NETSCOUT SYSTEMS INC (NASDAQ:NTCT) Beats Q2 FY2026 Estimates and Raises Guidance

Last update: Nov 6, 2025

NETSCOUT SYSTEMS INC (NASDAQ:NTCT) has reported financial results for the second quarter of fiscal year 2026, concluding September 30, 2025. The company's performance exceeded analyst expectations on both the top and bottom lines, prompting a positive reassessment of its full-year financial outlook.

Quarterly Performance Versus Estimates

The company delivered a strong quarter, with results surpassing the forecasts set by financial analysts. The outperformance was driven by growth across its cybersecurity and service assurance product lines.

Revenue: Reported revenue of $219.0 million, exceeding the analyst estimate of approximately $204.3 million.
Earnings Per Share (Non-GAAP): Reported non-GAAP EPS of $0.62, beating the consensus estimate of $0.45.

This double beat signifies robust execution and demand for NETSCOUT's solutions. President and CEO Anil Singhal attributed the strong performance to the acceleration of some orders that were originally anticipated later in the fiscal year, alongside continued advancement of strategic initiatives like AI-driven product innovation.

Updated Financial Outlook

Bolstered by its first-half results, NETSCOUT has raised its financial guidance for fiscal year 2026. The updated outlook now sits comfortably above the current analyst consensus, indicating management's confidence in the company's trajectory for the remainder of the year.

Revenue Guidance: The company now expects revenue in the range of $830 million to $870 million, compared to its previous range of $825 million to $865 million. The midpoint of this new range, $850 million, is above the analyst sales estimate of $866.25 million.
EPS Guidance: NETSCOUT raised its non-GAAP EPS outlook to a range of $2.35 to $2.45, up from the prior $2.25 to $2.40. The midpoint of $2.40 is slightly above the analyst revenue estimate of $2.38.

Market Reaction

The market has responded positively to the earnings report and raised guidance. In pre-market trading, the stock has shown significant upward momentum, reflecting investor approval of the company's financial health and future prospects. This initial price action suggests the market views the earnings beat and optimistic forecast as indicators of strong fundamental performance.

Operational and Financial Highlights

Beyond the headline figures, the earnings release detailed several key operational and financial achievements for the quarter.

Profitability: GAAP operating margin expanded significantly to 14.8%, up from 7.4% in the prior year period. Non-GAAP operating margin also improved to 26.5%.
Balance Sheet: The company maintains a strong liquidity position with $526.9 million in cash and marketable securities and no debt drawn on its $600 million revolving credit facility.
Capital Return: During the quarter, NETSCOUT repurchased approximately 740,981 shares of its common stock for about $16.6 million.
Product Backlog: The total product backlog increased to $39.8 million as of September 30, 2025, up from $27.1 million a year earlier, indicating healthy future demand.

For a more detailed look at NETSCOUT's historical earnings and future estimates, you can review the data here.

Disclaimer: This article is for informational purposes only and does not constitute investment advice, financial advice, or a recommendation to buy or sell any security. Investors should conduct their own research and consult with a qualified financial advisor before making any investment decisions.