Calix (CALX): Losses Rise 46.5% Annually, Profitability Challenges Loom Over Turnaround Narrative

Calix (CALX) remains unprofitable, with annual losses climbing at a rate of 46.5% over the last five years and profit margins failing to show improvement. Despite the absence of recent profits and past earnings quality concerns, analysts project robust earnings growth ahead, forecasting a 91.94% yearly increase. For revenue, consensus points to an 11% annual growth rate, outpacing the broader US market. The shares trade at a price-to-sales ratio of 4.8x, which is well above both peer and industry averages. With a current share price of $68.04, CALX sits notably higher than its estimated fair value of $56.39. Valuation remains a central consideration for investors following the stock’s turnaround potential.

See our full analysis for Calix.

The next section puts these headline figures for Calix side by side with the widely watched company narratives, highlighting points of alignment and divergence for investors tracking the story.

See what the community is saying about CalixNYSE:CALX Revenue & Expenses Breakdown as at Oct 2025

Margins Target a 15-Point Swing

Analysts expect profit margins to climb from -3.1% today to 15.4% within three years. This represents a dramatic projected turnaround that would shift Calix from unprofitable to strong margin territory if achieved. According to the analysts' consensus view, this margin expansion is supported by ongoing adoption of Calix Cloud and managed services, which are anticipated to drive higher gross margins and improve long-term earnings quality.

Consensus also highlights the rollout of agentic AI features and platform upgrades as pivotal, with rapid customer adoption needed to unlock recurring revenue growth and attain these higher margins. The 15.4% target depends on both the successful deployment of new technology and customer willingness to pay for advanced, recurring solutions. This reinforces analyst optimism while also raising execution risks.

Consensus narrative suggests recent results set the stage for an inflection in margins, but hitting long-term targets will require flawless execution and broad customer acceptance. 📊 Read the full Calix Consensus Narrative.

Share Count Shrink Supports EPS Paths

Analysts forecast that the number of Calix shares outstanding will decline by 1.53% annually over the next three years. This means future earnings growth per share could outpace total net profit gains. According to the analysts' consensus view, reducing the share count can help the company reach its 2028 EPS goal of $3.13 even faster, provided margin and revenue forecasts materialize as projected.

This supports the path to earnings per share growth, adding a lever for value creation beyond simply top-line expansion or cost discipline alone. However, consensus also notes that share buybacks only strengthen investor returns if operational momentum persists. Disappointments on revenue or margin could blunt these potential EPS benefits.

Story Continues

Premium Price Tag Stands Out

Calix’s current share price of $68.04 is 20.7% above its DCF fair value of $56.39 and trades at a price-to-sales ratio of 4.8x. This is far higher than the US communications industry average of 2.2x. Analysts' consensus narrative highlights that, given the stock’s premium against both industry peers and modeled fair value, investor confidence in Calix’s ability to deliver on ambitious growth, margin, and recurring revenue forecasts is critical.

With the stock already priced higher than the $72.17 analyst price target, there is little room for disappointment. Any stumble on execution or slower market adoption could pressure the current valuation. If Calix executes as forecast, sustaining or even exceeding these premium multiples could be justified in the eyes of growth-oriented investors.

Next Steps

To see how these results tie into long-term growth, risks, and valuation, check out the full range of community narratives for Calix on Simply Wall St. Add the company to your watchlist or portfolio so you'll be alerted when the story evolves.

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A good starting point is our analysis highlighting 1 key reward investors are optimistic about regarding Calix.

See What Else Is Out There

Calix faces valuation concerns, with shares trading well above its estimated fair value. This leaves little margin for error if growth expectations falter.

If you want to focus on companies priced attractively relative to their fundamentals, uncover opportunities with these 834 undervalued stocks based on cash flows that could offer better value and downside protection.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include CALX.

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