Applied Optoelectronics, Inc.: Q3 FY2026 earnings call

What management said about Q3 FY2026, from the documents filed with the SEC on 5 November 2026: press release. Guidance figures: 1 lowered, 5 new. The quarter’s numbers.

Key takeaways

Revenue reached $269.9 million: Revenue was $269.9 million, up from $191.9 million in Q2 2026 and $118.6 million in Q3 2025. Source
Returned to GAAP net income: GAAP net income was $6.3 million, or $0.07 per basic share, compared with a net loss of $22.8 million in Q2 2026. Source
Datacenter revenue rose to $155.6 million: Datacenter revenue was $155,609 thousand, against $107,662 thousand in Q2 2026 and $43,935 thousand in Q3 2025. Source
800G and 1.6T scaling progressing: Management said the company made meaningful progress scaling manufacturing for its 800G and 1.6T products. Source
Non-GAAP gross margin below Q3 2025: Non-GAAP gross margin was 28.7%, compared with 31.0% in Q3 2025 and 29.8% in Q2 2026. Source
Adjusted EBITDA was $28,537 thousand: Adjusted EBITDA was $28,537 thousand, against $2,005 thousand in Q3 2025 and a negative $543 thousand in Q2 2026. Source
Hyperscale agreement adds visibility: Management said the multi-year agreement with a Tier 1 hyperscale customer provides improved long-term visibility. Source
End-2026 800G and 1.6T target lowered: End-2026 target for over 500,000 pieces per month replaces around 650,000, as the company works through construction issues. Source

“We are pleased to have generated record revenue for our sixth consecutive quarter and to have returned to GAAP profitability in Q3,”
Dr. Thompson Lin, AOI’s Founder, President and Chief Executive Officer

Guidance

Area	Period	Figure	Against last quarter
Revenue Source	fourth quarter 2026	$385 million to $420 million	New
Non-GAAP gross margin Source	fourth quarter 2026	29.5% to 31%	New
Non-GAAP net income Source	fourth quarter 2026	$45.9 million to $60.4 million	New
Non-GAAP income per share Source	fourth quarter 2026	$0.48 to $0.63, using approximately 96 million shares	New
800G and 1.6 Tb manufacturing capacity Source	end of 2026	over 500,000 pieces per month	Lowered from around 650,000 pieces per month
800G and 1.6 Tb manufacturing capacity Source	end of 2027	over 1 million pieces per month	New

What changed from last quarter

New guidance: Fourth-quarter 2026 guidance given for revenue, non-GAAP gross margin, non-GAAP net income and non-GAAP income per share. Source
Guidance lowered: End-2026 capacity target for 800G and 1.6 Tb products now over 500,000 pieces per month, from around 650,000. Source
New guidance: End-2027 capacity target of over 1 million 800G and 1.6 Tb pieces per month introduced. Source
New: Multi-year strategic agreement secured with a Tier 1 hyperscale datacenter customer. Source
New: US 2027 capacity expansion plan now expected to take longer to complete, citing power and construction issues. Source

Results and growth drivers

Revenue reached $269.9 million: Revenue was $269.9 million, up from $191.9 million in Q2 2026 and $118.6 million in Q3 2025. Source
Returned to GAAP net income: GAAP net income was $6.3 million, or $0.07 per basic share, compared with a net loss of $22.8 million in Q2 2026. Source
Non-GAAP net income increased: Non-GAAP net income was $14.8 million, or $0.17 per diluted share, compared with $5.5 million, or $0.06 per diluted share, in Q2 2026. Source
Nine-month revenue higher year over year: Nine-month revenue was $612,942 thousand, against $321,441 thousand in the same period of 2025. Source

Segments and end markets

Datacenter revenue rose to $155.6 million: Datacenter revenue was $155,609 thousand, against $107,662 thousand in Q2 2026 and $43,935 thousand in Q3 2025. Source
CATV revenue increased: CATV revenue was $110,879 thousand, compared with $70,602 thousand in Q3 2025 and $80,578 thousand in Q2 2026. Source
Telecom and other revenue small: Telecom revenue was $2,727 thousand, against $3,742 thousand in Q3 2025; other revenue was $660 thousand. Source

“We delivered another solid quarter, including accelerating revenue growth and improving profitability, driven by robust demand and manufacturing expansion in both our datacenter and CATV businesses,”
Dr. Stefan Murry, AOI’s Chief Financial Officer and Chief Strategy Officer

Products and customers

800G and 1.6T scaling progressing: Management said the company made meaningful progress scaling manufacturing for its 800G and 1.6T products. Source
Optical and HFC product range: The company describes itself as a provider of advanced optical and HFC networking products that power AI. Source
Datacenter and CATV expansion: Management attributed revenue growth to robust demand and manufacturing expansion in both datacenter and CATV businesses. Source

Costs, margins and profitability

GAAP gross margin edged higher: GAAP gross margin was 28.2%, compared with 27.7% in Q2 2026 and 28.0% in Q3 2025. Source
Non-GAAP gross margin below Q3 2025: Non-GAAP gross margin was 28.7%, compared with 31.0% in Q3 2025 and 29.8% in Q2 2026. Source
R&D and G&A expense rose: R&D expense was $38,109 thousand, against $21,265 thousand in Q3 2025; G&A was $31,613 thousand, against $20,314 thousand. Source
Adjusted EBITDA was $28,537 thousand: Adjusted EBITDA was $28,537 thousand, against $2,005 thousand in Q3 2025 and a negative $543 thousand in Q2 2026. Source
Discontinued-product expenses lower: Expenses associated with discontinued products were $1,098 thousand, against $3,594 thousand in Q2 2026 and $3,372 thousand in Q3 2025. Source
Income tax expense recorded: Income tax expense was $2,359 thousand in Q3 2026, against nil in Q3 2025; nine-month tax expense was $4,697 thousand. Source

“We expect our 2027 capacity expansion plan in the US to take longer to complete due to longer than expected time to obtain necessary electrical power among other construction related issues.”
Dr. Stefan Murry, AOI’s Chief Financial Officer and Chief Strategy Officer

Demand and customer agreements

Demand described as accelerating: Management said demand for AI-related optical technologies is accelerating. Source
Hyperscale agreement adds visibility: Management said the multi-year agreement with a Tier 1 hyperscale customer provides improved long-term visibility. Source
Optical connectivity demand growing: Management said demand for high-bandwidth, energy-efficient optical connectivity products continues to grow. Source

Manufacturing capacity and timing

Capacity approaching 330,000 units: Total manufacturing equipment capacity was approaching 330,000 units per month, against approaching 200,000 in Q2 2026. Source
End-2026 800G and 1.6T target lowered: End-2026 target for over 500,000 pieces per month replaces around 650,000, as the company works through construction issues. Source
End-2027 target over one million: Management expects to grow capacity to over 1 million 800G and 1.6 Tb transceivers per month by end-2027. Source

Balance sheet, capital and cash

Cash balance increased: Cash, cash equivalents and restricted cash were $621,457 thousand, up from $216,035 thousand at December 31, 2025. Source
Inventories and receivables increased: Inventories were $377,991 thousand and accounts receivable were $413,760 thousand, against $183,105 thousand and $244,404 thousand at December 31, 2025. Source
Net PP&E grew: Net property, plant and equipment was $1,043,993 thousand, up from $376,050 thousand at December 31, 2025. Source
Accounts payable increased: Accounts payable was $494,279 thousand, against $143,932 thousand at December 31, 2025. Source
Convertible notes and current debt: Convertible senior notes were $128,836 thousand; the current portion of notes payable and long-term debt was $59,990 thousand. Source
Paid-in capital rose sharply: Additional paid-in capital was $2,757,548 thousand, against $1,224,538 thousand at December 31, 2025; total stockholders' equity was $2,241,348 thousand. Source

Strategy, positioning and leadership

Focus on executing capacity plans: Management said it remains focused on executing its capacity expansion plans and believes it is well positioned for the next phase of AI datacenter deployment. Source
Tier-one supplier positioning: The company says it supplies critical infrastructure products to tier-one customers across cloud computing, CATV broadband, telecommunications and FTTH markets. Source
Executive titles: Dr. Thompson Lin is Founder, President and CEO; Dr. Stefan Murry is CFO and Chief Strategy Officer. Source

Coming up, as management said on 5 November 2026

End-2026 capacity milestone: Management expects sufficient equipment installed by end-2026 to produce over 500,000 800G and 1.6 Tb pieces per month. Source
End-2027 capacity target: Company plans to grow capacity to over 1 million 800G and 1.6 Tb pieces per month by end-2027. Source

Figures management reported

Figure	Reported
Gross margin (GAAP) Source	28.2% in Q3 2026
Gross margin (non-GAAP) Source	28.7% in Q3 2026
End-market revenue: datacenter Source	$155,609 thousand
End-market revenue: CATV Source	$110,879 thousand
End-market revenue: telecom Source	$2,727 thousand

Risks management discussed

Operational: Longer than expected time to obtain electrical power, plus other construction issues, is affecting the US 2027 capacity expansion. Source
Operational: Management said construction issues are being worked through, and the end-2026 capacity expectation was revised as a result. Source

Earlier plans management reported on

Not stated: Earlier target of around 650,000 pieces per month by end-2026 was replaced by over 500,000 in the current release.
Delayed: Management said the US 2027 capacity expansion plan will take longer than expected, citing power and construction issues. Source

Other quarters

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.

As filed with the SEC

Open the filing on EDGAR

Applied Optoelectronics Reports Third Quarter 2026 Results

Sugar Land, Texas, November 5, 2026 - Applied Optoelectronics, Inc. (NASDAQ: AAOI) (“AOI”), a leading provider of advanced optical and HFC networking products that power AI, today announced financial results for its third quarter ended September 30, 2026.

“We are pleased to have generated record revenue for our sixth consecutive quarter and to have returned to GAAP profitability in Q3,” said Dr. Thompson Lin, AOI’s Founder, President and Chief Executive Officer. “We have made meaningful progress in scaling our manufacturing capabilities, particularly for our 800G and 1.6T products, to address demand for AI-related optical technologies that we believe is accelerating. We have recently secured a multi-year strategic agreement with a Tier 1 hyperscale datacenter customer, which we think provides us with improved long-term visibility and reinforces our confidence in the opportunity ahead as demand for high-bandwidth, energy-efficient optical connectivity products continues to grow.”

“We delivered another solid quarter, including accelerating revenue growth and improving profitability, driven by robust demand and manufacturing expansion in both our datacenter and CATV businesses,” said Dr. Stefan Murry, AOI’s Chief Financial Officer and Chief Strategy Officer. “We currently have a total manufacturing equipment capacity approaching 330,000 units per month. We expect our 2027 capacity expansion plan in the US to take longer to complete due to longer than expected time to obtain necessary electrical power among other construction related issues. As we work through these construction issues, we now expect by the end of 2026 that we will have sufficient manufacturing equipment installed to produce over 500,000 pieces of 800G and 1.6 Tb products per month and we expect to grow our manufacturing capacity to over 1 million pieces of 800G and 1.6 Tb transceivers per month by the end of 2027. We remain focused on executing on our capacity expansion plans and believe we are well positioned to support the next phase of AI datacenter deployment.”

Third Quarter 2026 Financial Summary

GAAP revenue was $269.9 million, compared with $118.6 million in the third quarter of 2025 and $191.9 million in the second quarter of 2026.
GAAP gross margin was 28.2%, compared with 28.0% in the third quarter of 2025 and 27.7% in the second quarter of 2026. Non-GAAP gross margin was 28.7%, compared with 31.0% in the third quarter of 2025 and 29.8% in the second quarter of 2026.
GAAP net income was $6.3 million, or $0.07 per basic share, compared with net loss of $17.9 million, or $0.28 per basic share in the third quarter of 2025, and a net loss of $22.8 million, or $0.28 per basic share in the second quarter of 2026.
Non-GAAP net income was $14.8 million, or $0.17 per diluted share, compared with non-GAAP net loss of $5.4 million, or $0.09 per basic share in the third quarter of 2025, and a non-GAAP net income of $5.5 million, or $0.06 per diluted share in the second quarter of 2026.

A reconciliation between all GAAP and non-GAAP information referenced above is contained in the tables below. Please also refer to “Non-GAAP Financial Measures” below for a description of these non-GAAP financial measures.

Fourth Quarter 2026 Business Outlook (+)

For fourth quarter of 2026, the company currently expects:

Revenue in the range of $385 million to $420 million.
Non-GAAP gross margin in the range of 29.5% to 31%.
Non-GAAP net income in the range of $45.9 million to $60.4 million, and non-GAAP income per share in the range of $0.48 to $0.63 using approximately 96 million shares.

(+) Please refer to the note below on forward-looking statements and the risks involved with such statements as well as the note on non-GAAP financial measures.

Conference Call Information

The company will host a conference call and webcast for analysts and investors today, November 5, 2026 to discuss its third quarter 2026 financial results and outlook for its fourth quarter 2026 at 4:30 p.m. Eastern time / 3:30 p.m. Central time. This call will be open to the public, and investors may access the call by dialing 888-880-3330 (domestic) or 646-357-8766 (international). A live audio webcast of the conference call along with supplemental financial information will also be accessible on the company's website at investors.ao-inc.com. Following the webcast, an archived version will be available on the website for one year. A telephonic replay of the call will be available one hour after the call and will run for five business days and may be accessed by dialing (800) 770-2030 (domestic) or (609) 800-9909 (international) and entering passcode 4754976 #.

Forward-Looking Information

Forward-looking statements notice

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, you can identify forward-looking statements by terminology such as "believe," "may," "estimate," "continue," "anticipate," "intend," "should," "could," "would," "target," "seek," "aim," "predicts," "think," "objectives," "optimistic," "new," "goal," “priorities,” "strategy," "potential," "is likely," "will," "expect," “momentum,” "plan" "project," "permit," “positions” or by other similar expressions that convey uncertainty of future events or outcomes. These statements include management’s beliefs and expectations related to our outlook for the fourth quarter of 2026 and the remainder of the year. Such forward-looking statements reflect the views of management at the time such statements are made. These forward-looking statements involve risks and uncertainties, as well as assumptions and current expectations, which could cause the company's actual results to differ materially from those anticipated in such forward-looking statements. These risks and uncertainties include but are not limited to: reduction in the size or quantity of customer orders; change in demand for the company's products due to industry conditions; changes in manufacturing operations; volatility in manufacturing costs; delays in shipments of products; disruptions in the supply chain; change in the rate of design wins or the rate of customer acceptance of new products; the company's reliance on a small number of customers for a substantial portion of its revenues; potential pricing pressure; a decline in demand for our customers' products or their rate of deployment of their products; general conditions in the internet datacenter, cable television (CATV) broadband, telecom, or fiber-to-the-home (FTTH) markets; changes in the world economy (particularly in the United States and China); changes in the regulation and taxation of international trade, including the imposition of tariffs; changes in currency exchange rates; the negative effects of seasonality; and other risks and uncertainties described more fully in the company's documents filed with or furnished to the Securities and Exchange Commission, including our Annual Report on Form 10-K for the year ended December 31, 2025 and our Quarterly report on Form 10-Q for the quarter ended September 30, 2026. More information about these and other risks that may impact the company's business are set forth in the "Risk Factors" section of the company's quarterly and annual reports on file with the Securities and Exchange Commission. You should not rely on forward-looking statements as predictions of future events. All forward-looking statements in this press release are based upon information available to us as of the date hereof, and qualified in their entirety by this cautionary statement. Except as required by law, we assume no obligation to update forward-looking statements for any reason after the date of this press release to conform these statements to actual results or to changes in the company's expectations.

Non-GAAP Financial Measures

We provide non-GAAP gross margin, non-GAAP net income (loss), and non-GAAP earnings (loss) per share, and non-GAAP Adjusted EBITDA to eliminate the impact of items that we do not consider indicative of our overall operating performance. To arrive at our non-GAAP gross margin, we exclude stock-based compensation expenses, expenses associated with discontinued products, and non-recurring (income) expenses, if any, from our GAAP gross margin. To arrive at our non-GAAP net income (loss), we exclude all amortization of intangible assets, stock-based compensation expense, expenses associated with discontinued products, non-cash expenses associated with discontinued products and non-recurring (income) expenses, unrealized foreign exchange loss (gain), and non-GAAP tax benefit (expenses) from our GAAP net income (loss). Included in our non-recurring expenses in Q3 2026 and Q3 2025 are employee severance expenses (if any) and legal expenses associated with litigation and certain legal and advisory expenses associated with purchase termination or patent protection. In computing our non-GAAP income tax benefit (expense), we have applied an estimate of our annual effective income tax rate and applied it to our net income before income taxes. Our non-GAAP Adjusted EBITDA is calculated by excluding depreciation expense, non-GAAP tax benefit (expense), and interest (income) expense, as well as the items excluded from non-GAAP net income (loss), from our GAAP net income (loss). Our non-GAAP diluted net earnings (loss) per share is calculated by dividing our non-GAAP net gain (loss) by the fully diluted share count (for periods in which non-GAAP net income is positive) or basic share count (for periods in which our non-GAAP net income is negative).

We believe that our non-GAAP measures are useful to investors in evaluating our operating performance for the following reasons:

We believe that elimination of items such as amortization of intangible assets, stock-based compensation expense, non-recurring revenue and expenses, losses from the disposal of idle assets, unrealized foreign exchange gain or loss, and depreciation on certain equipment undergoing reconfiguration is appropriate because treatment of these items may vary for reasons unrelated to our overall operating performance;
We believe that elimination of expenses associated with discontinued products, including depreciation and inventory obsolescence is appropriate because these expenses are not indicative of our ongoing operations;
We believe that estimating non-GAAP income taxes allows comparison with prior periods and provides additional information regarding the generation of potential future deferred tax assets;
We believe that non-GAAP measures provide better comparability with our past financial performance, period-to-period results and with our peer companies, many of which also use similar non-GAAP financial measures; and
We anticipate that investors and securities analysts will utilize non-GAAP measures as a supplement to GAAP measures to evaluate our overall operating performance.

A reconciliation of our GAAP net income (loss), GAAP total gross profit, GAAP earnings (loss), and GAAP earnings (loss) per share for Q3 2026 to our non-GAAP net income (loss), non-GAAP total gross profit, Adjusted EBITDA, and earnings (loss) per share, respectively, is provided below, together with corresponding reconciliations for Q3 2025.

Non-GAAP measures should not be considered as an alternative to gross profit, net income (loss), earnings (loss) per share, or any other measure of financial performance calculated and presented in accordance with GAAP. Our non-GAAP measures may not be comparable to similarly titled measures of other organizations because other organizations may not calculate such other non-GAAP measures in the same manner. We have not reconciled the non-GAAP measures included in our guidance to the appropriate GAAP financial measures because the GAAP measures are not readily determinable on a forward-looking basis. GAAP measures that impact our non-GAAP financial measures may include stock-based compensation expense, non-recurring expenses, amortization of intangible assets, unrealized exchange loss (gain), asset impairment charges, loss (gain) from disposal of idle assets, and changes in the fair value of our convertible notes. These GAAP measures cannot be reasonably predicted and may directly impact our non-GAAP gross margin, our non-GAAP net income and our non-GAAP fully-diluted earnings per share, although changes with respect to certain of these measures may offset other changes. In addition, certain of these measures are out of our control. Accordingly, a reconciliation of the non-GAAP financial measure guidance to the corresponding GAAP measures is not available without unreasonable effort.

About Applied Optoelectronics

Applied Optoelectronics, Inc. (AOI) is a leading developer and manufacturer of advanced optical and HFC networking products that serve as the critical building blocks for AI datacenters, CATV and broadband fiber access networks worldwide. AOI supplies these critical infrastructure products to tier-one customers across cloud computing, CATV broadband, telecommunications, and FTTH markets. The company has R&D facilities in Atlanta, GA, and engineering and manufacturing facilities at its corporate headquarters in Sugar Land, TX, as well as in Taipei, Taiwan and Ningbo, China. For additional information, visit www.ao-inc.com. # # #

Preliminary Condensed Consolidated Balance Sheets

	September 30, 2026	December 31, 2025
ASSETS
CURRENT ASSETS
Cash, Cash Equivalents and Restricted Cash	$621,457	$216,035
Accounts Receivable, Net	413,760	244,404
Inventories	377,991	183,105
Prepaid Expenses and Other Current Assets	131,557	32,183
Total Current Assets	1,544,765	675,727
Property, Plant And Equipment, Net	1,043,993	376,050
Land Use Rights, Net	4,940	4,825
Operating Right of Use Asset	70,509	49,697
Intangible Assets, Net	3,692	3,623
Other Assets	467,727	58,501
TOTAL ASSETS	$3,135,626	$1,168,423
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts Payable	$494,279	$143,932
Bank Acceptance Payable	51,509	33,363
Accrued Expenses	49,794	42,491
Current Lease Liability-Operating	5,182	3,522
Current Portion of Notes Payable and Long Term Debt	59,990	33,975
Total Current Liabilities	660,754	257,283
Convertible Senior Notes	128,836	129,829
Other Long-Term Liabilities	104,688	47,393
TOTAL LIABILITIES	894,278	434,505
STOCKHOLDERS' EQUITY
Common Stock	90	75
Additional Paid-in Capital	2,757,548	1,224,538
Cumulative Translation Adjustment	4,551	(617)
Retained Earnings	(520,841)	(490,078)
TOTAL STOCKHOLDERS' EQUITY	2,241,348	733,918
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$3,135,626	$1,168,423

Preliminary Condensed Consolidated Statements of Operations

	Three Months Ended September 30,		Nine Months Ended September 30,
	2026	2025	2026	2025
Revenue
CATV	$110,879	$70,602	$258,298	$191,122
Datacenter	155,609	43,935	344,675	120,775
Telecom	2,727	3,742	8,698	8,618
Other	660	351	1,271	926
Total Revenue	269,875	118,630	612,942	321,441
Total Cost of Goods Sold	193,720	85,367	439,664	226,472
Total Gross Profit	76,155	33,263	173,278	94,969
Operating Expenses:
Research and Development	38,109	21,265	98,636	59,687
Sales and Marketing	7,875	9,871	25,712	23,363
General and Administrative	31,613	20,314	88,090	55,020
Total Operating Expenses	77,597	51,450	212,438	138,070
Operating Loss	(1,442)	(18,187)	(39,160)	(43,101)
Other Income (Expense):
Interest Income	3,094	451	8,079	961
Interest Expense	(1,221)	(902)	(3,011)	(2,653)
Other Income (Expense), net	8,228	702	8,027	8,587
Total Other Income (Expense):	10,101	251	13,095	6,895
Net income (loss) before Income Taxes	8,659	(17,936)	(26,065)	(36,206)
Income Tax Expense	(2,359)	-	(4,697)	-
Net income (loss)	$6,300	$(17,936)	$(30,762)	$(36,206)
Net income (loss) per share attributable to common stockholders
basic	$0.07	$(0.28)	$(0.38)	$(0.64)
diluted	$0.07	$(0.28)	$(0.38)	$(0.64)
Weighted-average shares used to compute net income (loss) per share attributable to common stockholders
basic	85,397	63,329	81,016	56,762
diluted	87,835	63,329	81,016	56,762

Reconciliation of Statements of Operations under GAAP and Non-GAAP

	Three Months Ended September 30,		Nine Months Ended September 30,
	2026	2025	2026	2025
GAAP total gross profit	$76,155	$33,263	$173,278	$94,969
Share-based compensation expense	161	87	487	264
Non-recurring expense	29	7	327	48
Expenses associated with discontinued products	1,098	3,372	4,691	3,372
Non-GAAP total gross profit	$77,443	$36,729	$178,783	$98,653
GAAP net gain (loss)	$6,300	$(17,936)	$(30,762)	$(36,206)
Share-based compensation expense	5,684	3,116	14,939	8,842
Expenses associated with discontinued products	1,098	3,372	4,691	3,372
Non-cash expenses associated with discontinued products	902	1,106	2,920	3,225
Amortization of intangible assets	127	113	371	330
Non-recurring (income) expense	816	86	5,837	1,340
Unrealized exchange loss (gain)	(568)	5,550	176	490
Tax (benefit) expense related to the above	433	(806)	17,155	3,519
Non-GAAP net income (loss)	$14,792	$(5,399)	$15,327	$(15,088)
GAAP net income (loss)	$6,300	$(17,936)	$(30,762)	$(36,206)
Share-based compensation expense	5,684	3,116	14,939	8,842
Expenses associated with discontinued products	1,098	3,372	4,691	3,372
Non-cash expenses associated with discontinued products	902	1,106	2,920	3,225
Amortization of intangible assets	127	113	371	330
Non-recurring expense (income)	816	85	5,837	1,341
Unrealized exchange loss (gain)	(568)	5,550	176	490
Depreciation expense	13,692	6,148	31,159	15,936
Interest (income) expense, net	(1,873)	451	(5,068)	1,692
Income tax expenses (credit)	2,359	-	4,697	-
Adjusted EBITDA	$28,537	$2,005	$28,960	$(978)
GAAP diluted net income (loss) per share	$0.07	$(0.28)	$(0.38)	$(0.64)
Share-based compensation expense	0.06	0.05	0.18	0.16
Expenses associated with discontinued products	0.01	0.05	0.06	0.06
Non-cash expenses associated with discontinued products	0.01	0.02	0.03	0.06
Non-recurring (income) expense	0.01	-	0.07	0.02
Unrealized exchange loss (gain)	(0.01)	0.08	-	0.01
Non-GAAP tax benefit	0.01	(0.01)	0.20	0.06
Effect of diluted share count	0.01	-	0.02	-
Non-GAAP diluted net earnings (loss) per share	$0.17	$(0.09)	$0.18	$(0.27)
Shares used to compute diluted loss per share	85,397	63,329	81,016	56,762
Shares used to compute diluted earnings per share	87,835	63,329	84,106	56,762

(a) Provided for the purpose of calculating gross profit as a percentage of revenue (gross margin).

Contacts
The Blueshirt Group, Investor Relations
Lindsay Savarese
+1-212-331-8417 ir@ao-inc.com