Extreme networks (EXTR 13.50%) The stock posts big gains in Wednesday trading following the company’s recent quarterly report. The networking specialist’s stock price was up 13.9% as of 1:30 p.m. ET.

Before the market opened this morning, Extreme Networks released results for the first quarter of its 2025 fiscal year, ending September 30. The company delivered sales and profits above market expectations, and also issued encouraging guidance.

Extreme Networks’ results suggest the company could be turning a corner

Extreme Networks reported non-GAAP (Adjusted) earnings per share of $0.17 on revenue of $269.2 million in the fiscal first quarter, beating analysts’ average estimate of earnings per share of $0.13 by single digits business of approximately $261.3 million. Even though revenue declined 23.8% in the quarter, it remained significantly above Wall Street’s target and increased 4.9% on a sequential quarterly basis. The company’s annualized recurring revenue for subscription software (SaaS) stood at $174.1 million at the end of the fiscal first quarter, up 23.4% year-over-year and 4.3% quarter-on-quarter sequentially.

Extreme Networks Guide to More Sequential Quarterly Growth

For the second quarter of its current fiscal year, Extreme Networks expects sales between $273 million and $283 million. If the company were to hit the midpoint of this forecast range, it would mean a sales decline of about 6% and a sequential quarterly increase of about 3%.

Meanwhile, management forecasts an adjusted gross margin between 62.2% and 63.2% for the current quarter. For reference, the company posted an adjusted gross margin of 63% in the first quarter of this fiscal year and a margin of 62.5% in the second quarter of last year.

Adjusted earnings per share for the current quarter are expected to be between $0.16 and $0.20. Hitting the midpoint of this range would result in earnings falling 25% year over year, but it would also mean an increase of about 6% over last quarter’s earnings.