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What changed in Ribbon Communications Inc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Ribbon Communications Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+386 added−380 removedSource: 10-K (2026-02-26) vs 10-K (2025-02-27)

Top changes in Ribbon Communications Inc.'s 2025 10-K

386 paragraphs added · 380 removed · 299 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

76 edited+31 added−23 removed87 unchanged
Biggest changeThe solutions provided with this portfolio include those for: ● Securing and providing resilient connectivity and calling via direct routing for Operator Connect - Microsoft Teams, Zoom and other cloud-based UC&C applications. ● Securing contact center applications. ● Securing service provider hosted and managed unified communications (“UC”) services. ● Securing network interconnects for communications services. ● Network transformation of fixed service provider voice services networks to help evolve, consolidate, and modernize legacy networks to VoIP and onto virtualized network environments or the Telco Cloud. ● Implementing IP Multimedia Subsystem (“IMS”) networks required by mobile service providers for VoLTE service deployments and for 5G voice services. ● Modernizing, evolving, and securing enterprise and industry vertical UC environments, supporting both on-premises and cloud-based deployments. ● Securing voice sessions and protecting VoIP communications connectivity infrastructures, contact centers, Private Branch Exchanges and media servers. ● Providing identity assurance that helps mitigate robocalls, prevent fraud by determining phone caller identity, intent, and reputation. ● Analytics to provide visibility, security, and service assurance to enhance communication network operations and customer experiences.
Biggest changeThe solutions provided with this portfolio include those for: ● Network transformation of fixed service provider voice services networks to help evolve, consolidate, and modernize legacy networks to VoIP and onto virtualized network environments or the Telco Cloud. ● Securing and implementing IP Multimedia Subsystem (“IMS”) networks required by mobile service providers for VoLTE and VoNR (5G) voice services. ● Securing network interconnects between communications service providers as well as protecting VoIP communications infrastructures. ● Securing and providing resilient connectivity for cloud-based unified communications solutions such as Microsoft Teams, Zoom Phone, Webex Calling, as well as service provider—hosted and managed UC. ● Securing premises and cloud-based contact center applications such as Five9, NICE CXone, Genesys, and similar services. ● Modernizing and evolving unified communications for large enterprises, government (both civilian and military), and key industry verticals, supporting both on-premises and cloud-based deployments. ● Helping mitigate robocalls and prevent fraud by determining phone caller identity, intent, and the caller’s reputation. ● Enabling Agentic AI platforms to interface with traditional voice communication services thru secure Cloud APIs. ● Analytics and AI-driven automation to provide visibility, security, manageability, and service assurance for optimizing communication network operations, reducing costs, and improving customer experiences.
Customers Our customers are comprised of a diverse set of service providers and enterprises located in over 140 countries around the world. Service provider customers include telephone companies (“telcos”) offering fixed and wireless communications services, cable Multi-System Operators (“MSOs”) and Communications as a service providers. Our service provider customers include many of the largest CSPs globally.
Customers Our customers are comprised of a diverse set of service providers and enterprises located in over 140 countries around the world. Service provider customers include telephone companies (“telcos”) offering fixed and wireless communications services, cable Multi-System Operators (“MSOs”) and Communications as a service provider. Our service provider customers include many of the largest CSPs globally.
Neptune supports multiple services delivered over multiple access network technologies. Ethernet interfaces ranging from Gigabit Ethernet (“GbE”) through to 100GbE allow all IP/MPLS and Ethernet access networks to be supported, and pluggables providing XGS-PON, EPON and TDM circuit emulation allow PON access networks and legacy TDM access network to be supported.
Neptune supports multiple services delivered over multiple access network technologies. Ethernet interfaces ranging from Gigabit Ethernet (“GbE”) through to 100GbE allow all IP/MPLS and Ethernet access networks to be supported, and pluggables providing XGS-PON, EPON, and TDM circuit emulation allow PON access networks and legacy TDM access networks to be supported.
This uses AES-256 encryption, which is the strongest and most robust encryption standard that is commercially available today, and also supports a choice of standard, Post Quantum Computing, and Quantum Key Distribution key exchange mechanisms. ● The Neptune product line of high-performance switching and routing solutions are optimized to provide the converged multi-service, service-aware aggregation needed for cost/performance optimized connectivity between consumers and the applications and services they are using.
This uses AES-256 encryption, which is the strongest and most robust encryption standard commercially available today, and also supports a choice of standard, Post-Quantum Computing, and Quantum Key Distribution key exchange mechanisms. ● The Neptune product line of high-performance switching and routing solutions are optimized to provide the converged multi-service, service-aware aggregation needed for cost/performance optimized connectivity between consumers and the applications and services they are using.
In addition to the protections described above, we seek to safeguard our intellectual property by employing measures to protect against the unauthorized use or disclosure of the source and object code for our software, documentation and other written materials; licensing our software pursuant to signed license agreements, which impose restrictions on others’ ability to use our software; and seeking to limit disclosure of our intellectual property by requiring employees and consultants with access to our proprietary information to execute confidentiality agreements.
In addition to the protections described above, we seek to safeguard our intellectual property by employing measures to protect against the unauthorized use or disclosure of the source and object code for our software, documentation and other 14 ​ written materials; licensing our software pursuant to signed license agreements, which impose restrictions on others’ ability to use our software; and seeking to limit disclosure of our intellectual property by requiring employees and consultants with access to our proprietary information to execute confidentiality agreements.
Additional Information Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed with or furnished to the United States Securities and Exchange Commission (the “SEC”), are available free of charge through the SEC’s Internet site ( http://www.sec.gov ) or our Internet site ( http://www.ribboncommunications.com ) as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC.
Additional Information Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed with or furnished to the United States Securities and Exchange Commission (the “SEC”), are available free of charge through the SEC’s Internet site ( https://www.sec.gov/ ) or our Internet site ( http://www.ribboncommunications.com ) as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC.
Mergers between service providers may also increase competition for a smaller number of more concentrated customers and channels for products and solutions. 9 ​ IP Optical Networks Business Segment The global information society is generating a very high volume of telecommunications traffic for business, entertainment, education, surveillance, industrial control, and other applications.
Mergers between service providers may also increase competition for a smaller number of more concentrated customers and channels for products and solutions. IP Optical Networks Business Segment The global information society is generating a very high volume of telecommunications traffic for business, entertainment, education, surveillance, industrial control, and other applications.
We have successfully avoided any significant impacts thus far by carefully managing the flow of material, and enacting our established business continuity processes with alternate suppliers and production operation centers. 12 ​ Research and Development Our global R&D workforce is geographically distributed across a balanced set of centers of excellence.
We have successfully avoided any significant impacts thus far by carefully managing the flow of material and enacting our established business continuity processes with alternate suppliers and production operation centers. Research and Development Our global R&D workforce is geographically distributed across a balanced set of centers of excellence.
We regularly review market trends and volume demand for newly introduced products with our suppliers and distributors to negotiate reduced component pricing as the products mature. We carefully manage end-of-sale and end-of-life transitions to maximize return on investment and minimize wasted material, while maximizing customer satisfaction.
We regularly review market trends and volume demand for newly introduced products with our suppliers and distributors to negotiate reduced component pricing as the products mature. We carefully manage end-of-sale and end-of-life transitions to maximize 13 ​ return on investment and minimize wasted material, while maximizing customer satisfaction.
To support our customers’ requirements, our direct sales team is organized geographically and by major customers. 11 ​ Our sales teams sell our full portfolio of products and solutions from both segments to customers in each salesperson’s assigned region.
To support our customers’ requirements, our direct sales team is organized geographically and by major customers. Our sales teams sell our full portfolio of products and solutions from both segments to customers in each salesperson’s assigned region.
We are currently subject to, and expect to face in 13 ​ the future, allegations that we have infringed the intellectual property rights of third parties, including those of our competitors and non-practicing entities.
We are currently subject to, and expect to face in the future, allegations that we have infringed the intellectual property rights of third parties, including those of our competitors and non-practicing entities.
Information contained on, or that can be accessed through, our website does not constitute a part of this annual report and is not incorporated by reference herein. 16 ​
Information contained on, or that can be accessed through, our website does not constitute a part of this annual report and is not incorporated by reference herein.
New applications enabled by LLM AI will dramatically increase the traffic from the subscriber device to the data center. Need for Reliable, Secure, High-Bandwidth Enterprise and Critical Infrastructure Communications The “critical infrastructure” market vertical is defined as those companies whose assets, systems, and networks, whether physical or virtual, are considered vital to a country’s national interest.
New applications enabled by LLM AI will dramatically increase traffic from subscriber devices to the data center. Need for Reliable, Secure, High-Bandwidth Enterprise and Critical Infrastructure Communications The “critical infrastructure” market vertical is defined as those companies whose assets, systems, and networks, whether physical or virtual, are considered vital to a country’s national interest.
For additional information regarding our corporate governance and our social responsibility goals and initiatives, please see “Corporate Governance” on our investor relations website (investors.ribboncommunications.com) and our most recent sustainability report, which is available at ribboncommunications.com/company/company-policies/sustainability-report. Seasonality We have experienced quarterly fluctuations in customer activity due to seasonal considerations.
For additional information regarding our corporate governance and our social responsibility goals and initiatives, please see “Corporate Governance” on our investor relations website (https://investors.ribboncommunications.com/) and our most recent sustainability report, which is available at ribboncommunications.com/company/company-policies/sustainability-report. 17 ​ Seasonality We have experienced quarterly fluctuations in customer activity due to seasonal considerations.
Employee Hiring, Turnover and Engagement. Our turnover and hiring metrics are refreshed on a weekly basis and formally presented monthly. This up-to-date information allows us to quantify our success with employee retention, implement timely and selective retention initiatives as needed, and measure the speed at which we attract and onboard qualified candidates.
Employee Hiring, Turnover and Engagement . Our turnover and hiring metrics are refreshed on a weekly basis and formally presented monthly. This up-to-date information allows us to quantify our success with employee retention, implement timely and selective retention initiatives, and measure the speed at which we attract and onboard qualified candidates.
Our leading manufacturers have presence in multiple international locations. This enables us to implement a flexible manufacturing and logistics landscape for each product line and target markets. This structure also facilitates redundancy and business continuity to mitigate risks related to adverse trade tariff, taxation, and natural disasters.
Our leading manufacturers have presence in multiple international locations. This enables us to implement a flexible manufacturing and logistics landscape for each product line and target markets. This structure also facilitates redundancy and business continuity to mitigate risks related to adverse trade tariffs, taxation, and natural disasters.
Increasingly, network operators are also pursuing open, multi-layer optimized and disaggregated IP and Optical networking solutions, where they have the flexibility to assemble networks based on transport and control subsystems from different vendors with software-defined networking.
Increasingly, network operators are also pursuing open, multi-layer optimized and disaggregated IP and Optical networking solutions, where they have the flexibility to assemble networks based on transport and control subsystems from different vendors using software-defined networking.
In addition, Neptune provides a 400G ZR+ pluggable capability, allowing it to support both single layer IP over DWDM 10 ​ connectivity or multi-layer optimized IPoOTN/DWDM connectivity, whichever best meets the network operator’s needs. With these capabilities, Neptune is ideally suited for residential broadband backhaul, business services, MSOs and private enterprise networks.
In addition, Neptune provides a 800G ZR+ pluggable capability, allowing it to support both single layer IP over DWDM connectivity or multi-layer optimized IPoOTN/DWDM connectivity, whichever best meets the network operator’s needs. With these capabilities, Neptune is ideally suited for residential broadband backhaul, business services, MSOs, and private enterprise networks.
For additional information on Ribbon’s talent and our current engagement activities, please see our most recent sustainability report, which is available at ribboncommunications.com/company/company-policies/sustainability-report. 15 ​ Corporate Governance and Social Responsibility We are committed to operating ethically, efficiently and inclusively.
For additional information on Ribbon’s talent and our current engagement activities, please see our most recent sustainability report, which is available at https://ribboncommunications.com/company/sustainability-report. Corporate Governance and Social Responsibility We are committed to operating ethically, efficiently and inclusively.
Service providers in some global regions, as mandated by governments or voluntarily, are also replacing certain incumbent vendor communications equipment and technology in their networks because of concerns for security. This presents a significant growth and market share opportunity. This technology evolution challenge extends beyond service providers to many enterprises as well as Federal, State, and Local governments.
Service providers in some global regions, as mandated by governments or voluntarily, are also replacing certain incumbent vendor communications equipment and technology in their networks because of concerns for security. This presents significant growth and market share opportunity. This technology evolution challenge extends beyond service providers to many enterprises, as well as Federal, State, and Local governments. In particular, U.S.
Our transformative acquisition of ECI in 2020 dramatically expanded our addressable market beyond secure voice communications into IP Networking, Optical Transport, and Software-Defined Networking (“SDN”) Management and Automation. We are implementing a focused strategy to target our broad global base of service provider and enterprise customers to establish us as key supplier of networking solutions.
Our transformative acquisition of ECI in 2020 dramatically expanded our addressable market beyond secure voice communications into IP Networking, Optical Transport, and Software-Defined Networking (“SDN”) Management and Automation. We are implementing a focused strategy to target our broad global base of service providers and enterprise customers to establish ourselves as a key supplier of networking solutions.
Verizon is a service provider that offers interconnect, fixed line and mobile communications services, and our software solutions are sold across their business divisions supporting their large enterprises, SMB and consumer telecommunications and cable-related offerings. Our top five customers represented approximately 34% of our revenue in the year ended December 31, 2024.
Verizon is a service provider that offers interconnect, fixed line and mobile communications services, and our software solutions are sold across their business divisions supporting their large enterprises, SMB and consumer telecommunications and cable-related offerings. Our top five customers represented approximately 41% of our revenue in the year ended December 31, 2025.
Muse’s suite of advanced service and network control applications empower service providers to do more, through simple service creation and lifecycle management, proactive network assurance, network optimization, and automation. Muse ensures that people and systems receive the right tools to monetize the network effectively through intuitive graphical user interfaces or industry-standard Application Programmable Interfaces.
Muse’s suite of advanced service and network control applications empowers service providers to do more, through simple service creation and lifecycle management, proactive network assurance, network optimization, and automation. Muse ensures that people and systems receive the right tools to monetize the network effectively through intuitive graphical user interfaces or industry-standard Application Programming Interfaces.
Critical infrastructure providers are under increasing pressure to support new services, reduce carbon emission, improve security, expand automation, and increase safety. Achieving these goals requires a transition to a modernized, secure communications network that provides seamless IP connectivity and services and very high capacity optical transport.
Critical infrastructure providers are under increasing pressure to support new services, reduce carbon emissions, improve security, expand automation, and increase safety. Achieving these goals requires a transition to a modernized, secure communications network that provides seamless IP connectivity and services, as well as very high-capacity optical transport.
Apollo can dynamically reconfigure optimal links in the event of fiber failures to maintain service availability. Apollo is “self-aware,” with intelligent reporting for efficient and SDN-ready operations. Apollo also provides deployment choice, whether as an integrated solution or as standalone subsystems for disaggregated open architecture multivendor solutions.
Apollo can dynamically reconfigure optimal links in the event of fiber failures to 11 ​ maintain service availability. Apollo is “self-aware,” with intelligent reporting to enable efficient, SDN-ready operations. Apollo also provides deployment options, whether as an integrated solution or as standalone subsystems for disaggregated, open-architecture, multivendor solutions.
Our customer-centric culture shapes all of our activities and inspires our team members to make a positive impact with our clients, investors, and communities. In the year ended December 31, 2024, Verizon Communications Inc. (“Verizon”) accounted for approximately 14% of our revenue.
Our customer-centric culture shapes all of our activities and inspires our team members to make a positive impact with our clients, investors, and communities. In the year ended December 31, 2025, Verizon Communications Inc. (“Verizon”) accounted for approximately 17% of our revenue.
Our IP Optical Networks segment provides high-performance, secure, and reliable hardware and software products and solutions for IP networking, switching, and routing, and optical transport. This portfolio is offered to service provider, enterprise and industry verticals with critical transport network infrastructures including utilities, government, defense, transportation and education and research.
Our IP Optical Networks segment provides high-performance, secure, and reliable hardware and software products and solutions for IP networking, switching, and routing, and optical transport. This portfolio is offered to service providers, enterprises and industry verticals with critical transport network infrastructures requirements including utilities, government, defense, transportation and education and research.
Segment Information Our Chief Operating Decision Maker (“CODM”) assesses our performance based on the performance of two separate lines of our business: the Cloud and Edge segment (“Cloud and Edge”) and the IP Optical Networks segment (“IP Optical Networks”). 7 ​ Cloud and Edge Business Segment The Cloud and Edge segment provides secure and reliable software and hardware products, solutions, and services for VoIP communications, Voice Over LTE (“VoLTE”) and Voice Over 5G (“VoNR”) communications, as well as UC&C services to both service provider and enterprise customers.
Segment Information Our Chief Operating Decision Maker (“CODM”) assesses our performance based on the performance of two separate lines of our business: the Cloud and Edge segment (“Cloud and Edge”) and the IP Optical Networks segment (“IP Optical Networks”). 8 ​ Cloud and Edge Business Segment The Cloud and Edge segment provides secure and reliable software and hardware products, solutions, and services for VoIP communications, Voice Over LTE (“VoLTE”) and Voice Over 5G (“VoNR”) communications, as well as unified communications-related (“UC”) services to both service provider and enterprise customers.
Our Apollo hardware and software products deliver reconfigurable and programmable low-latency optical transport that simultaneously speeds up provisioning of new services while maximizing traffic throughput at the lowest cost per bit. Apollo provides customers with a choice of two transmission optimizations. Capacity-reach optimization uses industry-leading 5nm-140Gbaud technology that maximizes channel capacity for any given distance.
Our Apollo hardware and software products deliver reconfigurable and programmable low-latency optical transport that simultaneously speeds up provisioning of new services while maximizing traffic throughput at the lowest cost per bit. Apollo offers customers two transmission optimization options. Capacity-reach optimization uses industry-leading 5nm-140Gbaud technology that maximizes channel capacity for any given distance.
This program includes a variety of wellness related topics delivered quarterly through activities such as webinars, exercise sessions, and engaging challenges. In 2024, we continued with our Hybrid Work Model. Under this policy, employees spend a minimum of two days per week working from one of our offices.
This program includes a variety of wellness related topics delivered quarterly through activities such as webinars, exercise sessions, and engaging challenges. 16 ​ In 2025, we continued with our hybrid work model. Under this policy, which was introduced in 2023, employees spend a minimum of two days per week working from one of our offices.
We believe this shift creates opportunities for us to increase our share in the market as compared to direct competitors such as Cisco, Juniper Networks, Inc., Huawei, Nokia, Ciena, Infinera Corporation, Adtran Networks, and Fujitsu Limited. We believe a key differentiation from these competitors is our optimized and integrated multi-layer IP optical solutions.
We believe this shift creates opportunities for us to increase our market share relative to direct competitors such as Cisco, Juniper Networks, Inc., Huawei, Nokia, Ciena, Adtran Networks, and Fujitsu Limited. We believe a key differentiator from these competitors is our optimized and integrated multi-layer IP optical solutions.
This exponential growth in data traffic is expected to continue and even accelerate, straining existing broadband and mobile networks. While 5G, and next generation WiFi, are the technologies of choice for the wireless network, there is also a surge of investment targeted at addressing the bottle neck of the broadband access network with higher capacity fiber connections.
This exponential growth in data traffic is expected to continue and even accelerate, straining existing broadband and mobile networks. While 5G and next-generation WiFi are the technologies of choice for the wireless network, there is also a surge of investment to address the bottleneck in the broadband access network through higher-capacity fiber connections.
Our Network Transformation product portfolio is deployed in the most demanding environments and enables the modernization of fixed, mobile and enterprise voice communications networks to support network and Telco Cloud-based services and the next generation of IP-based voice communications services and includes multiple software-centric platforms and products including: ● Signaling products that provide network signaling for communications services. ● Call Controllers that provide call processing within networks for voice communications services and applications. ● Media Gateways that perform the interworking or translation of media, or voice sessions and the corresponding network protocols both within and across VoIP and legacy communications networks and use codecs (coder-decoder) and digital signal processors to do so. ● A multi-tenant and highly scalable Application Server that enables the deployment of VoIP and UC&C services and applications.
They also provide integration with installed analog devices, such as elevator phones, paging equipment, and fax machines. ​ Our Network Transformation product portfolio is deployed in the most demanding environments and enables the modernization of fixed, mobile, and enterprise voice communications networks to support network and Telco Cloud-based services and the next generation of IP-based voice communications services, and includes multiple software-centric platforms and products, including: ● Call Controllers that provide call processing within networks for voice communications services and applications. ● Media Gateways that perform the interworking or translation of media, or voice sessions, and the corresponding network protocols both within and across VoIP and legacy communications networks, and use codecs (coder-decoder) and digital signal processors to do so. ● A multi-tenant and highly scalable Application Server that enables the deployment of VoIP and UC services and applications.
In particular, the U.S. Federal defense agencies have a significant need to modernize their voice communications infrastructure, replacing legacy on-premises systems with modern cloud-based voice and video solutions. However, the unique requirements regarding security and survivability are not easily met by off-the-shelf enterprise applications, creating significant opportunities for companies that specialize in this area.
Federal agencies including Department of War and other civilian agencies have a significant need to modernize their voice communications infrastructure by replacing legacy on-premises systems with cloud-based voice and video solutions. However, the unique requirements regarding security and survivability are not easily met by off-the-shelf enterprise applications, creating significant opportunities for companies that specialize in this area.
Our Cloud and Edge products are increasingly software-centric and cloud-native for deployment on private, public, or hybrid cloud infrastructures, in data centers, on enterprise premises, and within service provider private networks.
Our Cloud and Edge products are increasingly software-centric and cloud-native, with deployments across private, public, and hybrid cloud infrastructures, in data centers, on enterprise premises, and within service provider private networks.
All these factors are causing service providers to re-think and evolve, or even over-haul, the way 4 ​ networks are designed, architected, managed, and optimized to deliver services to their customers with disruptive economics.
All these factors are causing service providers to rethink and evolve, or even overhaul, the way networks are designed, architected, managed, and optimized to deliver services to their customers with disruptive economics.
We also utilize agility and safety stock processes to help meet higher-than-forecasted customer demand to stock raw material and sub-assembly inventory. Occasionally, we experience unforeseen demand drops of certain products or sub-assemblies due to technology evolution, customer consumption behavior, or shortened product lifecycle. For example, we encountered supply chain disruptions in 2021 due to component demand and logistics complications.
We also utilize agility and safety stock processes to help meet higher-than-forecasted customer demand to stock raw material and sub-assembly inventory. Occasionally, we experience unforeseen demand drops of certain products or sub-assemblies due to technology evolution, customer consumption behavior, or shortened product lifecycle.
Similarly, command and control groups within today’s defense forces have a need for high performance secure networks as their strategic sensors and assault systems are becoming more integrated. In this ecosystem, effective decision-making requires the pooling and analysis of data from a vast array of sensors and other information sources.
Similarly, command and control groups within today’s defense forces have a need for high-performance secure networks as their strategic sensors and assault systems are becoming more integrated. In this ecosystem, effective decision-making requires pooling and analyzing data from a vast array of sensors and other information sources. The data must be delivered securely, in real-time, to wherever it is required.
The exponential growth in traffic has largely been driven by the consumption of video and in the next several years, it is expected that new applications leveraging large language model (“LLM”) AI will dramatically increase the amount of network bandwidth usage.
The exponential growth in traffic has largely been driven by video consumption, and over the next several years, new applications leveraging large language model (“LLM”) AI are expected to dramatically increase network bandwidth usage.
Compliance with applicable safety regulations is a top priority and we strive to maintain our strong track record for safety, which continues to be reinforced through regular training modules at all of our locations.
Compliance with applicable safety regulations is a top priority and we strive to maintain our strong record for safety, which continues to be reinforced through regular training modules at all of our locations. Ribbon continues to prioritize the well-being of our employees and their families worldwide.
Advanced planning algorithms design multi-layer IP Optical networks that maximize traffic handling with failure resiliency by looking holistically at all network layers, providing the best return on capital expenditures. These multi-layer optimized networks can then meet specific customer and service needs on a case-by-case basis.
Advanced planning algorithms design multi-layer IP and Optical networks that maximize traffic handling with failure resiliency by looking holistically at all network layers, providing the best return on capital expenditures.
The portfolio also includes Policy and Routing products that work in heterogeneous voice networks and are used to intelligently manage communications sessions based on multiple policies such as least cost and Quality of Service routing, media type, source or destination, and time of day or week. 8 ​ ● Enterprise Session Border Controllers and Edge products, deployable on premises or in the cloud, to enable the deployment and migration to secure cloud-based UC&C applications such as Microsoft Teams, Zoom Phone and service provider UC&C offerings, as well as securing cloud contact center offerings.
The portfolio also includes Policy and Routing products that work across heterogeneous voice networks to intelligently manage communications sessions based on multiple policies such as least-cost and Quality of Service routing, media type, source or destination, and time of day or week. 9 ​ ● Enterprise Session Border Controllers and Edge products, deployable on premises or in the cloud, enable organizations to gracefully migrate legacy premises assets to secure cloud-based UC and contact center applications.
Legacy services such as IP Multiprotocol Label Switching (“MPLS”) circuits, Centrex lines, and TDM phone are increasingly expensive to operate, and providers need to migrate customers to new offerings or risk high margin revenue streams.
It is imperative that providers invest to capture new revenue streams while reducing network operating costs. Legacy services such as IP Multiprotocol Label Switching (“MPLS”) circuits, Centrex business 4 ​ services, and TDM phone lines are increasingly expensive to operate, and providers need to migrate customers to new offerings or risk high-margin revenue streams.
We leverage partnerships with key go-to-market channels and solutions providers such as Dell and Microsoft, as well as other popular unified communications and collaboration (“UC&C”) platforms such as Zoom Phone and similar service provider UC&C offerings. ● Partnerships – We continually look to form industry partnerships that will enhance our current solution offerings to our customers.
We leverage partnerships with key go-to-market channels and solutions providers such as Dell and Microsoft, as well as other popular unified communications and collaboration platforms such as Zoom Phone and Webex Calling. ● Partnerships – We continually look to expand our partnership ecosystem to form strategic relationships that will enhance our current solution offerings to our customers.
Services and Support As communication networks continue to grow increasingly vital to society and business, and complexity grows with every new technology introduction cycle, service providers are increasingly challenged to control costs and find the expertise to operate, maintain, and repair these platforms.
These multi-layer optimized networks can then meet specific customer and service needs on a case-by-case basis. 12 ​ Services and Support As communication networks continue to grow increasingly vital to society and business, and complexity grows with every new technology introduction cycle, service providers are increasingly challenged to control costs and find the expertise to operate, maintain, and repair these platforms.
The average time to fill a position in 2024 was 38 days. Our employee management process includes conducting exit interviews with all employees that leave us voluntarily. The data obtained from our exit questionnaire and one-on-one interviews are referenced when creating and updating benefit plans and other employee initiatives/offerings.
In 2025, our voluntary turnover rate was 5.5%, a slight decrease from the 6.6% voluntary turnover rate we experienced in 2024. Our employee management process includes conducting exit interviews with all employees that leave us voluntarily. The data obtained from our exit questionnaire and one-on-one interviews are referenced when creating and updating benefit plans and other employee initiatives/offerings.
At the foundation, high performance Optical connections and advanced IP networking are needed to keep pace with the advancements in communications. This hyper-connectivity will be a key enabler and deliver disruptive ultra-low cost-per-bit 5 ​ communications within and between networks and the cloud, while also delivering on the promise of latency sensitive networking demanded by many of the applications.
This hyper-connectivity will be a key enabler and deliver disruptive ultra-low cost-per-bit communications within and between networks and the cloud, while also delivering on the promise of latency-sensitive networking demanded by many of the applications.
As of December 31, 2024, we had a total of 3,052 employees worldwide, located geographically as follows: ​ ​ ​ ​ ​ ​ ​ ​ Number of Percentage of ​ ​ employees ​ total ​ Asia ​ 1,174 ​ 39 % North America 852 28 % EMEA 927 ​ 30 % LATAM 99 3 % ​ Approximately 635 employees are covered by collective bargaining agreements or works councils.
As of December 31, 2025, we had a total of 3,080 employees worldwide, located geographically as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Number of ​ ​ ​ Percentage of ​ ​ employees ​ total ​ Asia ​ 1,228 ​ 40 % North America 889 29 % EMEA 859 ​ 28 % LATAM 104 3 % ​ Approximately 590 employees are covered by collective bargaining agreements or works councils.
To assist in this, we are deliberate in making sure that each employee is aware that they play a role in fostering a work environment that encourages mutual respect and congenial relationships among employees.
To assist in this, we are deliberate in making sure that each employee is aware that they play a role in fostering a work environment that encourages mutual respect and congenial relationships among employees. 15 ​ We believe that a culture which encourages all employees to take pride in their individual contributions and work together as a team is key to our success.
We have a formalized employee referral program in place as we have found that employees who join us through employee referrals are a good cultural fit and remain with us longer than those who have no personal connection. Approximately 29% of our hires in 2024 came from employee referrals.
For the year ended December 31, 2025, we hired 316 employees globally. We have a formalized employee referral program in place as we have found that employees who join us through employee referrals are a good cultural fit and remain with us longer than those who have no personal connection.
We believe this transition is instrumental in continuing to improve our profitability and competitiveness, and in growing the recurring revenue portion of our business. ● Enterprise Offerings – The market need and growth rate are higher at the network edge than at the core. Our solution portfolio includes secure Unified Communications software-centric applications and IP and Optical network connectivity solutions.
We believe this transition is instrumental in continuing to improve our profitability and competitiveness, and in growing the recurring revenue portion of our business. ● Enterprise Offerings – Our solution portfolio includes secure Unified Communications, software-centric applications, and IP and Optical network connectivity solutions. Together, these solutions address various critical infrastructure, federal defense, large enterprise, and medium-sized businesses.
As of December 31, 2024, we had 787 issued patents in the U.S., 659 of which expire between 2025 and 2042, and we had 41 in-process patent applications in the U.S. As of such date, we also had 351 issued patents in foreign jurisdictions, and we had 86 in-process patent applications in foreign jurisdictions.
As of such date, we also had 375 issued patents in foreign jurisdictions, 238 of which expire between 2026 and 2042, and we had 6 in-process patent applications in foreign jurisdictions. As of December 31, 2025, we had 27 trademarks registered or pending in the U.S. and 171 trademarks registered or pending in foreign jurisdictions.
These rewards are comprised of both monetary and non-monetary awards and are also used to recognize service anniversaries, birthdays, and other notable events. Learning and Development (L&D) .
In 2025, approximately 3,000 awards were distributed, whereby 46% of our employees were rewarded for their contributions. These rewards are comprised of both monetary and non-monetary awards and are also used to recognize service anniversaries, birthdays, and other notable events. Learning and Development (L&D) .
As a result, service providers and enterprises must constantly seek out new technologies to refresh their networks to provide increased flexibility, automation, programmability, scalability, and reliability, to enable these new applications and services with an expedited time to market.
As a result, service providers and enterprises must constantly seek out new technologies to refresh their networks and provide greater flexibility, automation, programmability, scalability, and reliability, enabling these new applications and services with expedited time-to-market. These investments provide a competitive advantage and deliver value-added services that improve network efficiency, increase customer satisfaction, and generate new revenue streams.
Next-generation rural broadband networks help service providers grow their revenues by extending service reach and diversity, and by satisfying the massive pent-up demand for high-speed Internet connectivity. Next-generation broadband networks will also leverage new technologies like fixed-wireless access, while laying the foundation for future revenue opportunities like 5G backhaul transport services.
Next-generation rural broadband networks help service providers grow their revenues by extending service reach and diversity, and by satisfying the massive pent-up demand for high-speed Internet connectivity.
In addition, since 2010, we have provided a day of paid time off for all employees to participate in our Global Day of Service, during which employees and their families are encouraged to volunteer and contribute to local charitable organizations in their communities.
Once again, in 2025 we provided a day of paid time off for all employees to participate in our Global Day of Service, during which employees are encouraged to volunteer and contribute to local charitable organizations in their communities. In 2025, 1,283 employees across the globe donated an aggregate of approximately 5,000 hours to support charitable organizations.
Modernization of Communications Service Provider Networks to Reduce Total Cost of Ownership CSPs of all types operate in a hyper-competitive environment as consumers and businesses have an increasing number of choices for their communication needs. It is imperative that providers invest to capture new revenue streams, while reducing the cost to operate their networks.
Within this broad industry context, investment in our products and services is driven by several key industry trends and strategic priorities. Modernization of Communications Service Provider Networks to Reduce Total Cost of Ownership CSPs of all types operate in a hyper-competitive environment as consumers and businesses have an increasing number of choices for their communication needs.
Cloud and Edge Competition Competition in the market for the Cloud and Edge portfolio remains strong. The market is shifting from an environment dominated by a few large telecommunications legacy hardware equipment companies, such as Ericsson LM Telephone Company (“Ericsson”), Huawei Technologies Co. Ltd.
The market is shifting from an environment dominated by a few large telecommunications legacy hardware equipment companies, such as Ericsson LM Telephone Company (“Ericsson”), Huawei Technologies Co. Ltd. (“Huawei”), and Nokia Corporation (“Nokia”), to a market that is 10 ​ characterized by cloud-native software, hybrid private public cloud compute environments, and open interoperable interfaces.
Strategy Overview Our mission is to create a recognized global technology leader providing open, cloud-centric solutions spanning multiple network layers that enable the secure exchange of communications and information, with unparalleled scale, performance, and elasticity.
Our mission is to create a recognized global technology leader that provides network solutions that are scalable, elastic and cloud-centric, enabling the secure exchange of information.
Our goal is to continue to focus on finding ways to support our employees and their families. In addition, as a company consistently advocating for a healthy, balanced lifestyle, we offer a Wellness Program, which is available to all employees and their families.
In 2025, we observed a notable increase in EAP utilization, highlighting the importance of these services in supporting overall wellness. In addition, as a company consistently advocating for a healthy, balanced lifestyle, we offer a wellness program, which is available to all employees and their families.
The ongoing unrest and conflict in the Middle East has caused some disruption to material supply chain and production operations in that region.
We regularly review current inventory levels to ensure adequate reserves for excess and obsolete inventory arising from shortened product life cycle or demand drops. ​ The ongoing unrest and conflict in the Middle East has caused some disruption to material supply chain and production operations in that region.
This encourages collaboration, innovation, and socialization while maintaining the flexibility to work remotely as well. Community Investment . We value the communities in which we work. We encourage a service mindset among our employees wherever they are and support community involvement and engagement.
Consistent in-office presence remains a key component in fostering team collaboration, strengthening our company culture, and promoting a unified employee experience. Community Investment . We value the communities in which we work. We encourage a service mindset among our employees wherever they are and support community involvement and engagement.
Our SBC portfolio consists of the following categories of products: ● Core network SBCs that are deployable by customers in their core networks, or on private or public clouds, and used to identify, manage, and protect voice communications traffic as it moves through and between communication networks.
These elements can be deployed in both private and public cloud environments, such as Red Hat OpenShift, Amazon Web Services (“AWS”), Microsoft Azure, and Google Cloud Platform. ● Feature-rich virtualized software products (“VNF”) that can run on Commercial Off-The-Shelf (“COTS”) hardware or in private or public cloud environments. ● On-premises dedicated appliances (“PNF”) that scale up and down to meet the most demanding performance and security requirements. ​ Our SBC portfolio consists of the following categories of products: ● Core network SBCs that are deployable by customers in their core networks, or on private or public clouds, and used to identify, manage, and protect voice communications traffic as it moves through and between communication networks.
The data must be delivered securely, in real-time, to wherever it is required. These solutions integrate intelligent optical transport with agile IP networking to provide a converged, secure, communication network that can be rapidly configured and deployed in challenging environmental conditions.
These solutions integrate intelligent optical transport with agile IP networking to provide a converged, secure, communication network that can be rapidly configured and deployed in challenging environmental conditions. Global demand for fiber connectivity Across the globe, nations are investing in fiber-optic infrastructure, driven by a desire to gain a competitive economic advantage and enhance national security.
We are an industry leader in the development and deployment of the STIR (Secure Telephone Identity Revisited) and SHAKEN (Signature-based Handling of Asserted information using toKENS) standards, with deployments throughout North America and Europe. ● A cloud-native Analytics Platform with applications that aid customers in gathering actionable intelligence from their communications network elements, including SBCs in the core and edge of their networks, to provide them with network performance visibility, service assurance, security, and fraud mitigation.
We are an industry leader in the development and deployment of the STIR (Secure Telephone Identity Revisited) and SHAKEN (Signature-based Handling of Asserted information using toKENS) standards, with deployments throughout North America and select countries in Europe. ​ Cloud and Edge Competition Competition in the market for the Cloud and Edge portfolio remains strong.
The identity assurance portfolio, using information from deployed network elements including SBCs, helps mitigate robocalls and prevent fraud by determining phone caller identity, intent, and reputation. With this information, it is possible to help determine if a call is from a legitimate person, for a legitimate purpose, and without malicious intent.
With this information, it is possible to help determine if a call is from a legitimate person, for a legitimate purpose, and without malicious intent, ultimately helping to detect and mitigate robocalls and prevent fraud. Our customers use these capabilities to deliver a better call experience to their end customers.
We are focused specifically on the access and aggregation layer of the network including cell-site routers, optical transport, and IP aggregation and routing. In many cases, the build-out of this part of the network lags or follows the up-front investment in the RAN portion of the network, and increases as traffic levels grow.
We focus on the access and aggregation layer of the network, including cell-site routers, optical transport, and IP aggregation and routing.
In particular, we are focused on penetrating the largest service providers around the world in order to drive long term growth and improved competitiveness. 6 ​ ● North American IP Optical Networks Market Share – We expect to continue to unlock the value of our former ECI portfolio by growing IP Optical Networks market share in the North American market by leveraging the extensive deployment base and ongoing business that we have with service providers and enterprise customers.
Ribbon has extensive experience across multiple generations of voice and data technologies to support our customers’ efforts to implement modern cloud-centric services with minimal disruption to customers and revenue streams. ● Cross-Selling and Tier One Service Provider Growth – We are laser-focused on marketing and selling our combined portfolio to our global base of service providers, critical infrastructure providers, and enterprise customers to expand our presence and gain market share in the larger IP routing and optical networking segment. ● North American IP Optical Networks Market Share – We expect to continue to unlock the value of our routing and optical networking portfolio by growing market share in North America by leveraging the extensive deployment base and ongoing business that we have with service providers, critical infrastructure, and enterprise customers.
We believe 5G is a multi-year opportunity as global service providers roll out the new capital-intensive technology and build out the needed network infrastructure over the next decade.
We believe 5G represents a multi-year opportunity as global service providers roll out the new technology and build the necessary network infrastructure. ● Software-Centric and Cloud-Native Offerings – The industry is in the early stages of a major migration of network functions from on-premise hardware platforms to private and public cloud networks.
Ribbon regularly promotes our Employee Assistance Program (the “EAP”), which is offered to all employees and their families to provide customized services to meet varying needs globally. The EAP is a confidential support service to help our employees and their dependents at no cost to our employees. In 2024, we saw a significant increase in the utilization of our EAP.
One of the key resources available is our Employee Assistance Program (“EAP”), a confidential service offered at no cost to employees and their dependents, providing support for a wide range of personal and professional needs. To help employees understand how to access these resources, we host several EAP orientation sessions throughout the year.
We have seen significant success with regional service providers in the U.S., bolstered by the federal funding programs focused on improving internet access to underserved markets. ● Participate in the 5G Opportunity – We have made significant R&D investments in our IP Optical product portfolio in order to address multiple opportunities tied to the deployment of 5G mobile networks.
In particular, we have a growing presence with regional service providers in the U.S., bolstered by federal funding 7 ​ programs to improve internet access in underserved markets.
In 2024, we delivered more than 19 live training webinars, 9 manager/leader development programs, and approximately 13 training hours per employee across our workforce. Safety, Health and Well-being. Our objective is to provide a safe and hazard-free work environment for all employees.
By fostering a culture of growth and adaptability we ensure that our workforce remains innovative, resilient, and ready to lead in an ever-changing business landscape. Safety, Health and Well-being. Our objective is to provide a safe and hazard-free work environment for all employees.
Our mission is to create a recognized global technology leader providing cloud-centric solutions that enable the secure exchange of information, with unparalleled scale, performance and elasticity. We are headquartered in Plano, Texas, and have a global presence with research and development or sales and support locations in over 30 countries around the world.
We are at the intersection of the adoption of Artificial Intelligence (“AI”) by Service Providers and Enterprises addressing the rapid growth in fiber connectivity and integration of voice capabilities into Agentic AI platforms We are headquartered in Plano, Texas, and have a global presence with research and development or sales and support locations in over 30 countries around the world.
These learning programs utilize a combination of in-person and online curriculum and include core modules, some of which are mandatory, relating to ethical conduct, products and services, cybersecurity, safety, human rights and anti-corruption, as well as additional tailored programs on topics such as leadership, management, excellence in service, project management and competency development.
Core modules include essential areas such as ethical conduct, products and services, cybersecurity, workplace safety, human rights and anti-corruption. Beyond the core curriculum, we offer tailored programs to meet diverse development needs that range from leadership development to personal effectiveness.
We have tightened the alignment further in 2024 with the integration of several software research and development (“R&D”) teams and an integrated customer support and services organization. Similarly, the go-to-market team was combined under a single Global Sales Leader role.
Key elements of the strategy include: ● Operational Integration – Initially adopting a business-unit model post-acquisition, we evolved the organization in 2023 by integrating the two business units under a single leader, establishing a Chief Operating Officer position. In 2024, we further tightened alignment by integrating several software R&D teams and an integrated customer support and services organization.
We have identified opportunities where we have been able to combine technology from both our Voice and IP Routing portfolios in order to address a clear customer need and differentiate our offering.
We have also identified opportunities to combine technology from both our voice and IP routing portfolios to address a clear customer need and differentiate our offering. ● AI Growth Vectors – We are aggressively pursuing multiple paths to derive value from the explosive investment in Artificial Intelligence: o We have launched a new AIOps and Automation platform called Acumen that delivers operational savings for network operators by using AI to automate network operations and accelerate trouble resolution.
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These investments provide a competitive advantage and bring value-added services to increase network efficiency, increase customer satisfaction and produce new revenue streams. Within this broad industry context, investment in our products and services is driven by several key industry trends and strategic priorities.
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Next-generation broadband networks will also leverage new technologies such as fixed-wireless access, while laying the foundation for future revenue opportunities, such as 5G backhaul transport services. 5 ​ At the foundation, high-performance optical connections and advanced IP networking are needed to keep pace with advancements in communications.
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Key elements of the strategy include: ● Operational Integration – In order to provide laser focus on the unique aspects of our portfolio, we initially adopted a business unit model following the acquisition of ECI, along with regional sales teams and an integrated corporate organization.
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The European Union has set a goal for universal gigabit connectivity by 2030 through its Digital Decade initiative. India’s BharatNet project aims to connect 250,000 village councils with fiber, and the USA’s $42 billion BEAD fund prioritizes rural broadband in unserved regions.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeRisks Related to Ownership of our Common Stock and Warrants ● The choice of forum provision in our Certificate of Incorporation could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or agents. ● Anti-takeover provisions in our charter documents and under Delaware law could make an acquisition of us more difficult, limit attempts by our stockholders to replace or remove our current management and may negatively affect the market price of our common stock. ● The outstanding warrants are exercisable for common stock, which would increase the number of shares eligible for future resale in the public market and result in dilution to stockholders. ● We may issue debt and equity securities that are senior to our common stock, which could negatively affect the value of our common stock. ● The outstanding warrants are speculative in nature and may not have any value. ● Holders of our warrants will have no rights as a common stockholder until they acquire our common stock. ● The market price of shares of our common stock may experience volatility, which could cause holders of the warrants to incur substantial losses. ● An active trading market for the warrants does not exist and may not develop.
Biggest changeRisks Related to Our Indebtedness and Accounting Matters ● The terms of our credit agreement could adversely affect our operating flexibility and pose risks of default, which would negatively impact our liquidity and operations. ● Impairment of our goodwill or intangible assets may require us to record a significant charge to earnings. ● Failure to maintain appropriate internal controls in the future may adversely affect our stock price and our business. 19 ​ Risks Related to Ownership of our Common Stock and Warrants ● The choice of forum provision in our Certificate of Incorporation could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or agents. ● Anti-takeover provisions in our charter documents and under Delaware law could make an acquisition of us more difficult, limit attempts by our stockholders to replace or remove our current management and may negatively affect the market price of our common stock. ● The outstanding warrants are exercisable for common stock, which would increase the number of shares eligible for future resale in the public market and result in dilution to stockholders. ● We may issue debt and equity securities that are senior to our common stock, which could negatively affect the value of our common stock. ● The outstanding warrants are speculative in nature and may not have any value. ● Holders of our warrants will have no rights as a common stockholder until they acquire our common stock. ● The market price of shares of our common stock may experience volatility, which could cause holders of the warrants to incur substantial losses. ● An active trading market for the warrants does not exist and may not develop.
These laws may increase our compliance costs and potential liability. Many similar laws have been proposed at the federal level and in the other states. Any liability from our failure to comply with the requirements of these laws could adversely affect our financial condition.
These laws may increase our compliance costs and potential liability. Many similar laws have been proposed at the federal level and in other states. Any liability from our failure to comply with the requirements of these laws could adversely affect our financial condition.
General Risk Factors ● Litigation and government investigations could result in significant legal expenses and settlement payments, fines or damage awards. 18 ​ ● Our stock price has been and may continue to be volatile. ● We are party to a stockholders’ agreement with certain stockholders which provides such stockholders with certain rights that may differ from the rights of our other stockholders. ● Delaware law and our charter documents contain provisions that could discourage or prevent a potential takeover.
General Risk Factors ● Litigation and government investigations could result in significant legal expenses and settlement payments, fines or damage awards. ● Our stock price has been and may continue to be volatile. ● We are party to a stockholders’ agreement with certain stockholders which provides such stockholders with certain rights that may differ from the rights of our other stockholders. ● Delaware law and our charter documents contain provisions that could discourage or prevent a potential takeover.
Import tariffs and/or other mandates recently imposed by the United States, have led to and could in the future lead to retaliatory actions by affected countries, including Canada, Mexico and China, resulting in “trade wars,” and could significantly increase the prices on raw materials, the manufacturing of our equipment, and/or increased costs for goods imported into the United States, all of which are critical to our business.
Import tariffs and/or other mandates recently imposed or threatened by the United States, have led to and could in the future lead to retaliatory actions by affected countries, including Canada, Mexico and China, resulting in “trade wars,” and could significantly increase the prices on raw materials, the manufacturing of our equipment, and/or increased costs for goods imported into the United States, all of which are critical to our business.
Provisions of our Certificate of Incorporation and By-laws may have the effect of delaying or preventing a change of control or changes in our management, including, generally, provisions that: ● do not provide cumulative voting in the election of directors, which limits the ability of minority stockholders to elect director candidates; ● allow only the Board to fill a vacancy on the Board, however occurring, including a vacancy resulting from an enlargement of the Board; ● require advance notice for stockholder proposals to be brought before a meeting of stockholders, including proposed nominations of persons for election to the board of directors; ● only allow stockholder action to be taken at an annual or special meeting; ● require a vote of holders of at least 66 2/3% of the voting power of our outstanding voting stock entitled to vote thereon to amend or repeal certain provisions of our Certificate of Incorporation or its By-laws; ● limit the ability of stockholders to call a special meeting; and ● authorize blank check preferred stock. 32 ​ These provisions may make it more difficult for stockholders to replace members of our board of directors, which is responsible for appointing the members of our management.
Provisions of our Certificate of Incorporation and By-laws may have the effect of delaying or preventing a change of control or changes in our management, including, generally, provisions that: ● do not provide cumulative voting in the election of directors, which limits the ability of minority stockholders to elect director candidates; ● allow only the Board to fill a vacancy on the Board, however occurring, including a vacancy resulting from an enlargement of the Board; ● require advance notice for stockholder proposals to be brought before a meeting of stockholders, including proposed nominations of persons for election to the board of directors; ● only allow stockholder action to be taken at an annual or special meeting; ● require a vote of holders of at least 66 2/3% of the voting power of our outstanding voting stock entitled to vote thereon to amend or repeal certain provisions of our Certificate of Incorporation or its By-laws; ● limit the ability of stockholders to call a special meeting; and ● authorize blank check preferred stock. 34 ​ These provisions may make it more difficult for stockholders to replace members of our board of directors, which is responsible for appointing the members of our management.
In addition, our international operations are subject to other inherent risks, including: ● greater reliance on channel partners; ● difficulties collecting accounts receivable and longer collection cycles; ● difficulties and costs of staffing and managing international operations; ● impacts of differing technical standards; ● compliance with international trade, customs and export control regulations; ● foreign government regulations limiting or prohibiting potential sales or increasing the cost of doing business in such markets, including adverse tax policies, tariffs, customs regulations, trade protection measures, export quotas and qualifications to transact business; ● foreign currency exchange controls, restrictions on repatriation of cash and changes in currency exchange rates; ● any need to adapt and localize our products for specific countries; ● our ability to effectively price our products in competitive international markets; and ● political, social and economic instability, including as a result of the fragility of global financial markets, health pandemics or epidemics and/or acts of war or terrorism.
In addition, our international operations are subject to other inherent risks, including: ● greater reliance on channel partners; 28 ​ ● difficulties collecting accounts receivable and longer collection cycles; ● difficulties and costs of staffing and managing international operations; ● impacts of differing technical standards; ● compliance with international trade, customs and export control regulations; ● foreign government regulations limiting or prohibiting potential sales or increasing the cost of doing business in such markets, including adverse tax policies, tariffs, customs regulations, trade protection measures, export quotas and qualifications to transact business; ● foreign currency exchange controls, restrictions on repatriation of cash and changes in currency exchange rates; ● any need to adapt and localize our products for specific countries; ● tariffs and other trade barriers; ● our ability to effectively price our products in competitive international markets; and ● political, social and economic instability, including as a result of the fragility of global financial markets, health pandemics or epidemics and/or acts of war or terrorism.
Moreover, if we invest in the development of technologies, products and solutions that do not function as expected, are not adopted by the industry, are not ready in time, are not accepted by our customers as quickly as anticipated or at all, 21 ​ mature more quickly than we anticipated or are not successful in the marketplace, our sales and earnings may suffer and, as a result, our stock price could decline.
Moreover, if we invest in the development of technologies, products and solutions that do not function as expected, are not adopted by the industry, are not ready in time, are not accepted by our customers as quickly as anticipated or at all, mature more quickly than we anticipated or are not successful in the marketplace, our sales and earnings may suffer and, as a result, our stock price could decline.
The loss or significant curtailment of any government contracts or subcontracts, whether due to our performance or due to interruptions or changes in governmental funding, could have a material adverse effect on our business, results of operations and financial condition. Further, sales to government customers may require specific testing efforts or impose significant compliance or certification obligations.
The loss or significant curtailment of any government contracts or subcontracts, whether due to our performance or due to interruptions or 25 ​ changes in governmental funding, could have a material adverse effect on our business, results of operations and financial condition. Further, sales to government customers may require specific testing efforts or impose significant compliance or certification obligations.
For example, following recent border clashes with China, India has enacted bans on the import of some goods manufactured in China and separately will require certain products be manufactured in India. These requirements include our products that are currently manufactured outside of India and, as a result, we are working to identify local manufacturing for such products.
For example, following border clashes with China, India has enacted bans on the import of some goods manufactured in China and separately will require certain products be manufactured in India. These requirements include our products that are currently manufactured outside of India and, as a result, we are working to identify local manufacturing for such products.
Any such revenue shortfall would, therefore, have a significant effect on our operating results for that quarter. If we fail to compete successfully against telecommunications equipment and networking companies, our ability to increase our revenue and remain profitable will be impaired. Competition in the telecommunications market is intense.
Any such revenue shortfall would, therefore, have a significant effect on our operating results for that quarter. 20 ​ If we fail to compete successfully against telecommunications equipment and networking companies, our ability to increase our revenue and remain profitable will be impaired. Competition in the telecommunications market is intense.
Factors that could impact federal government spending on our products and services include a significant decline in, or reapportioning of, spending by the federal government customers, changes, delays or cancellations of government programs or requirements, the adoption of new laws or regulations, government shutdowns or other delays in the government budget and/or appropriations process, changes in the political climate and general economic conditions.
Factors that could impact federal government spending on our products and services include a significant decline in, or reapportioning of, spending by the federal government customers, changes, delays or cancellations of government programs or requirements, the adoption of new laws or regulations, new or prolonged government shutdowns or other delays in the government budget and/or appropriations process, changes in the political climate and general economic conditions.
In addition, we may not be able to develop international market demand for our products, which could impair our ability to grow our revenue. In many international markets, long-standing relationships between potential customers and their local 27 ​ suppliers and protective regulations, including local content requirements and approvals, create barriers to entry.
In addition, we may not be able to develop international market demand for our products, which could impair our ability to grow our revenue. In many international markets, long-standing relationships between potential customers and their local suppliers and protective regulations, including local content requirements and approvals, create barriers to entry.
As we virtualize our product portfolio, we expect our margins to improve due to decreased costs tied to production and sales of our appliance products, however, our revenue may decline as a result of the decreases in sales of appliance products, many of which have generated higher revenue on a per-unit basis than certain of our software products.
As we virtualize our product portfolio, we expect our 23 ​ margins to improve due to decreased costs tied to production and sales of our appliance products, however, our revenue may decline as a result of the decreases in sales of appliance products, many of which have generated higher revenue on a per-unit basis than certain of our software products.
While we regularly monitor our inventory of supplies, a failure to find acceptable alternative sources could hurt our ability to deliver high-quality products to our customers and negatively affect our operating margins. Reliance on our suppliers also exposes us to potential quality variations and unforeseen price increases.
While we regularly monitor our inventory 24 ​ of supplies, a failure to find acceptable alternative sources could hurt our ability to deliver high-quality products to our customers and negatively affect our operating margins. Reliance on our suppliers also exposes us to potential quality variations and unforeseen price increases.
For example, we have offices located in Mexico City, Mexico; and Tokyo, Japan, regions known for seismic activity, which could be impacted in the event of an earthquake and we operate a facility in Ft. Lauderdale, Florida that is subject to the impact of hurricanes.
For example, we have offices located in Mexico City, Mexico; and Tokyo, Japan, regions known for seismic activity, which could be impacted in the event of an earthquake and we operate a facility in 26 ​ Ft. Lauderdale, Florida that is subject to the impact of hurricanes.
Monitoring unauthorized use of our products is difficult and we cannot be certain that the steps we have taken will prevent unauthorized use of our technology, particularly in foreign countries where the laws may not protect our proprietary 28 ​ rights as fully as in the United States.
Monitoring unauthorized use of our products is difficult and we cannot be certain that the steps we have taken will prevent unauthorized use of our technology, particularly in foreign countries where the laws may not protect our proprietary rights as fully as in the United States.
As a Delaware corporation, we are also subject to provisions of Delaware law, including Section 203 of the Delaware General Corporation law, which prevents some stockholders holding more than 15% of our outstanding common stock from engaging in certain business combinations without approval of the holders of substantially all of our outstanding common stock. 35 ​ These provisions of our Certificate of Incorporation, our By-Laws or Delaware law could have the effect of delaying or deterring a change in control that some stockholders may consider beneficial and therefore could limit the opportunity for our stockholders to receive a premium for their shares of our common stock and could also affect the price that some investors are willing to pay for our common stock.
As a Delaware corporation, we are also subject to provisions of Delaware law, including Section 203 of the Delaware General Corporation law, which prevents some stockholders holding more than 15% of our outstanding common stock from engaging in certain business combinations without approval of the holders of substantially all of our outstanding common stock. 37 ​ These provisions of our Certificate of Incorporation, our By-Laws or Delaware law could have the effect of delaying or deterring a change in control that some stockholders may consider beneficial and therefore could limit the opportunity for our stockholders to receive a premium for their shares of our common stock and could also affect the price that some investors are willing to pay for our common stock.
Risk Factors Summary The following is a summary of the principal risks that could adversely affect our business, operations and financial results: Risks Related to Our Business and Industry ● Our quarterly revenue and operating results are unpredictable and may fluctuate significantly quarter to quarter. ● Failure to compete successfully could impair our ability to increase revenues and/or remain profitable. ● Our future success is dependent on growing our base of customers and expanding our recurring revenue. ● Consolidation in the telecommunications industry could harm our business. ● Restructuring activities could adversely affect our ability to execute our business strategy. ● Exposure to the credit risk of some of our customers and to credit exposures in fragile financial markets could result in material losses. ● Disruptions to relationships with distributors, resellers, system integrators and other channel partners could adversely affect our revenues. ● Failure to align our strategic plan with our customers’ investments, or failure of products and services to meet customers’ demands, could impact our revenues. ● Failure of our products to interoperate with our customers’ existing networks could result in customer losses. ● Failure for customers to adopt our new products and services focused on virtualized networks, could reduce our revenues. ● Failure by our strategic partners or by us in integrating products could harm our business. ● We rely on contract manufacturers. ● We rely on single or limited sources for supply of some components of our products. ● Failure to correctly estimate future requirements for end-of-production products purchased from third parties could harm our operating results or business. ● Products may have errors or defects that we find only after full deployment. ● Government sales are subject to potential delays and cutbacks, may require specific testing efforts, or impose significant compliance obligations. ● Future investments, mergers or acquisitions could be difficult to integrate, disrupt our business, dilute shareholder value and harm our financial condition. ● Failure to hire and retain key personnel could negatively impact our ability to meet our business objectives and impair future growth. ● Man-made problems, such as terrorism, and natural catastrophic events may disrupt our operations and harm our operating results. ● We may not be successful in our artificial intelligence initiatives and such initiatives may expose us to greater litigation and regulatory risk. ​ Risks Related to Our International Operations ● Worldwide global economic conditions and uncertainties may have a material adverse impact on our business. ● Increases in tariffs, trade restrictions or taxes on our products could have an adverse impact on our operations. 17 ​ ● The wars in Israel and Ukraine could materially impact our sales to customers in that region. ● Conditions in Israel may materially and adversely affect our business. ● Risks associated with our international operations could impair our ability to grow our international revenue. ● Fluctuations in currency exchange rates could negatively impact our financial results and cash flows. ● Use and reliance upon research and development resources in global locations may expose us to unanticipated costs and/or liabilities.
Risk Factors Summary The following is a summary of the principal risks that could adversely affect our business, operations and financial results: Risks Related to Our Business and Industry ● Our quarterly revenue and operating results are unpredictable and may fluctuate significantly quarter to quarter. ● Failure to compete successfully could impair our ability to increase revenues and/or remain profitable. ● Our future success is dependent on growing our base of customers and expanding our recurring revenue. ● Consolidation in the telecommunications industry could harm our business. ● Restructuring activities could adversely affect our ability to execute our business strategy. ● Exposure to the credit risk of some of our customers and to credit exposures in fragile financial markets could result in material losses. ● Disruptions to relationships with distributors, resellers, system integrators and other channel partners could adversely affect our revenues. ● Failure to align our strategic plan with our customers’ investments, or failure of products and services to meet customers’ demands, could impact our revenues. ● Failure of our products to interoperate with our customers’ existing networks could result in customer losses. ● Failure for customers to adopt our new products and services focused on virtualized networks, could reduce our revenues. ● Failure by our strategic partners or by us in integrating products could harm our business. ● We rely on contract manufacturers. ● We rely on single or limited sources for supply of some components of our products. 18 ​ ● Failure to correctly estimate future requirements for end-of-production products purchased from third parties could harm our operating results or business. ● Products may have errors or defects that we find only after full deployment. ● Government sales are subject to potential delays and cutbacks, may require specific testing efforts, or impose significant compliance obligations. ● Future investments, mergers or acquisitions could be difficult to integrate, disrupt our business, dilute shareholder value and harm our financial condition. ● Failure to hire and retain key personnel could negatively impact our ability to meet our business objectives and impair future growth. ● Man-made problems, such as terrorism, and natural catastrophic events may disrupt our operations and harm our operating results. ● We may not be successful in our artificial intelligence initiatives and such initiatives may expose us to greater litigation and regulatory risk. ​ Risks Related to Our International Operations ● Worldwide global economic conditions and uncertainties may have a material adverse impact on our business. ● Increases in tariffs, trade restrictions or taxes on our products could have an adverse impact on our operations. ● The war in Ukraine and military action in Israel could materially impact our sales to customers in that region. ● Conditions in Israel may materially and adversely affect our business. ● Risks associated with our international operations could impair our ability to grow our international revenue. ● Fluctuations in currency exchange rates could negatively impact our financial results and cash flows. ● Use and reliance upon research and development resources in global locations may expose us to unanticipated costs and/or liabilities.
As a result, political, economic and military conditions in Israel may directly affect our business. In October 2023, Hamas conducted several terrorist attacks in Israel resulting in 26 ​ ongoing war across the country.
As a result, political, economic and military conditions in Israel may directly affect our business. In October 2023, Hamas conducted several terrorist attacks in Israel resulting in ongoing war across the country.
If the defenses we claim in our material litigation matters are ultimately unsuccessful, or if we are unable to achieve a favorable settlement with an adverse party or a government agency, we could be liable for large settlement payments, damage awards or fines that could have a material adverse effect on our business and results of operations. 34 ​ Our stock price has been and may continue to be volatile.
If the defenses we claim in our material litigation matters are ultimately unsuccessful, or if we are unable to achieve a favorable settlement with an adverse party or a government agency, we could be liable for large settlement payments, damage awards or fines that could have a material adverse effect on our business and results of operations. 36 ​ Our stock price has been and may continue to be volatile.
However, if we underestimate our forecast and our customers place orders to purchase more products than are available, we may not have 23 ​ sufficient inventory to support their needs.
However, if we underestimate our forecast and our customers place orders to purchase more products than are available, we may not have sufficient inventory to support their needs.
Our competitors’ broad product 19 ​ portfolios, coupled with already existing relationships, may cause our customers to buy our competitors’ products or harm our ability to attract new customers.
Our competitors’ broad product portfolios, coupled with already existing relationships, may cause our customers to buy our competitors’ products or harm our ability to attract new customers.
If we are unable to generate sufficient cash flows in the future, and if availability under our current facility is not sufficient to support our operations, we may need to refinance our debt or obtain additional financing. 31 ​ If our goodwill or intangible assets become impaired, we may be required to record a significant charge to earnings.
If we are unable to generate sufficient cash flows in the future, and if availability under our current facility is not sufficient to support our operations, we may need to refinance our debt or obtain additional financing. 33 ​ If our goodwill or intangible assets become impaired, we may be required to record a significant charge to earnings.
If we were to fail to comply with existing or future export licensing, customs regulations, economic sanctions and other laws, we could be subject to substantial civil and criminal penalties, including fines and incarceration for responsible employees and managers, and the possible loss of export or import 30 ​ privileges.
If we were to fail to comply with existing or future export licensing, customs regulations, economic sanctions and other laws, we could be subject to substantial civil and criminal penalties, including fines and incarceration for responsible employees and managers, and the possible loss of export or import 32 ​ privileges.
The JPM Stockholders and Swarth collectively own approximately 45% of our common stock as of December 31, 2024, and may decide to sell their shares in bulk or from time to time, except as provided under the Stockholders Agreement, which timing we cannot control.
The JPM Stockholders and Swarth collectively own approximately 45% of our common stock as of December 31, 2025, and may decide to sell their shares in bulk or from time to time, except as provided under the Stockholders Agreement, which timing we cannot control.
As such, it is not possible to predict all of the risks related to the use of AI, and changes in laws, rules, directives, and regulations governing the use of AI may adversely affect our ability to develop and use AI or subject us to legal liability.
It is not possible to predict all of the risks related to the use of AI, and changes in laws, rules, directives, and regulations governing the use of AI may adversely affect our ability to develop and use AI or subject us to legal liability.
We cannot predict or estimate the amount, timing or nature of our future offerings and debt financings. Future offerings could reduce the value of our common stock and dilute the interests of our stockholders. 33 ​ The warrants are speculative in nature and may not have any value.
We cannot predict or estimate the amount, timing or nature of our future offerings and debt financings. Future offerings could reduce the value of our common stock and dilute the interests of our stockholders. 35 ​ The warrants are speculative in nature and may not have any value.
Given the general uncertainty regarding global economic conditions and other factors, such as inflation, high interest rates and foreign exchange rate fluctuations, we believe that customers have tried to maintain or improve profitability through cost control and constrained capital spending, which places additional pressure to demonstrate acceptable return on investment.
Given the general uncertainty regarding global economic conditions and other factors, such as tariffs, trade barriers, inflation, high interest rates and foreign exchange rate fluctuations, we believe that customers have tried to maintain or improve profitability through cost control and constrained capital spending, which places additional pressure to demonstrate acceptable return on investment.
While we believe that we leverage appropriate detection and prevention systems and services and that we focus on continuous improvement based upon the latest attack vectors in the industry, we cannot guarantee that there will never be any information technology system failures, including future breaches of our or our third-party providers’ data security measures through a cyberattack, other cyber incident or otherwise, or the theft or loss of laptops, other mobile devices or electronic records used to back up our systems or our third-party providers’ systems, which could result in a disclosure of customer, employee, or our information or otherwise disrupt our ability to function in the normal course of business by potentially causing, among other things, delays in the fulfillment or cancellation of customer orders or disruptions in the manufacture or shipment of products or delivery of services, any of which could have a material adverse effect on our operating results.
While we believe that we leverage appropriate detection and prevention systems and services and that we focus on continuous improvement based upon the latest attack vectors in the industry, we have previously experienced information technology system failures and cannot guarantee that there will not be additional incidents in the future, including future breaches of our or our third-party providers’ data security measures through a cyberattack, other cyber incident or otherwise, or the theft or loss of 30 ​ laptops, other mobile devices or electronic records used to back up our systems or our third-party providers’ systems, which could result in a disclosure of customer, employee, or our information or otherwise disrupt our ability to function in the normal course of business by potentially causing, among other things, delays in the fulfillment or cancellation of customer orders or disruptions in the manufacture or shipment of products or delivery of services, any of which could have a material adverse effect on our operating results.
These risks are amplified by any global supply chain disruptions. As we do not have internal manufacturing capabilities, any difficulties or failures to perform by our contract manufacturers could cause delays in customer product shipments, which could negatively affect our relationships with customers and result in delayed revenue.
These risks are amplified by any global supply chain disruptions, including, as a result of tariffs. As we do not have internal manufacturing capabilities, any difficulties or failures to perform by our contract manufacturers could cause delays in customer product shipments, which could negatively affect our relationships with customers and result in delayed revenue.
We rely on certain key customers, and our future success will depend on our ability to generate recurring business from our existing customers and to attract additional customers beyond our current customer base. One customer, Verizon, contributed approximately 14% of our revenue in the year ended December 31, 2024.
We rely on certain key customers, and our future success will depend on our ability to generate recurring business from our existing customers and to attract additional customers beyond our current customer base. One customer, Verizon, contributed approximately 17% of our revenue in the year ended December 31, 2025.
We have expanded, and expect to continue to expand, our operations in international and emerging markets. International operations are a significant part of our business, accounting for approximately 53% of total revenues in 2024. We expect such operations to continue to require significant management attention and financial resources to successfully grow.
We have expanded, and expect to continue to expand, our operations in international and emerging markets. International operations are a significant part of our business, accounting for approximately 52% of total revenues in 2025. We expect such operations to continue to require significant management attention and financial resources to successfully grow.
The warrants are exercisable for common stock, which would increase the number of shares eligible for future resale in the public market and result in dilution to stockholders. The warrants to purchase an aggregate of 4,858,090 shares of our common stock are currently exercisable.
The warrants are exercisable for common stock, which would increase the number of shares eligible for future resale in the public market and result in dilution to stockholders. The warrants to purchase an aggregate of 4,681,432 shares of our common stock are currently exercisable.
We spend a significant amount of time, money and resources developing new technology, products and solutions to help keep up with rapid technology and market changes. Our strategic plan, includes a continued shift in our investments from mature technologies that previously generated significant revenue for us toward certain networking technologies.
We spend a significant amount of time, money and resources developing new technology, products and solutions to help keep up with rapid technology and market changes. Our strategic plan includes a continued shift in our investments from mature technologies that previously generated significant revenue for us toward certain networking technologies and the use of AI to assist in network management.
As of December 31, 2024, we had $300.9 million of goodwill and $187.5 million of intangible assets. Goodwill is tested annually for impairment and, along with our intangible assets, is also reviewed for impairment when events or changes in circumstances indicate the carrying value may not be recoverable.
As of December 31, 2025, we had $300.9 million of goodwill and $143.3 million of intangible assets. Goodwill is tested annually for impairment and, along with our intangible assets, is also reviewed for impairment when events or changes in circumstances indicate the carrying value may not be recoverable.
(2021). We expect this trend to continue. Consolidation among our customers may cause delays or reductions in capital expenditure plans by such customers and/or increased competitive pricing pressures as the number of available customers declines and the relative bargaining power of customers increases in relation to suppliers. Any of these factors could materially adversely affect our business.
Consolidation among our customers may cause delays or reductions in capital expenditure plans by such customers and/or increased competitive pricing pressures as the number of available customers declines and the relative bargaining power of customers increases in relation to suppliers. Any of these factors could materially 21 ​ adversely affect our business.
We recorded restructuring expense of $10.2 million and $16.2 million in 2024 and 2023, respectively, including severance and related costs, facilities restructuring and accelerated amortization of lease assets. In 2025, we expect to record additional restructuring expense of approximately $5 million as we look to further streamline operations and consolidate our global footprint.
We recorded restructuring expense of $19.7 million and $10.2 million in 2025 and 2024, respectively, including severance and related costs, facilities restructuring and accelerated amortization of lease assets. In 2026, we expect to record additional restructuring expense of approximately $8 million as we look to further streamline operations and consolidate our global footprint.
We were in compliance with this covenant at December 31, 2024.
We were in compliance with this covenant at December 31, 2025.
Our current restructuring and any future restructuring, should it become necessary for us to further restructure our business due to market conditions or other factors that reduce the demand for our products and services, could adversely affect our ability to execute our business strategy in a number of ways, including through loss of key employees; potential work stoppages by our unionized employees; diversion of management’s attention from normal daily operations of the business; diminished ability to respond to customer requirements related to both products and services; disruption of our engineering and manufacturing processes, which could adversely affect our ability to introduce new products and to deliver products both on a timely basis and in accordance with the highest quality standards; and/or reduced ability to execute effectively internal administrative processes, including the implementation of key information technology programs. 20 ​ There can be no assurance that any restructuring actions we have taken in the past, or may take in the future, will improve our financial condition or results of operations.
Our current restructuring and any future restructuring, should it become necessary for us to further restructure our business due to market conditions or other factors that reduce the demand for our products and services, could adversely affect our ability to execute our business strategy in a number of ways, including through loss of key employees; potential work stoppages by our unionized employees; diversion of management’s attention from normal daily operations of the business; diminished ability to respond to customer requirements related to both products and services; disruption of our engineering and manufacturing processes, which could adversely affect our ability to introduce new products and to deliver products both on a timely basis and in accordance with the highest quality standards; and/or reduced ability to execute effectively internal administrative processes, including the implementation of key information technology programs.
If we enter into a merger or make acquisitions in the future, we could, among other things issue stock that would dilute existing stockholders’ percentage ownership; incur significant debt or assume significant liabilities; materially reduce our cash; incur significant amortization expenses related to intangible assets; and/or incur large and immediate write-offs for in-process research and development and stock-based compensation. 24 ​ Mergers, acquisitions and dispositions are inherently risky and subject to many factors outside of our control.
If we enter into a merger or make acquisitions in the future, we could, among other things, issue stock that would dilute existing stockholders’ percentage ownership; incur significant debt or assume significant liabilities; materially reduce our cash; incur significant amortization expenses related to intangible assets; and/or incur large and immediate write-offs for in-process research and development and stock-based compensation.
During 2024, our closing stock price ranged from a high of $4.30 per share to a low of $2.56 per share. The stock market has experienced significant price and volume fluctuation with such volatility often unrelated to the operating performance of these companies.
During 2025, our closing stock price ranged from a high of $5.14 per share to a low of $2.75 per share. The stock market has experienced significant price and volume fluctuation with such volatility often unrelated to the operating performance of these companies.
While we are developing plans to relocate our manufacturing sites, the timing required for relocation could impact our ability to sell such products or timely deliver the products and could result in lower or lost sales in India. The need to move the manufacturing of such products could also negatively impact the margin earned on the sale of such products.
While we are developing plans to relocate our manufacturing sites, 27 ​ the timing required for relocation could impact our ability to sell such products or timely deliver the products and could result in lower or lost sales in India.
We are developing AI initiatives, including generative AI, to, among other things, enhance our features for new and existing products, and create greater operation efficiencies for us.
We are developing AI solutions, including generative AI, such as our Acumen AIOps and Automation platform, to, among other things, enhance our features for new and existing products, and create greater operation efficiencies for us.
The ongoing war against Hamas and any additional conflicts, terrorist activities or political instability involving Israel or other countries in the region could adversely affect our business, results of operations, financial condition, cash flows and prospects.
Such instability may also lead to deterioration in the political and trade relationships that exist between Israel and these countries. The ongoing war against Hamas and any additional conflicts, terrorist activities or political instability involving Israel or other countries in the region could adversely affect our business, results of operations, financial condition, cash flows and prospects.
To compete effectively, we must deliver innovative products that provide extremely high reliability and quality; deploy and scale easily and efficiently; interoperate with existing network infrastructures and multivendor solutions; provide effective network management, as well as comprehensive customer support and professional services; provide a cost-effective and space-efficient solution for enterprises and service providers; meet price competition from low cost equipment providers; and offer solutions that are timely for the market and support where the industry is heading.
Mergers among any of these or other competitors could strengthen their ability to compete against us, and additional competitors with significant financial resources entering our markets could further intensify competition. ​ To compete effectively, we must deliver innovative products that provide extremely high reliability and quality; deploy and scale easily and efficiently; interoperate with existing network infrastructures and multivendor solutions; provide effective network management, as well as comprehensive customer support and professional services; provide a cost-effective and space-efficient solution for enterprises and service providers; meet price competition from low cost equipment providers; and offer solutions that are timely for the market and support where the industry is heading.
As a result of the complexity and rapid development of AI, it is the subject of evolving review by various U.S. governmental and regulatory agencies, and other foreign jurisdictions are applying, or are considering applying, their intellectual property, cybersecurity, data protection and other laws to AI and/or are considering general legal frameworks on AI. 25 ​ We may not always be able to anticipate how to respond to these frameworks, given that they are still rapidly evolving.
As a result of the complexity and rapid development of AI, it is the subject of evolving review by various U.S. governmental and regulatory agencies, and other foreign jurisdictions are applying, or are considering applying, their intellectual property, cybersecurity, data protection and other laws to AI and/or are considering general legal frameworks on AI.
In addition, tariff increases may have a similar impact on other suppliers and certain other customers, which could increase the negative impact on our operating results or future cash flows.
In addition, tariff increases may have a similar impact on other suppliers and certain other customers, which could increase the negative impact on our operating results or future cash flows. We are exposed to fluctuations in currency exchange rates that could negatively impact our financial results and cash flows.
Further, the U.S. and other European countries have imposed sanctions against Russia in connection with the war. These sanctions currently prohibit our ability to sell our hardware products and certain services to customers in Russia.
The uncertainty and the threat of an expansion of the war has resulted in some of our customers delaying purchases from us. Further, the U.S. and other European countries have imposed sanctions against Russia in connection with the war. These sanctions currently prohibit our ability to sell our hardware products and certain services to customers in Russia.
The ongoing wars in Israel and Ukraine, as well as the continued threat of terrorism and heightened security and military action in response to this threat, or any future acts of terrorism, may cause disruptions to the economies of the United States and other countries. Events such as work stoppages or widespread blackouts could have similar negative impacts.
The ongoing war in Ukraine and military action in Israel, as well as the continued threat of terrorism and heightened security and military action in response to this threat, or any future acts of terrorism, may cause disruptions to the economies of the United States and other countries.
Our top five customers contributed approximately 34% of our revenue in 2024.
Our top five customers contributed approximately 41% of our revenue in 2025.
Popular uprisings in various countries in the Middle East over the last few years, including in Syria in December 2024, have also affected the political stability of those countries and have led to a decline in the regional security situation. Such instability may also lead to deterioration in the political and trade relationships that exist between Israel and these countries.
Popular uprisings in various countries in the Middle East over the last few years, including in Iran in January 2026 and Syria in December 2024, have also affected the political stability of those countries and have led to a decline in the regional security situation.
Further, consolidation has also occurred in the telecommunications supplier and vendor space, including the proposed acquisition by Alianza of the Metaswitch business held by Microsoft (December 2024), the proposed merger of Infinera with Nokia (June 2024), the proposed acquisition of Juniper Networks by Hewlett Packard Enterprises (January 2024), the combination of ADTRAN, Inc. and ADVA (2022) and the acquisition of Acacia Communications, Inc. by Cisco Systems, Inc.
Further, consolidation has also occurred in the telecommunications supplier and vendor space, including the acquisition by Alianza of the Metaswitch business held by Microsoft (2024), the acquisition of Infinera by Nokia (2025), the acquisition of Juniper Networks by Hewlett Packard Enterprises (2025), and the combination of ADTRAN, Inc. and ADVA (2022). We expect this trend to continue.
If these strategic partners fail to perform or choose not to cooperate with us on certain projects, in addition to the effects described above, we could experience loss of customers and market share, or fail to attract new customers. 22 ​ If our contract manufacturers fail to perform, or if we change or consolidate manufacturers, we may fail to meet the demands of our customers and damage our customer relationships, which could materially adversely affect our business.
If these strategic partners fail to perform or choose not to cooperate with us on certain projects, in addition to the effects described above, we could experience loss of customers and market share, or fail to attract new customers.
The telecommunications industry, including many of our customers, has experienced consolidation, including, in the carrier space, the proposed acquisition of Frontier Communications by Verizon (2024), the merger between Rogers Communications Inc. and Shaw Communications Inc.
The telecommunications industry, including many of our customers, has experienced consolidation, including, in the carrier space, the proposed acquisition of Cox Communications by Charter Communications (2025), the recently completed acquisition of Frontier Communications by Verizon (2026) and the acquisition of Lumen’s Mass Markets Fiber business by AT&T, the merger between Rogers Communications Inc. and Shaw Communications Inc.
We may also have to expend resources to adjust our use of AI in certain jurisdictions if the legal frameworks on AI are not consistent across jurisdictions.
We may not always be able to anticipate how to respond to these frameworks, given that they are still rapidly evolving. We may also have to expend resources to adjust our use of AI in certain jurisdictions if the legal frameworks on AI are not consistent across jurisdictions.
In our IP Optical Networks segment, some payment terms may be as long as 180 days or, in limited circumstances, even longer. We evaluate and monitor individual customer payment capability in granting such open credit arrangements, maintain reserves that we believe are adequate to cover exposure for doubtful accounts, and in some cases, insure credit risk.
We evaluate and monitor individual customer payment capability in granting such open credit arrangements, maintain reserves that we believe are adequate to cover exposure for doubtful accounts, and in some cases, insure credit risk.
Our use and reliance upon R&D resources in global locations may expose us to unanticipated costs and/or liabilities. We have R&D offices in various global locations, including the United States, Canada, India and Israel.
There is no guarantee that our financial results will not be adversely affected by currency exchange rate fluctuations. 29 ​ Our use and reliance upon R&D resources in global locations may expose us to unanticipated costs and/or liabilities. We have R&D offices in various global locations, including the United States, Canada, India and Israel.
In these instances, the purchase and sale of our products are dependent on the channel partners, who typically control the timing, prioritization and implementation of projects.
Our sales through channel partners typically involve the use of our products as components of a larger solution being implemented by systems integrators. In these instances, the purchase and sale of our products are dependent on the channel partners, who typically control the timing, prioritization and implementation of projects.
We may not be able to locate suitable employees for any key employee who leaves or offer employment to potential replacements on reasonable terms. Our future success also depends upon the continued services of our executive officers who have critical industry experience and relationships that we rely on to implement our business plan.
Our future success also depends upon the continued services of our executive officers who have critical industry experience and relationships that we rely on to implement our business plan. None of our officers or key employees is bound by an employment agreement for any specific term.
We believe this shift creates opportunities for us, as well as our direct competitors in telecommunications and networking. The shift also creates opportunities for new entrants, including some that may currently be our strategic partners, that could become competitors in the industry. See Item 1. “ Business – Competition ”.
The market is also seeing the growing use of AI in many areas of the network. We believe these shifts create opportunities for us, as well as our direct competitors in telecommunications and networking. The shift also creates opportunities for new entrants, including some that may currently be our strategic partners, that could become competitors in the industry.
Risks Related to Intellectual Property ● Our business could be jeopardized if we are unable to protect our intellectual property. ● Failure to obtain necessary licenses or ongoing maintenance and support of third-party technology at acceptable prices on acceptable terms, or at all, could harm our operating results or business. ● A breach of the security of our information systems or those of our third-party providers could adversely affect our operating results.
Risks Related to Intellectual Property ● Our business could be jeopardized if we are unable to protect our intellectual property. ● Failure to obtain necessary licenses or ongoing maintenance and support of third-party technology at acceptable prices on acceptable terms, or at all, could harm our operating results or business. ● A breach of the security of our information systems or those of our third-party providers could adversely affect our operating results. ● The increasing use of AI tools, both internally and by third parties, creates risks of potential financial and reputational harm. ​ Risks Related to Regulation ● Data privacy issues, including evolving laws, regulations and associated compliance, may adversely impact our business and financial results. ● Failure to comply with the Foreign Corrupt Practices Act (“FCPA”), the U.K.
Therefore, we cannot be certain that we would be successful in overcoming problems in connection with our past or future acquisitions. Our inability to do so could significantly harm our business, revenue, and results of operations. Failure to hire and retain key personnel could negatively impact our ability to meet our business objectives and impair our future growth.
Mergers, acquisitions and dispositions are inherently risky and subject to many factors outside of our control. Therefore, we cannot be certain that we would be successful in overcoming problems in connection with our past or future acquisitions. Our inability to do so could significantly harm our business, revenue, and results of operations.
In addition, our ability to attract and retain key employees could be adversely impacted if we do not have a sufficient number of shares available under the Amended and Restated 2019 Stock Incentive Plan, as amended, to issue to our employees.
In addition, our ability to attract and retain key employees could be adversely impacted if we do not have a sufficient number of shares available under the 2025 Stock Incentive Plan to issue to our employees. We may not be able to locate suitable employees for any key employee who leaves or offer employment to potential replacements on reasonable terms.
Such disruptions or uncertainties could result in delays or cancellations of customer orders or the manufacture or shipment of our products and have a material adverse effect on our business and results of operations. Natural catastrophic events, such as earthquakes, fires, floods, tornadoes, or pandemics (such as the COVID-19 pandemic) may also affect our or our customers’ operations.
Events such as work stoppages or widespread blackouts could have similar negative impacts. Such disruptions or uncertainties could result in delays or cancellations of customer orders or the manufacture or shipment of our products and have a material adverse effect on our business and results of operations.
We may also need to pursue strategic partnerships with vendors that have broader technology or product offerings in order to compete with end-to-end solution providers. In addition, many of the enterprise markets we are pursuing require a broad network of resale partners in order to achieve effective distribution.
We may also need to pursue strategic partnerships with vendors that have broader technology or product offerings in order to compete with end-to-end solution providers.
For example, the General Data Protection Regulation has caused more stringent data protection requirements in the U.K. and the European Union, which has adopted similar regulations. These privacy laws impose onerous accountability obligations requiring data controllers and processors to maintain a record of their data processing and implement policies as part of its mandated privacy governance framework.
These privacy laws impose onerous accountability obligations requiring data controllers and processors to maintain a record of their data processing and implement policies as part of its mandated privacy governance framework.
If one or more of our significant customers experience financial difficulties, it could result in uncollectible accounts receivable and our loss of significant customers and anticipated revenue. Most of our sales are on an open credit basis, with typical payment terms of 30 to 90 days.
Due to our reliance on significant customers, we are dependent on the continued financial strength of our customers. If one or more of our significant customers experience financial difficulties, it could result in uncollectible accounts receivable and our loss of significant customers and anticipated revenue.
If these restrictions or other sanctions are enacted, they may limit our ability to provide products and services in an important country or region for our business. The war between Russia and Ukraine, and the sanctions imposed as a result, could materially impact our sales to customers in that region.
The need to move the manufacturing of such products could also negatively impact the margin earned on the sale of such products. If these restrictions or other sanctions are enacted, they may limit our ability to provide products and services in an important country or region for our business.
We have a history of significant acquisitions and we may merge with or acquire additional businesses, products or technologies in the future or sell a portion of our business. No assurance can be given that any future merger, acquisition or disposition will be successful or will not materially adversely affect our business, operating results or financial condition.
No assurance can be given that any future merger, acquisition or disposition will be successful or will not materially adversely affect our business, operating results or financial condition.
Legislation in various countries around the world with regard to cybersecurity, privacy and data protection is rapidly expanding and creating a complex compliance environment. We are subject to many privacy and data protection laws and regulations in the U.S. and around the world, some of which place restrictions on our ability to process personal data across our business.
Legislation in various countries around the world with regard to cybersecurity, privacy, use of AI and data protection is rapidly expanding and creating a complex compliance environment.
Our business depends upon highly skilled technical, managerial, engineering, sales, marketing and customer support personnel. Competition for these personnel is intense, especially during times of economic recovery or growth. In addition, for certain mature technologies, the availability of qualified personnel necessary to provide maintenance and professional services is smaller and such personnel may be difficult to find.
In addition, for certain mature technologies, the availability of qualified personnel necessary to provide maintenance and professional services is smaller and such personnel may be difficult to find.
Therefore, changes in the value of the U.S. dollar against other currencies will affect our revenue, income from operations, net income and the value of balance sheet items originally denominated in other currencies. There is no guarantee that our financial results will not be adversely affected by currency exchange rate fluctuations.
Therefore, while we do engage in some currency hedging to reduce potential risks, changes in the value of the U.S. dollar against other currencies will affect our revenue, income from operations, net income and the value of balance sheet items originally denominated in other currencies.
While certain of our products are certified by JITC, if we are unable to obtain future JITC certification as needed, our DOD sales and results of operations, may suffer. Any future investments, mergers or acquisitions we make or enter into, as applicable, could be difficult to integrate, disrupt our business, dilute shareholder value and seriously harm our financial condition.
Any future investments, mergers or acquisitions we make or enter into, as applicable, could be difficult to integrate, disrupt our business, dilute shareholder value and seriously harm our financial condition. We have a history of significant acquisitions and we may merge with or acquire additional businesses, products or technologies in the future or sell a portion of our business.
(April 2023), the acquisition of certain Lumen Technologies assets by Brightspeed (2022), the merger between T-Mobile US, Inc. and Sprint Corporation (2020) and the acquisition of Blue Face Ltd. by Comcast Corporation (2020).
(April 2023), and the acquisition of certain Lumen Technologies assets by Brightspeed (2022).
None of our officers or key employees is bound by an employment agreement for any specific term. The loss of the services of any of our executive officers or key employees could delay the development and introduction of, and negatively impact our ability to sell, our products and achieve our business objectives.
The loss of the services of any of our executive officers or key employees could delay the development and introduction of, and negatively impact our ability to sell, our products and achieve our business objectives. Man-made problems, such as war and terrorism, and natural catastrophic events may disrupt our operations and harm our operating results.
In 2024, approximately 4% of our sales were to customers in Eastern European countries, including Ukraine, Russia, and the surrounding countries. In February 2022, Russia commenced a military action in Ukraine. The uncertainty and the threat of an expansion of the war has resulted in some of our customers delaying purchases from us.
The war between Russia and Ukraine, and the sanctions imposed as a result, could materially impact our sales to customers in that region. In 2025, approximately 1% of our sales were to customers in Eastern European countries, including Ukraine, Russia, and the surrounding countries. In February 2022, Russia commenced a military action in Ukraine.
Many of our distribution and channel partners sell competitive products and services, and the loss of, or reduction in sales by, these partners could materially reduce our revenue. Our sales through channel partners typically involve the use of our products as components of a larger solution being implemented by systems integrators.
In addition, many of the enterprise markets we are pursuing require a broad network of resale partners in order to achieve effective distribution. 22 ​ Many of our distribution and channel partners sell competitive products and services, and the loss of, or reduction in sales by, these partners could materially reduce our revenue.
Additionally, proprietary, confidential, and/or sensitive information of the Company could be leaked, disclosed, or revealed as a result of or in connection with the use of generative artificial intelligence technologies. 29 ​ Risks Related to Regulation Risks associated with data privacy issues, including evolving laws, regulations and associated compliance efforts, may adversely impact our business and financial results.
Additionally, proprietary, confidential, and/or sensitive information of the Company could be leaked, disclosed, or revealed as a result of or in connection with the use of generative artificial intelligence technologies. The increasing use of AI tools, both internally and by third parties, creates risks of potential financial and reputational harm.
We are exposed to the credit risk of some of our customers and to credit exposures in fragile financial markets, which could result in material losses. Due to our reliance on significant customers, we are dependent on the continued financial strength of our customers.
There can be no assurance that any restructuring actions we have taken in the past, or may take in the future, will improve our financial condition or results of operations. We are exposed to the credit risk of some of our customers and to credit exposures in fragile financial markets, which could result in material losses.
Risks Related to Regulation ● Data privacy issues, including evolving laws, regulations and associated compliance, may adversely impact our business and financial results. ● Failure to comply with the Foreign Corrupt Practices Act (“FCPA”), the U.K.
The use of AI tools in financial and market analysis may introduce risks similar to those described above, including an inaccurate interpretation of our financial or operational performance or market trends or conditions, which in turn could result in inaccurate conclusions or investment recommendations. ​ ​ 31 ​ Risks Related to Regulation Risks associated with data privacy issues, including evolving laws, regulations and associated compliance efforts, may adversely impact our business and financial results.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeAs of the date of this Annual Report, we are not aware of any risks from cybersecurity threats that have materially affected or are reasonably likely to materially affect us, including our business strategy, results of operations and financial condition.
Biggest changeFurther, as of the date of this Annual Report, we are not aware of any other risks from cybersecurity threats that have materially affected or are reasonably likely to materially affect us, including our business strategy, results of operations and financial condition. 38 ​ Cybersecurity Risk Governance Our Board of Directors has overall responsibility for risk oversight, with its committees assisting the Board of Directors in performing this function based on their respective areas of expertise.
In addition, if any cybersecurity incident is determined under our incident response policy to pose a risk in excess of an identified threshold (as set forth in the policy), our 36 ​ Chief Legal Officer will promptly notify the Audit Committee regarding the incident.
In addition, if any cybersecurity incident is determined under our incident response policy to pose a risk in excess of an identified threshold (as set forth in the policy), our Chief Legal Officer will promptly notify the Audit Committee regarding the incident.
She is a Certified Information Security Manager, has operated her own security firm, and has over 20 years of cybersecurity experience, including her time as a US Navy Operations and Training Manager. Our CIO has held that position (or Head of IT) at Ribbon for over seven years.
She is a Certified Information Security Manager, has operated her own security firm, and has over 20 years of cybersecurity experience, including her time as a U.S. Navy Operations and Training Manager. Our CIO has held that position (or Head of IT) at Ribbon for over seven years.
In addition, we use third-party experts to assist us in performing annual penetration testing and active breach assessment simulations to verify implementation of security tools, mitigating controls, and our ability to respond to real-world scenarios pursuant to our incident response policy.
In addition, we use third-party experts to assist us in performing annual penetration testing and red team exercises to verify implementation of security tools, mitigating controls, and our ability to respond to real-world scenarios pursuant to our incident response policy.
We are focused on the continuous improvement of key processes such as data security, asset management, access control, vulnerability management, incident response, and third-party risk management. We also maintain business continuity management certification to ensure the ongoing review of our business continuity, disaster recovery and incident management processes, including as a result of a cybersecurity breach.
We are focused on the continuous improvement of key processes such as data security, asset management, information protection processes and procedures, protective technologies, and continuous monitoring. We also maintain business continuity management certification to ensure the ongoing review of our business continuity, disaster recovery and incident management processes.
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Cybersecurity Risk Governance Our Board of Directors has overall responsibility for risk oversight, with its committees assisting the Board of Directors in performing this function based on their respective areas of expertise.
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In early September 2025, we became aware that unauthorized persons, reportedly associated with a nation-state actor, had gained access to our IT network. We promptly initiated our incident response plan and began an investigation, containment and remediation effort using multiple third-party cybersecurity experts, including federal law enforcement.
Added
We are not aware of evidence indicating that the threat actor accessed or exfiltrated any material information. Several customer files saved outside of the main network appear to have been accessed by the threat actor and those customers have been notified by us.
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The September 2025 incident, including the costs of our remediation activities, did not have a material adverse effect on our business strategy, results of operations or financial condition.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeAs of December 31, 2024, we maintained the following principal facilities: ​ ​ ​ ​ ​ ​ Location Location Lease expiration Plano, Texas (a) Corporate headquarters, sales, marketing, research and development/engineering, customer support, general and administrative September 2032 Westford, Massachusetts (a) Research and development, customer support, general and administrative August 2028 Ottawa, Canada (b) Research and development/engineering, customer support, general and administrative December 2029 Petah Tikva, Israel (Main Campus) (c)(d) Research and development/engineering, sales and marketing, customer support, general and administrative ​ March 2025 Petah Tikva, Israel (Kshatot) (c)(d) Service, research and development/engineering, supply chain January 2025 Bangalore, India (Delta) Research and development/engineering, customer support, general and administrative December 2034 Bangalore, India (Alpha) Research and development/engineering, customer support, general and administrative December 2028 (a) A portion of this facility was not in use at December 31, 2024 and is being marketed for sublease.
Biggest changeAs of December 31, 2025, we maintained the following principal facilities: ​ ​ ​ ​ ​ ​ Location ​ ​ ​ Location ​ ​ ​ Lease expiration Plano, Texas (a) Corporate headquarters, sales, marketing, research and development/engineering, customer support, general and administrative September 2032 Westford, Massachusetts (a) Research and development, customer support, general and administrative August 2028 Ottawa, Canada (b) Research and development/engineering, customer support, general and administrative December 2029 Petah Tikva, Israel Research and development/engineering, sales and marketing, customer support, general and administrative ​ February 2031 Bangalore, India (Delta) Research and development/engineering, customer support, general and administrative December 2034 Bangalore, India (Alpha) Research and development/engineering, customer support, general and administrative December 2028 (a) A portion of this facility was not in use at December 31, 2025 and is being marketed for sublease.
A new lease was signed in 2023 for a building under construction in Petah Tikva. ​ We also lease smaller spaces that are each under 50,000 square feet for our staff in various countries around the world in sales, marketing, R&D/engineering, customer services and support, as well as for warehouse purposes.
(b) A portion of this facility was not in use at December 31, 2025 and some of the unused space is being subleased. ​ We also lease smaller spaces that are each under 50,000 square feet for our staff in various countries around the world in sales, marketing, R&D/engineering, customer services and support, as well as for warehouse purposes.
Removed
(b) A portion of this facility was not in use at December 31, 2024 and some of the unused space is being subleased. (c) A portion of this facility was not in use at December 31, 2024. (d) We plan to consolidate and relocate our office space in Israel.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeOur material legal proceedings are described in Part II, Item 8 of this Form 10-K in the Notes to Consolidated Financial Statements in Note 26, “ Commitments and Contingencies ” under the heading “Contingencies”. 37 ​ The outcome of litigation is inherently uncertain.
Biggest changeOur material legal proceedings are described in Part II, Item 8 of this Form 10-K in the Notes to Consolidated Financial Statements in Note 26, “ Commitments and Contingencies ” under the heading “Contingencies”. 39 ​ The outcome of litigation is inherently uncertain.
We settled certain matters during the fourth quarter of 2024 that did not individually or in the aggregate have a material impact on our financial condition or operating results.
We settled certain matters during the fourth quarter of 2025 that did not individually or in the aggregate have a material impact on our financial condition or operating results.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changePurchases of Equity Securities by the Issuer and Affiliated Purchasers The following table summarizes repurchases of our common stock during the fourth quarter of 2024: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Approximate Dollar ​ ​ ​ ​ ​ ​ ​ Total Number of ​ Value of Shares ​ ​ ​ ​ ​ ​ ​ Shares Purchased ​ that May ​ ​ ​ ​ ​ ​ ​ as Part of ​ Yet be Purchased ​ ​ Total Number ​ Average ​ Publicly ​ Under ​ ​ of Shares ​ Price Paid ​ Announced Plans ​ the Plans Period Purchased (1) per Share or Programs or Programs October 1, 2024 to October 31, 2024 ​ 296,525 ​ $ 3.45 ​ — ​ $ — November 1, 2024 to November 30, 2024 ​ 11,792 ​ $ 3.93 ​ — ​ $ — December 1, 2024 to December 31, 2024 ​ 49,120 ​ $ 4.09 ​ — ​ $ — Total ​ 357,437 ​ $ 3.56 ​ — ​ $ — (1) Upon vesting of restricted stock awards, certain of our employees may return to us a portion of the newly vested shares to satisfy the tax withholding obligations that arise in connection with such vesting.
Biggest changePurchases of Equity Securities by the Issuer and Affiliated Purchasers The following table summarizes repurchases of our common stock during the fourth quarter of 2025: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Approximate Dollar ​ ​ ​ ​ ​ ​ ​ Total Number of ​ Value of Shares ​ ​ ​ ​ ​ ​ ​ Shares Purchased ​ that May ​ ​ ​ ​ ​ ​ ​ as Part of ​ Yet be Purchased ​ ​ Total Number ​ Average ​ Publicly ​ Under ​ ​ of Shares ​ Price Paid ​ Announced Plans ​ the Plans Period ​ ​ ​ Purchased (1) ​ ​ ​ per Share ​ ​ ​ or Programs (2) ​ ​ ​ or Programs (3) October 1, 2025 to October 31, 2025 ​ 135,611 ​ $ 3.81 ​ 418,496 ​ $ 42,769,442 November 1, 2025 to November 30, 2025 ​ 930 ​ $ 3.08 ​ 553,743 ​ $ 41,045,333 December 1, 2025 to December 31, 2025 ​ 3,995 ​ $ 2.98 ​ — ​ $ 41,045,333 Total ​ 140,536 ​ $ 3.78 ​ 972,239 ​ $ 41,045,333 (1) Upon vesting of restricted stock awards, certain of our employees may return to us a portion of the newly vested shares to satisfy the tax withholding obligations that arise in connection with such vesting.
The comparison assumes an investment of $100 on December 31, 2019 in our common stock and in each of the indices and, in each case, assumes reinvestment of all dividends, if any. The performance shown is not necessarily indicative of future performance.
The comparison assumes an investment 41 ​ of $100 on December 31, 2020 in our common stock and in each of the indices and, in each case, assumes reinvestment of all dividends, if any. The performance shown is not necessarily indicative of future performance.
Performance Graph The following performance graph compares the cumulative total return to stockholders for our common stock for the period from December 31, 2019 through December 31, 2024 with the cumulative total return over the same period on the Nasdaq Composite Index, the Nasdaq Telecommunications Index and the Russell 2000.
Performance Graph The following performance graph compares the cumulative total return to stockholders for our common stock for the period from December 31, 2020 through December 31, 2025 with the cumulative total return over the same period on the Nasdaq Composite Index, the Nasdaq Telecommunications Index and the Russell 2000.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common stock is traded on The Nasdaq Global Select Market under the symbol “RBBN.” Holders At February 24, 2025, there were approximately 340 holders of record of our common stock. Recent Sales of Unregistered Securities None.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Market Information Our common stock is traded on The Nasdaq Global Select Market under the symbol “RBBN.” Holders At February 23, 2026, there were approximately 350 holders of record of our common stock. Recent Sales of Unregistered Securities None.
During the fourth quarter of 2024, 357,437 shares of restricted stock were returned to us by employees to satisfy tax withholding obligations arising in connection with vesting of restricted stock, which shares are included in this column.
During the fourth quarter of 2025, 140,536 shares of restricted stock were returned to us by employees to satisfy tax withholding obligations arising in connection with vesting of restricted stock, which shares are included in this column.
This graph is not deemed to be “filed” with the SEC or subject to the liabilities of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and should not be deemed to be incorporated by reference into any of our prior or subsequent filings under the Securities Act of 1933, as amended, or the Exchange Act. 39 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ ​ 2019 ​ 2020 ​ 2021 ​ 2022 ​ 2023 ​ 2024 Ribbon Communications Inc. ​ $ 100.00 ​ $ 211.61 ​ $ 195.16 ​ $ 90.00 ​ $ 93.55 ​ $ 134.19 Nasdaq Composite ​ $ 100.00 ​ $ 144.92 ​ $ 177.06 ​ $ 119.45 ​ $ 172.77 ​ $ 223.87 Russell 2000 ​ $ 100.00 ​ $ 119.96 ​ $ 137.74 ​ $ 109.59 ​ $ 128.14 ​ $ 142.93 Nasdaq Telecommunications ​ $ 100.00 ​ $ 110.08 ​ $ 112.44 ​ $ 82.21 ​ $ 90.96 ​ $ 103.21 ​ ​
This graph is not deemed to be “filed” with the SEC or subject to the liabilities of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and should not be deemed to be incorporated by reference into any of our prior or subsequent filings under the Securities Act of 1933, as amended, or the Exchange Act. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ December 31, ​ ​ 2020 ​ 2021 ​ 2022 ​ 2023 ​ 2024 ​ 2025 Ribbon Communications Inc. ​ $ 100.00 ​ $ 92.23 ​ $ 42.53 ​ $ 44.21 ​ $ 63.41 ​ $ 43.90 Nasdaq Composite ​ $ 100.00 ​ $ 122.18 ​ $ 82.43 ​ $ 119.22 ​ $ 154.48 ​ $ 187.14 Russell 2000 ​ $ 100.00 ​ $ 114.82 ​ $ 91.35 ​ $ 106.82 ​ $ 119.14 ​ $ 134.40 Nasdaq Telecommunications ​ $ 100.00 ​ $ 102.14 ​ $ 74.69 ​ $ 82.63 ​ $ 93.76 ​ $ 107.59 ​ ​
Added
(2) In June 2025, we announced a stock repurchase program for the period beginning June 5, 2025 through December 31, 2027, under which our Board of Directors authorized the repurchase of up to $50 million of our common stock at management’s discretion in the open market, in privately negotiated transactions structured through investment banking institutions, or a combination of the foregoing, (the "2025 Repurchase Program" or the “Repurchase Program”).
Added
We used $3.2 million to repurchase 972,239 shares of our common stock under the Repurchase Program during the fourth quarter of 2025. At December 31, 2025, we had $41.0 million remaining under the Repurchase Program for future repurchases.
Added
The amount and timing of repurchases are subject to a variety of factors including liquidity, cash flow, stock price, compliance with our credit facility and general business and market conditions. We may also, from time to time, enter into Rule 10b5-1 plans to facilitate repurchases of our shares under this authorization.
Added
The Repurchase Program may be modified, increased, suspended, or discontinued at any time. The Repurchase Program is being funded using cash on hand and cash from operations. (3) Represents amounts available for repurchases under the Repurchase Program.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeOur cost of revenue, gross profit and gross margin for the years ended December 31, 2024 and 2023 were as follows (in thousands, except percentages): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended Increase/(decrease) ​ ​ December 31, ​ from prior year ​ ​ 2024 2023 $ % Cost of revenue: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Product ​ $ 228,527 ​ $ 250,609 ​ $ (22,082) ​ (8.8) % Service ​ 140,949 ​ 139,357 ​ 1,592 ​ 1.1 % Amortization of acquired technology ​ 24,893 ​ 28,290 ​ (3,397) ​ (12.0) % Total cost of revenue ​ $ 394,369 ​ $ 418,256 ​ $ (23,887) ​ (5.7) % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Gross profit ​ $ 439,512 ​ $ 408,083 ​ $ 31,429 ​ 7.7 % Gross margin ​ ​ 52.7 % ​ 49.4 % ​ ​ ​ ​ ​ 50 ​ Our segment cost of revenue, gross profit and gross margin for the years ended December 31, 2024 and 2023 were as follows (in thousands, except percentages): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended Year ended ​ ​ December 31, 2024 ​ December 31, 2023 ​ ​ ​ Cloud and ​ IP Optical ​ ​ ​ ​ Cloud and ​ IP Optical ​ ​ ​ ​ ​ Edge Networks Total Edge Networks Total ​ Product ​ $ 73,684 ​ $ 154,843 ​ $ 228,527 ​ $ 72,081 ​ $ 178,528 ​ $ 250,609 ​ Service ​ ​ 94,579 ​ ​ 46,370 ​ ​ 140,949 ​ ​ 92,644 ​ ​ 46,713 ​ ​ 139,357 ​ Amortization of acquired technology ​ 7,677 ​ 17,216 ​ 24,893 ​ 12,904 ​ 15,386 ​ 28,290 ​ Total cost of revenue ​ $ 175,940 ​ $ 218,429 ​ $ 394,369 ​ $ 177,629 ​ $ 240,627 ​ $ 418,256 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Gross profit ​ $ 329,217 ​ $ 110,295 ​ $ 439,512 ​ $ 300,018 ​ $ 108,065 ​ $ 408,083 ​ Gross margin ​ ​ 65.2 % ​ 33.6 % ​ 52.7 % ​ 62.8 % ​ 31 % ​ 49.4 % ​ Our gross margin was 3.3 percentage points higher in 2024 compared to 2023.
Biggest changeOur cost of revenue, gross profit and gross margin for the years ended December 31, 2025 and 2024 were as follows (in thousands, except percentages): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended ​ ​ ​ Increase/(decrease) ​ ​ December 31, ​ from prior year ​ ​ ​ ​ ​ 2025 ​ ​ ​ 2024 ​ ​ ​ $ ​ ​ ​ % Cost of revenue: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Product ​ $ 249,247 ​ $ 228,527 ​ $ 20,720 ​ 9.1 % Service ​ 154,259 ​ 140,949 ​ 13,310 ​ 9.4 % Amortization of acquired technology ​ 20,344 ​ 24,893 ​ (4,549) ​ (18.3) % Total cost of revenue ​ $ 423,850 ​ $ 394,369 ​ $ 29,481 ​ 7.5 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Gross profit ​ $ 420,706 ​ $ 439,512 ​ $ (18,806) ​ (4.3) % Gross margin ​ ​ 49.8 % ​ 52.7 % ​ ​ ​ ​ ​ Our segment cost of revenue, gross profit and gross margin for the years ended December 31, 2025 and 2024 were as follows (in thousands, except percentages): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended ​ ​ ​ Year ended ​ ​ December 31, 2025 ​ December 31, 2024 ​ ​ ​ Cloud and ​ IP Optical ​ ​ ​ ​ Cloud and ​ IP Optical ​ ​ ​ ​ ​ ​ ​ ​ Edge ​ ​ ​ Networks ​ ​ ​ Total ​ ​ ​ Edge ​ ​ ​ Networks ​ ​ ​ Total ​ Product ​ $ 76,810 ​ $ 172,437 ​ $ 249,247 ​ $ 73,684 ​ $ 154,843 ​ $ 228,527 ​ Service ​ ​ 108,625 ​ ​ 45,634 ​ ​ 154,259 ​ ​ 94,579 ​ ​ 46,370 ​ ​ 140,949 ​ Amortization of acquired technology ​ 2,920 ​ 17,424 ​ 20,344 ​ 7,677 ​ 17,216 ​ 24,893 ​ Total cost of revenue ​ $ 188,355 ​ $ 235,495 ​ $ 423,850 ​ $ 175,940 ​ $ 218,429 ​ $ 394,369 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Gross profit ​ $ 323,075 ​ $ 97,631 ​ $ 420,706 ​ $ 329,217 ​ $ 110,295 ​ $ 439,512 ​ Gross margin ​ ​ 63.2 % ​ 29.3 % ​ 49.8 % ​ 65.2 % ​ 33.6 % ​ 52.7 % ​ Our gross margin was 2.9 percentage points lower in 2025 compared to 2024.
Research and Development. Research and development (“R&D”) expenses consist primarily of salaries and related personnel expenses and prototype costs for the design, development, testing and enhancement of our products.
Research and development (“R&D”) expenses consist primarily of salaries and related personnel expenses and prototype costs for the design, development, testing and enhancement of our products.
Our other expense, net in 2024 was $29.1 million and was primarily comprised of $9.1 of fair value adjustments to the Preferred Stock and Warrants, $2.7 of accrued dividends and the $1.8 million call premium on our Preferred Stock that we redeemed on June 25, 2024, the $6.3 million write-off of an expired tax indemnity asset associated with the ECI Acquisition, and foreign currency exchange losses of $5.7 million.
Our other expense, net in 2024 was $29.1 million and was primarily comprised of $9.1 million of fair value adjustments to the Preferred Stock and Warrants, $2.7 million of accrued dividends and the $1.8 million call premium on our Preferred Stock that we redeemed on June 25, 2024, $6.3 million write-off of an expired tax indemnity asset associated with the ECI Acquisition, and foreign currency exchange losses of $5.7 million.
The remaining unamortized gain in accumulated other comprehensive (loss) income of approximately $0.5 million was written off to interest expense in conjunction with the refinancing of the 2020 Credit Facility on June 21, 2024.
The remaining unamortized gain in accumulated other comprehensive income (loss) of approximately $0.5 million was written off to interest expense in conjunction with the refinancing of the 2020 Credit Facility on June 21, 2024.
The portion of the gain in accumulated other comprehensive (loss) income related to our remaining term loan debt balance totaled $12.0 million and was being released into earnings on a straight line basis over the remaining term of the 2020 Credit Facility as a decrease to interest expense beginning in the second quarter of 2023, the amortization of which was $3.0 million and $4.7 million for the years ended December 31, 2024 and 2023, respectively.
The portion of the gain in accumulated other comprehensive income (loss) related to our remaining term loan debt balance totaled $12.0 million and was being released into earnings on a straight line basis over the remaining term of the 2020 Credit Facility as a decrease to interest expense beginning in the second quarter of 2023, the amortization of which was $3.0 million and $4.7 million for the years ended December 31, 2024 and 2023, respectively.
The remaining unamortized gain in accumulated other comprehensive (loss) income of $4.4 million was written off to interest expense in conjunction with the refinancing of the 2020 Credit Facility on June 21, 2024. Our objectives in using interest rate derivatives have been to add stability to interest expense and to manage our exposure to interest rate movements.
The remaining unamortized gain in accumulated other comprehensive income (loss) of $4.4 million was written off to interest expense in conjunction with the refinancing of the 2020 Credit Facility on June 21, 2024. Our objectives in using interest rate derivatives have been to add stability to interest expense and to manage our exposure to interest rate movements.
On June 21, 2024, we entered into a Senior Secured Credit Facilities Credit Agreement (the “2024 Credit Facility” or “Credit Agreement”) as guarantor, with our wholly-owned subsidiary, Ribbon Communications Operating Company, Inc., as the borrower (“Borrower”), HPS Investment Partners, LLC ("HPS"), as administrative agent, and HPS and WhiteHorse Capital Management, LLC ("WhiteHorse" and, together with HPS, the "Lenders"), pursuant to which the Lenders provided us with a $385 million Credit Agreement comprised of (i) a $350 million term loan (the “2024 Term Loan”) and (ii) a $35 million revolving credit facility (the “2024 Revolver”), including a $20 million sublimit for letters of credit.
On June 21, 2024, we entered into a Senior Secured Credit Facilities Credit Agreement (the “2024 Credit Facility” or “2024 Credit Agreement”) as guarantor, with our wholly-owned subsidiary, Ribbon Communications Operating Company, Inc., as the borrower (“Borrower”), HPS Investment Partners, LLC ("HPS"), as administrative agent, and HPS and WhiteHorse Capital Management, LLC ("WhiteHorse" and, together with HPS, the "Lenders"), pursuant to which the Lenders provided us with a $385 million Credit Agreement comprised of (i) a $350 million term loan (the “2024 Term Loan”) and (ii) a $35 million revolving credit facility (the “2024 Revolver”), including a $20 million sublimit for letters of credit.
Factors that could indicate an impairment may exist include significant underperformance relative to plan or long-term projections, strategic changes in business strategy, significant negative industry or economic trends, a significant change in circumstances relative to a large customer, a significant decline in our stock price for a sustained period and a decline in our market capitalization to below net book value.
Factors that could indicate an impairment may exist include significant underperformance relative to plan or long-term projections, strategic changes in business strategy, significant negative industry 48 ​ or economic trends, a significant change in circumstances relative to a large customer, a significant decline in our stock price for a sustained period and a decline in our market capitalization to below net book value.
If future demand or market conditions are less favorable than our projections, additional inventory write-downs could be required and would be reflected in the cost of revenue in the period the revision is made. To date, we have not been required to revise any of our assumptions or estimates used in determining our inventory valuations.
If future demand or market conditions are less favorable than our projections, additional inventory write-downs could be required and would be reflected in the cost of revenue in the period the 47 ​ revision is made. To date, we have not been required to revise any of our assumptions or estimates used in determining our inventory valuations.
Certain of our warranties are considered to be assurance-type in nature, ensuring that the product is functioning as intended. Assurance-type warranties do not represent separate performance obligations. We also sell separately-priced maintenance service contracts which qualify as service-type warranties and represent separate performance obligations. We do not allow and have no history of accepting product returns.
Certain of our warranties are considered to be assurance-type in nature, ensuring that the product is functioning as intended. Assurance-type warranties do not represent separate performance obligations. We also sell separately-priced 46 ​ maintenance service contracts which qualify as service-type warranties and represent separate performance obligations. We do not allow and have no history of accepting product returns.
We record our amortization in relation to expected future cash flows rather than on a straight-line basis. Accordingly, such expense may vary from one period to the next. Acquisition-, Disposal- and Integration-Related. Acquisition-, disposal- and integration-related expenses include those expenses related to acquisitions that we would otherwise not have incurred.
We record our amortization in relation to expected future cash flows rather than on a straight-line basis. Accordingly, such expense may vary from one period to the next. Acquisition-, Disposal- and Integration-Related. Acquisition-, disposal- and integration-related expenses include those expenses related to acquisitions and disposals that we would otherwise not have incurred.
Certain countries in which we operate have enacted legislation consistent with the OECD model rules effective beginning in 2024. We considered the applicable tax laws in relevant jurisdictions and concluded there was no material effect on our tax provision for the year ended December 31, 2024.
Certain countries in which we operate have enacted legislation consistent with the OECD model rules effective beginning in 2024. We considered the applicable tax laws in relevant jurisdictions and concluded there was no material effect on our tax provision for the year ended December 31, 2025.
The portion of the gain in accumulated other comprehensive (loss) income related to the term loan debt prepaid on the date of the final sale of our swap totaled $7.3 million and was released into earnings immediately as Other expense, net.
The portion of the gain in accumulated other comprehensive income (loss) related to the term loan debt prepaid on the date of the final sale of our swap 56 ​ totaled $7.3 million and was released into earnings immediately as Other expense, net.
We typically have more than one SSP 44 ​ for individual products and services due to the stratification of those products and services by customers and circumstances. In these instances, we may use information such as the size of the customer and geographic region in determining the SSP.
We typically have more than one SSP for individual products and services due to the stratification of those products and services by customers and circumstances. In these instances, we may use information such as the size of the customer and geographic region in determining the SSP.
On August 16, 2022, we sold another $30 million of the notional amount of our interest 55 ​ rate swap back to our counterparty for $1.6 million, reducing the notional amount to $340 million, which approximated the term loan debt then outstanding.
On August 16, 2022, we sold another $30 million of the notional amount of our interest rate swap back to our counterparty for $1.6 million, reducing the notional amount to $340 million, which approximated the term loan debt then outstanding.
Although headline inflation in the United States and Europe appears to be easing, core inflation (excluding food and energy prices) remains elevated and is a source of continued cost pressure on businesses and households.
Although headline inflation in the United States and Europe appears to be easing, core inflation (excluding food 43 ​ and energy prices) remains elevated and is a source of continued cost pressure on businesses and households.
The gain in accumulated other comprehensive (loss) income related to the $60 million notional amount sold of $3.1 million was being released into earnings on a straight line basis over the remaining term of the 2020 Credit Facility as a decrease to interest expense, the amortization of which totaled $0.4 million and $0.9 million for the years ended December 31, 2024 and 2023, respectively.
The gain in accumulated other comprehensive income (loss) related to the $60 million notional amount sold of $3.1 million was being released into earnings on a straight line basis over the remaining term of the 2020 Credit Facility as a decrease to interest expense, the amortization of which totaled $0.4 million and $0.9 million for the year ended December 31, 2024 and 2023, respectively.
During 2024 and 2023, we performed an analysis to determine if, based on all available evidence, we considered it more likely than not that some portion or all of the recorded deferred tax assets will not be realized in a future period.
During 2025 and 2024, we performed an analysis to determine if, based on all available evidence, we considered it more likely than not that some portion or all of the recorded deferred tax assets will not be realized in a future period.
As a result of our evaluations, in 2024, for the U.S. deferred tax assets, we concluded that deferred tax assets are generally realizable, with the exception of certain federal and state net operating loss carryforwards, as well as certain tax credits, that are not anticipated to be utilized.
As a result of our evaluations, in 2025, for the U.S. deferred tax assets, we concluded that deferred tax assets are generally realizable, with the exception of certain federal and state net operating loss carryforwards, as well as certain tax credits, that are not anticipated to be utilized.
If we elect to repatriate all of the funds held by our non-U.S. subsidiaries as of December 31, 2024, we do not believe that the amounts of potential withholding taxes that would arise from the repatriation would have a material effect on our liquidity.
If we elect to repatriate all of the funds held by our non-U.S. subsidiaries as of December 31, 2025, we do not believe that the amounts of potential withholding taxes that would arise from the repatriation would have a material effect on our liquidity.
Any potential positions eliminated in countries outside the United States are subject to local law and consultation requirements. In connection with the 2023 Restructuring Plan, we recorded restructuring and related expense for severance related costs of $2.0 million and $9.9 million in 2024 and 2023, respectively.
Any potential positions eliminated in countries outside the United States are subject to local law and consultation requirements. In connection with the 2023 Restructuring Plan, we recorded restructuring and related expense for severance related costs of $0.2 million and $2.0 million in 2025 and 2024, respectively.
The rate at which we consume cash is dependent upon the cash needs of our future operations, including our contractual obligations at December 31, 2024, primarily comprised of our debt principal and interest obligations as described above, and our operating lease and purchase obligations.
The rate at which we consume cash is dependent upon the cash needs of our future operations, including our contractual obligations at December 31, 2025, primarily comprised of our debt principal and interest obligations as described above, and our operating lease and purchase obligations.
Accounting for Income Taxes. Our provision for income taxes is comprised of both current taxes and deferred taxes. The current income tax provision is generally calculated as the estimated taxes payable or refundable on tax returns to be filed for the year ended December 31, 2024.
Accounting for Income Taxes. Our provision for income taxes is comprised of both current taxes and deferred taxes. The current income tax provision is generally calculated as the estimated taxes payable or refundable on tax returns to be filed for the year ended December 31, 2025.
At December 31, 2024 and 2023, we had cash collateral of $2.7 million and $0.1 million, respectively, supporting the Guarantees, which are reported in Restricted cash in our consolidated balance sheets. We are exposed to financial market risk related to foreign currency fluctuations and changes in interest rates. These exposures are actively monitored by management.
At December 31, 2025 and 2024, we had cash collateral of $1.7 million and $2.7 million, respectively, supporting the Guarantees, which are reported in Restricted cash in our consolidated balance sheets. We are exposed to financial market risk related to foreign currency fluctuations and changes in interest rates. These exposures are actively monitored by management.
Margins for the first six months are 5.25% per annum for ABR Loans and 6.25% per annum for SOFR Loans. Thereafter, margins vary based on our Consolidated Net Leverage Ratio, ranging from 4.75% to 5.25% per annum for ABR Loans and 5.75% to 6.25% per annum for SOFR Loans.
Margins for the first six months were 5.25% per annum for ABR Loans and 6.25% per annum for SOFR Loans. Thereafter, margins vary based on our Consolidated Net Leverage Ratio, ranging from 4.75% to 5.25% per annum for ABR Loans and 5.75% to 6.25% per annum for SOFR Loans.
Interest expense in 2024 was higher than 2023 primarily due to higher margins under our 2024 Term Loan compared to our 2020 Term Loan, and higher interest in 2024 due to our interest rate swap no longer being in place, partially offset by write-offs related to the refinancing of the 2020 Credit Facility with a portion of the proceeds from the 2024 Credit Facility on June 21, 2024.
Interest expense in 2025 was higher than 2024 primarily due to higher margins under our 2024 Term Loan as compared to our 2020 Term Loan, and higher interest in 2025 due to our interest rate swap no longer being in place, partially offset by write-offs related to the refinancing of the 2020 Credit Facility with a portion of the proceeds from the 2024 Credit Facility on June 21, 2024.
We assess each valuation methodology based upon the relevance and availability of the data at the time the valuation is performed and the methodologies are weighted appropriately. Based upon the completion of our 2024, 2023, and 2022 annual tests for goodwill impairment, we determined that there was no impairment of goodwill for either of our reporting units. Leases .
We assess each valuation methodology based upon the relevance and availability of the data at the time the valuation is performed and the methodologies are weighted appropriately. Based upon the completion of our 2025, 2024, and 2023 annual tests for goodwill impairment, we determined that there was no impairment of goodwill for either of our reporting units.
Judgments concerning the recognition and measurement of a tax benefit might change as new information becomes available. Results of Operations Years Ended December 31, 2024 and 2023 Revenue.
Judgments concerning the recognition and measurement of a tax benefit might change as new information becomes available. Results of Operations Years Ended December 31, 2025 and 2024 Revenue.
The Warrants remain outstanding and without modification. For additional detail on the Private Placement, see Note 16 - Preferred Stock and Warrants to our consolidated financial statements.
The Warrants remain outstanding and without modification. For additional detail on the Private Placement, see Note 15 - Preferred Stock and Warrants to our consolidated financial statements.
The degree to which the ongoing wars in Israel and Ukraine and the inflationary and high interest rate environment impacts our future business, financial position and results of operations will depend on developments beyond our control. The Ongoing Wars in Israel and Ukraine .
The degree to which the ongoing wars in Israel and Ukraine and the inflationary and high interest rate environment impacts our future business, financial position and results of operations will depend on developments beyond our control. The Ongoing War in Ukraine and military action in Israel .
Our deferred service revenue was $126 million at December 31, 2024 and $116 million at December 31, 2023. Our deferred revenue balance may fluctuate as a result of the timing of revenue recognition, customer payments, maintenance contract renewals, contractual billing rights and maintenance revenue deferrals included in multiple element arrangements.
Our deferred service revenue was $149 million at December 31, 2025 and $126 million at December 31, 2024. Our deferred revenue balance may fluctuate as a result of the timing of revenue recognition, customer payments, maintenance contract renewals, contractual billing rights and maintenance revenue deferrals included in multiple element arrangements.
For facilities that are part of a restructuring plan, and for which we have no intent or ability to enter into a sublease, we recognize accelerated rent amortization over the period from the date that we commence the plan to fully or partially vacate a facility through the final vacate date. We did not record accelerated rent amortization in 2024.
For facilities that are part of a restructuring plan, and for which we have no intent or ability to enter into a sublease, we recognize accelerated rent amortization over the period from the date that we commence the plan to fully or partially vacate a facility through the final vacate date.
The amount of stock-based compensation expense recorded in any period for unvested awards requires estimates of the amount of stock-based awards that are expected to be forfeited prior to vesting, as well as assumptions regarding the probability that performance-based stock awards without market conditions will be earned. Preferred Stock and Warrants.
The amount of stock-based compensation expense recorded in any period for unvested awards requires estimates of the amount of stock-based awards that are expected to be forfeited prior to vesting, as well as assumptions regarding the probability that performance-based stock awards without market conditions will be earned. Goodwill and Intangible Assets.
Recent Accounting Pronouncements In November 2024, the Financial Accounting Standards Board (the "FASB") issued ASU 2024-03, Income Statement, Reporting Comprehensive Income: Expense Disaggregation Disclosures (Subtopic 220-40) (“ASU 2024-03”), which requires disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the financial statements.
In November 2024, the FASB issued ASU 2024-03, Income Statement, Reporting Comprehensive Income: Expense Disaggregation Disclosures (Subtopic 220-40) (“ASU 2024-03”), which requires disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the financial statements.
The write-offs related to the refinancing consisted of the remaining unamortized gains in accumulated other comprehensive (loss) income from the sales of our interest rate swap totaling $4.9 million, partially offset by the write-off of debt issuance costs from the 2020 Credit Facility totaling $2.0 million.
The write-offs related to the refinancing consisted of the remaining unamortized gains in AOCI from the sales of our interest rate swap totaling $4.9 million, partially offset by the write-off of debt issuance costs from the 2020 Credit Facility totaling $2.0 million.
We had cash held by our non-U.S. subsidiaries aggregating approximately $18 million and $16 million at December 31, 2024 and 2023, respectively.
We had cash held by our non-U.S. subsidiaries aggregating approximately $50 million and $18 million at December 31, 2025 and 2024, respectively.
We believe that our R&D expenses will increase modestly in 2025 primarily due to higher employee and consulting costs related to modifying certain legacy products and certain of our cloud native solutions. 51 ​ Sales and Marketing.
We believe that our R&D expenses will increase modestly in 2026 primarily due to higher employee and consulting costs related to supporting certain legacy products and development of our cloud native solutions. ​ Sales and Marketing.
In February 2023, our Board of Directors approved a strategic restructuring program (the “2023 Restructuring Plan”) to streamline our operations in order to support our investment in critical growth areas. The 2023 Restructuring Plan includes, among other things, charges related to a workforce reduction.
We anticipate no future expense in 2026 related to the 2025 Restructuring Plan. In February 2023, our Board of Directors approved a strategic restructuring program (the “2023 Restructuring Plan”) to streamline our operations in order to support our investment in critical growth areas. The 2023 Restructuring Plan includes, among other things, charges related to a workforce reduction.
The following customer contributed 10% or more of our revenue in the years ended December 31, 2024 and 2023: ​ ​ ​ ​ ​ ​ ​ Year ended ​ December 31, ​ December 31, ​ Customer 2024 2023 Verizon Communications Inc. 14 % 11 % ​ 49 ​ Revenue earned from customers domiciled outside the United States was 53% and 58% of total revenue in 2024 and 2023, respectively.
The following customer contributed 10% or more of our revenue in the years ended December 31, 2025 and 2024: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended ​ ​ December 31, ​ December 31, ​ Customer ​ ​ ​ 2025 ​ ​ ​ 2024 Verizon Communications Inc. ​ 17 % 14 % ​ Revenue earned from customers domiciled outside the United States was 52% and 53% of total revenue in 2025 and 2024, respectively.
Our interest expense in 2024 primarily represents interest, amortization of debt issuance costs and original issue discount, and the amortization of gains in accumulated other comprehensive (loss) income from the sales of our interest rate swap.
Our interest expense in 2024 primarily represents term debt interest, amortization of debt issuance costs and original issue discount, interest associated with factoring arrangements and the amortization of gains in accumulated other comprehensive income (loss) (“AOCI”) from the sales of our interest rate swap.
Amortization of acquired intangible assets included in Operating expenses (“Opex Amortization”) for the years ended December 31, 2024 and 2023 was as follows (in thousands, except percentages): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended Decrease December 31, ​ from prior year 2024 2023 $ % $ 25,969 ​ $ 28,601 ​ $ (2,632) ​ (9.2) % ​ Opex Amortization was lower in 2024 compared to 2023 due to our method of amortization.
Amortization of acquired intangible assets included in Operating expenses (“Opex Amortization”) for the years ended December 31, 2025 and 2024 was as follows (in thousands, except percentages): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended ​ ​ ​ Decrease December 31, ​ from prior year 2025 ​ ​ ​ 2024 ​ ​ ​ $ ​ ​ ​ % $ 23,849 ​ $ 25,969 ​ $ (2,120) ​ (8.2) % ​ Opex Amortization was lower in 2025 compared to 2024 due to our method of amortization.
Higher revenue in our Cloud and Edge segment and lower operating expenses company-wide due to our various cost saving initiatives, including lower employee and facilities expenses, continue to positively affect our operating cash flow.
Higher revenue and lower operating expenses company-wide due to our various cost-saving initiatives, including lower employee and facilities expenses, continue to positively impact our operating cash flow.
Please see the additional discussion of our restructuring initiatives in the “Restructuring and Cost Reduction Initiatives” section of the Overview of this MD&A. We recorded restructuring and related expense of $10.2 million in 2024, comprised of $4.1 of severance and related costs, and $6.1 million for variable and other facilities-related costs.
Please see the additional discussion of our restructuring initiatives in the “Restructuring and Cost Reduction Initiatives” section of the Overview of this MD&A. We recorded restructuring and related expense of $19.7 million in 2025, comprised of $13.7 million of severance and related costs, and $6.0 million for variable and other facilities-related costs.
R&D expenses for the years ended December 31, 2024 and 2023 were as follows (in thousands, except percentages): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended Decrease ​ December 31, ​ from prior year ​ 2024 2023 $ % $ 179,941 ​ $ 190,660 ​ $ (10,719) ​ (5.6) % ​ The decrease in our research and development expenses in 2024 compared to 2023 was primarily attributable to approximately $9 million of lower expenses in our IP Optical Networks segment and approximately $2 million of lower expenses in our Cloud and Edge segment.
R&D expenses for the years ended December 31, 2025 and 2024 were as follows (in thousands, except percentages): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year ended ​ ​ ​ Decrease ​ December 31, ​ from prior year ​ 2025 ​ ​ ​ 2024 ​ ​ ​ $ ​ ​ ​ % $ 178,872 ​ $ 179,941 ​ $ (1,069) ​ (0.6) % ​ The decrease in our research and development expenses in 2025 compared to 2024 was primarily attributable to approximately $2 million of lower expenses in our IP Optical Networks segment and approximately $1 million of higher expenses in our Cloud and Edge segment.
Our actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors including, but not limited to, those disclosed in Item 1A, “Risk Factors”, elsewhere in this Annual Report on Form 10-K, in other documents filed with the SEC and otherwise publicly disclosed.
Our actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors including, but not limited to, those disclosed in Item 1A, “Risk Factors”, elsewhere in this Annual Report, in other documents filed with the SEC and otherwise publicly disclosed. Please refer to “Cautionary Note Regarding Forward-Looking Statements” above for additional information.
Acquisition- and disposal-related expenses include professional and services fees, such as legal, audit, consulting, paying agent and other fees. Integration-related expenses represent incremental costs related to combining our systems and processes with those of acquired businesses, such as third-party consulting and other third-party services. We recorded no such expenses in 2024 compared to $4.5 million recorded in 2023.
Acquisition- and disposal-related 53 ​ expenses include professional and services fees, such as legal, audit, consulting, paying agent and other fees. Integration-related expenses represent incremental costs related to combining our systems and processes with those of acquired businesses, such as third-party consulting and other third-party services.
These assumptions require significant judgment about the forecasts of future taxable income and are consistent with the plans and estimates we are using to manage our underlying businesses.
These assumptions require significant judgment about the forecasts of future taxable income and are consistent with the plans and estimates we are using to manage our underlying businesses. Such assessment is completed on a jurisdiction-by-jurisdiction basis.
Please refer to “Cautionary Note Regarding Forward-Looking Statements” above for additional information. For a complete description of our business and other important information, please refer to Item 1 of Part I of this Annual Report on Form 10-K. Overview We are a leading global provider of communications technology to service providers and enterprises.
For a complete description of our business and other important information, please refer to Item 1 of Part I of this Annual Report . Overview We are a leading global provider of communications technology to service providers and enterprises.
The 2022 Restructuring Plan includes, among other things, charges related to a consolidation of facilities and a workforce reduction. Any positions eliminated in countries outside the United States are subject to local law and consultation requirements. In connection with the 2022 Restructuring Plan, we recorded restructuring and related expense of $6.1 million in 2024 for variable and other facilities-related costs.
The 2022 Restructuring Plan includes, among other things, charges related to a consolidation of facilities and a workforce reduction. Any positions eliminated in countries outside the United States are subject to local law and consultation requirements.
We believe our sales and marketing expenses will be relatively flat in 2025 as compared to 2024. General and Administrative. General and administrative expenses consist primarily of salaries and related personnel costs for executive and administrative personnel, and audit, legal and other professional fees.
We believe our sales and marketing expenses will be relatively flat in 2026 as compared to 2025 with increases for employee-related variable compensation expenses offset by continued cost efficiencies. General and Administrative. General and administrative expenses consist primarily of salaries and related personnel costs for executive and administrative personnel, and audit, legal and other professional fees.
Key Trends and Economic Factors Affecting Ribbon Supplier Disruptions. Ongoing uncertainty in the global economy due to inflation, the wars in Israel and Ukraine, national security concerns and other factors, continue to disrupt various manufacturing, commodity and financial markets, increase volatility, and impede global supply chains.
Ongoing uncertainty in the global economy due to inflation, global military actions, including in Israel and Ukraine, national security concerns and other factors, continue to disrupt various manufacturing, commodity and financial markets, increase volatility, and impede global supply chains.
At December 31, 2024, we had an outstanding balance under the 2024 Term Loan of $348.3 million at an average interest rate of 10.6%, with no revolver balance and no letters of credit outstanding under our 2024 Credit Facility.
At December 31, 2025, we had an outstanding balance under the 2024 Term Loan of $342.1 million at an average interest rate of 10.3%, with no revolver balance and no letters of credit outstanding under our 2024 Credit Facility. We were in compliance with all covenants of the 2024 Credit Facility at December 31, 2025 and 2024, respectively.
U.S. revenue is increasing due to higher sales into the U.S. market from both the Cloud and Edge and IP Optical Networks segments. Due to the timing of project completions, we expect that the domestic and international components as a percentage of our revenue may fluctuate from quarter to quarter and year to year.
U.S. revenue grew slightly year over year, increasing approximately $7 million across the Cloud and Edge and IP Optical Networks segments. Due to the timing of project completions, we expect that the domestic and international components as a percentage of our revenue may fluctuate from quarter to quarter and year to year.
We anticipate that we will record nominal future expense for severance in connection with the 2023 Restructuring Plan. In February 2022, our Board of Directors approved a strategic restructuring program (the “2022 Restructuring Plan”) to streamline our operations in order to support our investment in critical growth areas.
We anticipate no future expense in 2026 related to the 2023 Restructuring Plan. 45 ​ In February 2022, our Board of Directors approved a strategic restructuring program (the “2022 Restructuring Plan”) to streamline our operations in order to support our investment in critical growth areas.
Judgment is required in determining whether an event has occurred that may impair the value of goodwill, identifiable intangible assets or other long-lived assets.
Any impairment charges are reported separately in our consolidated statements of operations. Judgment is required in determining whether an event has occurred that may impair the value of goodwill, identifiable intangible assets or other long-lived assets.
Intangible assets with estimated lives and other long-lived assets are reviewed for impairment when events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.
Goodwill is not amortized, but instead is tested for impairment annually, or more frequently if indicators of potential impairment exist. Intangible assets with estimated lives and other long-lived assets are reviewed for impairment when events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.
At December 31, 2024, we had $10.9 million of letters of credit, bank guarantees, and surety bonds outstanding (collectively, "Guarantees") under various uncommitted facilities and no letters of credit outstanding under the 2024 Credit Facility.
In the course of our business, we use letters of credit, bank guarantees and surety bonds (collectively, “Guarantees”). We had $11.1 million and $10.9 million of Guarantees under various uncommitted facilities as of December 31, 2025 and 2024, respectively. We had no letters of credit outstanding under the 2024 Credit Facility at December 31, 2025 and 2024.
Operating Segments Our CODM assesses our performance based on the performance of two separate organizations within Ribbon, the Cloud and Edge operating segment (“Cloud and Edge”) and the IP Optical Networks operating segment (“IP Optical Networks”). For additional details regarding our operating segments, see Note 18 - Operating Segment Information to our consolidated financial statements.
Operating Segments Our CODM assesses our performance based on the performance of two separate organizations within Ribbon, the Cloud and Edge operating segment (“Cloud and Edge”) and the IP Optical Networks operating segment (“IP Optical Networks”).
Yet, the economic outlook remains uncertain, and the implications of current and future tariffs, higher government deficits and debt, tighter monetary policy, and potentially higher long-term interest rates may drive a higher cost of capital for our business.
The effective federal funds rate averaged 3.64%, consistent with the Federal Reserve’s view that inflation is decelerating. Yet, the economic outlook remains uncertain, and the implications of current and future tariffs, higher government deficits and debt, tighter monetary policy, and potentially higher long-term interest rates may drive a higher cost of capital for our business. Tariffs .
Higher product revenue in our IP Optical Networks segment and lower operating expenses company-wide due to our various cost saving initiatives, including lower employee and facilities expenses, all positively affected our operating cash flow in 2023. Cash Flows from Investing Activities Our investing activities used cash of $22.9 million and $9.5 million in 2024 and 2023, respectively.
Higher revenue in our Cloud and Edge segment and lower operating expenses company-wide due to our various cost saving initiatives, including lower employee and facilities expenses, continue to positively affect our operating cash flow. 57 ​ Cash Flows from Investing Activities Our investing activities used cash of $25.3 million and $22.9 million in 2025 and 2024, respectively.
We are required to record expense through the respective final vesting dates regardless of the number of shares that are ultimately earned.
These results are then used to calculate the grant date fair values. We are required to record expense through the respective final vesting dates regardless of the number of shares that are ultimately earned.
Accordingly, we have maintained a valuation allowance on our U.S. deferred tax assets of $18.6 million. As a result of our evaluations for Israel, we maintained a full valuation allowance against our net deferred tax assets in Israel.
Accordingly, we have maintained a valuation allowance on our U.S. deferred tax assets of $21.5 million, which 54 ​ increased slightly over the prior year. As a result of our evaluations for Israel, we maintained a full valuation allowance against our net deferred tax assets in Israel.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion should be read in conjunction with our financial statements and the related notes included in Item 8, “Financial Statements and Supplementary Data” in this Annual Report on Form 10-K.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion should be read in conjunction with our financial statements and the related notes included in Item 8, “Financial Statements and Supplementary Data” in this Annual Report. This discussion contains forward-looking statements that reflect our plans, estimates and beliefs and involve risks and uncertainties.
We will continue to evaluate the potential effect of Pillar Two rules on our future reporting periods, but we do not expect Pillar Two to have a significant impact on our results of operations, financial position, or cash flows. 53 ​ Years Ended December 31, 2023 and 2022 For a comparison of our results of operations for the fiscal years ended December 31, 2023 and 2022, see “Part II, Item 7.
We will continue to evaluate the potential effect of Pillar Two rules on our future reporting periods, but we do not expect Pillar Two to have a significant impact on our results of operations, financial position, or cash flows.
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”), which increases the disclosure requirements around rate reconciliation information and certain types of 57 ​ income taxes companies are required to pay. ASU 2023-09 will be effective for us beginning with our 2025 annual financial statements, with early adoption permitted.
In December 2023, the FASB issued ASU 2023-09 Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”), which increases the disclosures requirements around rate reconciliation information and certain types of income taxes companies are required to pay.
Our investing activities were primarily used to purchase property and equipment. The $13.4 million increase in purchases of property and equipment in 2024 compared to 2023 is primarily due to the build out of a new facility in Israel. Cash Flows from Financing Activities Our financing activities provided $37.7 million of cash in 2024.
Our investing activities were primarily used to purchase property and equipment. The increase in purchases of property and equipment in 2025 and 2024 is primarily due to the build out of a new facility in Israel.
Our revenue was $833.9 million in 2024, comprised of $505.2 million attributable to Cloud and Edge and $328.7 million attributable to IP Optical Networks. Our revenue was $826.3 million in 2023, comprised of $477.6 million attributable to Cloud and Edge and $348.7 million attributable to IP Optical Networks.
Our revenue was $833.9 million in 2024, comprised of $505.2 million attributable to Cloud and Edge and $328.7 million attributable to IP Optical Networks. Our gross profit was $420.7 million in 2025, comprised of $323.1 million attributable to Cloud and Edge and $97.6 million attributable to IP Optical Networks.
Critical Accounting Policies and Estimates This MD&A is based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America.
We may incur additional expense in the future if we are unable to sublease other locations included in these initiatives. Critical Accounting Policies and Estimates This MD&A is based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America.
Total service revenue increased by $4 million and $1 million in our IP Optical Networks and Cloud and Edge segments, respectively. Maintenance revenue was $5 million lower in 2024 compared to 2023 primarily due to modestly lower renewal rates from decommissioning some older legacy equipment with several Cloud and Edge customers.
Maintenance revenue was $4 million lower in 2025 compared to 2024 primarily due to modestly lower renewal rates from decommissioning of older legacy equipment with several Cloud and Edge customers. 50 ​ Professional services revenue was $27 million higher in 2025 compared to 2024, with increases of $25 million and $2 million in our Cloud and Edge and IP Optical Networks segments, respectively.
We have concluded that our software licenses are functional intellectual property that are distinct, as the user can benefit from the software on its own.
The software and hardware are delivered before related services are provided and are functional without professional services or customer support. We have concluded that our software licenses are functional intellectual property that are distinct, as the user can benefit from the software on its own.
Cash Flows from Operating Activities Our primary source of cash from operating activities has been from cash collections from our customers. We expect cash flows from operating activities to be affected by increases and decreases in sales volumes and timing of collections, and by purchases and shipments of inventory.
We expect cash flows from operating activities to be affected by increases and decreases in sales volumes and timing of collections, and by purchases and shipments of inventory. Our primary uses of cash from operating activities have been for personnel costs and investment in our research and development and in our sales and marketing, and general and administrative departments.
Revenue from sales to enterprise customers was 39% and 32% of our product revenue in 2024 and 2023, respectively. These sales were made through both our direct sales team and indirect sales channel partners. The increase in enterprise sales reflects stronger sales of our products to customers in Federal agencies.
The decrease in revenue from the sale of Cloud and Edge products was primarily attributable to lower sales to enterprise customers, including U.S. Federal agencies. Revenue from sales to enterprise customers was 34% and 39% of our product revenue in 2025 and 2024, respectively. These sales were made through both our direct sales team and indirect sales channel partners.
Our gross profit was $439.5 million in 2024, comprised of $329.2 million attributable to Cloud and Edge and $110.3 million attributable to IP Optical Networks. Our gross profit was $408.1 million in 2023, comprised of $300.0 million attributable to Cloud and Edge and $108.1 million attributable to IP Optical Networks.
Our gross profit was $439.5 million in 2024, comprised of $329.2 million attributable to Cloud and Edge and $110.3 million attributable to IP Optical Networks. Our gross margin was 49.8% in 2025 and 52.7% in 2024. In 2025, our Cloud and Edge gross margin was 63.2% and our IP Optical Networks gross margin was 29.3%.
The uncertainty resulting from the wars in Israel and Ukraine, and the threat for expansion of one or both of these wars, could result in some of our customers delaying purchases from us. Further, a number of our employees in Israel are members of the military reserves and subject to immediate call-up in response to the war in Israel.
The uncertainty resulting from the recent war in Israel and ongoing war in Ukraine, and the threat for expansion of one or both of these wars, could result in some of our customers delaying purchases from us.
We anticipate that we will expense $5 million in 2025 related to the 2022 Restructuring Plan.
We anticipate that we will expense approximately $3 million of facilities-related costs in 2026 related to the 2022 Restructuring Plan.
Although we have eliminated positions as part of our restructuring initiatives, we continue to hire in certain areas that we believe are important to our future growth. Interest Expense, net.
In 2024, we recorded restructuring and related expense of $10.2 million, comprised of $4.1 million for severance and related costs, and $6.1 million for variable and other facilities-related costs. Although we have eliminated positions as part of our restructuring initiatives, we continue to hire in certain areas that we believe are important to our future growth. Interest Expense, net.
In connection with the establishment of the 2024 Credit Facility, $7.7 million of original issue discount was withheld by the Lenders and we incurred $6.3 million of debt issuance costs for a total of $14.0 million that is being amortized to Interest expense, net over the term of the agreement. 54 ​ Our previous credit facility was the Senior Secured Credit Facilities Credit Agreement (as amended, the "2020 Credit Facility"), which we entered into on March 3, 2020, by and among us, as a guarantor, Ribbon Communications Operating Company, Inc., as the borrower (the "Borrower"), Citizens Bank, N.A., Santander Bank, N.A., and others as lenders, ("2020 Credit Facility Lenders").
In connection with the establishment of the 2024 Credit Facility, $7.7 million of original issue discount was withheld by the Lenders and we incurred $6.3 million of debt issuance costs for a total of $14.0 million that is being amortized to Interest expense, net over the term of the agreement.
MD&A” of our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on February 28, 2024.
Years Ended December 31, 2024 and 2023 For a comparison of our results of operations for the fiscal years ended December 31, 2024 and 2023, see “Part II, Item 7. MD&A” of our Annual Report on Form 10-K for the year ended December 31, 2024, filed with the SEC on February 27, 2025.
ASU 2023-07 became effective for us beginning with this Annual Report on Form 10-K which includes the required additional segment disclosures.
ASU 2023-09, which the Company applied on a prospective basis, became effective beginning with this Annual Report on Form 10-K and includes the required additional income tax disclosures.
We believe that rapid technological innovation is critical to our long-term success, and we are tailoring our investments to meet the requirements of our customers and market.
Some aspects of our R&D efforts require significant short-term expenditures, the timing of which may cause significant variability in our expenses. We believe that rapid technological innovation is critical to our long-term success, and we are tailoring our investments to meet the requirements of our customers and market.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeBecause a higher proportion of our expenses are denominated in foreign currencies compared to our revenue, our net loss for the year ended December 31, 2024 would have been positively impacted by approximately $11 million. ​ 58 ​
Biggest changeBecause a higher proportion of our expenses are denominated in foreign currencies compared to our revenue, our net loss for the year ended December 31, 2025 would have been positively impacted by approximately $32 million. ​ 59 ​
A hypothetical movement of plus or minus 50 basis points in the interest rate of our outstanding debt would have changed our interest expense by approximately $2 million for the year ended December 31, 2024.
A hypothetical movement of plus or minus 50 basis points in the interest rate of our outstanding debt would have changed our interest expense by approximately $2 million for the year ended December 31, 2025.
Dollar expenses. A hypothetical 10% strengthening of the U.S. Dollar would have negatively impacted our revenues for the year ended December 31, 2024 by approximately $20 million.
Dollar expenses. A hypothetical 10% strengthening of the U.S. Dollar would have negatively impacted our revenues for the year ended December 31, 2025 by approximately $20 million.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk We are exposed to market risk related to changes in interest rates and foreign currency exchange rates. The following discussion about these market risks includes forward-looking statements. Actual results could differ materially from those projected in these forward-looking statements. At December 31, 2024, we had outstanding debt totaling $348.3 million.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk We are exposed to market risk related to changes in interest rates and foreign currency exchange rates. The following discussion about these market risks includes forward-looking statements. Actual results could differ materially from those projected in these forward-looking statements. At December 31, 2025, we had outstanding debt totaling $342.1 million.

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