Cloud network, while expanding its DDoS protection capabilities. The DigiCert DDoS protection business acquisition is expected to contribute approximately $20 million in annualized revenue from the acquisition date, while providing the Company with greater control of the Arbor Cloud network and a clearer path to scaling cloud-based services over time.
Our operating results are influenced by a number of factors, including, but not limited to, the volume, mix, and quantity of products and services sold, pricing, costs and availability of materials used in our products, growth in employee-related costs, including commissions, and the expansion of our operations. Factors that affect our ability to maximize our operating results include, but are not limited to, our ability to introduce and enhance existing products, the marketplace acceptance of those new or enhanced products, continued expansion into international markets, expansion into new or adjacent markets, development of strategic partnerships, competition, successful acquisition and integration efforts, and our ability to control costs, and make improvements in a highly competitive industry.
We continue to closely monitor current global and macroeconomic conditions, including the impacts of thearmed ongoingconflicts waror in Ukraine and hostilities in the Middle East,warfare, global geopolitical tension, stock market volatility, industry-specific capital spending trends, exchange rate fluctuations, inflation, interest rates, international trade relations (including trade protection measures, such as tariffs and other trade barriers), and the risk of a recession, including the manner and extent to which they have impacted and could continue to impact our business, customers, employees, supply chain, and distribution network. In addition, our industry is experiencing AI-related supply-chain dynamics which could influence the timing and size of certain customer orders. The full extent of the impacts of these global and macroeconomic conditions remainremains dynamic. In response to the war in Ukraine, we ceased business operations in Russia, including sales, support on existing contracts and professional services. We remain optimistic but cognizant of ongoing macroeconomic dynamics and constrained customer spending in the service provider market and firmly focused on driving product innovation, returning tosustaining annual revenue growth, and enhancing margins through continued disciplined cost management as we navigate the current macroeconomic landscape that may persist through fiscal year 2026.landscape. As a result, we have continued our efforts to manage discretionary costs and align spending with the current environment while we continue to execute on our long-term strategic plans.
Though we continue to monitor the impacts of evolving global and macroeconomic conditions on our business, we believe our current cash reserves and access to capital through our revolving credit facility leave us well-positioned to manage our business in today's environment. We expect net cash provided by operations combined with cash, cash equivalents, marketable securities and investments and borrowing availability under our revolving credit facility to provide sufficient liquidity to fund current obligations, capital spending, debt service requirements and working capital requirements over at least the next twelve months. We continue to take actions to manage costs and increase productivity throughout our company, including managing discretionary spending and hiring activities, but are continuing to invest in areas that advance our business for the future. In addition to our cash equivalents, the Companywe had $600 million available under a revolving credit facility based on covenant levels at DecemberJune 31,30, 2025.2026.
Total revenue increased $38.8$23.7 million, or 6%,13%, for the ninethree months ended DecemberJune 31,30, 2025,2026, as compared to total revenue for the ninethree months ended DecemberJune 31,30, 2024.2025, Thedriven increaseby was attributable to an increaseincreases in both product and service revenuerevenue. fromGrowth bothwas ourprimarily driven by demand for service assurance andofferings cybersecurity offerings. Within these offerings, both ourfrom enterprise and service provider customer verticalschannels. contributedU.S. torevenue thisincreased growth.24% while international revenue decreased 1%.
Our gross profit percentage increased 2 percentage points to 80%79 % during the ninethree months ended DecemberJune 31,30, 2025,2026, as compared with the ninethree months ended DecemberJune 31,30, 2024,2025, primarily due to increased product revenue growth and a more favorable product mix associated with increased licensing of our software products.
Net income for the ninethree months ended DecemberJune 31,30, 20252026 was $77.3$21.8 million, as compared with a net loss for the ninethree months ended DecemberJune 31,30, 20242025 of $385.5$3.7 million. The decreaseincrease of $462.8$25.5 million in net lossincome was primarily due to a $427.0 million decrease in goodwill impairment charges, a $38.8$23.7 million increase in revenue, $19.0$3.7 million decreaseincrease fromin restructuringtax charges,benefit, $5.1$3.4 million decreaseincrease in interestcapitalized expense,software, a $3.0 million decrease in direct material costs, and a $1.8$1.1 million increase in interest income. These decreases to net loss wereincome, partially offset by a $16.3$11.8 million increase in income tax expense, a $10.8 million increase to employee-related expenses primarily due to an increase in variable incentive compensation, and a $5.5 million decrease in other income primarily due to the change in fair value of the equity investment in Napatech that was sold in August 2025.compensation.
At DecemberJune 31,30, 2025,2026, we had cash, cash equivalents, marketable securities and investments (current and non-current) of $586.2$668.5 million. This represents ana increasedecrease of $93.7$36.7 million from $492.5$705.1 million at March 31, 2025.2026. This increasedecrease was primarily due to $142.3$55.0 million used in the acquisition of the DDoS Protection Business of DigiCert, $25.3 million used for tax withholdings on restricted stock units, $20.2 million in purchases of marketable securities, and $3.5 million used for capital expenditures, partially offset by $50.8 million of net cash provided by operations, $11.8 million in proceeds from the sale of our entire Napatech equity investment and a $47.1$23.8 million in proceeds from the maturity of marketable securities. Partially offsetting the increase was $69.3 million in purchases of marketable securities, $31.6 million used to repurchase shares of our common stock, $15.7 million used for tax withholdings on restricted stock units and $6.9 million used for capital expendituressecurities during the ninethree months ended DecemberJune 31,30, 2025.2026.
We supplement the United States GAAP financial measures we report in quarterly and annual earnings announcements, investor presentations and other investor communications by reporting the following non-GAAP measures: non-GAAP gross profit, non-GAAP income from operations, non-GAAP operating margin, non-GAAP net income, non-GAAP diluted net income per share, and adjusted EBITDA. Non-GAAP gross profit removes expenses related to the amortization of acquired intangible assets, share-based compensation expense, and acquisition-related depreciation expense.expense from gross profit (GAAP). Non-GAAP income from operations includes the aforementioned adjustments related to non-GAAP gross profit and also removes goodwill impairment charges, executive transition costs, and restructuring charges.charges Non-GAAP operating margin is non-GAAPfrom income (loss) from operations expressed as a percentage of revenue.(GAAP). Non-GAAP net income includes the foregoing adjustments related to non-GAAP income from operations, and also removes the income tax effects of such adjustments asfrom wellnet asincome any(loss) loss on extinguishment of debt.(GAAP). Non-GAAP diluted net income per share is non-GAAP net income divided by total outstanding shares on a diluted basis. Adjusted EBITDA (formerly non-GAAP EBITDA from operations) includes the aforementioned adjustments related to non-GAAP net income and also removes interest and other expense, income taxes,tax expense, and non-acquisition related depreciation from net income (GAAP). Beginning thisin quarter,the third quarter of fiscal year 2026, we have renamed non-GAAP EBITDA from operations to adjusted EBITDA. We now reconcile this metric to GAAP net income,income; however, the adjustments included, and the resulting amounts are unchanged from prior periods. This change is intended to align terminology with common market practice.
These non-GAAP measures are not prepared in accordance with GAAP, should not be considered an alternative for measures prepared in accordance with GAAP (gross profit, operatingincome margin,(loss) from operations, net income, and diluted net income per share), and may have limitations because they do not reflect all our results of operations as determined in accordance with GAAP. These non-GAAP measures should only be used to evaluate our results of operations in conjunction with the corresponding GAAP measures. The presentation of non-GAAP information is not meant to be considered superior to, in isolation from, or as a substitute for results prepared in accordance with GAAP. These non-GAAP measures should not be used to evaluate our results of operations against those of our peers or other companies, as the definitions and calculations of our non-GAAP measures may not be the same as those used by other companies, even if the measures share the same name.
The following table reconciles gross profit, income (loss) from operations, net income (loss) and net income (loss) per share on a GAAP and non-GAAP basis for the three and nine months ended DecemberJune 31,30, 20252026 and 2024,2025, respectively (dollars in thousands, except for per share data):
The preparation of our consolidated financial statements in conformity with GAAP requires management to use judgment in making estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosure of contingent assets and liabilities.
Our accounting policies for revenue recognition and the valuation of goodwill are based on, among other things, judgments and assumptions made by management that include inherent risks and uncertainties. There have been no significant changes to the above critical accounting policies or in the underlying accounting assumptions and estimates used in such policies from those disclosed in our annual consolidated financial statements and accompanying notes included in our Annual Report.
Our discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with GAAP consistently applied. The preparation of these consolidated financial statements requires us to make significant estimates and judgments that affect the amounts reported in our consolidated financial statements and the accompanying notes. These items are regularly monitored and analyzed by management for changes in facts and circumstances, and material changes in these estimates could occur in the future. Changes in estimates are recorded in the period in which they become known. We base our estimates on historical experience and various other assumptions that we believe to be reasonable under the circumstances. Actual results may differ from our estimates.
While all of our accounting policies impact the consolidated financial statements, certain policies are viewed to be critical. Critical accounting policies are those that are both most important to the portrayal of our financial condition and results of operations and that require management's most subjective or complex judgments and estimates. We consider the following accounting policies to be critical in fully understanding and evaluating our financial results:
•revenue recognition; and
•valuation of goodwill.
Please refer to the critical accounting policies set forth in our Annual Report for a description of all of our critical accounting policies and estimates.
Three Months Ended DecemberJune 31,30, 20252026 and 20242025
Total revenue increased $23.7 million, or 13% for the three months ended June 30, 2026, compared to the three months ended June 30, 2025, driven by increases in both product and service revenue. Product revenue increased 18%, driven by increased enterprise demand for service assurance offerings, which included revenue related to U.S. Government agencies. Service revenue increased 9%, primarily due to the timing and composition of maintenance and contract renewals and to a lesser extent incremental revenue from the DigiCert DDoS protection business acquisition on May 1, 2026. U.S. revenue increased 24%, benefiting from increased enterprise and service provider demand while international revenue decreased 1%. By product line, service assurance revenue increased 20% due to an increase in revenue from enterprise and service provider customers that included the benefit in part from government-related orders, some of which were received earlier than anticipated. Cybersecurity revenue increased 1% due to incremental revenue from the DigiCert DDoS protection business acquisition partially offset by a decrease in product revenue from enterprise customers. From a customer-vertical perspective, enterprise revenue increased 19%, driven by an increase in both product and service revenue and service provider revenue increased 3%.
Revenue
Product revenue consists of sales of our hardware products and licensing of our software products. Service revenue consists of customer support agreements, consulting, training, subscription-based services, and stand-ready software as a service offerings. During the three months ended December 31, 2025, one direct customer and one channel partner each accounted for approximately 10% of total revenue. During the three months ended December 31, 2024, one direct customer and no channel partners accounted for more than 10% of total revenue.
Product. The 5%, or $6.5 million, decrease in product revenue compared with the same period last year was attributable to a decrease in revenue from service provider customers from service assurance offerings and enterprise customers from cybersecurity offerings.
Service. The 4%, or $5.1 million, increase in service revenue compared with the same period last year was primarily due to an increase in revenue from maintenance contracts as well as cloud and subscription services.
The 8%, or $12.7 million, decrease in United States revenue compared to the same period last year was primarily due to a decrease in revenue from both service provider customers from service assurance offerings and enterprise customers from cybersecurity offerings, partly offset by an increase in revenue from enterprise customers from service assurance offerings. The 12%, or $11.3 million, increase in international revenue compared with the same period last year was driven by an increase in revenue from service provider and enterprise customers from both cybersecurity and service assurance offerings.
The 3%, or $4.6 million, decrease in revenue from the service assurance product line compared to the same period last year was due to a decrease in revenue from service provider customers. The 4%, or $3.3 million, increase in revenue from the cybersecurity product line compared to the same period last year was due to an increase in revenue from enterprise and service provider customers.
The 5%, or $6.5 million, decrease in revenue from the service provider customer vertical was due to a decrease in product revenue from service assurance offerings partly offset by an increase from cybersecurity product and service revenue. The 4%, or $5.1 million, increase in revenue from the enterprise customer vertical was due to an increase in product and service revenue from service assurance offerings as well as an increase from cybersecurity service lines, partially offset by a decrease in cybersecurity product lines.
Cost of product revenue consists primarily of material components, manufacturing personnel expenses, packaging materials, overhead and amortization of acquired developed technology and core technology. Cost of service revenue consists primarily of personnel, material, overhead and support costs.
Product. The 10%,19%, or $1.6$2.3 million, decrease in cost of product revenue for the three months ended DecemberJune 31,30, 20252026 compared to the same period last year was primarily driven by a $6.5 million or 5% decrease, in product revenue. Our product gross profit percentage increased 1 percentage point to 88% during the three months ended December 31, 2025 as compared with the three months ended December 31, 2024 due to a more favorable product mix associated with increased licensing of our software products.
Service. The 3%,11%, or $1.0$3.3 million, increase in cost of service revenue for the three months ended DecemberJune 31,30, 20252026 compared to the same period last year was primarily driven by a $5.1 million or 4% increase, in service revenue, and an increase in employee-related variable incentive compensation.compensation, and a $1.4 million increase in personnel costs driven by increased headcount from our DigiCert DDoS protection business acquisition. Our service gross profit percentage was consistent at 76%72% during the three months ended DecemberJune 31,30, 20252026 as compared with the three months ended DecemberJune 31,30, 2024.2025.
The 5%,6%, or $1.9$2.6 million, increase in research and development expenses for the three months ended DecemberJune 31,30, 20252026 compared to the same period last year was primarily due to an increase in employee-related variable incentive compensation,compensation and an increase of $1.4 million in personnel costs driven by increased headcount from our DigiCert DDoS protection business acquisition, partially offset by $0.3an million decreaseincrease in depreciationcapitalized expense.software development costs.
The 6%,3%, or $4.5$2.2 million, decreaseincrease in total sales and marketing expenses for the three months ended DecemberJune 31,30, 20252026 compared to the same period last year was primarily due to aan $4.3increase millionin decreaseemployee-related associatedvariable withincentive the timing of trade shows and other events.compensation.
The 8%, or $2.1 million, decrease in general and administrative expenses for the three months ended June 30, 2026 compared to the same period last year was primarily due to a $1.1 million decrease in stock based compensation driven by the retirement of our former Chief Financial Officer and Chief Operating Officer, a $1.0 million decrease associated with the elimination of the costs associated with the previous one-year senior advisor roles of our former Chief Financial Officer and Chief Operating Officer, a $0.5 million decrease in professional service costs, a $0.5 million decrease in legal expenses, and a $0.4 million increase in software capitalization, partially offset by an increase in employee-related variable incentive compensation.
The 3%, or $0.6 million, increase in general and administrative expenses for the three months ended December 31, 2025 compared to the same period last year was primarily due to an increase in employee-related variable incentive compensation, partially offset by $0.4 million decrease in legal expenses.
Interest and Other Income (Expense),Income, Net. Interest and other income (expense),income, net includes interest earned on our cash, cash equivalents and marketable securities, interest expense and other non-operating gains or losses.
The 153%,20 %, or $6.6$0.7 million, increase in interest and other income (expense), net, for the three months ended DecemberJune 31,30, 20252026 compared to the same period last year was primarily due to $4.5a $1.8 million decrease in foreign exchange expense and a $1.1 million increase in interest, offset by a $2.5 million decrease in the change in fair value of our prior equity investment in Napatech that was sold in August 2025, a $2.2 million decrease in interest expense, and a $0.7 million increase in interest income. This increase was partially offset by a $0.9 million increase in foreign currency exchange expense.2025.
The effective tax rates were 17.2%(15.2)% and 14.9%30.1% for the three months ended DecemberJune 31,30, 20252026 and 2024,2025, respectively. The effective tax rate for the three months ended DecemberJune 31,30, 20252026 differed from the effective tax rate for the three months ended DecemberJune 31,30, 2024,2025, primarily duerelated to a decrease in the research and development tax credit and an increase in the forecasted benefit of the foreign derived intangible income deduction.deduction, a significant benefit related to stock compensation and a decrease in foreign withholding taxes.
Nine Months Ended December 31, 2025 and 2024
Revenue
During the nine months ended December 31, 2025, no direct customers or channel partners accounted for more than 10% of the Company's total revenue. During the nine months ended December 31, 2024, one direct customer and no channel partners accounted for more than 10% of total revenue.
Product. The 7%, or $19.0 million, increase in product revenue compared with the same period last year was attributable to an increase in revenue from enterprise customers from service assurance offerings as well as an increase in revenue from service provider and enterprise customers from cybersecurity offerings. Also contributing to the increase in product revenue was an increase in U.S.Government agency related orders.
Service. The 6%, or $19.7 million, increase in service revenue compared with the same period last year was primarily due to an increase in revenue from maintenance contracts, partly due to the timing of customer maintenance renewals, as well as cloud and subscription services.
Total revenue by geography was as follows:
The 2%, or $7.8 million, increase in United States revenue compared to the same period last year was primarily due to an increase in revenue from enterprise customers from both service assurance and cybersecurity offerings, partly offset by a decrease in revenue from service provider customers from both service assurance and cybersecurity offerings. Also contributing to the increase was the timing of maintenance renewal orders and an increase in U.S. Government agency related orders. The 12%, or $30.9 million, increase in international revenue compared with the same period last year was driven by an increase in revenue from service provider and enterprise customers from both service assurance and cybersecurity offerings.
Total revenue by product line was as follows:
The 5%, or $19.3 million, increase in revenue from the service assurance product line compared to the same period last year was due to an increase in revenue from enterprise customers, partially offset by a decrease in service provider product revenue. The 9%, or $19.4 million, increase in revenue from the cybersecurity product line compared to the same period last year was due to an increase in revenue from service provider and enterprise customers. Revenue from both the service assurance and cybersecurity product lines benefited from the timing of maintenance renewals within the fiscal year.
Total revenue by customer vertical was as follows:
The 2%, or $5.9 million, increase in revenue from the service provider customer vertical was due to an increase in service revenue from both the service assurance and cybersecurity product lines, as well as an increase in product revenue from the cybersecurity product line. The 9%, or $32.8 million, increase in revenue from the enterprise vertical was due to an increase in product and service revenue from both the service assurance and cybersecurity product lines. Revenue from both the service assurance and cybersecurity product lines benefited from the timing of maintenance renewals within the fiscal year.
Cost of Revenue and Gross Profit
Product. The 8%, or $3.5 million, decrease in cost of product revenue for the nine months ended December 31, 2025 compared to the same period last year was primarily driven by a 2 percentage point increase in our gross profit percentage to 87% due to a more favorable product mix associated with increased licensing of our software products.
Service. The 4%, or $3.5 million increase in cost of service revenue for the nine months ended December 31, 2025 compared to the same period last year was primarily driven by a $19.7 million, or 6%, increase, in service revenue, and an increase in employee-related variable incentive compensation. The service gross profit percentage was consistent at 74% for the nine months ended December 31, 2025 when compared to the nine months ended December 31, 2024.
Operating Expenses
Research and development. The 3%, or $3.6 million, increase in research and development expenses for the nine months ended December 31, 2025 compared to the same period last year was primarily due to an increase in employee-related variable incentive compensation, partially offset by a $1.8 million decrease in employee-related costs due to a reduction in headcount, and a $1.2 million decrease in depreciation expense.
Sales and marketing. The 0%, or $0.6 million, decrease in sales and marketing expenses for the nine months ended December 31, 2025 compared to the same period last year was primarily due to a $1.8 million decrease in employee-related expenses due to a reduction in headcount, $1.6 million decrease associated with trade shows and other events partially offset by an increase in employee-related variable incentive compensation.
General and administrative. The 7%, or $5.4 million, increase in general and administrative expenses for the nine months ended December 31, 2025 compared to the same period last year was primarily due to an increase in employee-related variable incentive compensation, a $1.4 million increase in professional services, a $0.7 million increase in software expenses and a $0.5 million increase in legal fees.
Restructuring charges. During the third quarter of fiscal year 2024, we entered into transition agreements that provided termination benefits for certain employees to ensure an orderly transition of responsibilities for continuity purposes. As a result of this related workforce change, during the nine months ended December 31, 2025 we recorded restructuring charges totaling $0.9 million. During the nine months ended December 31, 2024, we recorded restructuring charges totaling $19.9 million related to one-time termination benefits for one hundred forty-two employees who voluntarily terminated their employment during the nine months ended December 31, 2024.
Goodwill impairment. During the first quarter of fiscal year 2025, due to a decrease in our stock price and overall market capitalization, along with other qualitative considerations including the continued impact from the conditions in the macroeconomic environment, it was determined a Triggering Event occurred, indicating goodwill may be impaired. Accordingly, we conducted an interim quantitative impairment test of its goodwill at June 30, 2024 using the market approach to estimate the fair value of its reporting unit. As a result of that interim impairment test, we recorded a $427.0 million goodwill impairment charge during the nine months ended December 31, 2024.
NTCT insider buying and selling (Form 4)
Since 2026-04-11, insiders reported open-market purchases in 0 Form 4 filings and open-market sales in 8 filings (5 insiders, 7 trade dates, 40,254 shares, about $1.6M; 7 of these filings say the sales were made under a Rule 10b5-1 trading plan). Net open-market shares: -40,254 (purchases minus sales); net value about -$1.6M.Totals add up every open-market (code P and S) line in those filings, using the prices reported in the filings. Awards, option exercises, tax withholding and gifts are listed below but not counted.
| Trade date | Insider | Transaction | Shares | Price | Value |
|---|---|---|---|---|---|
| 2026-09-11 | Perretta Christopher |
Open-market sale |
7,000 | $38.00 | $266.0K |
| 2026-09-10 | Vitale Vivian M |
Option exercise | 7,000 | — | — |
| 2026-09-10 | Perretta Christopher |
Option exercise | 7,000 | — | — |
| 2026-09-10 | Pelage Marlene |
Option exercise | 7,000 | — | — |
| 2026-09-10 | Nash Shannon |
Option exercise | 7,000 | — | — |
| 2026-09-10 | Hadzima Joseph G Jr |
Option exercise | 7,000 | — | — |
| 2026-09-10 | Grasso Alfred |
Option exercise | 7,000 | — | — |
| 2026-09-10 | Egan John R |
Option exercise | 7,000 | — | — |
| 2026-09-10 | Donahue Robert E |
Option exercise | 7,000 | — | — |
| 2026-08-25 | Szabados Michael |
Open-market sale | 4,000 | $37.70 | $150.8K |
| 2026-08-25 | Piazza Anthony John |
Option exercise | 2,500 | — | — |
| 2026-08-25 | Piazza Anthony John |
Shares withheld for tax | 737 | $37.81 | $27.9K |
| 2026-08-25 | Munshi Sanjay |
Option exercise | 3,000 | — | — |
| 2026-08-25 | Munshi Sanjay |
Shares withheld for tax | 731 | $37.81 | $27.6K |
| 2026-08-17 | Munshi Sanjay |
Open-market sale |
2,269 | $39.27 | $89.1K |
| 2026-08-11 | Downing John |
Open-market sale |
8,000 | $38.41 | $307.3K |
| 2026-06-19 | Szabados Michael |
Shares withheld for tax | 1,782 | $39.67 | $70.7K |
| 2026-06-19 | Szabados Michael |
Option exercise | 6,048 | — | — |
| 2026-06-19 | Singhal Anil K |
Option exercise | 10,368 | — | — |
| 2026-06-19 | Singhal Anil K |
Shares withheld for tax | 4,609 | $39.67 | $182.8K |
| 2026-06-19 | Downing John |
Option exercise | 5,184 | — | — |
| 2026-06-19 | Downing John |
Shares withheld for tax | 2,305 | $39.67 | $91.4K |
| 2026-06-15 | Szabados Michael |
Shares withheld for tax | 1,856 | $41.42 | $76.9K |
| 2026-06-15 | Szabados Michael |
Option exercise | 6,300 | — | — |
| 2026-06-15 | Singhal Anil K |
Shares withheld for tax | 4,195 | $41.42 | $173.8K |
| 2026-06-15 | Singhal Anil K |
Option exercise | 10,800 | — | — |
| 2026-06-15 | Munshi Sanjay |
Option exercise | 2,400 | — | — |
| 2026-06-15 | Munshi Sanjay |
Shares withheld for tax | 585 | $41.42 | $24.2K |
| 2026-06-15 | Downing John |
Shares withheld for tax | 1,591 | $41.42 | $65.9K |
| 2026-06-15 | Downing John |
Option exercise | 5,400 | — | — |
| 2026-06-15 | Piazza Anthony John |
Option exercise | 2,000 | — | — |
| 2026-06-15 | Piazza Anthony John |
Shares withheld for tax | 589 | $41.42 | $24.4K |
| 2026-06-08 | Downing John |
Open-market sale |
8,000 | $40.29 | $322.3K |
| 2026-06-06 | Szabados Michael |
Option exercise | 6,300 | — | — |
| 2026-06-06 | Szabados Michael |
Shares withheld for tax | 1,850 | $40.59 | $75.1K |
| 2026-06-06 | Singhal Anil K |
Option exercise | 10,800 | — | — |
| 2026-06-06 | Singhal Anil K |
Shares withheld for tax | 3,170 | $40.59 | $128.7K |
| 2026-06-06 | Piazza Anthony John |
Shares withheld for tax | 705 | $40.59 | $28.6K |
| 2026-06-06 | Piazza Anthony John |
Option exercise | 2,400 | — | — |
| 2026-06-06 | Munshi Sanjay |
Option exercise | 2,880 | — | — |
| 2026-06-06 | Munshi Sanjay |
Shares withheld for tax | 702 | $40.59 | $28.5K |
| 2026-06-06 | Downing John |
Shares withheld for tax |
1,585 | $40.59 | $64.3K |
| 2026-06-06 | Downing John |
Option exercise |
5,400 | — | — |
| 2026-05-15 | Szabados Michael |
Open-market sale |
4,000 | $38.40 | $153.6K |
| 2026-05-15 | Munshi Sanjay |
Open-market sale |
1,985 | $38.40 | $76.2K |
| 2026-05-12 | Grasso Alfred |
Open-market sale |
5,000 | $40.67 | $203.3K |
| 2026-05-06 | Singhal Anil K |
Shares withheld for tax | 3,181 | $35.77 | $113.8K |
| 2026-05-06 | Singhal Anil K |
Option exercise | 10,800 | — | — |
| 2026-05-06 | Piazza Anthony John |
Option exercise | 4,500 | — | — |
| 2026-05-06 | Piazza Anthony John |
Shares withheld for tax | 1,423 | $35.77 | $50.9K |
| 2026-05-06 | Munshi Sanjay |
Option exercise | 3,750 | — | — |
| 2026-05-06 | Munshi Sanjay |
Shares withheld for tax | 1,014 | $35.77 | $36.3K |
| 2026-05-06 | Downing John |
Option exercise | 5,400 | — | — |
| 2026-05-06 | Downing John |
Shares withheld for tax | 1,588 | $35.77 | $56.8K |
Well-known investors holding NTCT (13F)
| Investor | Quarter | Shares | Reported value | % of their 13F | Change vs prior quarter |
|---|---|---|---|---|---|
| AQR Capital Management (Cliff Asness) | 2026-06-30 | 1,059,810 | $45.8M | 0.02% | Reduced 12% |
| Two Sigma Investments | 2026-06-30 | 449,621 | $19.6M | 0.01% | Added 3% |
| Millennium Management (Israel Englander) | 2026-06-30 | 432,729 | $18.8M | 0.01% | Added 526% |
| Citadel Advisors (Ken Griffin) | 2026-06-30 | 257,561 | $11.2M | 0.01% | Added 299% |
| First Eagle Investment Management | 2026-06-30 | 248,402 | $10.8M | 0.02% | Added 24% |
| Bridgewater Associates | 2026-06-30 | 99,831 | $4.3M | 0.02% | Reduced 47% |
| D. E. Shaw & Co. | 2026-06-30 | 39,975 | $1.7M | 0.0% | Reduced 62% |
| Gotham Asset Management (Joel Greenblatt) | 2026-06-30 | 8,414 | $366.4K | 0.0% | Reduced 69% |