Harmonic (HLIT) Stock Forecast & Price Target

Harmonic Inc. is poised for a positive financial outlook due to anticipated sequential revenue growth in Q4 and an expected return to over 30% growth throughout 2026, which will likely enhance profit margins. The scaling of its CableOS business, coupled with accelerated deployments from Tier-1 customers, has resulted in greater consistency in financial results. Furthermore, increased traffic and enhancements from one of its major Video customers could drive additional revenue, reinforcing Harmonic's strong market position in both broadband access solutions and video processing services.

Harmonic Inc. faces significant challenges as its Broadband revenue remains flat, largely due to headwinds experienced by major customers Comcast and Charter, which is reflected in a bleak Q3 revenue guidance indicating a year-over-year decline of 45% at the midpoint. The anticipated Broadband revenue range of $75 million to $85 million set for Q3 raises concerns about overall financial stability, with expectations leaning towards the higher end of this forecast mainly due to management's historically conservative estimates. Additionally, the company's transition from hardware to software/SaaS in its Video segment has exerted pressure on revenue, raising further doubts about Harmonic's ability to maintain its market position and growth trajectory.