Form 10-Q - Quarterly report [Sections 13 or 15(d)]

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

________________________________

FORM 10-Q


(Mark One)
☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 27, 2024


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______ to _______

Commission File Number 001-33278

________________________________

AVIAT NETWORKS, INC.

(Exact name of registrant as specified in its charter)

________________________________

Delaware

20-5961564

(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)

200 Parker Drive, Suite C100A,

Austin,

Texas

78728

(Address of principal executive offices)

(Zip Code)

(408) 941-7100

(Registrant’s telephone number, including area code)

________________________________

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which Registered
Common Stock	AVNW	The Nasdaq Stock Market LLC
Preferred Share Purchase Rights		The Nasdaq Stock Market LLC

Indicate by checkmark whether the registrant (l) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☐

Accelerated filer

☒

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of shares outstanding of the registrant’s common stock as of November 1, 2024 was 12,690,353.

AVIAT NETWORKS, INC.

QUARTERLY REPORT ON FORM 10-Q

For the Quarterly Period Ended September 27, 2024

Table of Contents



			Page
Part I. Financial Information			3
Item 1. Financial Statements			3
Condensed Consolidated Statements of Operations (Unaudited)			3
Condensed Consolidated Statements of Comprehensive Income (Unaudited)			4
Condensed Consolidated Balance Sheets (Unaudited)			5
Condensed Consolidated Statements of Cash Flows (Unaudited)			6
Condensed Consolidated Statements of Equity (Unaudited)			7
Notes to Condensed Consolidated Financial Statements (Unaudited)			8
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			24
Item 3. Quantitative and Qualitative Disclosures About Market Risk			29
Item 4. Controls and Procedures			30
Part II. Other Information			31
Item 1. Legal Proceedings			31
Item 1A. Risk Factors			31
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			31
Item 3. Defaults upon Senior Securities			31
Item 4. Mine Safety Disclosures			31
Item 5. Other Information			31
Item 6. Exhibits			32
Signatures			33
Exhibit Index			33

PART I. FINANCIAL INFORMATION

Item 1.Financial Statements

AVIAT NETWORKS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)


	Three Months Ended
(In thousands, except per share amounts)	September 27, 2024		September 29, 2023
Revenues:
Product sales	$	61,116	$	59,545
Services	27,313		27,364
Total revenues	88,429		86,909
Cost of revenues:
Product sales	52,201		36,313
Services	16,440		19,401
Total cost of revenues	68,641		55,714
Gross margin	19,788		31,195
Operating expenses:
Research and development	10,408		6,424
Selling and administrative	24,948		19,237
Restructuring charges	—		644
Total operating expenses	35,356		26,305
Operating (loss) income	(15,568)		4,890
Interest expense, net	1,115		99
Other expense, net	710		802
(Loss) income before income taxes	(17,393)		3,989
(Benefit from) provision for income taxes	(5,514)		432
Net (loss) income	$	(11,879)	$	3,557

Net (loss) income per share of common stock outstanding:
Basic	$	(0.94)	$	0.31
Diluted	$	(0.94)	$	0.30
Weighted-average shares outstanding:
Basic	12,646		11,574
Diluted	12,646		11,943

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements.

AVIAT NETWORKS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME

(Unaudited)


	Three Months Ended
(In thousands)	September 27, 2024		September 29, 2023
Net (loss) income	$	(11,879)	$	3,557
Other comprehensive income:
Net change in cumulative translation adjustments	2,153		33
Other comprehensive income	2,153		33
Comprehensive (loss) income	$	(9,726)	$	3,590

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements.

AVIAT NETWORKS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)


(In thousands, except share and par value amounts)	September 27, 2024		June 28, 2024
ASSETS
Current Assets:
Cash and cash equivalents	$	51,034	$	64,622

Accounts receivable, net of allowances of $2,190 and $1,854	169,002		158,013
Unbilled receivables	94,725		90,525
Inventories	79,559		62,267
Assets held for sale	—		2,720
Other current assets	32,942		27,076
Total current assets	427,262		405,223
Property, plant and equipment, net	11,883		9,480
Goodwill	15,153		8,217
Intangible assets, net	28,754		13,644
Deferred income taxes	91,317		83,112
Right-of-use assets	3,665		3,710
Other assets	12,823		11,837
Total assets	$	590,857	$	535,223
LIABILITIES AND EQUITY
Current Liabilities:
Accounts payable	$	104,926	$	92,854
Accrued expenses	39,137		42,148
Operating lease liabilities	1,125		1,006
Advance payments and unearned revenue	79,380		58,839

Other current liabilities	21,234		21,614
Current portion of long-term debt	2,395		2,396
Total current liabilities	248,197		218,857
Long-term debt	80,980		45,954
Unearned revenue	7,522		7,413
Long-term operating lease liabilities	2,782		2,823
Other long-term liabilities	407		394
Reserve for uncertain tax positions	3,445		3,485
Deferred income taxes	412		412
Total liabilities	343,745		279,338
Commitments and contingencies (Note 12)
Stockholders’ equity:
Preferred stock, $0.01 par value, 50.0 million shares authorized, none issued	—		—
Common stock, $0.01 par value, 300.0 million shares authorized, 12.7 million and 12.6 million shares issued and outstanding as of September 27, 2024 and June 28, 2024, respectively.	127		126
Treasury stock 0.2 million and 0.2 million shares as of September 27, 2024 and June 28, 2024, respectively	(6,479)		(6,479)
Additional paid-in-capital	861,023		860,071
Accumulated deficit	(590,392)		(578,513)
Accumulated other comprehensive loss	(17,167)		(19,320)
Total stockholders’ equity	247,112		255,885
Total liabilities and stockholders’ equity	$	590,857	$	535,223

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements.

AVIAT NETWORKS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)


	Three Months Ended
(In thousands)	September 27, 2024		September 29, 2023
Operating Activities
Net (loss) income	$	(11,879)	$	3,557
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities:
Depreciation of property, plant and equipment	1,317		1,168
Amortization of intangible assets	513		176
Provision for uncollectible receivables	350		14
Share-based compensation	1,664		1,834
Deferred taxes	(6,826)		(170)
Inventory write-downs	501		547
Non-cash lease expense	325		177

Other non-cash operating activities, net	(37)		17
Changes in operating assets and liabilities:
Accounts receivable	(15,498)		7,043
Unbilled receivables	(2,821)		(1,738)
Inventories	(13,197)		1,955
Accounts payable	8,594		1,787
Accrued expenses	(6,807)		(3,947)
Advance payments and unearned revenue	20,015		1,998
Income taxes payable	1,773		331
Other assets and liabilities	(5,152)		(769)
Net cash (used in) provided by operating activities	(27,165)		13,980
Investing Activities
Purchase of property, plant and equipment	(5,421)		(717)


Proceeds from sale of asset held for sale	2,396		—
Acquisition, net of cash acquired	(18,150)		—
Net cash used in investing activities	(21,175)		(717)
Financing Activities
Proceeds from revolver	35,000		25,200
Repayments of revolver	—		(25,200)




Payments for taxes related to net settlement of equity awards	(711)		(105)
Proceeds from issuance of common stock under employee stock plans	—		285
Net cash provided by financing activities	34,289		180
Effect of exchange rate changes on cash, cash equivalents, and restricted cash	1,293		(223)
Net (decrease) increase in cash, cash equivalents, and restricted cash	(12,758)		13,220
Cash, cash equivalents, and restricted cash, beginning of period	64,934		22,521
Cash, cash equivalents, and restricted cash, end of period	$	52,176	$	35,741

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements.

AVIAT NETWORKS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

(Unaudited)


	Three Months Ended September 27, 2024
	Common Stock			Treasury Stock		Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Loss		Total Equity
(In thousands)	Shares	$ Amount		$ Amount
Balance as of June 28, 2024	12,622	$	126	$	(6,479)	$	860,071	$	(578,513)	$	(19,320)	$	255,885
Net loss	—	—		—		—		(11,879)		—		(11,879)
Other comprehensive income	—	—		—		—		—		2,153		2,153
Issuance of common stock under employee stock plans	80	1		—		(1)		—		—		—
Shares withheld for taxes related to vesting of equity awards	(26)	—		—		(711)		—		—		(711)

Share-based compensation	—	—		—		1,664		—		—		1,664

Balance as of September 27, 2024	12,676	$	127	$	(6,479)	$	861,023	$	(590,392)	$	(17,167)	$	247,112


	Three Months Ended September 29, 2023
	Common Stock			Treasury Stock		Additional Paid-in Capital		Accumulated Deficit		Accumulated Other Comprehensive Loss		Total Equity
(In thousands)	Shares	$ Amount		$ Amount
Balance as of June 30, 2023	11,518	$	115	$	(6,147)	$	830,048	$	(589,273)	$	(16,004)	$	218,739
Net income	—	—		—		—		3,557		—		3,557
Other comprehensive income	—	—		—		—		—		33		33
Issuance of common stock under employee stock plans	204	2		—		283		—		—		285
Shares withheld for taxes related to vesting of equity awards	(3)	—		—		(105)		—		—		(105)

Share-based compensation	—	—		—		1,834		—		—		1,834
Balance as of September 29, 2023	11,719	$	117	$	(6,147)	$	832,060	$	(585,716)	$	(15,971)	$	224,343

See accompanying Notes to Unaudited Condensed Consolidated Financial Statements.

AVIAT NETWORKS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 1. The Company and Basis of Presentation

The Company

Aviat Networks, Inc. (“Aviat,” the “Company,” “we,” “us,” and “our”) designs, manufactures, and sells wireless networking and access networking solutions and services to mobile and fixed telephone service providers, private network operators, government agencies, transportation and utility companies, public safety agencies and broadcast system operators across the globe. Aviat’s products include broadband wireless access base stations and customer premises equipment for fixed and mobile, point-to-point digital microwave radio systems for access, backhaul, trunking and license-exempt applications, supporting new network deployments, network expansion, and capacity upgrades.

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) and with the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information, and Aviat has made estimates, assumptions and judgments affecting the amounts reported in its unaudited condensed consolidated financial statements and the accompanying notes, as discussed in greater detail below. Accordingly, the statements do not include all information and footnotes required by U.S. GAAP for annual consolidated financial statements. In the opinion of the Company’s management, such interim financial statements reflect all adjustments (consisting of normal recurring adjustments) considered necessary for a fair statement of its financial position, results of operations and cash flows for such periods. The results for the three months ended September 27, 2024 are not necessarily indicative of the results that may be expected for the full fiscal year or future operating periods. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the consolidated financial statements and footnotes thereto included in Aviat’s Annual Report on Form 10-K for the fiscal year ended June 28, 2024.

The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned and majority-owned subsidiaries. All intercompany transactions and accounts have been eliminated. Certain amounts in the financial statements have been reclassified for comparative purposes to conform to the current period financial statement presentation.

Aviat’s fiscal year includes 52 or 53 weeks and ends on the Friday nearest to June 30. The three months ended September 27, 2024 and September 29, 2023 both consisted of 13 weeks. Fiscal year 2025 contains 52 weeks and will end on June 27, 2025. Fiscal year 2024 contained 52 weeks and ended on June 28, 2024.

Use of Estimates

The preparation of unaudited condensed consolidated financial statements in accordance with U.S. GAAP requires the Company to make estimates, assumptions and judgments affecting the amounts reported and related disclosures. Estimates are based upon historical factors, current circumstances and the experience and judgment of the Company’s management. The Company evaluates estimates and assumptions on an ongoing basis and may employ outside experts to assist in making these evaluations. Changes in such estimates, based on more accurate information, or different assumptions or conditions, may affect amounts reported in future periods. Such estimates affect significant items, including revenue recognition, provision for uncollectible receivables, inventory valuation, goodwill and identified intangible assets in business combinations, valuation allowances for deferred tax assets, uncertainties in income taxes, contingencies and recoverability of long-lived assets. Actual results may differ materially from estimates.

Revisions to Prior Period Consolidated Financial Statements

Subsequent to the third quarter of fiscal 2024, the Company identified certain errors in the quarterly financial statements for fiscal 2024. In accordance with ASC 250, Accounting Changes and Error Corrections and Staff Accounting Bulletins (“SAB”) No. 99, Materiality and No. 108, Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements, the Company evaluated the materiality of the errors and determined that the impacts were not material, individually or in the aggregate, to the Company’s previously issued consolidated financial

statements. As a result, the Company has revised the prior period financial statements and related disclosures to correct the errors for comparability across all periods presented herein. Refer to Note 15. Revisions to Prior Period Consolidated Financial Statements of the Notes to this Form 10-Q, and Note 1. The Company and Summary of Significant Accounting Policies and Part II, Item 9B. Other Information of the Company’s Annual Report on Form 10-K for the fiscal year ended June 28, 2024 for further information.

Summary of Significant Accounting Policies

There have been no material changes in the Company’s significant accounting policies as of and for the three months ended September 27, 2024, as compared to the significant accounting policies described in the Company’s Annual Report on Form 10-K for the fiscal year ended June 28, 2024.

Accounting Standards Not Yet Adopted

In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The ASU enhances the transparency and usefulness of income tax information through improvements to disclosures primarily related to the rate reconciliation and income taxes paid information. ASU 2023-09 is effective for the Company’s annual reporting beginning in fiscal 2026. The Company is currently evaluating the impact of this ASU on its consolidated financial statements.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The ASU expands reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses that are regularly presented to the chief operating decision maker. The disclosures required under ASU 2023-07 are also required for public entities with a single reportable segment. ASU 2023-07 is effective for the Company’s annual reporting beginning in fiscal 2025 and for interim periods beginning in fiscal 2026. The Company is currently evaluating the impact of the ASU on its consolidated financial statements.

The Company considers the applicability and impact of all ASUs issued by the FASB. The Company determined at this time that all other ASUs issued but not yet adopted are either not applicable or are expected to have a minimal impact on its financial position and results of operations.

Note 2. Net (Loss) Income Per Share of Common Stock

The following table presents the computation of basic and diluted net (loss) income per share:


	Three Months Ended
(In thousands, except per share amounts)	September 27, 2024		September 29, 2023
Numerator:
Net (loss) income	$	(11,879)	$	3,557

Denominator:
Weighted-average shares outstanding, basic	12,646		11,574
Effect of potentially dilutive equivalent shares	—		369
Weighted-average shares outstanding, diluted	12,646		11,943

Net (loss) income per share of common stock outstanding:
Basic	$	(0.94)	$	0.31
Diluted	$	(0.94)	$	0.30

The following table summarizes the weighted-average equity awards that were excluded from the diluted net (loss) income per share calculations since they were anti-dilutive:


	Three Months Ended
(In thousands)	September 27, 2024	September 29, 2023
Stock options	396	259
Restricted stock units and performance stock units	154	58
Total shares of common stock excluded	550	317

Note 3. Revenue Recognition

Contract Balances, Performance Obligations, and Backlog


(In thousands)	September 27, 2024		June 28, 2024
Contract assets
Accounts receivable, net	$	169,002	$	158,013
Unbilled receivables	94,725		90,525
Capitalized commissions	3,531		3,269
Contract liabilities
Advance payments and unearned revenue	$	79,380	$	58,839
Unearned revenue, long-term	7,522		7,413

Significant changes in contract balances may arise as a result of recognition over time for services, transfer of control for equipment, and periodic payments (both in arrears and in advance).

From time to time, the Company may experience unforeseen events that could result in a change to the scope or price associated with an arrangement. When such events occur, the transaction price and measurement of progress for the performance obligation are updated and this change is recognized as a cumulative catch-up to revenue. Because of the nature and type of contracts, the timeframe to completion and satisfaction of current and future performance obligations can shift; however, this will have no impact on the Company’s future obligation to bill and collect.

As of September 27, 2024, the Company reported $86.9 million in advance payments and unearned revenue and long-term unearned revenue, of which approximately 80% is expected to be recognized as revenue in the next twelve months and the remainder thereafter. Approximately $16.6 million of revenue was recognized during the three months ended September 27, 2024, which was included in advance payments and unearned revenue at June 28, 2024.

Remaining Performance Obligations

The aggregate amount of transaction price allocated to unsatisfied (or partially unsatisfied) performance obligations was approximately $144.8 million at September 27, 2024 relating to our long-term field service projects. Of this amount, approximately 50% is expected to be recognized as revenue during the next 12 months, with the remaining amount to be recognized thereafter.

Note 4. Balance Sheet Components

Cash, Cash equivalents, and Restricted cash

The following provides a summary of cash, cash equivalents, and restricted cash reported within the unaudited condensed consolidated balance sheets that reconciles to the corresponding amount in the unaudited condensed consolidated statement of cash flows:


(In thousands)	September 27, 2024		June 28, 2024
Cash and cash equivalents	$	51,034	$	64,622

Restricted cash included in long-term other assets	1,142		312
Total cash, cash equivalents, and restricted cash	$	52,176	$	64,934

Inventories


(In thousands)	September 27, 2024		June 28, 2024
Finished products	$	55,788	$	44,890
Raw materials and supplies	21,712		15,433
Customer service inventories	2,059		1,944
Total inventories	$	79,559	$	62,267
Consigned inventories included within raw materials and supplies	$	12,105	$	11,456

The Company records charges to adjust inventories due to excess and obsolete inventory resulting from lower sales forecasts, product transitioning or discontinuance. The charges incurred during the three months ended September 27, 2024 and September 29, 2023 were included in cost of product sales as follows:


	Three Months Ended
(In thousands)	September 27, 2024		September 29, 2023
Excess and obsolete inventory	$	310	$	294
Customer service inventory write-downs	191		253
Total charges	$	501	$	547

Other Current Assets


(In thousands)	September 27, 2024		June 28, 2024
Prepaid and other current assets	$	15,076	$	13,559
Taxes	11,256		8,623
Contract manufacturing assets	6,610		4,894

Total other current assets	$	32,942	$	27,076

Property, Plant and Equipment, net


(In thousands)	September 27, 2024		June 28, 2024

Buildings and leasehold improvements	$	1,302	$	1,302
Software and equipment	73,456		69,898
Total property, plant and equipment, gross	74,758		71,200
Less: accumulated depreciation	(62,875)		(61,720)
Total property, plant and equipment, net	$	11,883	$	9,480

Included in the total property, plant and equipment, gross were $4.2 million and $4.1 million of assets in progress which have not been placed in service as of September 27, 2024 and June 28, 2024, respectively.

Depreciation expense related to property, plant and equipment, was as follows:


	Three Months Ended
(In thousands)	September 27, 2024		September 29, 2023
Depreciation	$	1,317	$	1,168

Accrued Expenses


(In thousands)	September 27, 2024		June 28, 2024
Taxes	$	11,718	$	8,827
Compensation and benefits	8,240		9,689
Project costs	7,007		14,305

Other	5,816		3,507
Warranties	3,510		2,996
Commissions	1,533		1,538
Professional fees	1,313		1,286
Total accrued expenses	$	39,137	$	42,148

The Company accrues for the estimated cost to repair or replace products under warranty. Changes in the warranty liability were as follows:


	Three Months Ended
(In thousands)	September 27, 2024		September 29, 2023
Balance as of the beginning of the period	$	2,996	$	2,100
Warranty provision recorded during the period	544		375
Assumed in acquisition	406		—
Consumption during the period	(436)		(375)
Balance as of the end of the period	$	3,510	$	2,100

Advance Payments and Unearned Revenue


(In thousands)	September 27, 2024		June 28, 2024
Advance payments	$	18,989	$	8,517
Unearned revenue	60,391		50,322
Total advance payments and unearned revenue	$	79,380	$	58,839

Excluded from the balances above are $7.5 million and $7.4 million in long-term unearned revenue as of September 27, 2024 and June 28, 2024, respectively.

Note 5. Fair Value Measurements of Assets and Liabilities

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in the principal market (or most advantageous market in the absence of a principal market) for the asset or liability in an orderly transaction between market participants as of the measurement date. The Company maximizes the use of observable inputs and minimizes the use of unobservable inputs in measuring fair value and established a three-level fair value hierarchy that prioritizes the observable inputs used to measure fair value. The three levels of inputs used to measure fair value are as follows:

•Level 1 — Observable inputs such as quoted prices in active markets for identical assets or liabilities;

•Level 2 — Observable market-based inputs or observable inputs that are corroborated by market data; and

•Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The estimated fair values and valuation input levels of assets and liabilities that are measured at fair value on a recurring basis as of September 27, 2024 and June 28, 2024 were as follows:


(In thousands)	September 27, 2024		June 28, 2024		Valuation Inputs
Assets:
Cash and cash equivalents:
Money market funds	$	2,858	$	6,602	Level 1
Bank certificates of deposit	$	3,574	$	3,706	Level 2

Items are classified within Level 1 if quoted prices are available in active markets. The Company’s Level 1 items are primarily money market funds and marketable securities. As of September 27, 2024 and June 28, 2024, the money market funds were valued at $1.00 net asset value per share.

Items are classified within Level 2 if the observable inputs to quoted market prices, benchmark yields, reported trades, broker/dealer quotes or alternative pricing sources are available with reasonable levels of price transparency. The Company’s bank certificates of deposit are classified within Level 2. The carrying value of bank certificates of deposit approximates their fair value. The Company did not have any recurring assets or liabilities that were valued using significant unobservable inputs.

Note 6. Credit Facility and Debt

The Company entered into a Secured Credit Facility Agreement (the “Credit Facility”), dated May 9, 2023, amended as of November 22, 2023 and October 18, 2024, with Wells Fargo Bank, National Association, as administrative agent, swingline lender and issuing lender and Wells Fargo Securities LLC, Citigroup Global Markets Inc., and Regions Capital Markets as lenders. The Credit Facility provides for a $40.0 million revolving credit facility (the “Revolver”) and a $50.0 million Delayed Draw Term Loan Facility (the “Term Loan”) with a maturity date of May 8, 2028. The $40.0 million Revolver can be borrowed with a $10.0 million sub-limit for letters of credit, and a $10.0 million swingline loan sub-limit. Refer to Note 16. Subsequent Events for further information.

In November 2023, the Company borrowed $50.0 million against the Term Loan to primarily settle the cash portion of the consideration associated with the NEC Transaction (as defined below). See Note 11. Acquisitions for further information.

As of September 27, 2024, the available credit under the Revolver was $0.7 million, reflecting the available limit of $5.0 million less outstanding letters of credit of $4.3 million. The Company borrowed $35.0 million against the Revolver during the three months ended September 27, 2024. As of September 27, 2024, the Company had $48.8 million outstanding under its Term Loan and $35.0 million outstanding under its Revolver.

The following summarizes the Company’s outstanding long-term debt as of September 27, 2024:


(In thousands)
Revolver	$	35,000
Term loan	48,750
Less: unamortized deferred financing costs	(375)
Total debt	83,375
Less: current portion of long-term debt	(2,395)
Total long-term debt	$	80,980

Outstanding borrowings under the Credit Facility bear interest at either: (a) Adjusted Term Secured Overnight Financing Rate (“SOFR”) plus the applicable margin; or (b) the Base Rate plus the applicable margin. The pricing levels for interest rate margins are determined based on the Consolidated Total Leverage Ratio as determined and adjusted quarterly. As of September 27, 2024, the applicable margin on Adjusted Term SOFR and Base Rate borrowings was 2.50% and 1.50%, respectively. The effective rate of interest on the outstanding Term Loan and Revolver borrowings as of September 27, 2024 was 7.4% and 7.6%, respectively.

The Credit Facility requires the Company and its subsidiaries to maintain a fixed charge coverage ratio to be greater than 1.25 to 1.00 as of the last day of any fiscal quarter of the Company. The Credit Facility also requires that the Company maintain a maximum leverage ratio of 3.00 times EBITDA, with a step-down to 2.75 times EBITDA after four full quarters, and 2.50 times EBITDA after eight full quarters. The Credit Facility contains customary affirmative and negative covenants, including, among others, covenants limiting the ability of the Company and its subsidiaries to dispose of assets, permit a change in control, merge or consolidate, make acquisitions, incur indebtedness, grant liens, make investments, make certain restricted payments, and enter into transactions with affiliates, in each case subject to customary exceptions. As of September 27, 2024, the Company was in compliance with all financial covenants contained in the Credit Facility.

As of September 27, 2024, scheduled maturities of outstanding long-term debt are as follows:


(In thousands)
Remainder of 2025	$	2,500
2026	3,750
2027	6,250
2028	71,250

Total	$	83,750

Note 7. Restructuring

The following table summarizes restructuring related activities during the three months ended September 27, 2024:



(In thousands)	Employee Severance and Benefits		Facilities and Other		Total
Balance as of June, 28, 2024	$	1,718	$	—	$	1,718

Cash payments	(80)		—		(80)

Balance as of September, 27, 2024	$	1,638	$	—	$	1,638

As of September 27, 2024, the accrued restructuring balance of $1.6 million was included in other current liabilities on the unaudited condensed consolidated balance sheets. Included in the above were positions identified for termination that have not been executed from a restructuring perspective.

Prior Years’ Plans

During fiscal 2024, the Company’s Board of Directors approved restructuring plans, primarily associated with the NEC Transaction (as defined below) and reductions in workforce in certain of the Company’s operations to optimize skill sets and align cost structure. The fiscal 2024 plans are expected to be completed through the end of fiscal 2025.

Note 8. Stockholders’ Equity

Stock Repurchase Program

In November 2021, the Company’s Board of Directors approved a stock repurchase program to purchase up to $10.0 million of the Company’s common stock. As of September 27, 2024, $6.9 million remains available and Aviat may choose to suspend or discontinue the repurchase program at any time. Repurchased shares are recorded as treasury stock. During the first quarter of fiscal 2025, the Company did not repurchase any shares of its common stock.

Stock Incentive Programs

As of September 27, 2024, the Company had one stock incentive plan for its employees and non-employee directors, the 2018 Incentive Plan (the “2018 Plan”). The 2018 Plan provides for the issuance of share-based awards in the form of stock options, stock appreciation rights, restricted stock awards and units, and performance share awards and units.

Under the 2018 Plan, option exercise prices are equal to the fair market value of Aviat common stock on the date the options are granted using the closing stock price. After vesting, options generally may be exercised within seven years after the date of grant.

Restricted stock units are not transferable until vested and the restrictions lapse upon the achievement of continued employment or service over a specified time period. Restricted stock units issued to employees generally vest three years from the date of grant (three-year cliff or annually over three years). Restricted stock units issued annually to non-executive board members generally vest on the day before the annual stockholders’ meeting.

Vesting of performance share awards and units is subject to the achievement of predetermined financial performance and share price criteria, and continued employment through the end of the applicable period.

During the three months ended September 27, 2024, the Company granted 9,140 restricted stock units.

The Company recognizes compensation cost for share-based payment awards on a straight-line basis over the requisite service period. For awards with a performance condition vesting feature, share-based compensation costs are recognized when achievement of the performance conditions is considered probable. Forfeitures are recognized as they occur.

Total compensation expense for share-based awards included in the unaudited condensed consolidated statements of operations was as follows:


	Three Months Ended
(In thousands)	September 27, 2024		September 29, 2023
By Expense Category:
Cost of revenues	$	104	$	183
Research and development	143		146
Selling and administrative	1,417		1,505
Total share-based compensation expense	$	1,664	$	1,834
By Type of Award:
Options	$	327	$	346
Restricted stock and performance share awards and units	1,337		1,488
Total share-based compensation expense	$	1,664	$	1,834

As of September 27, 2024, there was approximately $1.8 million of total unrecognized compensation expense related to non-vested stock options granted which is expected to be recognized over a weighted-average period of 1.7 years. As of September 27, 2024, there was $5.9 million of total unrecognized compensation expense related to non-vested stock awards which is expected to be recognized over a weighted-average period of 1.5 years.

Note 9. Segment and Geographic Information

Aviat operates in one reportable business segment: the design, manufacturing, and sale of wireless networking products, solutions, and services. The Company’s financial performance is regularly reviewed by its chief operating decision maker who is its Chief Executive Officer (“CEO”).

The Company reports revenue by region and country based on the location where its customers accept delivery of products and services. Revenue by region for the three months ended September 27, 2024 and September 29, 2023 was as follows:


	Three Months Ended
(In thousands)	September 27, 2024		September 29, 2023
North America	$	42,225	$	54,853
Africa and the Middle East	10,450		9,954
Europe	5,600		5,252
Latin America and Asia Pacific	30,154		16,850
Total revenue	$	88,429	$	86,909

Note 10. Income Taxes

The Company’s effective tax rate varies from the U.S. federal statutory rate of 21% primarily due to U.S. global intangible low-taxed income inclusion (GILTI), state taxes, stock-based compensation and foreign operations that are subject to income taxes at different statutory rates. During interim periods, tax expense or benefit are accrued for jurisdictions that are anticipated to be profitable for fiscal 2025.

The determination of income taxes for the three months ended September 27, 2024 and September 29, 2023 was based on the Company’s estimated annual effective tax rate adjusted for losses in certain jurisdictions for which no tax benefit can be recognized. The tax benefit for the three months ended September 27, 2024 was primarily due to tax benefit resulting from year-to-date losses. The tax expense for the three months ended September 29, 2023 was primarily due to tax expense related to U.S. and profitable foreign subsidiaries.

The Company has a number of years with open tax audits which vary from jurisdiction to jurisdiction. The major tax jurisdictions that are open and subject to potential audits include the U.S., Singapore, Ghana, Kenya, Nigeria, Saudi Arabia and Tanzania. The earliest years for these jurisdictions are as follows: U.S. - 2003; Singapore - 2015; Ghana – 2016; Kenya – 2018; Nigeria – 2006; Saudi Arabia – 2019 and Tanzania - 2017.

Interest and penalties related to unrecognized tax benefits are accounted for as part of the provision for federal, foreign, and state income taxes. Such interest expense was not material for the three months ended September 27, 2024 and September 29, 2023.

On March 11, 2021, the US enacted the American Rescue Plan Act of 2021 (“ARPA”) which expands Section 162(m) to cover the next five most highly compensated employees for the taxable year, in addition to the “covered employees” effective for taxable years beginning after December 31, 2026. The Company will continue to examine the elements of the ARPA and the impact it may have on future business.

On August 16, 2022, the U.S. enacted the Inflation Reduction Act of 2022 (“IRA”) which includes a new corporate alternative minimum tax of 15% on adjusted financial statement income of corporations with profits greater than $1 billion, effective for taxable years beginning after December 31, 2022, and a 1% excise tax on stock repurchases by public corporations after December 31, 2022. The Company will continue to evaluate the applicability and effect of the IRA as more guidance is issued.

Note 11. Acquisitions

4RF Limited

On July 2, 2024, the Company acquired 4RF Limited (“4RF”), a New Zealand company. Aviat purchased all of the issued and outstanding shares of 4RF in an all-cash transaction for $18.2 million, net of $1.2 million cash acquired. 4RF is a leading provider of industrial wireless access solutions, including narrowband point-to-point/multi-point radios and Private LTE and 5G routers. The acquisition of 4RF allows Aviat to expand its product offering for the global industrial wireless access markets including Private LTE/5G.

The Company is in the process of determining the allocation of the purchase price to the fair value of the assets acquired and liabilities assumed. The preliminary estimated fair value of the assets acquired and liabilities assumed consisted of working capital of $5.6 million, other assets and liabilities of $1.6 million, intangible assets of $8.5 million, and goodwill of $2.5 million. The goodwill from this acquisition is non-deductible for tax purposes.

NEC’s Wireless Transport Business

On May 9, 2023, the Company entered into a Master Sale of Business Agreement (as amended on November 30, 2023, the “Purchase Agreement”) with NEC Corporation (“NEC”), to acquire NEC’s wireless transport business (the “NEC Transaction”). The Company completed the NEC Transaction on November 30, 2023 (the “Closing Date”).

Prior to the Closing Date, NEC was a leader in wireless backhaul networks with an extensive installed base of their Pasolink series products. The completion of the NEC Transaction increases the scale of Aviat, enhances the Company’s product portfolio with a greater capability to innovate, and creates a more diversified business. The results of operations of the NEC Transaction have been included in the consolidated financial statements since the Closing Date.

The fair value of the consideration transferred at the closing of the NEC Transaction was comprised of (i) cash of $32.2 million, and (ii) the issuance of 736,750 shares or $22.3 million of common stock of the Company. The fair value of the shares issued was determined based on the closing market price of the Company’s common stock on the Closing Date. Aggregate consideration transferred at closing was approximately $54.5 million, which is subject to certain post-closing adjustments. As of September 27, 2024, the Company recorded accruals of approximately $19.6 million in estimated additional cash consideration, which is included in other current liabilities on the unaudited condensed consolidated balance sheets. The additional consideration is primarily related to the settlement of the post-closing working capital adjustment, and is expected to be transferred to NEC in the second quarter of fiscal 2025. The Company funded the cash portion of the consideration with Term Loan borrowings under its Credit Facility. See Note 6. Credit Facility and Debt for further information.

The NEC Transaction was accounted for as a business combination using the acquisition method of accounting. The Company is in the process of obtaining final independent third-party valuations of certain intangible and tangible assets acquired. The fair values of the acquired intangible assets are based on estimates and assumptions that are considered reasonable by the Company. As of the acquisition date, the Company has recorded the assets acquired and the liabilities assumed at their respective estimated fair values. The recognized goodwill is attributable to the workforce of the acquired business and expected synergies. The goodwill from this acquisition is expected to be fully deductible for tax purposes.

A summary of the preliminary purchase price allocation is as follows:


(In thousands)
Accounts receivable, net	$	42,487
Inventories	29,279
Property, plant and equipment, net	539
Identifiable finite-lived intangible assets:
Customer relationships	9,200
Technology	3,200
Other assets	243
Accounts payable	(13,182)
Advance payments and unearned revenue	(3,192)
Other liabilities	(2,501)
Goodwill	8,015
Net assets acquired	$	74,088

The preliminary purchase price allocation has been updated for certain measurement period adjustments based on revised estimates of fair value, which primarily resulted in a $6.8 million decrease in accounts receivables, a $4.9 million decrease in inventories, a $6.8 million increase in identifiable finite-lived intangible assets acquired and a $4.9 million increase to goodwill. The preliminary purchase price allocation is subject to adjustment based on the Company obtaining final independent third-party valuations, determining fair value and final allocations of purchase price to the identifiable assets acquired and liabilities assumed, and determining the final consideration, including adjustments related to settlement of the final post-closing working capital adjustment.

Revenue and operating income associated with the NEC Transaction included in the consolidated statements of operations for the three months ended September 27, 2024 were $25.0 million and $1.0 million, respectively.

Note 12. Commitments and Contingencies

Purchase Orders and Other Commitments

From time to time in the normal course of business, the Company may enter into purchasing agreements with its suppliers that require the Company to accept delivery of and remit full payment for (i) finished products that it has ordered, (ii) finished products that it requested be held as safety stock, and (iii) work in process started on its behalf, in the event it cancels or terminates the purchasing agreement. Because these agreements do not specify fixed or minimum quantities, do not specify minimum or variable price provisions, and do not specify the approximate timing of the transaction, and the Company has no present intention to cancel or terminate any of these agreements, the Company currently does not believe that it has any future liability under these agreements. As of September 27, 2024, the Company had outstanding purchase obligations with its suppliers or contract manufacturers of $72.0 million. In addition, the Company had purchase obligations of approximately $5.3 million associated with software as a service and software maintenance support.

Financial Guarantees and Commercial Commitments

Guarantees issued by banks, insurance companies, or other financial institutions are contingent commitments issued to guarantee performance under borrowing arrangements, such as bank overdraft facilities, tax and customs obligations, and similar transactions, or to ensure performance under customer or vendor contracts. The terms of the guarantees are generally equal to the remaining term of the related debt or other obligations and are generally limited to two years or less. As of September 27, 2024, the Company had no guarantees applicable to its debt arrangements.

The Company has entered into commercial commitments in the normal course of business including surety bonds, standby letters of credit agreements, and other arrangements with financial institutions primarily relating to the guarantee of future performance on certain contracts to provide products and services to customers. As of September 27, 2024, the Company had commercial commitments outstanding of $19.7 million, that were not recorded on the unaudited condensed consolidated balance sheets. The Company does not believe, based on historical experience and information currently

available, that it is probable that any significant amounts will be required to be paid on these performance guarantees in the future.

The following table presents details of the Company’s commercial commitments:


(In thousands)	September 27, 2024
Letters of credit	$	4,292
Bonds	15,383
	$	19,675

Indemnifications

Under the terms of substantially all of the Company’s license agreements, it has agreed to defend and pay any final judgment against its customers arising from claims against such customers that the Company’s products infringe the intellectual property rights of a third party. As of September 27, 2024, the Company has not received any notice that any customer is subject to an infringement claim arising from the use of its products; the Company has not received any request to defend any customers from infringement claims arising from the use of its products; and the Company has not paid any final judgment on behalf of any customer related to an infringement claim arising from the use of its products. Because the outcome of infringement disputes is related to the specific facts of each case and given the lack of previous or current indemnification claims, the Company cannot estimate the maximum amount of potential future payments, if any, related to its indemnification provisions. As of September 27, 2024, the Company had not recorded any liabilities related to these indemnifications.

Legal Proceedings

The Company is subject from time to time to disputes with customers concerning its products and services. From time to time, the Company may be involved in various other legal claims and litigation that arise in the normal course of its operations. The Company is aggressively defending all current litigation matters. Although there can be no assurances and the outcome of these matters is currently not determinable, the Company currently believes that none of these claims or proceedings are likely to have a material adverse effect on its financial position. There are many uncertainties associated with any litigation and these actions or other third-party claims against the Company may cause it to incur costly litigation and/or substantial settlement charges. As a result, the Company’s business, financial condition, results of operations, and cash flows could be adversely affected. The actual liability in any such matters may be materially different from the Company’s estimates, if any.

The Company records accruals for its outstanding legal proceedings, investigations or claims when it is probable that a liability will be incurred and the amount of loss can be reasonably estimated. The Company evaluates, at least on a quarterly basis, developments in legal proceedings, investigations or claims that could affect the amount of any accrual, as well as any developments that would result in a loss contingency to become both probable and reasonably estimable. The Company has not recorded any significant accrual for loss contingencies associated with such legal claims or litigation discussed above.

Contingent Liabilities

The Company records a loss contingency as a charge to operations when (i) it is probable that an asset has been impaired or a liability has been incurred at the date of the financial statements; and (ii) the amount of the loss can be reasonably estimated. Disclosure in the notes to the financial statements is required for loss contingencies that do not meet both conditions if there is a reasonable possibility that a loss may have been incurred. Gain contingencies are not recorded until realized. The Company expenses all legal costs incurred to resolve regulatory, legal and tax matters as incurred.

In March 2016, an enforcement action by the Indian Department of Revenue, Ministry of Finance was brought against Aviat’s subsidiary Aviat Networks (India) Private Limited (“Aviat India”) relating to the non-realization of intercompany receivables and non-payment of intercompany payables, which originated from 1999 to 2012, within the time frames dictated by the Indian regulations under the Foreign Exchange Management Act. In November 2017, the Indian Department of Revenue, Ministry of Finance also initiated a similar action against Telsima Communications Private Limited (“Telsima India”), a subsidiary of the Company, relating to the non-realization of intercompany receivables and non-payment of intercompany payables which originated from the period prior to our acquisition of Telsima India in February 2009. In September 2019, the directors of Aviat India appeared before the Ministry of Finance Enforcement Directorate. In March 2024, the Company appeared before the Joint Director of Enforcement to review the transactions at issue. No subsequent

hearing date has been scheduled as of September 27, 2024. The Company has accrued an immaterial amount representing the estimated probable loss for which it would settle the matter. The Company currently cannot form an estimate of the range of loss in excess of its amounts already accrued. If the outcome of this matter is greater than the current immaterial amount accrued, the Company intends to dispute it vigorously.

Periodically, the Company reviews the status of each significant matter to assess the potential financial exposure. If a potential loss is considered probable and the amount can be reasonably estimated, the estimated loss is reflected in our results of operations. Significant judgment is required to determine the probability that a liability has been incurred or an asset impaired and whether such loss is reasonably estimable. Further, estimates of this nature are highly subjective, and the final outcome of these matters could vary significantly from the amounts that have been included in the consolidated financial statements.

As additional information becomes available, the Company will reassess the potential liability related to its pending claims and litigation and may revise estimates accordingly. Such revisions in the estimates of the potential liabilities could have a material impact on the Company’s results of operations and financial position.

Note 13. Goodwill and Intangible Assets

The following presents details of goodwill and intangible assets:


(In thousands)	September 27, 2024		June 28, 2024
Goodwill	$	15,153	$	8,217

The $6.9 million increase for the three months ended September 27, 2024 is associated with the preliminary purchase price allocations for the 4RF acquisition and the NEC Transaction. Refer to Note 11. Acquisitions for further information.

The Company performs its annual goodwill impairment test on the first day of its fourth fiscal quarter. No indicators of impairment were identified during the current period that required the Company to perform an interim assessment or recoverability test.


(In thousands except useful life)	Useful life in Years	September 27, 2024		June 28, 2024
Intangible assets:
Technology	7	$	6,835	$	1,800
Patents	10	690		690
Customer relationships	14 — 15	22,123		11,530
Trade names	16	1,330		1,330
Total gross intangible assets		$	30,978	$	15,350
Accumulated amortization		(2,224)		(1,706)
Total net intangible assets		$	28,754	$	13,644

Amortization of finite-lived intangibles for the three months ended September 27, 2024 was $0.5 million and is included in selling and administrative expenses. There were no impairment charges recorded for the three months ended September 27, 2024.

As of September 27, 2024, the estimated future amortization expense of finite-lived intangible assets is as follows (in thousands):


Remainder of 2025	$	2,449
2026	2,640
2027	2,640
2028	2,640
2029	2,640
Thereafter	15,745
Total	$	28,754

Note 14. Related Party Transactions

NEC Corporation

On November 30, 2023 (the “Closing Date”), the Company completed the NEC Transaction. See Note 11. Acquisitions for further information. A portion of the total consideration in the NEC Transaction included the issuance of 736,750 shares in Company common stock to NEC. The Company and NEC entered into a Registration Rights and Lock-Up Agreement, restricting NEC’s ability to transfer shares (the “Lock-Up”), except for certain limited exceptions as provided in the Registration Rights and Lock-Up Agreement, until one day after the one-year anniversary of the Closing Date (the “Initial Lock-Up Expiration Date”). Starting one day after the Initial Lock-Up Expiration Date, one-twelfth of the issued shares shall be released from the Lock-Up each month, such that all issued shares shall be released from Lock-Up by the two-year anniversary of the Closing Date. Pursuant to the Purchase Agreement, NEC will have the right to nominate a director to the Company’s Board of Directors from the Closing Date and for a period of two years thereafter. As of September 27, 2024, NEC held approximately 5.8% of the Company’s outstanding common stock.

In connection with the closing of the NEC Transaction and as of the Closing Date, the Company and NEC entered into agreements covering the performance of certain post-closing services and licensing arrangements. The agreements include arrangements covering manufacturing services and product supply, transition services, distribution services, research and development services, and licensing of trademark and intellectual property (“IP”).

The Manufacturing and Supply Agreement includes arrangements for NEC to manufacture and supply Pasolink products on behalf of and to the Company and its customers. The transition services agreements include arrangements for the Company and NEC to provide and receive certain transition services, primarily associated with administrative functions. The distribution services agreements includes arrangements where NEC will provide distribution services on behalf of and to the Company and its customers in certain international markets and territories. The Research and Development Cooperating Agreement for Existing Products includes arrangements for NEC to provide the Company certain services relating to development work to maintain existing products of the NEC business. The licensing agreements include arrangements where the Company will grant NEC a non-exclusive license to certain Pasolink trademarks in Japan, and NEC will grant the Company a non-exclusive, worldwide (excluding Japan) license to certain NEC IP, including mobile backhaul-related patents. The licensing agreements are royalty-free and perpetual.

A summary of the related party activity between the Company and NEC during the three months ended September 27, 2024 is as follows:


(In thousands)
Transition services received	$	745
Research and development services received	3,013
Purchase of inventories	8,293

As of September 27, 2024, the Company’s outstanding related party balances with NEC included in the unaudited condensed consolidated balance sheets are as follows:


(In thousands)
Accounts receivable, net	$	4,822

Accounts payable	11,878
Other current liabilities	19,596

Note 15. Revisions to Prior Period Consolidated Financial Statements

As described in Note 1. The Company and Basis of Presentation, subsequent to the third quarter of fiscal 2024, the Company identified certain errors in the quarterly financial statements for fiscal 2024 related to estimated total contract costs and progress to completion for an over-time arrangement. The Company identified additional errors impacting the quarterly financial statements for fiscal 2024 related to the recognition of revenue prior to performance obligations being met and related to journal entries recorded in error. In accordance with ASC 250, Accounting Changes and Error Corrections and Staff Accounting Bulletins (“SAB”) No. 99, Materiality and No. 108, Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements, the Company evaluated the materiality of the errors and determined that the impacts were not material, individually or in the aggregate, to the Company’s previously issued consolidated financial statements. The Company has revised the prior period financial statements and related disclosures for the first quarter of fiscal 2024 to correct the errors. A summary of the corrections to the impacted financial statement line items in the Company’s previously issued Consolidated Statements of Operations, Comprehensive Income, Equity and Cash Flows for the three months ended September 29, 2023 is provided below.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)


	Three Months Ended September 29, 2023
(In thousands, except per share amounts)	As Previously Reported		Adjustments		As Revised
Revenues:

Services	$	28,021	$	(657)	$	27,364
Total revenues	87,566		(657)		86,909




Gross margin	31,852		(657)		31,195





Operating income	5,547		(657)		4,890



Income before income taxes	4,646		(657)		3,989
Provision for income taxes	641		(209)		432
Net income	$	4,005	$	(448)	$	3,557



Net income per share of common stock outstanding:
Basic	$	0.35	$	(0.04)	$	0.31
Diluted	$	0.34	$	(0.04)	$	0.30

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (unaudited)


	Three Months Ended September 29, 2023
(In thousands)	As Previously Reported		Adjustments		As Revised
Net income	$	4,005	$	(448)	$	3,557



Comprehensive income	$	4,038	$	(448)	$	3,590

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)


	Three Months Ended September 29, 2023
(In thousands)	As Previously Reported		Adjustments		As Revised
Operating Activities
Net income	$	4,005	$	(448)	$	3,557





Deferred taxes	39		(209)		(170)






Unbilled receivables	(2,395)		657		(1,738)






Net cash provided by operating activities	13,980		—		13,980

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (unaudited)


			Three Months Ended September 29, 2023
	Accumulated Deficit	Total Equity
(In thousands)
As Previously Reported
Balance as of June 30, 2023			$	(587,914)	$	220,098
Net income			4,005		4,005






Balance as of September 29, 2023			$	(583,909)	$	226,150

Adjustments
Balance as of June 30, 2023			$	(1,359)	$	(1,359)
Net income			(448)		(448)






Balance as of September 29, 2023			$	(1,807)	$	(1,807)

As Revised
Balance as of June 30, 2023			$	(589,273)	$	218,739
Net income			3,557		3,557






Balance as of September 29, 2023			$	(585,716)	$	224,343

Note 16. Subsequent Events

Credit Facility Amendment

On October 18, 2024, the Company entered into a Second Amendment to Credit Agreement (the “Credit Facility Amendment”), with Wells Fargo Bank, National Association, as administrative agent, swingline lender and issuing lender and Wells Fargo Securities LLC, Citigroup Global Markets Inc., and Regions Capital Markets as lenders.

The Credit Facility Amendment amends and modifies that certain Credit Facility dated May 9, 2023. The Credit Facility Amendment provided for changes and modifications to the Credit Facility, which include, among other things, (i) changes to certain payment term mechanics, (ii) a commitment to make term loans in the aggregate principal amount of $75.0 million for the purpose of refinancing the Term Loan currently outstanding under the Credit Facility, and (iii) an increase in the Revolver to $75.0 million in the aggregate. Refer to Note 6. Credit Facility and Debt for further information.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

This Quarterly Report on Form 10-Q, including “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations,” contains forward-looking statements that involve risks and uncertainties, as well as assumptions that, if they do not materialize or prove correct, could cause our results to differ materially from those expressed or implied by such forward-looking statements. All statements other than statements of historical fact are statements that could be deemed to be forward-looking statements, including without limitation statements of, about, concerning or regarding: our ability to maintain effective internal control over financial reporting and management systems and remediate material weaknesses; our plans, strategies and objectives for future operations, including with respect to growing our business and sustaining profitability; our restructuring efforts; our research and development efforts and new product releases and services; trends in revenue; drivers of our business and the markets in which we operate; future economic conditions, performance or outlook, and changes in our industry and the markets we serve; the outcome of contingencies; the value of our contract awards; beliefs or expectations; the sufficiency of our cash and our capital needs and expenditures; our intellectual property protection; our compliance with regulatory requirements and the associated expenses; expectations regarding litigation; our intention not to pay cash dividends; seasonality of our business; the impact of foreign exchange and inflation; taxes; and assumptions underlying any of the foregoing. Forward-looking statements may be identified by the use of forward-looking terminology, such as “anticipates,” “believes,” “expects,” “may,” “should,” “would,” “will,” “intends,” “plans,” “estimates,” “strategy,” “projects,” “targets,” “goals,” “seeing,” “delivering,” “continues,” “forecasts,” “future,” “predict,” “might,” “could,” “potential,” or the negative of these terms, and similar words or expressions.

These forward-looking statements are based on estimates reflecting the current beliefs of the senior management of Aviat Networks, Inc. (“Aviat,” the “Company,” “we,” “us,” and “our”). These forward-looking statements involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. Forward-looking statements should therefore be considered in light of various important factors, including those set forth in this Quarterly Report on Form 10-Q.

See “Item 1A. Risk Factors” in the Company’s fiscal 2024 Annual Report on Form 10-K filed with the SEC on October 4, 2024 for more information regarding factors that may cause its results to differ materially from those expressed or implied by the forward-looking statements contained in this Quarterly Report on Form 10-Q.

You should not place undue reliance on these forward-looking statements, which reflect our management’s opinions only as of the date of the filing of this Quarterly Report on Form 10-Q. Forward-looking statements are made in reliance upon the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), along with provisions of the Private Securities Litigation Reform Act of 1995, and we expressly disclaim any obligation, other than as required by law, to update any forward-looking statements to reflect further developments or information obtained after the date of filing of this Quarterly Report on Form 10-Q or, in the case of any document incorporated by reference, the date of that document.

Overview of Business; Operating Environment and Key Factors Impacting Fiscal 2025 and 2024 Results

The following Management’s Discussion and Analysis (“MD&A”) is intended to help the reader understand Aviat’s results of operations and financial condition. MD&A is provided as a supplement to, and should be read in conjunction with, the Company’s unaudited condensed consolidated financial statements and accompanying notes. In the discussion herein, the fiscal year ending June 27, 2025 is referred to as “fiscal 2025” or “2025” and the fiscal year ended June 28, 2024 is referred to as “fiscal 2024” or “2024.”

Overview

Aviat is a global supplier of microwave networking and access networking solutions, backed by an extensive suite of professional services and support. Aviat sells radios, routers, software and services integral to the functioning of data transport networks. Aviat has more than 3,000 customers and significant relationships with global service providers and private network operators. Aviat’s North America manufacturing base consists of a combination of contract manufacturing and assembly and testing operated in Austin, Texas by Aviat. Additionally, Aviat utilizes a contract manufacturer based in Asia for much of its international equipment demand. Aviat’s technology is underpinned by more than 500 patents. Aviat competes on the basis of total cost of ownership, microwave radio expertise and solutions for mission critical communications. Aviat has a global presence.

Acquisitions

4RF Limited

NEC’s Wireless Transport Business

On November 30, 2023, the Company completed the acquisition of NEC Corporation’s (“NEC”) wireless transport business (the “NEC Transaction”). Prior to the acquisition date, NEC was a leader in wireless backhaul networks with an extensive installed base of their Pasolink series products. The completion of the NEC Transaction increases the scale of Aviat, enhances the Company’s product portfolio with a greater capability to innovate, and creates a more diversified business. See Note 11. Acquisitions of the Notes for further information.

The fair value of the consideration transferred at the closing of the NEC Transaction was comprised of (i) cash of $32.2 million, and (ii) the issuance of 736,750 shares or $22.3 million of Company common stock. Aggregate consideration transferred at closing was approximately $54.5 million, which is subject to certain post-closing adjustments. The Company estimates additional cash consideration of approximately $19.6 million will be transferred to NEC in the second quarter of fiscal 2025, primarily related to settlement of the post-closing working capital adjustment. The Company funded the cash portion of the NEC Transaction with Term Loan borrowings under its Credit Facility. See Note 6. Credit Facility and Debt of the Notes for further information.

Operations Review

The market for mobile backhaul continued to be the Company’s primary addressable market segment globally in the first three months of fiscal 2025. In North America, the Company supported 5G and long-term evolution (“LTE”) deployments of its mobile operator customers, public safety network deployments for state and local governments, and private network implementations for utilities and other customers. In international markets, the Company’s business continued to rely on a combination of customers increasing their capacity to handle subscriber growth and the ongoing build-out of some large LTE and 5G deployments. Aviat’s position continues to be to support its customers for 5G and LTE readiness and ensure that its technology roadmap is well aligned with evolving market requirements. Aviat’s strength in turnkey and after-sale support services is a differentiating factor that wins business for the Company and enables it to expand its business with existing customers. Additionally, Aviat operates an e-commerce platform that provides low-cost services, simple experience, and fast delivery to mobile operators and private network customers. However, as disclosed above and in the “Risk Factors” section in Item 1A of its Annual Report on Form 10-K filed with the SEC on October 4, 2024, a number of factors could prevent the Company from achieving its objectives, including ongoing pricing pressures attributable to competition and macroeconomic conditions in the geographic markets that it serves.

Revisions to Prior Period Consolidated Financial Statements

Subsequent to the third quarter of fiscal 2024, the Company identified certain errors in the quarterly financial statements for fiscal 2024. The Company evaluated the materiality of the errors and determined that the impacts were not material, individually or in the aggregate, to the Company’s previously issued consolidated financial statements for any of the prior reporting periods in which they occurred. The Company has revised the prior period financial statements for fiscal 2024 to correct the errors. The revisions ensure comparability across all periods presented herein. Refer to Note 1. The Company and Basis of Presentation and Note 15. Revisions to Prior Period Consolidated Financial Statements of the Notes for further information.

Revenue

The Company manages its sales activities primarily on a geographic basis in North America and three international geographic regions: (1) Africa and the Middle East, (2) Europe, and (3) Latin America and Asia Pacific. Revenue by region for the three months ended September 27, 2024 and September 29, 2023 and the related changes were as follows:


	Three Months Ended
(In thousands, except percentages)	September 27, 2024		September 29, 2023		$ Change		% Change
North America	$	42,225	$	54,853	$	(12,628)	(23.0)	%
Africa and the Middle East	10,450		9,954		496		5.0	%
Europe	5,600		5,252		348		6.6	%
Latin America and Asia Pacific	30,154		16,850		13,304		79.0	%
Total revenue	$	88,429	$	86,909	$	1,520	1.7	%

Revenue in North America decreased by $12.6 million during the first quarter of fiscal 2025 compared with the same period of fiscal 2024 primarily due to lower demand from Tier 1 mobile network operators and timing of certain private network projects.

Revenue in Africa and the Middle East increased by $0.5 million during the first quarter of fiscal 2025 compared with the same period of fiscal 2024 primarily due to spending from mobile network operators in the region.

Revenue in Europe increased by $0.3 million during the first quarter of fiscal 2025 compared with the same period of fiscal 2024 primarily due to increased sales to mobile operators in the region.

Revenue in Latin America and Asia Pacific increased by $13.3 million during the first quarter of fiscal 2025 compared with the same period of fiscal 2024 primarily due to contributions resulting from the NEC Transaction.


	Three Months Ended
(In thousands, except percentages)	September 27, 2024		September 29, 2023		$ Change		% Change
Product sales	$	61,116	$	59,545	$	1,571	2.6	%
Services	27,313		27,364		(51)		(0.2)	%
Total revenue	$	88,429	$	86,909	$	1,520	1.7	%

Revenue from product sales increased by 2.6% and revenue from services decreased by 0.2% for the first quarter of fiscal 2025 compared with the same quarter of fiscal 2024 primarily due to the factors discussed above and product sales contribution from the NEC Transaction.

Gross Margin


	Three Months Ended
(In thousands, except percentages)	September 27, 2024			September 29, 2023			$ Change		% Change
Revenue	$	88,429		$	86,909		$	1,520	1.7	%
Cost of revenue	68,641			55,714			12,927		23.2	%
Gross margin	$	19,788		$	31,195		$	(11,407)	(36.6)	%
% of revenue	22.4		%	35.9		%
Product margin %	14.6		%	39.0		%
Service margin %	39.8		%	29.1		%

Gross margin for the first quarter of fiscal 2025 decreased by $11.4 million compared with the same quarter of fiscal 2024 primarily due to changes in regions and customers and the expected near-term dilution as a result of the NEC Transaction.

Research and Development


	Three Months Ended
(In thousands, except percentages)	September 27, 2024			September 29, 2023			$ Change		% Change
Research and development	$	10,408		$	6,424		$	3,984	62.0	%
% of revenue	11.8		%	7.4		%

Research and development expenses increased by $4.0 million for the first quarter of fiscal 2025 primarily due to increased product development activities.

Selling and Administrative


	Three Months Ended
(In thousands, except percentages)	September 27, 2024			September 29, 2023			$ Change		% Change
Selling and administrative	$	24,948		$	19,237		$	5,711	29.7	%
% of revenue	28.2		%	22.1		%

Selling and administrative expenses increased by $5.7 million for the first quarter of fiscal 2025 compared with the first quarter of fiscal 2024 primarily due to merger and acquisition expenses and additional costs resulting from the NEC Transaction.

Restructuring


	Three Months Ended
(In thousands, except percentages)	September 27, 2024		September 29, 2023		$ Change		% Change
Restructuring charges	$	—	$	644	$	(644)	(100.0)	%

In the first quarter of fiscal 2025, there were no restructuring charges incurred, compared to $0.6 million in the first quarter of fiscal 2024. The prior year period includes restructuring charges primarily associated with reductions in workforce to optimize skill sets and align cost structure across the Company.

Interest Expense, net


	Three Months Ended
(In thousands, except percentages)	September 27, 2024		September 29, 2023		$ Change		% Change
Interest expense, net	$	1,115	$	99	$	1,016	1,026.3	%

Interest expense, net increased by $1.0 million for the first quarter of fiscal 2025 compared to the first quarter of fiscal 2024 primarily due to interest expense incurred on the Term Loan borrowings used to fund the NEC Transaction in the second quarter of fiscal 2024.

Other Expense, net


	Three Months Ended
(In thousands, except percentages)	September 27, 2024		September 29, 2023		$ Change		% Change
Other expense, net	$	710	$	802	$	(92)	(11.5)	%

Other expense, net decreased by $(0.1) million for the first quarter of fiscal 2025, primarily as a result of foreign exchange rate movement.

Income Taxes


	Three Months Ended
(In thousands, except percentages)	September 27, 2024		September 29, 2023		$ Change		% Change
(Loss) income before income taxes	$	(17,393)	$	3,989	$	(21,382)	(536.0)	%
(Benefit from) provision for income taxes	$	(5,514)	$	432	$	(5,946)	(1,376.4)	%

The Company estimates its annual effective tax rate at the end of each quarterly period, and records the tax effect of certain discrete items in the interim period in which they occur, including changes in judgment about uncertain tax positions and deferred tax valuation allowances.

The tax benefit for the first three months of fiscal 2025 was primarily due to tax benefit resulting from year-to-date losses. The tax expense for the first three months of fiscal 2024 was primarily attributable to tax expense related to U.S. and profitable foreign subsidiaries.

Liquidity, Capital Resources, and Financial Strategies

Sources of Cash

As of September 27, 2024, the Company’s total cash and cash equivalents were $51.0 million. Approximately $12.5 million was held in the United States. The remaining balance of $38.6 million, or 76%, was held outside the United States.

Operating Activities

Operating cash flows is presented as net (loss) income adjusted for certain non-cash items and changes in operating assets and liabilities. Net cash (used in) provided by operating activities was $(27.2) million for the first three months of fiscal 2025, compared with $14.0 million in the prior year. The $(41.1) million decrease is primarily attributable to increases in working capital and decreased earnings compared to the prior year.

Investing Activities

Net cash used in investing activities was $21.2 million for the first three months of fiscal 2025, compared to $0.7 million in the prior year. The $20.5 million increase is primarily due to payments associated with the acquisition of 4RF.

Financing Activities

Financing cash flows consist primarily of borrowings and repayments under the Company’s Credit Facility and proceeds from the exercise of employee stock options. Net cash provided by financing activities was $34.3 million for the first three months of fiscal 2025, compared with $0.2 million in the prior year. The $34.1 million increase is primarily due to the $35.0 million of borrowings on the Company’s Revolver.

As of September 27, 2024, the Company’s principal sources of liquidity consisted of $51.0 million in cash and cash equivalents, $0.7 million of available credit under its Credit Facility, and future collections of receivables from customers. On October 18, 2024, the Company amended its Credit Facility which increased the borrowing capacity to $75.0 million for each of the Term Loan and Revolver facilities. The Company regularly requires letters of credit from certain customers, and, from time to time, these letters of credit are discounted without recourse shortly after shipment occurs in order to meet immediate liquidity requirements and to reduce its credit and sovereign risk. Historically, the Company’s primary sources of liquidity have been cash flows from operations and credit facilities.

The Company believes that its existing cash and cash equivalents, the available borrowings under its Credit Facility and future cash collections from customers will be sufficient to provide for its anticipated requirements and plans for cash for at least the next 12 months. In addition, the Company believes these sources of liquidity will be sufficient to provide for its anticipated requirements and plans for cash beyond the next 12 months.

The Company borrowed $35.0 million against the Revolver during the first three months of fiscal 2025. As of September 27, 2024, the Company had $48.8 million outstanding under its Term Loan and $35.0 million outstanding under its Revolver and was in compliance with all financial covenants contained in the Credit Facility.

Critical Accounting Estimates

For information about the Company’s critical accounting estimates, see the “Critical Accounting Estimates” section of “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” in its fiscal 2024 Annual Report on Form 10-K.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

In the normal course of doing business, the Company is exposed to risks associated with foreign currency exchange rates and changes in interest rates. The Company employs established policies and procedures governing the use of financial instruments to manage its exposure to such risks. Information about the Company’s market risk is presented in Part II, Item 7A in its fiscal 2024 Annual Report on Form 10-K. There have been no material changes to the Company’s market risk during the first three months of fiscal 2025.

Exchange Rate Risk

The Company conducts business globally in numerous currencies and is therefore exposed to foreign currency risks. From time to time, the Company uses derivative instruments to reduce the volatility of earnings and cash flows associated with changes in foreign currency exchange rates. The Company does not hold or issue derivatives for trading purposes or make speculative investments in foreign currencies.

From time to time, the Company enters into foreign exchange forward contracts to mitigate the change in fair value of specific non-functional currency assets and liabilities on the balance sheet. All balance sheet hedges are marked to market through earnings every period. Changes in the fair value of these derivatives are largely offset by re-measurement of the underlying assets and liabilities. The Company did not have any foreign exchange forward contracts outstanding as of September 27, 2024.

Certain of the Company’s international business are transacted in non-U.S. dollar (“USD”) currencies. From time to time, the Company utilizes foreign currency hedging instruments to minimize the currency risk of non-USD transactions. The impact of translating the assets and liabilities of foreign operations to USD is included as a component of stockholders’ equity. As of September 27, 2024 and June 28, 2024, the cumulative translation adjustment decreased stockholders’ equity by $17.2 million and $19.3 million, respectively.

Interest Rate Risk

The Company’s exposure to market risk for changes in interest rates relates primarily to its cash equivalents and borrowings under its Credit Facility. Refer to Note 6. Credit Facility and Debt of the Notes for further information.

Exposure on Cash Equivalents

The Company had $51.0 million in total cash and cash equivalents as of September 27, 2024. Cash equivalents totaled $6.4 million as of September 27, 2024 and were comprised of money market funds and bank certificates of deposit. Cash equivalents have been recorded at fair value. Fair value is measured using inputs that fall into a three-level hierarchy that prioritizes the inputs used to measure fair value based on observability of such inputs. For more information on the fair value measurements of cash equivalents, refer to Note 5. Fair Value Measurements of Assets and Liabilities of the Notes for further information.

The Company’s cash equivalents earn interest at fixed rates; therefore, changes in interest rates will not generate a gain or loss on these investments unless they are sold prior to maturity. The weighted-average days to maturity for cash equivalents held as of September 27, 2024 was 51 days, and these investments had an average yield of approximately 5.4% per annum. A 10% change in interest rates on the Company’s cash equivalents is not expected to have a material impact on its financial position, results of operations, or cash flows.

Exposure on Borrowings

As of September 27, 2024, the Company had $48.8 million outstanding under its Term Loan and $35.0 million outstanding under its Revolver.

The Company’s borrowings under the current Credit Facility bear interest at either: (a) Adjusted Term SOFR plus the applicable margin; or (b) the Base Rate plus the applicable margin. The pricing levels for interest rate margins are determined based on the Consolidated Total Leverage Ratio as determined and adjusted quarterly. As of September 27, 2024, the applicable margin on Adjusted Term SOFR and Base Rate borrowings was 2.50% and 1.50%, respectively. The effective rate of interest on the outstanding Term Loan and Revolver borrowings as of September 27, 2024 was 7.4% and 7.6%, respectively.

A 10% change in interest rates is estimated to have a $0.6 million impact on annual interest expense on the Company’s outstanding long-term debt as of September 27, 2024.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

As disclosed in the Company’s Annual Report on Form 10-K for the fiscal year ended June 28, 2024, the Company’s management concluded that our disclosure controls and procedures were not effective as of June 28, 2024 due to certain material weaknesses in internal control over financial reporting. Refer to Part II, Item 9A. Controls and Procedures in the Company’s Annual Report on Form 10-K for the fiscal year ended June 28, 2024 for further information.

During the first quarter of fiscal 2025, the Company implemented actions designed to improve our internal control over financial reporting and remediate these material weaknesses, including (i) providing training to the applicable control performers related to the importance of timely execution of control activities for which they are responsible; (ii) beginning the redesign of controls over the determination of the appropriate period for revenue recognition, controls over arrangements where revenue is recognized over time and controls related to the review and approval of journal entries, and (iii) implementing a formal monitoring program to perform the necessary evaluations to ascertain whether the components of internal control are present and functioning, including implementing corrective actions as necessary.

These steps are subject to ongoing senior management review, as well as oversight by the audit committee of our Board of Directors. While significant progress has been made to remediate the material weaknesses, the material weaknesses will not be considered remediated until the associated controls operate effectively for a sufficient period of time and management concludes, through testing, that the controls are operating effectively. We will continue to monitor the design and effectiveness of these and other processes, procedures and controls and make further changes management deems appropriate.

The Company’s management, with the participation of our President and CEO, and Chief Financial Officer (“CFO”), completed an evaluation of the effectiveness of the design and operation of the disclosure controls and procedures as of September 27, 2024. The Company’s CEO and CFO have concluded that our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, were not effective as of September 27, 2024, due to the material weaknesses described above not being fully remediated as of the date of the evaluation.

Changes in Internal Controls over Financial Reporting

Except as noted above, there were no changes to our internal controls over financial reporting as defined in Rules 13a-15(f) or 15d-15(f) that occurred during the quarter ended September 27, 2024 that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

Inherent Limitations on Effectiveness of Controls

The Company’s management, including its CEO and CFO, does not expect that its disclosure controls and procedures or its internal control over financial reporting will prevent or detect all errors and all fraud. A control system, no matter how well-designed and operated, can provide only reasonable, not absolute, assurance that the control system’s objectives will be met. The design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Further, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that misstatements due to error or fraud will not occur or that all control issues and instances of fraud, if any, have been detected. The design of any system of controls is based in part on certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Projections of any evaluation of the effectiveness of controls to future periods are subject to risks. Over time, controls may become inadequate because of changes in conditions or deterioration in the degree of compliance with policies or procedures.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

For a discussion of legal proceedings as of September 27, 2024, please refer to “Legal Proceedings” and “Contingent Liabilities” under Note 12. Commitments and Contingencies of the Notes to the unaudited condensed consolidated financial statements in this Quarterly Report on Form 10-Q, which are incorporated into this item by reference.

Item 1A. Risk Factors

Investors should carefully review and consider the information regarding certain factors which could materially affect our business, operating results, cash flows, and financial condition set forth under Item 1A, Risk Factors, in our fiscal 2024 Annual Report on Form 10-K filed with the SEC on October 4, 2024.

There have been no material changes from the risk factors described in our Annual Report, although we may disclose changes to such factors or disclose additional factors from time to time in our future filings with the SEC. Additional risks and uncertainties not presently known to us or that we currently deem immaterial also may impair our business operations.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Stock Repurchase Program

During the first quarter of fiscal 2025, the Company did not repurchase any shares of its common stock.

Item 3. Defaults Upon Senior Securities

Not applicable.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

Insider Trading Arrangements

During the three months ended September 27, 2024, none of the Company’s directors or officers adopted, modified, or terminated a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement,” as defined in Item 408 of Regulation S-K.

Item 6. Exhibits

The following exhibits are filed or furnished herewith or are incorporated by reference to exhibits previously filed with the SEC:


Exhibit Number						Descriptions
3.1						Amended and Restated Certificate of Incorporation of Aviat Networks, Inc., as amended (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed with the SEC on November 13, 2023, File No. 001-33278).
3.2						Amended and Restated Bylaws of Aviat Networks, Inc. (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed with the SEC on August 24, 2023, File No. 001-33278).
31.1*						Rule 13a-14(a)/15d-14(a) Certification of President and Chief Executive Officer
31.2*						Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer
32.1**						Section 1350 Certification of Chief Executive Officer and Chief Financial Officer
101.INS						XBRL Instance Document
101.SCH						XBRL Taxonomy Extension Schema Document
101.CAL						XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF						XBRL Taxonomy Extension Definition Linkbase Document
101.LAB						XBRL Taxonomy Extension Label Linkbase Document
101.PRE						XBRL Taxonomy Extension Presentation Linkbase Document
104						Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
*						Filed herewith.
**						Furnished herewith.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.



AVIAT NETWORKS, INC. (Registrant)

Date: November 5, 2024



By:			/s/ Michael Connaway
			Michael Connaway Senior Vice President and Chief Financial Officer (duly authorized officer)

Exhibit 31.1

CERTIFICATION PURSUANT TO SECTION 302(a)

OF THE SARBANES-OXLEY ACT OF 2002

I, Peter A. Smith, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q for the fiscal quarter ended September 27, 2024, of Aviat Networks, Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:

November 5, 2024

/s/ Peter A. Smith

Name:

Peter A. Smith

Title:

President and Chief Executive Officer

Exhibit 31.2

CERTIFICATION PURSUANT TO SECTION 302(a)

OF THE SARBANES-OXLEY ACT OF 2002

I, Michael Connaway, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q for the fiscal quarter ended September 27, 2024, of Aviat Networks, Inc.;

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:

November 5, 2024

/s/ Michael Connaway

Name:

Michael Connaway

Title:

Senior Vice President and Chief Financial Officer

Exhibit 32.1

CERTIFICATIONS OF CHIEF EXECUTIVE OFFICER AND

PRINCIPAL FINANCIAL OFFICER OF AVIAT NETWORKS, INC.

PURSUANT TO TITLE 18 OF THE UNITED STATES CODE SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the filing of the Quarterly Report on Form 10-Q of Aviat Networks, Inc. (“Aviat Networks”) for the fiscal quarter ended September 27, 2024, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), we, Peter A. Smith, President and Chief Executive Officer of Aviat Networks, and Michael Connaway, Senior Vice President and Chief Financial Officer of Aviat Networks, hereby certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. §1350, that:

1.The Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and

2.The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Aviat Networks as of the dates and for the periods expressed in the Report.


Date: November 5, 2024						/s/ Peter A. Smith
						Name: Peter A. Smith
						Title: President and Chief Executive Officer


Date: November 5, 2024						/s/ Michael Connaway
						Name: Michael Connaway
						Title: Senior Vice President and Chief Financial Officer

Cover - shares	3 Months Ended
Cover - shares	Sep. 27, 2024	Nov. 01, 2024
Document Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 27, 2024
Document Transition Report	false
Entity File Number	001-33278
Entity Registrant Name	AVIAT NETWORKS, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	20-5961564
Entity Address, Address Line One	200 Parker Drive, Suite C100A,
Entity Address, City or Town	Austin,
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	78728
City Area Code	408
Local Phone Number	941-7100
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		12,690,353
Entity Central Index Key	0001377789
Current Fiscal Year End Date	--06-30
Document Fiscal Year Focus	2025
Document Fiscal Period Focus	Q1
Amendment Flag	false
Common Stock
Document Information [Line Items]
Title of 12(b) Security	Common Stock
Trading Symbol	AVNW
Security Exchange Name	NASDAQ
Preferred Stock
Document Information [Line Items]
Title of 12(b) Security	Preferred Share Purchase Rights
Security Exchange Name	NASDAQ
No Trading Symbol Flag	true

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Sep. 27, 2024	Sep. 29, 2023
Revenues:
Total revenues	$ 88,429	$ 86,909
Cost of revenues:
Total cost of revenues	68,641	55,714
Gross margin	19,788	31,195
Operating expenses:
Research and development	10,408	6,424
Selling and administrative	24,948	19,237
Restructuring charges	0	644
Total operating expenses	35,356	26,305
Operating (loss) income	(15,568)	4,890
Interest expense, net	1,115	99
Other expense, net	710	802
(Loss) income before income taxes	(17,393)	3,989
(Benefit from) provision for income taxes	(5,514)	432
Net income, basic	(11,879)	3,557
Net income, diluted	$ (11,879)	$ 3,557
Net (loss) income per share of common stock outstanding:
Basic (in dollars per share)	$ (0.94)	$ 0.31
Diluted (in dollars per share)	$ (0.94)	$ 0.30
Weighted-average shares outstanding:
Basic (in shares)	12,646	11,574
Diluted (in shares)	12,646	11,943
Product sales
Revenues:
Total revenues	$ 61,116	$ 59,545
Cost of revenues:
Total cost of revenues	52,201	36,313
Services
Revenues:
Total revenues	27,313	27,364
Cost of revenues:
Total cost of revenues	$ 16,440	$ 19,401

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Sep. 27, 2024	Sep. 29, 2023
Statement of Comprehensive Income [Abstract]
Net (loss) income	$ (11,879)	$ 3,557
Other comprehensive income:
Net change in cumulative translation adjustments	2,153	33
Other comprehensive income	2,153	33
Comprehensive (loss) income	$ (9,726)	$ 3,590

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands	Sep. 27, 2024	Jun. 28, 2024
Current Assets:
Cash and cash equivalents	$ 51,034	$ 64,622
Accounts receivable, net of allowances of $2,190 and $1,854	169,002	158,013
Unbilled receivables	94,725	90,525
Inventories	79,559	62,267
Assets held for sale	0	2,720
Other current assets	32,942	27,076
Total current assets	427,262	405,223
Property, plant and equipment, net	11,883	9,480
Goodwill	15,153	8,217
Intangible assets, net	28,754	13,644
Deferred income taxes	91,317	83,112
Right-of-use assets	3,665	3,710
Other assets	12,823	11,837
Total assets	590,857	535,223
Current Liabilities:
Accounts payable	104,926	92,854
Accrued expenses	39,137	42,148
Operating lease liabilities	1,125	1,006
Advance payments and unearned revenue	79,380	58,839
Other current liabilities	21,234	21,614
Current portion of long-term debt	2,395	2,396
Total current liabilities	248,197	218,857
Long-term debt	80,980	45,954
Unearned revenue	7,522	7,413
Long-term operating lease liabilities	2,782	2,823
Other long-term liabilities	407	394
Reserve for uncertain tax positions	3,445	3,485
Deferred income taxes	412	412
Total liabilities	343,745	279,338
Commitments and contingencies (Note 12)
Stockholders’ equity:
Preferred stock, $0.01 par value, 50.0 million shares authorized, none issued	0	0
Common stock, $0.01 par value, 300.0 million shares authorized, 12.7 million and 12.6 million shares issued and outstanding as of September 27, 2024 and June 28, 2024, respectively.	127	126
Treasury stock 0.2 million and 0.2 million shares as of September 27, 2024 and June 28, 2024, respectively	(6,479)	(6,479)
Additional paid-in-capital	861,023	860,071
Accumulated deficit	(590,392)	(578,513)
Accumulated other comprehensive loss	(17,167)	(19,320)
Total stockholders’ equity	247,112	255,885
Total liabilities and stockholders’ equity	$ 590,857	$ 535,223

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) $ in Thousands	Sep. 27, 2024	Jun. 28, 2024
Statement of Financial Position [Abstract]
Allowance for doubtful accounts	$ 2,190	$ 1,854
Preferred stock par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized (in shares)	50,000,000.0	50,000,000.0
Preferred stock, shares issued (in shares)	0	0
Common stock par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	300,000,000.0	300,000,000.0
Common stock, shares issued (in shares)	12,700,000	12,600,000
Common stock, shares outstanding (in shares)	12,700,000	12,600,000
Treasury stock (in shares)	200,000	200,000

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Sep. 27, 2024	Sep. 29, 2023
Operating Activities
Net (loss) income	$ (11,879)	$ 3,557
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities:
Depreciation of property, plant and equipment	1,317	1,168
Amortization of intangible assets	513	176
Provision for uncollectible receivables	350	14
Share-based compensation	1,664	1,834
Deferred taxes	(6,826)	(170)
Inventory write-downs	501	547
Non-cash lease expense	325	177
Other non-cash operating activities, net	(37)	17
Changes in operating assets and liabilities:
Accounts receivable	(15,498)	7,043
Unbilled receivables	(2,821)	(1,738)
Inventories	(13,197)	1,955
Accounts payable	8,594	1,787
Accrued expenses	(6,807)	(3,947)
Advance payments and unearned revenue	20,015	1,998
Income taxes payable	1,773	331
Other assets and liabilities	(5,152)	(769)
Net cash (used in) provided by operating activities	(27,165)	13,980
Investing Activities
Purchase of property, plant and equipment	(5,421)	(717)
Acquisition, net of cash acquired	(18,150)	0
Net cash used in investing activities	(21,175)	(717)
Financing Activities
Proceeds from revolver	35,000	25,200
Repayments of revolver	0	(25,200)
Payments for taxes related to net settlement of equity awards	(711)	(105)
Proceeds from issuance of common stock under employee stock plans	0	285
Net cash provided by financing activities	34,289	180
Effect of exchange rate changes on cash, cash equivalents, and restricted cash	1,293	(223)
Net (decrease) increase in cash, cash equivalents, and restricted cash	(12,758)	13,220
Cash, cash equivalents, and restricted cash, beginning of period	64,934	22,521
Cash, cash equivalents, and restricted cash, end of period	52,176	35,741
Proceeds from Sale of Productive Assets	$ 2,396	$ 0

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (Unaudited) - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Treasury Stock	Additional Paid-in Capital	Accumulated Deficit	Accumulated Other Comprehensive Loss
Beginning balance (in shares) at Jun. 30, 2023		11,518
Beginning balance at Jun. 30, 2023	$ 218,739	$ 115	$ (6,147)	$ 830,048	$ (589,273)	$ (16,004)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net (loss) income	3,557				3,557
Other comprehensive income	33					33
Issuance of common stock under employee stock plans (in shares)		204
Issuance of common stock under employee stock plans	285	$ 2		283
Shares withheld for taxes related to vesting of equity awards (in shares)		(3)
Shares withheld for taxes related to vesting of equity awards	(105)			(105)
Share-based compensation	1,834			1,834
Ending balance (in shares) at Sep. 29, 2023		11,719
Ending balance at Sep. 29, 2023	$ 224,343	$ 117	(6,147)	832,060	(585,716)	(15,971)
Beginning balance (in shares) at Jun. 28, 2024	12,600	12,622
Beginning balance at Jun. 28, 2024	$ 255,885	$ 126	(6,479)	860,071	(578,513)	(19,320)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net (loss) income	(11,879)				(11,879)
Other comprehensive income	2,153					2,153
Issuance of common stock under employee stock plans (in shares)		80
Issuance of common stock under employee stock plans	0	$ 1		(1)
Shares withheld for taxes related to vesting of equity awards (in shares)		(26)
Shares withheld for taxes related to vesting of equity awards	(711)			(711)
Share-based compensation	$ 1,664			1,664
Ending balance (in shares) at Sep. 27, 2024	12,700	12,676
Ending balance at Sep. 27, 2024	$ 247,112	$ 127	$ (6,479)	$ 861,023	$ (590,392)	$ (17,167)

The Company and Basis of Presentation	3 Months Ended
The Company and Basis of Presentation	Sep. 27, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]
The Company and Basis of Presentation	The Company and Basis of Presentation The Company Aviat Networks, Inc. (“Aviat,” the “Company,” “we,” “us,” and “our”) designs, manufactures, and sells wireless networking and access networking solutions and services to mobile and fixed telephone service providers, private network operators, government agencies, transportation and utility companies, public safety agencies and broadcast system operators across the globe. Aviat’s products include broadband wireless access base stations and customer premises equipment for fixed and mobile, point-to-point digital microwave radio systems for access, backhaul, trunking and license-exempt applications, supporting new network deployments, network expansion, and capacity upgrades. Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) and with the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information, and Aviat has made estimates, assumptions and judgments affecting the amounts reported in its unaudited condensed consolidated financial statements and the accompanying notes, as discussed in greater detail below. Accordingly, the statements do not include all information and footnotes required by U.S. GAAP for annual consolidated financial statements. In the opinion of the Company’s management, such interim financial statements reflect all adjustments (consisting of normal recurring adjustments) considered necessary for a fair statement of its financial position, results of operations and cash flows for such periods. The results for the three months ended September 27, 2024 are not necessarily indicative of the results that may be expected for the full fiscal year or future operating periods. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the consolidated financial statements and footnotes thereto included in Aviat’s Annual Report on Form 10-K for the fiscal year ended June 28, 2024. The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned and majority-owned subsidiaries. All intercompany transactions and accounts have been eliminated. Certain amounts in the financial statements have been reclassified for comparative purposes to conform to the current period financial statement presentation. Aviat’s fiscal year includes 52 or 53 weeks and ends on the Friday nearest to June 30. The three months ended September 27, 2024 and September 29, 2023 both consisted of 13 weeks. Fiscal year 2025 contains 52 weeks and will end on June 27, 2025. Fiscal year 2024 contained 52 weeks and ended on June 28, 2024. Use of Estimates The preparation of unaudited condensed consolidated financial statements in accordance with U.S. GAAP requires the Company to make estimates, assumptions and judgments affecting the amounts reported and related disclosures. Estimates are based upon historical factors, current circumstances and the experience and judgment of the Company’s management. The Company evaluates estimates and assumptions on an ongoing basis and may employ outside experts to assist in making these evaluations. Changes in such estimates, based on more accurate information, or different assumptions or conditions, may affect amounts reported in future periods. Such estimates affect significant items, including revenue recognition, provision for uncollectible receivables, inventory valuation, goodwill and identified intangible assets in business combinations, valuation allowances for deferred tax assets, uncertainties in income taxes, contingencies and recoverability of long-lived assets. Actual results may differ materially from estimates. Revisions to Prior Period Consolidated Financial Statements Subsequent to the third quarter of fiscal 2024, the Company identified certain errors in the quarterly financial statements for fiscal 2024. In accordance with ASC 250, Accounting Changes and Error Corrections and Staff Accounting Bulletins (“SAB”) No. 99, Materiality and No. 108, Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements, the Company evaluated the materiality of the errors and determined that the impacts were not material, individually or in the aggregate, to the Company’s previously issued consolidated financial statements. As a result, the Company has revised the prior period financial statements and related disclosures to correct the errors for comparability across all periods presented herein. Refer to Note 15. Revisions to Prior Period Consolidated Financial Statements of the Notes to this Form 10-Q, and Note 1. The Company and Summary of Significant Accounting Policies and Part II, Item 9B. Other Information of the Company’s Annual Report on Form 10-K for the fiscal year ended June 28, 2024 for further information. Summary of Significant Accounting Policies There have been no material changes in the Company’s significant accounting policies as of and for the three months ended September 27, 2024, as compared to the significant accounting policies described in the Company’s Annual Report on Form 10-K for the fiscal year ended June 28, 2024. Accounting Standards Not Yet Adopted In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The ASU enhances the transparency and usefulness of income tax information through improvements to disclosures primarily related to the rate reconciliation and income taxes paid information. ASU 2023-09 is effective for the Company’s annual reporting beginning in fiscal 2026. The Company is currently evaluating the impact of this ASU on its consolidated financial statements. In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The ASU expands reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses that are regularly presented to the chief operating decision maker. The disclosures required under ASU 2023-07 are also required for public entities with a single reportable segment. ASU 2023-07 is effective for the Company’s annual reporting beginning in fiscal 2025 and for interim periods beginning in fiscal 2026. The Company is currently evaluating the impact of the ASU on its consolidated financial statements. The Company considers the applicability and impact of all ASUs issued by the FASB. The Company determined at this time that all other ASUs issued but not yet adopted are either not applicable or are expected to have a minimal impact on its financial position and results of operations.

Net (Loss) Income Per Share of Common Stock

3 Months Ended

Sep. 27, 2024

Earnings Per Share [Abstract]

Net (Loss) Income Per Share of Common Stock

The following table presents the computation of basic and diluted net (loss) income per share:


	Three Months Ended
(In thousands, except per share amounts)	September 27, 2024		September 29, 2023
Numerator:
Net (loss) income	$	(11,879)	$	3,557

Denominator:
Weighted-average shares outstanding, basic	12,646		11,574
Effect of potentially dilutive equivalent shares	—		369
Weighted-average shares outstanding, diluted	12,646		11,943

Net (loss) income per share of common stock outstanding:
Basic	$	(0.94)	$	0.31
Diluted	$	(0.94)	$	0.30

The following table summarizes the weighted-average equity awards that were excluded from the diluted net (loss) income per share calculations since they were anti-dilutive:


	Three Months Ended
(In thousands)	September 27, 2024	September 29, 2023
Stock options	396	259
Restricted stock units and performance stock units	154	58
Total shares of common stock excluded	550	317

Revenue Recognition

3 Months Ended

Sep. 27, 2024

Revenue from Contract with Customer [Abstract]

Revenue Recognition

Contract Balances, Performance Obligations, and Backlog


(In thousands)	September 27, 2024		June 28, 2024
Contract assets
Accounts receivable, net	$	169,002	$	158,013
Unbilled receivables	94,725		90,525
Capitalized commissions	3,531		3,269
Contract liabilities
Advance payments and unearned revenue	$	79,380	$	58,839
Unearned revenue, long-term	7,522		7,413

Significant changes in contract balances may arise as a result of recognition over time for services, transfer of control for equipment, and periodic payments (both in arrears and in advance).

Remaining Performance Obligations

Balance Sheet Components

3 Months Ended

Sep. 27, 2024

Balance Sheet Related Disclosures [Abstract]

Balance Sheet Components

Cash, Cash equivalents, and Restricted cash


(In thousands)	September 27, 2024		June 28, 2024
Cash and cash equivalents	$	51,034	$	64,622

Restricted cash included in long-term other assets	1,142		312
Total cash, cash equivalents, and restricted cash	$	52,176	$	64,934

Inventories


(In thousands)	September 27, 2024		June 28, 2024
Finished products	$	55,788	$	44,890
Raw materials and supplies	21,712		15,433
Customer service inventories	2,059		1,944
Total inventories	$	79,559	$	62,267
Consigned inventories included within raw materials and supplies	$	12,105	$	11,456


	Three Months Ended
(In thousands)	September 27, 2024		September 29, 2023
Excess and obsolete inventory	$	310	$	294
Customer service inventory write-downs	191		253
Total charges	$	501	$	547

Other Current Assets


(In thousands)	September 27, 2024		June 28, 2024
Prepaid and other current assets	$	15,076	$	13,559
Taxes	11,256		8,623
Contract manufacturing assets	6,610		4,894

Total other current assets	$	32,942	$	27,076

Property, Plant and Equipment, net


(In thousands)	September 27, 2024		June 28, 2024

Buildings and leasehold improvements	$	1,302	$	1,302
Software and equipment	73,456		69,898
Total property, plant and equipment, gross	74,758		71,200
Less: accumulated depreciation	(62,875)		(61,720)
Total property, plant and equipment, net	$	11,883	$	9,480

Depreciation expense related to property, plant and equipment, was as follows:


	Three Months Ended
(In thousands)	September 27, 2024		September 29, 2023
Depreciation	$	1,317	$	1,168

Accrued Expenses


(In thousands)	September 27, 2024		June 28, 2024
Taxes	$	11,718	$	8,827
Compensation and benefits	8,240		9,689
Project costs	7,007		14,305

Other	5,816		3,507
Warranties	3,510		2,996
Commissions	1,533		1,538
Professional fees	1,313		1,286
Total accrued expenses	$	39,137	$	42,148

The Company accrues for the estimated cost to repair or replace products under warranty. Changes in the warranty liability were as follows:


	Three Months Ended
(In thousands)	September 27, 2024		September 29, 2023
Balance as of the beginning of the period	$	2,996	$	2,100
Warranty provision recorded during the period	544		375
Assumed in acquisition	406		—
Consumption during the period	(436)		(375)
Balance as of the end of the period	$	3,510	$	2,100

Advance Payments and Unearned Revenue


(In thousands)	September 27, 2024		June 28, 2024
Advance payments	$	18,989	$	8,517
Unearned revenue	60,391		50,322
Total advance payments and unearned revenue	$	79,380	$	58,839

Excluded from the balances above are $7.5 million and $7.4 million in long-term unearned revenue as of September 27, 2024 and June 28, 2024, respectively.

Fair Value Measurements of Assets and Liabilities

3 Months Ended

Sep. 27, 2024

Fair Value Disclosures [Abstract]

Fair Value Measurements of Assets and Liabilities

•Level 1 — Observable inputs such as quoted prices in active markets for identical assets or liabilities;

•Level 2 — Observable market-based inputs or observable inputs that are corroborated by market data; and

•Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities.

The estimated fair values and valuation input levels of assets and liabilities that are measured at fair value on a recurring basis as of September 27, 2024 and June 28, 2024 were as follows:


(In thousands)	September 27, 2024		June 28, 2024		Valuation Inputs
Assets:
Cash and cash equivalents:
Money market funds	$	2,858	$	6,602	Level 1
Bank certificates of deposit	$	3,574	$	3,706	Level 2

Credit Facility and Debt

3 Months Ended

Sep. 27, 2024

Debt Disclosure [Abstract]

Credit Facility and Debt

The following summarizes the Company’s outstanding long-term debt as of September 27, 2024:


(In thousands)
Revolver	$	35,000
Term loan	48,750
Less: unamortized deferred financing costs	(375)
Total debt	83,375
Less: current portion of long-term debt	(2,395)
Total long-term debt	$	80,980

As of September 27, 2024, scheduled maturities of outstanding long-term debt are as follows:


(In thousands)
Remainder of 2025	$	2,500
2026	3,750
2027	6,250
2028	71,250

Total	$	83,750

Restructuring

3 Months Ended

Sep. 27, 2024

Restructuring and Related Activities [Abstract]

Restructuring

The following table summarizes restructuring related activities during the three months ended September 27, 2024:



(In thousands)	Employee Severance and Benefits		Facilities and Other		Total
Balance as of June, 28, 2024	$	1,718	$	—	$	1,718

Cash payments	(80)		—		(80)

Balance as of September, 27, 2024	$	1,638	$	—	$	1,638

Prior Years’ Plans

Stockholders’ Equity

3 Months Ended

Sep. 27, 2024

Share-Based Payment Arrangement [Abstract]

Stockholders’ Equity

Stock Repurchase Program

Stock Incentive Programs

During the three months ended September 27, 2024, the Company granted 9,140 restricted stock units.

Total compensation expense for share-based awards included in the unaudited condensed consolidated statements of operations was as follows:


	Three Months Ended
(In thousands)	September 27, 2024		September 29, 2023
By Expense Category:
Cost of revenues	$	104	$	183
Research and development	143		146
Selling and administrative	1,417		1,505
Total share-based compensation expense	$	1,664	$	1,834
By Type of Award:
Options	$	327	$	346
Restricted stock and performance share awards and units	1,337		1,488
Total share-based compensation expense	$	1,664	$	1,834

Segment and Geographic Information

3 Months Ended

Sep. 27, 2024

Segment Reporting [Abstract]

Segment and Geographic Information


	Three Months Ended
(In thousands)	September 27, 2024		September 29, 2023
North America	$	42,225	$	54,853
Africa and the Middle East	10,450		9,954
Europe	5,600		5,252
Latin America and Asia Pacific	30,154		16,850
Total revenue	$	88,429	$	86,909

Income Taxes	3 Months Ended
Income Taxes	Sep. 27, 2024
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes The Company’s effective tax rate varies from the U.S. federal statutory rate of 21% primarily due to U.S. global intangible low-taxed income inclusion (GILTI), state taxes, stock-based compensation and foreign operations that are subject to income taxes at different statutory rates. During interim periods, tax expense or benefit are accrued for jurisdictions that are anticipated to be profitable for fiscal 2025. The determination of income taxes for the three months ended September 27, 2024 and September 29, 2023 was based on the Company’s estimated annual effective tax rate adjusted for losses in certain jurisdictions for which no tax benefit can be recognized. The tax benefit for the three months ended September 27, 2024 was primarily due to tax benefit resulting from year-to-date losses. The tax expense for the three months ended September 29, 2023 was primarily due to tax expense related to U.S. and profitable foreign subsidiaries. The Company has a number of years with open tax audits which vary from jurisdiction to jurisdiction. The major tax jurisdictions that are open and subject to potential audits include the U.S., Singapore, Ghana, Kenya, Nigeria, Saudi Arabia and Tanzania. The earliest years for these jurisdictions are as follows: U.S. - 2003; Singapore - 2015; Ghana – 2016; Kenya – 2018; Nigeria – 2006; Saudi Arabia – 2019 and Tanzania - 2017. Interest and penalties related to unrecognized tax benefits are accounted for as part of the provision for federal, foreign, and state income taxes. Such interest expense was not material for the three months ended September 27, 2024 and September 29, 2023. On March 11, 2021, the US enacted the American Rescue Plan Act of 2021 (“ARPA”) which expands Section 162(m) to cover the next five most highly compensated employees for the taxable year, in addition to the “covered employees” effective for taxable years beginning after December 31, 2026. The Company will continue to examine the elements of the ARPA and the impact it may have on future business. On August 16, 2022, the U.S. enacted the Inflation Reduction Act of 2022 (“IRA”) which includes a new corporate alternative minimum tax of 15% on adjusted financial statement income of corporations with profits greater than $1 billion, effective for taxable years beginning after December 31, 2022, and a 1% excise tax on stock repurchases by public corporations after December 31, 2022. The Company will continue to evaluate the applicability and effect of the IRA as more guidance is issued.

Acquisitions

3 Months Ended

Sep. 27, 2024

Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract]

Acquisitions

4RF Limited

NEC’s Wireless Transport Business

A summary of the preliminary purchase price allocation is as follows:


(In thousands)
Accounts receivable, net	$	42,487
Inventories	29,279
Property, plant and equipment, net	539
Identifiable finite-lived intangible assets:
Customer relationships	9,200
Technology	3,200
Other assets	243
Accounts payable	(13,182)
Advance payments and unearned revenue	(3,192)
Other liabilities	(2,501)
Goodwill	8,015
Net assets acquired	$	74,088

Commitments and Contingencies

3 Months Ended

Sep. 27, 2024

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Purchase Orders and Other Commitments

Financial Guarantees and Commercial Commitments

available, that it is probable that any significant amounts will be required to be paid on these performance guarantees in the future.

The following table presents details of the Company’s commercial commitments:


(In thousands)	September 27, 2024
Letters of credit	$	4,292
Bonds	15,383
	$	19,675

Indemnifications

Legal Proceedings

Contingent Liabilities

Goodwill and Intangible Assets

3 Months Ended

Sep. 27, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

The following presents details of goodwill and intangible assets:


(In thousands)	September 27, 2024		June 28, 2024
Goodwill	$	15,153	$	8,217


(In thousands except useful life)	Useful life in Years	September 27, 2024		June 28, 2024
Intangible assets:
Technology	7	$	6,835	$	1,800
Patents	10	690		690
Customer relationships	14 — 15	22,123		11,530
Trade names	16	1,330		1,330
Total gross intangible assets		$	30,978	$	15,350
Accumulated amortization		(2,224)		(1,706)
Total net intangible assets		$	28,754	$	13,644

As of September 27, 2024, the estimated future amortization expense of finite-lived intangible assets is as follows (in thousands):


Remainder of 2025	$	2,449
2026	2,640
2027	2,640
2028	2,640
2029	2,640
Thereafter	15,745
Total	$	28,754

Related Party Transactions

3 Months Ended

Sep. 27, 2024

Related Party Transactions

NEC Corporation

A summary of the related party activity between the Company and NEC during the three months ended September 27, 2024 is as follows:


(In thousands)
Transition services received	$	745
Research and development services received	3,013
Purchase of inventories	8,293

As of September 27, 2024, the Company’s outstanding related party balances with NEC included in the unaudited condensed consolidated balance sheets are as follows:


(In thousands)
Accounts receivable, net	$	4,822

Accounts payable	11,878
Other current liabilities	19,596

Revisions to Prior Period Consolidated Financial Statements

3 Months Ended

Sep. 27, 2024

Accounting Changes and Error Corrections [Abstract]

Revisions to Prior Period Consolidated Financial Statements

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)


	Three Months Ended September 29, 2023
(In thousands, except per share amounts)	As Previously Reported		Adjustments		As Revised
Revenues:

Services	$	28,021	$	(657)	$	27,364
Total revenues	87,566		(657)		86,909




Gross margin	31,852		(657)		31,195





Operating income	5,547		(657)		4,890



Income before income taxes	4,646		(657)		3,989
Provision for income taxes	641		(209)		432
Net income	$	4,005	$	(448)	$	3,557



Net income per share of common stock outstanding:
Basic	$	0.35	$	(0.04)	$	0.31
Diluted	$	0.34	$	(0.04)	$	0.30

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (unaudited)


	Three Months Ended September 29, 2023
(In thousands)	As Previously Reported		Adjustments		As Revised
Net income	$	4,005	$	(448)	$	3,557



Comprehensive income	$	4,038	$	(448)	$	3,590

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)


	Three Months Ended September 29, 2023
(In thousands)	As Previously Reported		Adjustments		As Revised
Operating Activities
Net income	$	4,005	$	(448)	$	3,557





Deferred taxes	39		(209)		(170)






Unbilled receivables	(2,395)		657		(1,738)






Net cash provided by operating activities	13,980		—		13,980

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (unaudited)


			Three Months Ended September 29, 2023
	Accumulated Deficit	Total Equity
(In thousands)
As Previously Reported
Balance as of June 30, 2023			$	(587,914)	$	220,098
Net income			4,005		4,005






Balance as of September 29, 2023			$	(583,909)	$	226,150

Adjustments
Balance as of June 30, 2023			$	(1,359)	$	(1,359)
Net income			(448)		(448)






Balance as of September 29, 2023			$	(1,807)	$	(1,807)

As Revised
Balance as of June 30, 2023			$	(589,273)	$	218,739
Net income			3,557		3,557






Balance as of September 29, 2023			$	(585,716)	$	224,343

Subsequent Events	3 Months Ended
Subsequent Events	Sep. 27, 2024
Subsequent Events [Abstract]
Subsequent Events	Subsequent Events Credit Facility Amendment On October 18, 2024, the Company entered into a Second Amendment to Credit Agreement (the “Credit Facility Amendment”), with Wells Fargo Bank, National Association, as administrative agent, swingline lender and issuing lender and Wells Fargo Securities LLC, Citigroup Global Markets Inc., and Regions Capital Markets as lenders. The Credit Facility Amendment amends and modifies that certain Credit Facility dated May 9, 2023. The Credit Facility Amendment provided for changes and modifications to the Credit Facility, which include, among other things, (i) changes to certain payment term mechanics, (ii) a commitment to make term loans in the aggregate principal amount of $75.0 million for the purpose of refinancing the Term Loan currently outstanding under the Credit Facility, and (iii) an increase in the Revolver to $75.0 million in the aggregate. Refer to Note 6. Credit Facility and Debt for further information.

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Sep. 27, 2024	Sep. 29, 2023
Pay vs Performance Disclosure
Net (loss) income	$ (11,879)	$ 3,557

Insider Trading Arrangements	3 Months Ended
Insider Trading Arrangements	Sep. 27, 2024
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

The Company and Basis of Presentation (Policies)	3 Months Ended
The Company and Basis of Presentation (Policies)	Sep. 27, 2024
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Basis of Presentation	Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“U.S. GAAP”) and with the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial information, and Aviat has made estimates, assumptions and judgments affecting the amounts reported in its unaudited condensed consolidated financial statements and the accompanying notes, as discussed in greater detail below. Accordingly, the statements do not include all information and footnotes required by U.S. GAAP for annual consolidated financial statements. In the opinion of the Company’s management, such interim financial statements reflect all adjustments (consisting of normal recurring adjustments) considered necessary for a fair statement of its financial position, results of operations and cash flows for such periods. The results for the three months ended September 27, 2024 are not necessarily indicative of the results that may be expected for the full fiscal year or future operating periods. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the consolidated financial statements and footnotes thereto included in Aviat’s Annual Report on Form 10-K for the fiscal year ended June 28, 2024. The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly-owned and majority-owned subsidiaries. All intercompany transactions and accounts have been eliminated. Certain amounts in the financial statements have been reclassified for comparative purposes to conform to the current period financial statement presentation. Aviat’s fiscal year includes 52 or 53 weeks and ends on the Friday nearest to June 30. The three months ended September 27, 2024 and September 29, 2023 both consisted of 13 weeks. Fiscal year 2025 contains 52 weeks and will end on June 27, 2025. Fiscal year 2024 contained 52 weeks and ended on June 28, 2024.
Use of Estimates	Use of Estimates The preparation of unaudited condensed consolidated financial statements in accordance with U.S. GAAP requires the Company to make estimates, assumptions and judgments affecting the amounts reported and related disclosures. Estimates are based upon historical factors, current circumstances and the experience and judgment of the Company’s management. The Company evaluates estimates and assumptions on an ongoing basis and may employ outside experts to assist in making these evaluations. Changes in such estimates, based on more accurate information, or different assumptions or conditions, may affect amounts reported in future periods. Such estimates affect significant items, including revenue recognition, provision for uncollectible receivables, inventory valuation, goodwill and identified intangible assets in business combinations, valuation allowances for deferred tax assets, uncertainties in income taxes, contingencies and recoverability of long-lived assets. Actual results may differ materially from estimates.
Accounting Standards Not Yet Adopted	Accounting Standards Not Yet Adopted In December 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The ASU enhances the transparency and usefulness of income tax information through improvements to disclosures primarily related to the rate reconciliation and income taxes paid information. ASU 2023-09 is effective for the Company’s annual reporting beginning in fiscal 2026. The Company is currently evaluating the impact of this ASU on its consolidated financial statements. In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The ASU expands reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses that are regularly presented to the chief operating decision maker. The disclosures required under ASU 2023-07 are also required for public entities with a single reportable segment. ASU 2023-07 is effective for the Company’s annual reporting beginning in fiscal 2025 and for interim periods beginning in fiscal 2026. The Company is currently evaluating the impact of the ASU on its consolidated financial statements. The Company considers the applicability and impact of all ASUs issued by the FASB. The Company determined at this time that all other ASUs issued but not yet adopted are either not applicable or are expected to have a minimal impact on its financial position and results of operations.
Fair Value Measurements	Items are classified within Level 1 if quoted prices are available in active markets. The Company’s Level 1 items are primarily money market funds and marketable securities. As of September 27, 2024 and June 28, 2024, the money market funds were valued at $1.00 net asset value per share. Items are classified within Level 2 if the observable inputs to quoted market prices, benchmark yields, reported trades, broker/dealer quotes or alternative pricing sources are available with reasonable levels of price transparency. The Company’s bank certificates of deposit are classified within Level 2. The carrying value of bank certificates of deposit approximates their fair value.

Net (Loss) Income Per Share of Common Stock (Tables)

3 Months Ended

Sep. 27, 2024

Earnings Per Share [Abstract]

Schedule of Basic and Diluted Net Income per Share

The following table presents the computation of basic and diluted net (loss) income per share:


	Three Months Ended
(In thousands, except per share amounts)	September 27, 2024		September 29, 2023
Numerator:
Net (loss) income	$	(11,879)	$	3,557

Denominator:
Weighted-average shares outstanding, basic	12,646		11,574
Effect of potentially dilutive equivalent shares	—		369
Weighted-average shares outstanding, diluted	12,646		11,943

Net (loss) income per share of common stock outstanding:
Basic	$	(0.94)	$	0.31
Diluted	$	(0.94)	$	0.30

Schedule of Antidilutive Securities Excluded from Computation of Net Income Per Share

The following table summarizes the weighted-average equity awards that were excluded from the diluted net (loss) income per share calculations since they were anti-dilutive:


	Three Months Ended
(In thousands)	September 27, 2024	September 29, 2023
Stock options	396	259
Restricted stock units and performance stock units	154	58
Total shares of common stock excluded	550	317

Revenue Recognition (Tables)

3 Months Ended

Sep. 27, 2024

Revenue from Contract with Customer [Abstract]

Schedule of Contract with Customer, Asset and Liability


(In thousands)	September 27, 2024		June 28, 2024
Contract assets
Accounts receivable, net	$	169,002	$	158,013
Unbilled receivables	94,725		90,525
Capitalized commissions	3,531		3,269
Contract liabilities
Advance payments and unearned revenue	$	79,380	$	58,839
Unearned revenue, long-term	7,522		7,413

Balance Sheet Components (Tables)

3 Months Ended

Sep. 27, 2024

Balance Sheet Related Disclosures [Abstract]

Schedule of Cash, Cash Equivalents and Restricted Cash


(In thousands)	September 27, 2024		June 28, 2024
Cash and cash equivalents	$	51,034	$	64,622

Restricted cash included in long-term other assets	1,142		312
Total cash, cash equivalents, and restricted cash	$	52,176	$	64,934

Schedule of Cash, Cash Equivalents and Restricted Cash


(In thousands)	September 27, 2024		June 28, 2024
Cash and cash equivalents	$	51,034	$	64,622

Restricted cash included in long-term other assets	1,142		312
Total cash, cash equivalents, and restricted cash	$	52,176	$	64,934

Schedule of Inventories


(In thousands)	September 27, 2024		June 28, 2024
Finished products	$	55,788	$	44,890
Raw materials and supplies	21,712		15,433
Customer service inventories	2,059		1,944
Total inventories	$	79,559	$	62,267
Consigned inventories included within raw materials and supplies	$	12,105	$	11,456

Schedule of Adjustments to Inventory

The charges incurred during the three months ended September 27, 2024 and September 29, 2023 were included in cost of product sales as follows:


	Three Months Ended
(In thousands)	September 27, 2024		September 29, 2023
Excess and obsolete inventory	$	310	$	294
Customer service inventory write-downs	191		253
Total charges	$	501	$	547

Schedule of Other Current Assets

Other Current Assets


(In thousands)	September 27, 2024		June 28, 2024
Prepaid and other current assets	$	15,076	$	13,559
Taxes	11,256		8,623
Contract manufacturing assets	6,610		4,894

Total other current assets	$	32,942	$	27,076

Schedule of Property, Plant and Equipment, Net


(In thousands)	September 27, 2024		June 28, 2024

Buildings and leasehold improvements	$	1,302	$	1,302
Software and equipment	73,456		69,898
Total property, plant and equipment, gross	74,758		71,200
Less: accumulated depreciation	(62,875)		(61,720)
Total property, plant and equipment, net	$	11,883	$	9,480

Depreciation expense related to property, plant and equipment, was as follows:


	Three Months Ended
(In thousands)	September 27, 2024		September 29, 2023
Depreciation	$	1,317	$	1,168

Schedule of Accrued Expenses


(In thousands)	September 27, 2024		June 28, 2024
Taxes	$	11,718	$	8,827
Compensation and benefits	8,240		9,689
Project costs	7,007		14,305

Other	5,816		3,507
Warranties	3,510		2,996
Commissions	1,533		1,538
Professional fees	1,313		1,286
Total accrued expenses	$	39,137	$	42,148

Schedule of Changes in Warranty Liability

The Company accrues for the estimated cost to repair or replace products under warranty. Changes in the warranty liability were as follows:


	Three Months Ended
(In thousands)	September 27, 2024		September 29, 2023
Balance as of the beginning of the period	$	2,996	$	2,100
Warranty provision recorded during the period	544		375
Assumed in acquisition	406		—
Consumption during the period	(436)		(375)
Balance as of the end of the period	$	3,510	$	2,100

Schedule of Advance Payments and Unearned Income


(In thousands)	September 27, 2024		June 28, 2024
Advance payments	$	18,989	$	8,517
Unearned revenue	60,391		50,322
Total advance payments and unearned revenue	$	79,380	$	58,839

Fair Value Measurements of Assets and Liabilities (Tables)

3 Months Ended

Sep. 27, 2024

Fair Value Disclosures [Abstract]

Schedule of Fair Value, by Balance Sheet Grouping

The estimated fair values and valuation input levels of assets and liabilities that are measured at fair value on a recurring basis as of September 27, 2024 and June 28, 2024 were as follows:


(In thousands)	September 27, 2024		June 28, 2024		Valuation Inputs
Assets:
Cash and cash equivalents:
Money market funds	$	2,858	$	6,602	Level 1
Bank certificates of deposit	$	3,574	$	3,706	Level 2

Credit Facility and Debt (Tables)

3 Months Ended

Sep. 27, 2024

Debt Disclosure [Abstract]

Schedule of Long-Term Debt

The following summarizes the Company’s outstanding long-term debt as of September 27, 2024:


(In thousands)
Revolver	$	35,000
Term loan	48,750
Less: unamortized deferred financing costs	(375)
Total debt	83,375
Less: current portion of long-term debt	(2,395)
Total long-term debt	$	80,980

Schedule of Maturities of Long-Term Debt

As of September 27, 2024, scheduled maturities of outstanding long-term debt are as follows:


(In thousands)
Remainder of 2025	$	2,500
2026	3,750
2027	6,250
2028	71,250

Total	$	83,750

Restructuring (Tables)

3 Months Ended

Sep. 27, 2024

Restructuring and Related Activities [Abstract]

Schedule of Restructuring-Related Activities

The following table summarizes restructuring related activities during the three months ended September 27, 2024:



(In thousands)	Employee Severance and Benefits		Facilities and Other		Total
Balance as of June, 28, 2024	$	1,718	$	—	$	1,718

Cash payments	(80)		—		(80)

Balance as of September, 27, 2024	$	1,638	$	—	$	1,638

Stockholders’ Equity (Tables)

3 Months Ended

Sep. 27, 2024

Share-Based Payment Arrangement [Abstract]

Schedule of Compensation Expense for Share-based Compensation Awards

Total compensation expense for share-based awards included in the unaudited condensed consolidated statements of operations was as follows:


	Three Months Ended
(In thousands)	September 27, 2024		September 29, 2023
By Expense Category:
Cost of revenues	$	104	$	183
Research and development	143		146
Selling and administrative	1,417		1,505
Total share-based compensation expense	$	1,664	$	1,834
By Type of Award:
Options	$	327	$	346
Restricted stock and performance share awards and units	1,337		1,488
Total share-based compensation expense	$	1,664	$	1,834

Segment and Geographic Information (Tables)

3 Months Ended

Sep. 27, 2024

Segment Reporting [Abstract]

Schedule of Revenue by Region

Revenue by region for the three months ended September 27, 2024 and September 29, 2023 was as follows:


	Three Months Ended
(In thousands)	September 27, 2024		September 29, 2023
North America	$	42,225	$	54,853
Africa and the Middle East	10,450		9,954
Europe	5,600		5,252
Latin America and Asia Pacific	30,154		16,850
Total revenue	$	88,429	$	86,909

Acquisitions (Tables)

3 Months Ended

Sep. 27, 2024

Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract]

Schedule of Preliminary Purchase Consideration

A summary of the preliminary purchase price allocation is as follows:


(In thousands)
Accounts receivable, net	$	42,487
Inventories	29,279
Property, plant and equipment, net	539
Identifiable finite-lived intangible assets:
Customer relationships	9,200
Technology	3,200
Other assets	243
Accounts payable	(13,182)
Advance payments and unearned revenue	(3,192)
Other liabilities	(2,501)
Goodwill	8,015
Net assets acquired	$	74,088

Commitment and Contingencies (Tables)

3 Months Ended

Sep. 27, 2024

Commitments and Contingencies Disclosure [Abstract]

Schedule of Commercial Commitments

The following table presents details of the Company’s commercial commitments:


(In thousands)	September 27, 2024
Letters of credit	$	4,292
Bonds	15,383
	$	19,675

Goodwill and Intangible Assets (Tables)

3 Months Ended

Sep. 27, 2024

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Intangible Assets and Goodwill

The following presents details of goodwill and intangible assets:


(In thousands)	September 27, 2024		June 28, 2024
Goodwill	$	15,153	$	8,217

Schedule of Goodwill Impairment


(In thousands except useful life)	Useful life in Years	September 27, 2024		June 28, 2024
Intangible assets:
Technology	7	$	6,835	$	1,800
Patents	10	690		690
Customer relationships	14 — 15	22,123		11,530
Trade names	16	1,330		1,330
Total gross intangible assets		$	30,978	$	15,350
Accumulated amortization		(2,224)		(1,706)
Total net intangible assets		$	28,754	$	13,644

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense

As of September 27, 2024, the estimated future amortization expense of finite-lived intangible assets is as follows (in thousands):


Remainder of 2025	$	2,449
2026	2,640
2027	2,640
2028	2,640
2029	2,640
Thereafter	15,745
Total	$	28,754

Related Party Transactions (Tables)

3 Months Ended

Sep. 27, 2024

Schedule of Related Party Transactions

A summary of the related party activity between the Company and NEC during the three months ended September 27, 2024 is as follows:


(In thousands)
Transition services received	$	745
Research and development services received	3,013
Purchase of inventories	8,293

As of September 27, 2024, the Company’s outstanding related party balances with NEC included in the unaudited condensed consolidated balance sheets are as follows:


(In thousands)
Accounts receivable, net	$	4,822

Accounts payable	11,878
Other current liabilities	19,596

Revisions to Prior Period Consolidated Financial Statements (Tables)

3 Months Ended

Sep. 27, 2024

Accounting Changes and Error Corrections [Abstract]

Schedule of Consolidated Statements of Operations, Comprehensive Income, Balance Sheets, Cash Flows, and Equity

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)


	Three Months Ended September 29, 2023
(In thousands, except per share amounts)	As Previously Reported		Adjustments		As Revised
Revenues:

Services	$	28,021	$	(657)	$	27,364
Total revenues	87,566		(657)		86,909




Gross margin	31,852		(657)		31,195





Operating income	5,547		(657)		4,890



Income before income taxes	4,646		(657)		3,989
Provision for income taxes	641		(209)		432
Net income	$	4,005	$	(448)	$	3,557



Net income per share of common stock outstanding:
Basic	$	0.35	$	(0.04)	$	0.31
Diluted	$	0.34	$	(0.04)	$	0.30

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (unaudited)


	Three Months Ended September 29, 2023
(In thousands)	As Previously Reported		Adjustments		As Revised
Net income	$	4,005	$	(448)	$	3,557



Comprehensive income	$	4,038	$	(448)	$	3,590

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)


	Three Months Ended September 29, 2023
(In thousands)	As Previously Reported		Adjustments		As Revised
Operating Activities
Net income	$	4,005	$	(448)	$	3,557





Deferred taxes	39		(209)		(170)






Unbilled receivables	(2,395)		657		(1,738)






Net cash provided by operating activities	13,980		—		13,980

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (unaudited)


			Three Months Ended September 29, 2023
	Accumulated Deficit	Total Equity
(In thousands)
As Previously Reported
Balance as of June 30, 2023			$	(587,914)	$	220,098
Net income			4,005		4,005






Balance as of September 29, 2023			$	(583,909)	$	226,150

Adjustments
Balance as of June 30, 2023			$	(1,359)	$	(1,359)
Net income			(448)		(448)






Balance as of September 29, 2023			$	(1,807)	$	(1,807)

As Revised
Balance as of June 30, 2023			$	(589,273)	$	218,739
Net income			3,557		3,557






Balance as of September 29, 2023			$	(585,716)	$	224,343

Net (Loss) Income Per Share of Common Stock (Schedule of Basic and Diluted Net Income Per Share) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Sep. 27, 2024	Sep. 29, 2023
Numerator:
Net income, basic	$ (11,879)	$ 3,557
Net income, diluted	$ (11,879)	$ 3,557
Denominator:
Weighted-average shares outstanding, basic (in shares)	12,646	11,574
Effect of potentially dilutive equivalent shares (in shares)	0	369
Weighted-average shares outstanding, diluted (in shares)	12,646	11,943
Net (loss) income per share of common stock outstanding:
Basic (in dollars per share)	$ (0.94)	$ 0.31
Diluted (in dollars per share)	$ (0.94)	$ 0.30

Net (Loss) Income Per Share of Common Stock (Schedule of Common Stock Excluded Because they were Antidilutive) (Details) - shares shares in Thousands	3 Months Ended
	Sep. 27, 2024	Sep. 29, 2023
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total shares of common stock excluded (in shares)	550	317
Stock options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total shares of common stock excluded (in shares)	396	259
Restricted stock units and performance stock units
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Total shares of common stock excluded (in shares)	154	58

Revenue Recognition (Schedule of Contracted Balances) (Details) - USD ($) $ in Thousands	Sep. 27, 2024	Jun. 28, 2024
Contract assets
Accounts receivable, net	$ 169,002	$ 158,013
Unbilled receivables	94,725	90,525
Capitalized commissions	3,531	3,269
Contract liabilities
Advance payments and unearned revenue	79,380	58,839
Unearned revenue, long-term	$ 7,522	$ 7,413

Revenue Recognition (Narrative) (Details) $ in Millions	3 Months Ended
Revenue Recognition (Narrative) (Details) $ in Millions	Sep. 27, 2024 USD ($)
Disaggregation of Revenue [Line Items]
Advance payments and unearned income	$ 86.9
Revenue to be recognized, percentage	80.00%
Services
Disaggregation of Revenue [Line Items]
Revenue recognized	$ 16.6

Revenue Recognition (Remaining Performance Obligations) (Details) - Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-09-28 $ in Millions	Sep. 27, 2024 USD ($)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Remaining performance obligation, amount	$ 144.8
Remaining performance obligation, percentage	50.00%
Expected timing of satisfaction, period	12 months

Balance Sheet Components (Schedule of Cash, Cash Equivalents and Restricted Cash) (Details) - USD ($) $ in Thousands	Sep. 27, 2024	Jun. 28, 2024	Sep. 29, 2023	Jun. 30, 2023
Balance Sheet Related Disclosures [Abstract]
Cash and cash equivalents	$ 51,034	$ 64,622
Restricted cash included in long-term other assets	1,142	312
Total cash, cash equivalents, and restricted cash	$ 52,176	$ 64,934	$ 35,741	$ 22,521

Balance Sheet Components (Schedule of Inventories) (Details) - USD ($) $ in Thousands	Sep. 27, 2024	Jun. 28, 2024
Balance Sheet Related Disclosures [Abstract]
Finished products	$ 55,788	$ 44,890
Raw materials and supplies	21,712	15,433
Customer service inventories	2,059	1,944
Total inventories	79,559	62,267
Consigned inventories included within raw materials and supplies	$ 12,105	$ 11,456

Balance Sheet Components (Schedule of Inventory Adjustments) (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 27, 2024	Sep. 29, 2023
Balance Sheet Related Disclosures [Abstract]
Excess and obsolete inventory	$ 310	$ 294
Customer service inventory write-downs	191	253
Total charges	$ 501	$ 547

Balance Sheet Components (Schedule of Other Current Assets) (Details) - USD ($) $ in Thousands	Sep. 27, 2024	Jun. 28, 2024
Balance Sheet Related Disclosures [Abstract]
Prepaid and other current assets	$ 15,076	$ 13,559
Taxes	11,256	8,623
Contract manufacturing assets	6,610	4,894
Other current assets	$ 32,942	$ 27,076

Balance Sheet Components (Schedule of Property, Plant and Equipment) (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 27, 2024	Sep. 29, 2023	Jun. 28, 2024
Property, Plant and Equipment [Line Items]
Total property, plant and equipment, gross	$ 74,758		$ 71,200
Less: accumulated depreciation	(62,875)		(61,720)
Total property, plant and equipment, net	11,883		9,480
Depreciation	1,317	$ 1,168
Buildings and leasehold improvements
Property, Plant and Equipment [Line Items]
Total property, plant and equipment, gross	1,302		1,302
Software and equipment
Property, Plant and Equipment [Line Items]
Total property, plant and equipment, gross	$ 73,456		$ 69,898

Balance Sheet Components (Narrative) (Details) - USD ($) $ in Thousands	Sep. 27, 2024	Jun. 28, 2024
Property, Plant and Equipment [Line Items]
Total property, plant and equipment, gross	$ 74,758	$ 71,200
Asset under construction
Property, Plant and Equipment [Line Items]
Total property, plant and equipment, gross	$ 4,200	$ 4,100

Balance Sheet Components (Schedule of Accrued Expenses) (Details) - USD ($) $ in Thousands	Sep. 27, 2024	Jun. 28, 2024
Balance Sheet Related Disclosures [Abstract]
Taxes	$ 11,718	$ 8,827
Compensation and benefits	8,240	9,689
Project costs	7,007	14,305
Other	5,816	3,507
Warranties	3,510	2,996
Commissions	1,533	1,538
Professional fees	1,313	1,286
Total accrued expenses	$ 39,137	$ 42,148

Balance Sheet Components (Schedule of Accrued Warranties) (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 27, 2024	Sep. 29, 2023
Warranty Liability Roll Forward
Balance as of the beginning of the period	$ 2,996	$ 2,100
Warranty provision recorded during the period	544	375
Assumed in acquisition	406	0
Consumption during the period	(436)	(375)
Balance as of the end of the period	$ 3,510	$ 2,100

Balance Sheet Components (Schedule of Advance Payments and Unearned Revenue) (Details) - USD ($) $ in Thousands	Sep. 27, 2024	Jun. 28, 2024
Balance Sheet Related Disclosures [Abstract]
Advance payments	$ 18,989	$ 8,517
Unearned revenue	60,391	50,322
Total advance payments and unearned revenue	79,380	58,839
Unearned revenue, long-term	$ 7,522	$ 7,413

Fair Value Measurements of Assets and Liabilities (Schedule of Fair Value, by Balance Sheet Grouping) (Details) - Recurring - 45562 - USD ($) $ in Thousands	Sep. 27, 2024	Jun. 28, 2024
Level 1 \| Money market funds
Assets:
Cash and cash equivalents:	$ 2,858	$ 6,602
Level 2 \| Bank certificates of deposit
Assets:
Cash and cash equivalents:	$ 3,574	$ 3,706

Fair Value Measurements of Assets and Liabilities (Narrative) (Details) - $ / shares	Sep. 27, 2024	Jun. 28, 2024
Level 1 \| Money market funds
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Money market, net asset value (in dollars per share)	$ 1.00	$ 1.00

Credit Facility and Debt (Narrative) (Details)	1 Months Ended	3 Months Ended
Credit Facility and Debt (Narrative) (Details)	Nov. 30, 2023 USD ($)	Sep. 27, 2024 USD ($) quarter	May 09, 2023 USD ($)
Line of Credit Facility [Line Items]
Letters of credit		$ 4,292,000
Leverage Ratio 2.75
Line of Credit Facility [Line Items]
Term in quarters \| quarter		4
Leverage Ratio 2.50
Line of Credit Facility [Line Items]
Term in quarters \| quarter		8
Revolving Credit Facility \| Credit Facility
Line of Credit Facility [Line Items]
Credit facility, maximum borrowing capacity			$ 40,000,000.0
Revolver		$ 35,000,000
Debt instrument, interest, effective percentage		7.60%
Revolving Credit Facility \| Credit Facility \| Secured Overnight Financing Rate (SOFR)
Line of Credit Facility [Line Items]
Basis spread on variable rate		2.50%
Revolving Credit Facility \| Credit Facility \| Base Rate
Line of Credit Facility [Line Items]
Basis spread on variable rate		1.50%
Delayed Draw Term Loan Facility \| Credit Facility
Line of Credit Facility [Line Items]
Credit facility, maximum borrowing capacity			50,000,000.0
Letter of Credit \| Credit Facility
Line of Credit Facility [Line Items]
Credit facility, maximum borrowing capacity			10,000,000.0
Letters of credit		$ 4,300,000
Swing Line Loan \| Credit Facility
Line of Credit Facility [Line Items]
Credit facility, maximum borrowing capacity			$ 10,000,000.0
Line of Credit \| Credit Facility
Line of Credit Facility [Line Items]
Proceeds from lines of credit		35,000,000.0
Available credit under credit facility		700,000
Line of credit facility, current borrowing capacity		$ 5,000,000.0
Fixed charge coverage ratio		1.25
Line of Credit \| Credit Facility \| Measurement Input, EBITDA Multiple
Line of Credit Facility [Line Items]
Maximum leverage ratio, period 1		3.00
Maximum leverage ratio, period 2		2.75
Maximum leverage ratio, period 3		2.50
Line of Credit \| Delayed Draw Term Loan Facility
Line of Credit Facility [Line Items]
Proceeds from lines of credit	$ 50,000,000
Revolver		$ 48,800,000
Debt instrument, interest, effective percentage		7.40%

Credit Facility and Debt - (Schedule of Long-Term Debt) (Details) - USD ($) $ in Thousands	Sep. 27, 2024	Jun. 28, 2024
Debt Instrument [Line Items]
Long-term debt, gross	$ 83,750
Less: unamortized deferred financing costs	(375)
Total	83,375
Less: current portion of long-term debt	(2,395)	$ (2,396)
Total long-term debt	80,980	$ 45,954
Line of Credit \| Revolving Credit Facility
Debt Instrument [Line Items]
Long-term debt, gross	35,000
Line of Credit \| Delayed Draw Term Loan Facility
Debt Instrument [Line Items]
Long-term debt, gross	$ 48,750

Credit Facility and Debt - (Schedule of Maturities of Long-Term Debt) (Details) $ in Thousands	Sep. 27, 2024 USD ($)
Debt Disclosure [Abstract]
Remainder of 2025	$ 2,500
2026	3,750
2027	6,250
2028	71,250
Total	$ 83,750

Restructuring (Schedule of Restructuring Related Activities) (Details) $ in Thousands	3 Months Ended
	Sep. 27, 2024 USD ($)
Restructuring Reserve [Roll Forward]
Accrual balance, beginning of period	$ 1,718
Cash payments	(80)
Accrued balance, end of period	1,638
Employee Severance and Benefits
Restructuring Reserve [Roll Forward]
Accrual balance, beginning of period	1,718
Cash payments	(80)
Accrued balance, end of period	1,638
Facilities and Other
Restructuring Reserve [Roll Forward]
Accrual balance, beginning of period	0
Cash payments	0
Accrued balance, end of period	$ 0

Restructuring (Narrative) (Details) $ in Millions	Sep. 27, 2024 USD ($)
Restructuring and Related Activities [Abstract]
Restructuring liabilities	$ 1.6

Stockholders’ Equity (Narrative) (Details)	3 Months Ended
Stockholders’ Equity (Narrative) (Details)	Sep. 27, 2024 USD ($) plan shares	Nov. 30, 2021 USD ($)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Authorized repurchase amount		$ 10,000,000.0
Remaining value available under stock repurchase program	$ 6,900,000
Unrecognized compensation expense for non-vested stock options	1,800,000
Unrecognized compensation expense for non-vested stock awards	$ 5,900,000
Stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Nonvested awards, expense expected to be recognized, weighted average period	1 year 8 months 12 days
Restricted stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock granted (in shares) \| shares	9,140
Restricted stock units and performance stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Nonvested awards, expense expected to be recognized, weighted average period	1 year 6 months
2018 Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of stock incentive plans \| plan	1
2018 Plan \| Stock options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Option expiration period	7 years
2018 Plan \| Restricted stock units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period	3 years

Stockholders’ Equity (Schedule of Stock Based Compensation Expense) (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 27, 2024	Sep. 29, 2023
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expense	$ 1,664	$ 1,834
Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expense	327	346
Restricted stock and performance share awards and units
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expense	1,337	1,488
Cost of revenues
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expense	104	183
Research and development
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expense	143	146
Selling and administrative
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based compensation expense	$ 1,417	$ 1,505

Segment and Geographic Information (Details) $ in Thousands	3 Months Ended
Segment and Geographic Information (Details) $ in Thousands	Sep. 27, 2024 USD ($) segment	Sep. 29, 2023 USD ($)
Revenues from External Customers and Long-Lived Assets [Line Items]
Number of reportable segments \| segment	1
Total revenue	$ 88,429	$ 86,909
North America
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenue	42,225	54,853
Africa and the Middle East
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenue	10,450	9,954
Europe
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenue	5,600	5,252
Latin America and Asia Pacific
Revenues from External Customers and Long-Lived Assets [Line Items]
Total revenue	$ 30,154	$ 16,850

Acquisitions (Narrative) (Details) - USD ($) $ in Thousands			1 Months Ended	3 Months Ended
Acquisitions (Narrative) (Details) - USD ($) $ in Thousands	Jul. 02, 2024	Nov. 30, 2023	Nov. 30, 2023	Sep. 27, 2024	Sep. 29, 2023	Jun. 28, 2024
Business Acquisition [Line Items]
Goodwill				$ 15,153		$ 8,217
Total revenues				88,429	$ 86,909
Operating income (loss)				(15,568)	$ 4,890
4RF Limited
Business Acquisition [Line Items]
Payments to acquire businesses, net of cash acquired	$ 18,200
Cash acquired	1,200
Working capital	5,600
Other assets and liabilities	1,600
Intangible assets and other than goodwill	8,500
Goodwill	$ 2,500
NEC Corporation
Business Acquisition [Line Items]
Goodwill		$ 8,015	$ 8,015	4,900
Payments to acquire businesses			32,200	19,600
Consideration transferred, equity interest issued and issuable, number of shares (in shares)		736,750
Consideration transferred, equity interest issued and issuable		$ 22,300	22,300
Total net consideration			54,500
Decrease in accounts receivables				6,800
Inventories		$ 29,279	$ 29,279	4,900
Identifiable finite-lived intangible assets				6,800
Total revenues				25,000
Operating income (loss)				$ 1,000

Acquisitions (Schedule of Preliminary Purchase Consideration) (Details) - USD ($) $ in Thousands	Sep. 27, 2024	Jun. 28, 2024	Nov. 30, 2023
Business Acquisition [Line Items]
Goodwill	$ 15,153	$ 8,217
NEC Corporation
Business Acquisition [Line Items]
Accounts receivable, net			$ 42,487
Inventories	4,900		29,279
Property, plant and equipment, net			539
Identifiable finite-lived intangible assets	6,800
Other assets			243
Accounts payable			(13,182)
Advance payments and unearned revenue			(3,192)
Other liabilities			(2,501)
Goodwill	$ 4,900		8,015
Net assets acquired			74,088
Customer relationships \| NEC Corporation
Business Acquisition [Line Items]
Identifiable finite-lived intangible assets			9,200
Technology-Based Intangible Assets \| NEC Corporation
Business Acquisition [Line Items]
Identifiable finite-lived intangible assets			$ 3,200

Commitments and Contingencies (Narrative) (Details) $ in Thousands	3 Months Ended
	Sep. 27, 2024 USD ($)
Other Commitments [Line Items]
Commercial commitments outstanding	$ 19,675
Maximum
Other Commitments [Line Items]
Guarantee term	2 years
Purchase Obligations with Suppliers of Contract Manufacturers
Other Commitments [Line Items]
Purchase obligation	$ 72,000
Contractual Obligations Associated with Software as Service and Software
Other Commitments [Line Items]
Purchase obligation	$ 5,300

Commitments and Contingencies (Schedule of Commercial Commitments) (Details) $ in Thousands	Sep. 27, 2024 USD ($)
Commitments and Contingencies Disclosure [Abstract]
Letters of credit	$ 4,292
Bonds	15,383
Total	$ 19,675

Goodwill and Intangible Assets (Schedule of Intangible Assets and Goodwill) (Details) - USD ($) $ in Thousands	Sep. 27, 2024	Jun. 28, 2024
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill	$ 15,153	$ 8,217

Goodwill and Intangible Assets (Narrative) (Details) - USD ($)	3 Months Ended
	Sep. 27, 2024	Sep. 29, 2023
Goodwill and Intangible Assets Disclosure [Abstract]
Goodwill acquired	$ 6,900,000
Goodwill, impairment	0
Amortization of intangible assets	513,000	$ 176,000
Impairment charges	$ 0

Goodwill and Intangible Assets (Schedule of Goodwill Impairment) (Details) - USD ($) $ in Thousands	Sep. 27, 2024	Jun. 28, 2024
Finite-Lived Intangible Assets [Line Items]
Total gross intangible assets	$ 30,978	$ 15,350
Accumulated amortization	(2,224)	(1,706)
Total	$ 28,754	13,644
Technology
Finite-Lived Intangible Assets [Line Items]
Useful life in Years	7 years
Total gross intangible assets	$ 6,835	1,800
Patents
Finite-Lived Intangible Assets [Line Items]
Useful life in Years	10 years
Total gross intangible assets	$ 690	690
Customer relationships
Finite-Lived Intangible Assets [Line Items]
Total gross intangible assets	$ 22,123	11,530
Customer relationships \| Minimum
Finite-Lived Intangible Assets [Line Items]
Useful life in Years	14 years
Customer relationships \| Maximum
Finite-Lived Intangible Assets [Line Items]
Useful life in Years	15 years
Trade names
Finite-Lived Intangible Assets [Line Items]
Useful life in Years	16 years
Total gross intangible assets	$ 1,330	$ 1,330

Goodwill and Intangible Assets (Schedule of Finite-Lived Intangible Assets, Future Amortization Expense) (Details) - USD ($) $ in Thousands	Sep. 27, 2024	Jun. 28, 2024
Goodwill and Intangible Assets Disclosure [Abstract]
Remainder of 2025	$ 2,449
2026	2,640
2027	2,640
2028	2,640
2029	2,640
Thereafter	15,745
Total	$ 28,754	$ 13,644

Related Party Transactions (Narrative) (Details)	Nov. 30, 2023 shares	Sep. 27, 2024
NEC Transaction \| NEC Corporation
Related Party Transaction [Line Items]
Equity method investment, ownership percentage		5.80%
Lock-Up \| Related Party
Related Party Transaction [Line Items]
Share release, monthly release of issued shares	0.0833
Share release, period after closing date	2 years
NEC Corporation
Related Party Transaction [Line Items]
Consideration transferred, equity interest issued and issuable, number of shares (in shares)	736,750

Related Party Transactions (Schedule of Related Party Transactions) (Details) - NEC Corporation $ in Thousands	3 Months Ended
	Sep. 27, 2024 USD ($)
Transition services received
Related Party Transaction [Line Items]
Related party transaction, amounts of transaction	$ 745
Research and development services received
Related Party Transaction [Line Items]
Related party transaction, amounts of transaction	3,013
Purchase of inventories
Related Party Transaction [Line Items]
Related party transaction, amounts of transaction	$ 8,293

Related Party Transactions (Schedule of Related Party Transactions Balance Sheets) (Details) - USD ($) $ in Thousands	Sep. 27, 2024	Jun. 28, 2024
Related Party Transaction [Line Items]
Accounts receivable, net	$ 169,002	$ 158,013
Accounts payable	104,926	92,854
Other current liabilities	21,234	$ 21,614
NEC Corporation \| Related Party
Related Party Transaction [Line Items]
Accounts receivable, net	4,822
Accounts payable	11,878
Other current liabilities	$ 19,596

Revisions to Prior Period Consolidated Financial Statements (Consolidated Statements of Operations) (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Sep. 27, 2024	Sep. 29, 2023
Revenues:
Total revenues	$ 88,429	$ 86,909
Gross margin	19,788	31,195
Operating (loss) income	(15,568)	4,890
(Loss) income before income taxes	(17,393)	3,989
Provision for income taxes	(5,514)	432
Net income, basic	(11,879)	3,557
Net income, diluted	$ (11,879)	$ 3,557
Net income per share of common stock outstanding:
Basic (in dollars per share)	$ (0.94)	$ 0.31
Diluted (in dollars per share)	$ (0.94)	$ 0.30
As Previously Reported
Revenues:
Total revenues		$ 87,566
Gross margin		31,852
Operating (loss) income		5,547
(Loss) income before income taxes		4,646
Provision for income taxes		641
Net income, basic		4,005
Net income, diluted		$ 4,005
Net income per share of common stock outstanding:
Basic (in dollars per share)		$ 0.35
Diluted (in dollars per share)		$ 0.34
Adjustments
Revenues:
Total revenues		$ (657)
Gross margin		(657)
Operating (loss) income		(657)
(Loss) income before income taxes		(657)
Provision for income taxes		(209)
Net income, basic		(448)
Net income, diluted		$ (448)
Net income per share of common stock outstanding:
Basic (in dollars per share)		$ (0.04)
Diluted (in dollars per share)		$ (0.04)
Services
Revenues:
Total revenues	$ 27,313	$ 27,364
Services \| As Previously Reported
Revenues:
Total revenues		28,021
Services \| Adjustments
Revenues:
Total revenues		$ (657)

Revisions to Prior Period Consolidated Financial Statements (Consolidated Statements of Comprehensive Income) (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 27, 2024	Sep. 29, 2023
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net income	$ (11,879)	$ 3,557
Comprehensive income
Comprehensive (loss) income	$ (9,726)	3,590
As Previously Reported
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net income		4,005
Comprehensive income
Comprehensive (loss) income		4,038
Adjustments
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Net income		(448)
Comprehensive income
Comprehensive (loss) income		$ (448)

Revisions to Prior Period Consolidated Financial Statements (Consolidated Statements of Cash Flows) (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 27, 2024	Sep. 29, 2023
Operating Activities
Net (loss) income	$ (11,879)	$ 3,557
Deferred taxes		(170)
Unbilled receivables	(2,821)	(1,738)
Net cash (used in) provided by operating activities	$ (27,165)	13,980
As Previously Reported
Operating Activities
Net (loss) income		4,005
Deferred taxes		39
Unbilled receivables		(2,395)
Net cash (used in) provided by operating activities		13,980
Adjustments
Operating Activities
Net (loss) income		(448)
Deferred taxes		(209)
Unbilled receivables		657
Net cash (used in) provided by operating activities		$ 0

Revisions to Prior Period Consolidated Financial Statements (Consolidated Statements of Equity) (Details) - USD ($) $ in Thousands	3 Months Ended
	Sep. 27, 2024	Sep. 29, 2023
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Beginning balance	$ 255,885	$ 218,739
Net (loss) income	(11,879)	3,557
Ending balance	247,112	224,343
Accumulated Deficit
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Beginning balance	(578,513)	(589,273)
Net (loss) income	(11,879)	3,557
Ending balance	$ (590,392)	(585,716)
As Previously Reported
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Beginning balance		220,098
Net (loss) income		4,005
Ending balance		226,150
As Previously Reported \| Accumulated Deficit
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Beginning balance		(587,914)
Net (loss) income		4,005
Ending balance		(583,909)
Adjustments
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Beginning balance		(1,359)
Net (loss) income		(448)
Ending balance		(1,807)
Adjustments \| Accumulated Deficit
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Beginning balance		(1,359)
Net (loss) income		(448)
Ending balance		$ (1,807)

Subsequent Events (Details) - Revolving Credit Facility - Credit Facility - USD ($)	Oct. 18, 2024	May 09, 2023
Subsequent Event [Line Items]
Credit facility, maximum borrowing capacity		$ 40,000,000.0
Subsequent Event
Subsequent Event [Line Items]
Debt instrument, face amount	$ 75,000,000.0
Credit facility, maximum borrowing capacity	$ 75,000,000.0