📊 HLIT Key Takeaways
Is HLIT a Good Investment? Thesis Analysis
Harmonic faces severe operational deterioration with 26.2% revenue decline and negative net margins, indicating structural business challenges. While the balance sheet remains solid with strong liquidity (2.50x current ratio) and excellent free cash flow generation ($96.9M), this masks underlying profitability collapse—operating income is near zero and net losses are significant. The company has financial runway to navigate this downturn, but lacks evidence of stabilization or credible turnaround execution.
Why Buy HLIT? Key Strengths
- Strong free cash flow generation of $96.9M despite net losses, providing financial flexibility
- Fortress balance sheet with low leverage (0.29x debt-to-equity), solid equity base of $383.2M, and $124.1M cash
- Excellent liquidity metrics (2.50x current ratio, 2.26x quick ratio) provide cushion for operational challenges
- Healthy 48.5% gross margin indicates product/service pricing power and manufacturing efficiency
HLIT Investment Risks to Consider
- Severe top-line contraction of -26.2% YoY signals structural market headwinds or competitive displacement in communications equipment sector
- Operating profitability collapse with 3.9% operating margin and negative net income of -43.3M indicates cost structure misalignment
- Negative ROE (-11.3%) and ROA (-6.0%) confirm capital is currently being destroyed despite cash generation
- Heavy insider trading activity (24 Form 4 filings in 90 days) may signal lack of management confidence during downturn
Key Metrics to Watch
- Revenue stabilization and sequential trends—next two quarters critical to assess market recovery
- Operating margin improvement path and cost reduction initiatives relative to revenue base
- Operating cash flow sustainability as working capital normalizes; verify it's not just asset liquidation
- Quarterly gross margin trends to detect pricing pressure or product mix deterioration
HLIT Financial Metrics
💡 AI Analyst Insight
The 26.9% free cash flow margin provides substantial flexibility for dividends, buybacks, and strategic investments. Strong liquidity with a 2.50x current ratio provides a solid financial cushion.
HLIT Profitability Ratios
HLIT vs Default Sector
How HARMONIC INC. compares to Default sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is HLIT Overvalued or Undervalued?
Based on fundamental analysis, HARMONIC INC. has mixed fundamental signals relative to the Default sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
HLIT Balance Sheet & Liquidity
HLIT 5-Year Financial Trend & Growth Analysis
5-Year Trend Summary: HARMONIC INC.'s revenue has remained relatively flat over the 5-year period, with a 4% decline. The most recent EPS of $0.72 reflects profitable operations.
HLIT Growth Metrics (YoY)
HLIT Quarterly Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q3 2025 | $142.4M | $1.1M | $0.01 |
| Q2 2025 | $138.0M | $2.9M | $0.03 |
| Q1 2025 | $122.1M | $5.9M | $0.05 |
| Q3 2024 | $127.2M | $153.0K | $0.00 |
| Q2 2024 | $138.7M | $1.6M | $0.01 |
| Q1 2024 | $122.1M | $5.1M | $0.04 |
| Q3 2023 | $127.2M | $153.0K | $0.00 |
| Q2 2023 | $156.0M | $1.6M | $0.01 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
HLIT Capital Allocation
HLIT SEC 10-K & 10-Q Filing Analysis
Access official SEC EDGAR filings for HARMONIC INC. (CIK: 0000851310)
📋 Recent SEC Filings
❓ Frequently Asked Questions about HLIT
What is the AI rating for HLIT?
HARMONIC INC. (HLIT) has an AI rating of SELL with 62% confidence, based on fundamental analysis of SEC EDGAR filings.
What are HLIT's key strengths?
Claude: Strong free cash flow generation of $96.9M despite net losses, providing financial flexibility. Fortress balance sheet with low leverage (0.29x debt-to-equity), solid equity base of $383.2M, and $124.1M cash.
What are the risks of investing in HLIT?
Claude: Severe top-line contraction of -26.2% YoY signals structural market headwinds or competitive displacement in communications equipment sector. Operating profitability collapse with 3.9% operating margin and negative net income of -43.3M indicates cost structure misalignment.
What is HLIT's revenue and growth?
HARMONIC INC. reported revenue of $360.5M.
Does HLIT pay dividends?
HARMONIC INC. does not currently pay dividends.
Where can I find HLIT SEC filings?
Official SEC filings for HARMONIC INC. (CIK: 0000851310) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is HLIT's EPS?
HARMONIC INC. has a diluted EPS of $-0.38.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined rating reflects both perspectives for balanced insights.
Is HLIT a good stock to buy right now?
Based on our AI fundamental analysis in April 2026, HARMONIC INC. has a SELL rating with 62% confidence. Review the strengths and risks sections above before making a decision. This is not investment advice.
Is HLIT stock overvalued or undervalued?
Valuation metrics for HLIT: ROE of -11.3% (sector avg: 15%), net margin of -12.0% (sector avg: 12%). Compare these metrics with sector averages to assess valuation.
Should I buy HLIT stock in 2026?
Our dual AI analysis gives HARMONIC INC. a combined SELL rating for 2026. Revenue is data pending, with profitability at or below sector average. Always conduct your own research.
What is HLIT's free cash flow?
HARMONIC INC.'s operating cash flow is $108.0M, with capital expenditures of $11.1M. FCF margin is 26.9%.
How does HLIT compare to other Default stocks?
Vs Default sector averages: Net margin -12.0% (avg: 12%), ROE -11.3% (avg: 15%), current ratio 2.50 (avg: 1.8).