瑞邦通讯 (RBBN) 2026财年第三季度业绩电话会：营收增长14%，发布第四季度业绩指引lg...

核心要点

• Ribbon Communications公布2026财年第三季度营收为2.19亿美元，环比增长14%，同比增长2%，得益于两大运营板块较第二季度均有所改善。
• 调整后EBITDA达到2700万美元，环比增加1500万美元；非GAAP稀释后每股收益升至0.07美元。
• IP光网络业务营收环比增长17%至9600万美元，得益于路由产品、新增两家美国二级运营商客户以及在手订单转化。
• 云与边缘业务营收环比增长11%至1.23亿美元。与威瑞森相关的销售额比上半年季度运行率高出约50%。
• 管理层指引2026财年第四季度营收为2.33亿至2.47亿美元，调整后EBITDA为4000万至4700万美元，预计大部分环比增长将来自云与边缘业务。
• 供应链限制可能会将500万至1000万美元的客户需求推迟至下一季度，同时组件和物流成本上升预计将增加约每季度200万美元。

主要财务业绩

业务与运营表现

IP光网络

IP光网络业务实现9600万美元的收入，环比增长17%，同比增长5%。产品收入同比增长13%，但部分被2025年第四季度一项旧支持合同到期后服务收入下降所抵消。

路由器产品组合出货量增长约35%，且超过了光网络总销售额。管理层重点介绍了赢得的两家新的美国二级服务提供商客户、在公用事业及能源客户中的持续部署，以及一个越南IP与光网络项目，预计将超过2026年的1000万美元。

该板块录得1.24倍的预订营收比（针对2026年前九个月）。第三季度预订额同比增长约9%，尽管订单出货比为0.82倍，因Ribbon将上半年积压订单转化为出货量导致收入大幅增长。

板块非GAAP毛利率为35.5%，环比上升30个基点，但同比下降390个基点，主要由于零部件成本和地理区域组合所致。调整后EBITDA为亏损100万美元，环比改善500万美元。

云与边缘业务

云与边缘业务收入为1.23亿美元，环比增长11%，同比下降同比增长1%。Non-GAAP毛利率环比提升210个基点至61.9%。调整后EBITDA达到2800万美元，占部门营收的23%。

服务提供商营收环比增长15%，主要得益于与大客户的合作活跃度提高。Verizon仍是Ribbon最大的客户，占其季度营收的10%以上，且销售额比上半年季度运行率高出约50%。

Ribbon还提及与美国某大型民事联邦机构签署的新语音现代化项目、国防相关部署，以及在某个北约欧洲国家取得的项目合作。管理层预计，随着企业级部署投入生产，与其Salesforce Agentforce Contact Center的合作将带来额外的订阅收入。

按区域划分的趋势

美洲地区营收环比增长11%，同比增长2%。亚太地区营收环比增长20%，同比增长19%，主要受东南亚各地的需求以及印度持续的市场活动推动。欧洲、中东和非洲（EMEA）地区营收环比增长14%，但同比下降11%，原因在于前一年同期创下历史新高后，中东和非洲地区的销售额有所下滑。

管理层业绩指引

对于2026年第四季度，管理层预计：

Ribbon预计两个业务板块均将实现环比增长，其中大部分增量来自云与边缘（Cloud & Edge）业务。管理层将预期的盈利能力提升归因于在相对固定的成本基数上，软件业务占比提高以及专业服务收入增加。

该指引包含了大约每季度200万美元的额外零部件及物流成本。Ribbon可能会在2027年通过针对性提价来抵消部分压力。

管理层还预计，2027年Verizon的交换机迁移步伐将加快，而与Frontier业务覆盖相关的潜在合作仍处于规划阶段。

风险与关注要点

• Ribbon预计第四季度将面临部分供应限制，涉及内存、核心芯片和光线路系统零部件。
• 管理层估计，500万美元至1000万美元的客户需求可能会从第四季度递延至下一季度。
• 由于大型合同签订、部署及专业服务收入确认的时机不同，季度业绩可能会有所波动。
• 第三季度经营性现金流为负1400万美元，而净债务杠杆率为4.4倍。管理层预计现金流将在第四季度及2027年第一季度有所改善。
• IP光网络业务的利润率仍面临零部件成本上升及区域业务组合变化的影响。

分析师问答环节要点

管理层表示，IP光网络的最大机遇主要来自正在扩建光纤网络的传统一级电信运营商，尤其是在国际市场。随着运营商通过兼用于移动回传和宽带的基础设施为新设施提供连接，数据中心需求也间接做出了贡献。

Ribbon认为二级运营商是一个具备吸引力的市场，因为这些客户每年在光纤和IP路由基础设施上投资数千万美元，且通常寻求更强的技术支持和更快的供应商响应速度。

管理层表示，目前IP与光网络业务的利润率接近，因为Ribbon的大部分IP收入来自成本较低的边缘和汇聚路由器。随着时间的推移，公司预计IP产品组合将提升毛利润率表现。

对于第四季度的预订额，管理层认为前景向好，并预计由于客户寻求更高的供应保障，部分订单将形成2027年的在手订单。

业绩电话会议完整记录

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完整财报电话会议逐字稿

管理层陈述

Operator

Greetings, and welcome to the Ribbon Communications Third Quarter 2026 Financial Results Conference Call. [Operator Instructions] Please note, this conference is being recorded.

I would now like to turn the conference over to your host, Fahad Najam. Please go ahead.

Fahad Najam

Good afternoon, and welcome to Ribbon's Third Quarter 2026 Financial Results Conference Call. I'm Fahad Najam, SVP, Corporate Strategy and Investor Relations at Ribbon Communications. Also on the call today are Bruce McClelland, Ribbon's Chief Executive Officer; Rick Marmurek, Ribbon's Chief Financial Officer.

Today's call is being webcast live and will be archived on the Investor Relations section of our website at rbbn.com, where both our press release and supplemental slides are currently available. Certain matters we will be discussing today, including the business outlook and financial projections for fourth quarter of 2026 and beyond are forward-looking statements. Such statements are subject to risks and uncertainties that could cause actual results to differ materially from those contained in these forward-looking statements. These risks and uncertainties are discussed in our documents filed with the SEC, including our most recent Form 10-K. I refer you to our safe harbor statement included in the supplemental financial information posted on our website.

In addition, we will present non-GAAP financial information on this call. Reconciliations to the applicable GAAP measures are included in the earnings press release we issued earlier today as well as in the supplemental financial information we prepared for this conference call, which again, are both available on the Investor Relations section of our website.

And now I would like to turn the call over to Bruce. Bruce?

Bruce McClelland

Great. Thanks, Fahad. Good afternoon, everyone, and thanks for joining us today to discuss our third quarter results and outlook for the rest of the year. As we highlighted on our last earnings call, we expected a much stronger second half of the year with significant sequential improvement in both revenue and earnings starting in the third quarter, and I'm pleased to report that we delivered on those goals. We had a solid third quarter with meaningful sequential increases in revenue and profitability in both of our operating segments.

Revenue increased 14% sequentially to $219 million, while adjusted EBITDA more than doubled to $27 million. The strong IP Optical bookings trend in the first half translated into a record third quarter of sales for the segment, growing by 17% sequentially. This was one of the strongest quarters ever in the U.S. for the IP Optical Networks business, including two new Tier 2 service provider customers. As compared to the first quarter of this year, IP Optical sales increased more than 50% in the third quarter.

We also had a much stronger performance in our Cloud & Edge segment, with sales increasing 11% quarter-over-quarter. Service provider revenue increased 15% sequentially with increased activity with our largest customers. And Cloud & Edge sales in the enterprise and government market segment remained solid, including a prominent new win with a large civilian federal agency.

Importantly, Verizon continued as our largest 10% plus customer in the quarter with increased activity resulting in sales growth of approximately 50% compared to the first half quarterly run rate. This represents meaningful progress as we work with Verizon to reaccelerate their voice network modernization program. When you exclude sales to our top U.S. Tier 1 service provider customers, the rest of our business grew approximately 5% year-over-year.

From a geographic perspective, sales increased sequentially and year-over-year across almost all regions. In the Americas, revenue increased 11% sequentially and 2% year-over-year, largely reflecting improving activity with our U.S. Tier 1 service provider customers and higher enterprise sales. Asia Pacific revenue increased 20% sequentially and 19% year-over-year with growing demand across multiple countries in Southeast Asia. This included a significant new IP and optical project in Vietnam that exceeds $10 million this year. EMEA revenue increased 14% sequentially with higher sales in Europe, but declined 11% year-over-year with lower sales in the Middle East and Africa following a record quarter last year. Overall, we're encouraged by the increasing contribution from international markets and the diversification of our customer base.

Now a few more highlights from each of our operating segments. Starting with our IP Optical Networks business. This was our best third quarter ever and the second highest quarterly revenue performance in the U.S., where sales increased more than 150% compared to the prior year. As we've discussed previously, we had exceptionally strong bookings activity during the first half of the year, and our focus in the third quarter was on executing against that backlog and converting orders into revenue.

Shipments of our IP routing portfolio was a strength this quarter, growing approximately 35% and were higher than total optical sales, highlighting the importance of our combined IP and optical portfolio. In North America, we had an exceptionally strong quarter, supported by several important new customer wins and continued deployments across both service provider and critical infrastructure markets. We're particularly excited about two new U.S. Tier 2 service provider customers where we were awarded new projects for the first time and anticipate ongoing programs and investments, including data center connectivity.

We also continue to execute on a large expansion project with one of the largest energy producers in the U.S. And we secured a project with a new major regional power generation and transmission utility in the Midwest, serving a network of electric co-ops and approximately 3 million consumers. We had sizable shipments this quarter to a number of regional service providers, providing mobile backhaul, broadband Internet and data center interconnect services. These projects are all good examples of the opportunities we're seeing as service providers and utilities invest in more resilient, higher capacity IP and optical networks. And we're encouraged by the momentum in North America and believe our expanding customer base positions us well for continued growth.

In the EMEA region, we saw a significant sequential improvement in our business in Europe, supported by stronger activity across both critical infrastructure and service provider markets. Several of these projects include replacement of Chinese equipment and expansion to meet growth requirements with more modern, flexible IP and optical solutions.

In Asia Pacific, we had another very good quarter in India with revenue increasing modestly from the second quarter. India continues to be an important market for Ribbon, where we're selling the entire portfolio of IP and optical solutions, and we expect significant investment in fiber infrastructure in the coming years to meet both mobile and data center growth.

And as I mentioned earlier, we had a very strong activity in Southeast Asia, including new and expanding opportunities in the Philippines, Vietnam, Indonesia, Japan and Taiwan. The common thread across all these markets is the increasing importance of enterprise data centers as a driver for investment in new fiber networks, adding to the capacity growth and demand from mobile and Internet broadband.

A great example is our continued activity in Africa, where we're supporting the deployment of optical fiber backbone networks spanning several countries. These networks are designed to provide high-capacity connectivity supporting data centers and a broad range of communication services. We believe these types of projects highlight the expanding opportunity for Ribbon as investment in digital infrastructure extends beyond traditional hyperscale data center markets. Overall, we're pleased with the progress in IP Optical Networks and believe the broadening mix of customers and applications positions the business well for future growth.

Turning to our Cloud & Edge business. As I mentioned earlier, one of the most encouraging developments in the quarter was the improvement in our business with Verizon. We continue to have a broad engagement that includes network upgrades to significantly reduce operational costs and transitioning traditional telecom network functions to cloud-native technologies. Together, we're targeting increased velocity in 2027 and in the planning stages for their Frontier footprint.

Beyond the large service providers, we're also focused on expanding the addressable market for our voice network modernization solutions. In September, we announced a new partnership with TNS to provide independent and rural service providers with a fully managed cloud-based approach to replacing legacy voice switches. By incorporating Ribbon's carrier-grade voice technology into TNS' hosted Cloud Connect platform, we're providing smaller operators with a more cost-effective path to modernization without requiring them to own and operate complex voice switching infrastructure.

There's also an interesting longer-term dimension to these modernization programs in the context of the significant investment underway in AI infrastructure. As service providers retire legacy switching equipment, they're freeing up valuable space, power and cooling capacity in central offices and other network facilities that can be used for AI inference processing closer to the edge of the network. So the work we're doing to modernize these networks not only helps our customers lower cost and simplify their operations, it can also help unlock infrastructure that could support the next generation of edge AI applications.

In the enterprise market vertical, the growth in Cloud and Edge this quarter was underpinned by multiple projects in the government and defense space. This included the new voice modernization project I mentioned with a large new civilian federal agency. We were particularly excited about this win because it demonstrates the relevance of our technology in highly secure mission-critical communications environments and creates an opportunity to expand our presence across multiple civilian agencies. This complements additional shipments this quarter to several other defense agencies and a new win in Europe with a NATO country using our network-in-a-box solution.

The other key area of opportunity in enterprise that we highlighted last quarter is the growing adoption of enterprise AI applications and the integration with traditional telecom services. Our partnership with Salesforce to support its Agentforce Contact Center platform positions Ribbon to provide the secure voice connectivity required as AI agents begin interacting directly with customers. We're encouraged by the progress towards broader commercial adoption and anticipate several major enterprises will begin deploying Agentforce Contact Center over the coming months, driving additional subscription revenue for Ribbon as these applications move into production. Combined with our AWS relationship and cloud-native communications portfolio, we believe this gives Ribbon an important position in an emerging market for AI-powered voice communications.

Overall, the continued strength in enterprise, growth in government and expansion into enterprise AI are great examples of how we're diversifying Cloud & Edge beyond our traditional service provider customers.

With that, I'll turn it over to Rick to provide additional financial details on our results, and I'll come back on to discuss our outlook for the fourth quarter. Rick?

Eric Marmurek

Thanks, Bruce. Good afternoon, everyone. Let's begin with our consolidated results.

Third quarter performance improved significantly from the second quarter with strong revenue growth, higher profitability and meaningful improvement in earnings, reflecting continued momentum across the business. In the third quarter of 2026, Ribbon generated revenue of $219 million, up 14% sequentially and up 2% year-over-year. Consolidated non-GAAP gross margin was 50.3%, improving 100 basis points sequentially on higher revenue and improved operating leverage while declining 230 basis points year-over-year, primarily due to product and customer mix.

Non-GAAP operating expenses were $88 million, $1 million lower year-over-year and similar to the prior quarter. Adjusted EBITDA was $27 million, up $15 million sequentially and down $2 million from the prior year. Net interest expense was $11 million in the quarter.

Non-GAAP net income was $12 million, a $5 million improvement year-over-year and a $17 million improvement sequentially. This resulted in non-GAAP diluted earnings per share of $0.07, up $0.03 compared to the prior year and up $0.10 sequentially.

Now I'll provide a little more detail on the financial results of our two business segments. Starting with our IP Optical Networks segment, third quarter revenue was $96 million, increasing 17% sequentially with significant growth in product revenue from our routing portfolio. Year-over-year, sales were up 5%, primarily due to a 13% increase in product revenue, offset by lower services revenue due to a legacy support contract that ended during Q4 of '25.

Through the first nine months of the year, IP Optical Networks delivered a strong 1.24x book-to-revenue ratio, providing good visibility for continued momentum into the fourth quarter. Third quarter non-GAAP gross margin was 35.5%, up 30 basis points sequentially and down 390 basis points year-over-year. The year-over-year decline primarily reflects higher component costs and unfavorable geographic mix. IP Optical Networks adjusted EBITDA was a loss of $1 million in the quarter, improving $5 million sequentially and down $2 million versus the prior year.

Now turning to our Cloud & Edge business segment. Third quarter revenue was $123 million, up 11% sequentially and down 1% year-over-year. Non-GAAP Cloud & Edge gross margin was 61.9%, improving 210 basis points sequentially, driven by improved margins in both product and services. Gross margin remained relatively consistent with the prior year.

As we discussed on previous calls, the timing of professional services revenue can have a meaningful impact on quarterly margins, and we continue to focus on aligning our cost structure with the pace of our customer activity. Adjusted EBITDA for the segment was $28 million or 23% of revenue, improving $10 million sequentially and flat year-over-year. For the combined business, cash flow from operations was a use of $14 million in the quarter.

We ended the quarter with $42 million in cash. This included a $15 million draw on our revolver to simplify cash management. Our net debt leverage ratio was 4.4x. We expect continued EBITDA improvement that will reduce our leverage ratio as we move through the fourth quarter and into 2027. Capital expenditures totaled $1 million in the quarter, slightly lower than our expected quarterly spend of $3 million to $4 million.

In conclusion, as expected, our third quarter results improved substantially from the second quarter. We expect continued sequential growth and increased profitability in the fourth quarter, led primarily from our Cloud and Edge segment.

With that, I'll turn the call back to Bruce.

Bruce McClelland

Great. Thanks, Rick. Looking ahead to the fourth quarter and into 2027, we're encouraged by the continued improvement in our business and the opportunities we're seeing across several of our key markets. We have a number of relatively large opportunities in our funnel. And while the timing of individual awards and deployments can create some variability in quarterly results, we believe the overall demand environment remains healthy.

Total bookings in the quarter increased by 8% year-over-year and were evenly distributed across both of our businesses. Backlog increased 9% from the same point last year. As I mentioned earlier, revenue from Verizon increased meaningfully in the third quarter following a slower-than-anticipated first half. We anticipate further improvement in the fourth quarter and a solid 2027 with the pace of switch migrations continuing to increase and potential for incremental business from their Frontier operation.

Also, as I outlined earlier, we have several new initiatives that leverage the technology within the Cloud & Edge business to grow into new markets. We're increasingly excited about the new emerging opportunities tied to the wide-scale use of AI. Our work with Salesforce and AWS is positioning Ribbon as a technology leader in supporting AI-powered voice applications.

Another developing potentially significant market opportunity is related to the proliferation of voice phishing or vishing attacks. We recently announced new capabilities that we've developed that leverage our widely deployed SBC platform to be able to detect AI-generated voice impersonation, deep fakes and other new security threats. There's significant customer interest in a number of use cases to be able to quickly detect and prevent this new cyber vulnerability. I believe this could develop into a significant revenue opportunity over the next several years.

We also recently announced a new leader for our Acumen AIOps autonomous networking platform as we look to build our presence in this exciting new area and develop a stronger recurring revenue stream.

From an end market perspective, we continue to see results from our efforts to diversify outside traditional telecom with growing opportunities across critical infrastructure, government and defense. Our recent win with a new civilian federal agency, along with continued activity across utilities and defense markets reinforces our confidence in the growth potential of these businesses. These are attractive markets where the security, reliability and resiliency of our solutions provide important competitive differentiation.

Finally, our focus over the last several years to develop a robust IP routing and optical transport portfolio is translating into growth in key markets such as North America and Europe. Our strong third quarter performance, combined with new customer wins and a growing presence among regional service providers and utilities demonstrates the progress we're making in this market. We believe there's considerable room to expand our market share as customers continue investing in network modernization and capacity expansion.

So as we look ahead, we're expecting sequential and year-over-year growth in the fourth quarter, supported by improved backlog and pipeline. We believe the progress we've made in the third quarter represents an important step forward, and we're confident in our ability to build on that progress and create sustainable value for our shareholders.

As we move into 2027, we believe Ribbon has a more diversified set of growth opportunities, improving momentum with key customers and an expanding presence in several attractive markets to support our growth objectives. With that backdrop, for the fourth quarter of 2026, we expect revenue to be in a range of $233 million to $247 million and adjusted EBITDA to be in a range of $40 million to $47 million. Our guidance assumes approximately $2 million per quarter in increased product costs associated with higher component and logistics expenses with the potential to partially offset that through targeted price increases in 2027. Consistent with the broader industry trend, we do anticipate to be supply limited to some extent in the fourth quarter given the increasing demand environment for key technologies.

Operator, that concludes our prepared remarks, and we're now ready to take a few questions.

Operator

[Operator Instructions] And our first question will come from Michael Genovese with Rosenblatt Securities.

分析师问答

Michael Genovese

Yes, congratulations on sounding really good here. The fourth quarter guidance calls for up, I think, about 10% revenue and about 400 basis points of gross margin. So can you just talk about the bookings? And by the way, if you have a specific IP Optical booking number for the third quarter, you just gave us a nine months number, but one for the third quarter would be helpful. But how is that in terms of bookings versus new business? And what exactly drives the margin up in the fourth quarter, that would be helpful.

Bruce McClelland

Mike, so on the IP Optical bookings number, the bookings number in Q3 was up about 9% year-over-year. It was a book-to-bill of about 0.82, so a little lower from a book-to-bill perspective, but it's a reflection of the higher revenue, obviously, in the quarter.

So as we're looking into the fourth quarter here, a lot of the growth is certainly from the Cloud & Edge business in the quarter and thus the uplift in the margin. We do expect both businesses to increase in the fourth quarter, but I think the majority of the growth is likely out of the Cloud & Edge business. And the mix of software in the quarter and then higher professional service revenue, which on a somewhat fixed cost basis adds a fair amount of margin to the bottom line. So I think it's a combination of those two or three factors that are really driving the outlook for Q4 and feel good about where we are.

Michael Genovese

And is that the same big customer in -- 4Q that's going to drive a lot of that strength? And then as you think about that customer next year, should we think about both sort of an organic growth and then Frontier coming in as well? Like how should we think about that?

Bruce McClelland

Yes. So we do expect a little more revenue in the fourth quarter from those programs. It's not the majority of the increase in Q4, but they -- it helps contribute to the increase Q3 going into Q4. Obviously, it's still early on the 2027 planning as many of the customers finish their budget planning, et cetera. Having said that, we do anticipate a higher deployment rate or a migration rate in 2027.

Of course, in order for them to capture the savings, the faster we go to -- collectively go, the faster they capture the savings. So I think we're equally motivated here. And I think the planning around the new footprint is still early. So we'll see what approach they take in the Frontier footprint. There's a variety of different approaches here, all focused on how do you reduce the cost of running that legacy infrastructure. As an example, moving the transition from TDM to IP as close to the edge as you can, in some cases, right at the enterprise edge or at the school or the government facility allows them to basically deprecate the entire copper infrastructure.

And we're seeing a lot of interest in that approach. And we've got a great portfolio of gateways that can go right at the edge of the network, can also do circuit emulation of the existing TDM infrastructure. So I think there's a number of different tools in the toolkit that we look to employ there.

Operator

[Operator Instructions] We'll go next to Tim Savageaux with Northland Capital Markets.

Timothy Savageaux

Trying to maybe integrate a couple of different comments from both the release and your prepared commentary. And I guess you referenced a growing pipeline of data center and other AI opportunities. And Bruce, I think you talked about a number of large opportunities in the funnel. I assume those two comments are related on the one hand. And can you give us any more color about this funnel/pipeline? When you talk about large opportunities, should we infer Tier 1s there, either in carrier or data center land or not? And if not, can you give us a little more color on what's composing that pipeline, that growing pipeline?

Bruce McClelland

Yes. Thanks, Tim. Appreciate the question. So first of all, I would say the biggest opportunities we're seeing are with more traditional Tier 1 telecom operators as they're investing in more fiber infrastructure, expanding their networks, et cetera. So it's less into the data center directly, and it's more with the basic customers, more traditional Ribbon customers that we're working with today.

And we definitely see demand internationally in these larger markets where data center deployments are beginning to accelerate and the existing telecom operators are playing a critical role in providing the interconnect into these data centers similar to the program I talked about in Africa with the large telecom operator there. They're not building dedicated data center interconnect infrastructure as much as they are building on the fiber infrastructure that they're using for mobile backhaul and for Internet and now more and more for connecting into data centers. So hopefully, that's helpful. That's where our sweet spot is, I think, is really focused on those customers and partners.

Timothy Savageaux

Okay. Well, I infer through all of that, that these big opportunities are principally on the IP Optical side, just the way you've been discussing them. But let me know if that's not right. And in that sense, if you're talking about large opportunities with traditional Ribbon customers, that leads you to believe that you feel like you might be able to attain some Tier 1 traction in IP Optical in '27. Is that fair to say?

Bruce McClelland

Yes, on both of those questions. I mean I'm sorry, I should have clarified, it's definitely focused on fiber build-out that could be Optical or IP. And in fact, you saw this quarter with the growth in IP, they're very complementary. It's a very highly efficient way of designing the network, building the pluggable optics directly into the routing platform. So that combined portfolio is really helpful for us.

And again, I'll add, think international. I think we have just a great opportunity internationally, maybe where parts of the market are less served today for us to really grow and gain share. So that's, I think, where a lot of the momentum is.

Timothy Savageaux

Got it. Appreciate that. And to follow up on the U.S. or North American front, you mentioned two Tier 2, I guess, ISP wins, I think -- I assume we're talking about the same thing as mentioned a couple of different times. And how significant are those opportunities as you look at the bigger ones in the funnel? And is it reasonable to think that amongst those Tier 2s, whether they be carriers or ISPs, that with your larger competitors focusing pretty heavily on the very large hyperscalers, does that open up some opportunities for a supplier like Ribbon to maybe pay a little more attention to these guys and do better with them? And that's it for me.

Bruce McClelland

Yes. No, great observation, Tim, and that's exactly what we're seeing in the market. That's a great spot for us in the Tier 2 operator space, and they all invest double-digit millions of dollars into their fiber infrastructure, their IP routing service layer every year. We continue to work with one that we talked about a number of years ago up in Canada, Rogers. So it's that type of scale of operator, which is really meaningful for us. And we do think it's somewhat underserved. I think customers are looking for responsiveness, deep technical support and a lot of attention, and that's what we can provide them. So yes, I really feel good about those opportunities.

Operator

We'll go next to Dave Kang with B. Riley Securities.

Dave Kang

First question is your -- regarding IP Optical bookings closed off a little bit in third quarter. Just what your expectations are for this current fourth quarter?

Bruce McClelland

Dave, Yes, so I think the bookings number for Q4 looks pretty positive. In fact, I think we will end up putting in backlog for next year to make sure customers again want to make sure they have supply assurance and visibility and those sorts of things. The lower Q3 book-to-bill number, as I said, is a little misleading. I mean the revenue number came up a lot. And obviously, we -- it was really important we converted the backlog we were building in the first half into shipments and revenue and the bookings number in Q3 was up year-over-year. So no concerns there really, I think, on the demand picture.

Dave Kang

Okay. And then you said that -- IP clearly outperformed Optical. Was it just a coincidence? Or should we expect that as more of a trend going forward?

Bruce McClelland

Yes, it's a good question. A lot of our projects -- a lot of our deployments are project-based. So you take one at a time and understand what they're trying to accomplish. We have seen, I think, a trend towards a combined solution where we have both IP and optical into a customer's network as they're refreshing and adding capacity into these 400-gig optical deployments. So having both, I think, is really, really important for us.

Having said that, we see, again, a pipeline of pure optical or fiber infrastructure as a growing area for us. So it's not just the combined portfolio, both can be deployed independently. So it's a little hard to tell. I mean every quarter, I would expect to be just a little bit -- a little different, Dave, just depending on the mix and the customer base. As an example, if we have a strong quarter in critical infrastructure, often we're selling the whole portfolio into those opportunities. If it's a fiber deployment, like I talked about in Africa, that tends to be pure optical in those cases.

Dave Kang

Got it. And can you remind me what the margin differential is between those two, IP and optical?

Bruce McClelland

Yes, they're actually pretty consistent right now. A lot of the IP technology that we're selling tends to be lower cost aggregation routers that then integrate into a larger scale router. So the revenue profile tends to favor the edge access aggregation platforms. So you're not driving the same level of margins that you would a core router as an example. We do think that shifts over time and the IP portion ends up with a stronger gross margin profile over time.

Operator

And we'll take a follow-up question from Michael Genovese with Rosenblatt Securities.

Michael Genovese

Bruce, you mentioned being supply limited to some extent in the quarter -- this quarter. So which components and segment are most affected? And how much revenue could that push into '27?

Bruce McClelland

Yes. It's a chase on everything, as you can imagine, you get 90% of it covered and you're chasing the last whatever. And the longer lead time we have from customers, obviously, the more predictable our supply chain can be. But we are trying to be responsive and really differentiating in the market with faster time to market. So certainly, like everyone else, memory is an issue. If you're trying to step up within a lead time around core silicon, that's a problem.

And even optical, if it's line system, optical technology has pretty significant lead times that we've got to be able to plan for. So it's a variety of different areas, just depending on the mix inside the quarter. It's -- we'll see where we land up at the end of the year and how much more we can squeeze out. I do expect we'll probably push $5 million to $10 million that customers would want to get in the quarter, probably ends up in the next quarter or something like that.

Michael Genovese

And then just final one for me. Rick, the operating cash flow, do you think it will turn positive in the fourth quarter? And how should we think about working capital as revenue ramps?

Eric Marmurek

Yes. I do expect it to improve a little bit into the fourth quarter and certainly as we move into Q1 of '27. With the slower start to the first half, it did have an impact on the use of cash, but do expect it to pick up in Q4 and then into Q1.

Bruce McClelland

Rick, I think you saw the accounts receivable obviously increased quite a bit in Q3 as we're invoicing more and the collections on that takes whatever the normal DSOs are on that, right?

Michael Genovese

All right. Well, great. Thanks for taking the questions.

Operator

And this now concludes our question-and-answer session. I would like to turn the floor back over to Bruce McClelland for closing comments.

Bruce McClelland

Great. Well, thanks again for everyone joining us on the call and the interest in Ribbon. We look forward to speaking with many of you in the upcoming investor conferences over the next couple of months and speaking with you again in the new year. So thanks very much, everyone.

Operator

Ladies and gentlemen, thank you for your participation. This does conclude today's teleconference. You may disconnect your lines, and have a wonderful day.

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