Extreme Networks (NASDAQ: EXTR) is riding high after several recent customer wins and new additions to its product portfolio. These recent wins have some analysts speculating that the company could be a new challenger to enterprise networking giant Cisco Systems.
Extreme’s stock is up more than 40% since January and Oppenheimer recently gave Extreme an "outperform" rating, because of the networking company’s strides in enterprise edge cloud computing and artificial intelligence (AI).
Since the beginning of January, Extreme’s share price has risen from $18.43 a share on Jan. 3 to $25.90 a share on July 6 and may reach an all-time high this week (As of this writing, Extreme shares were trading at $27.50, up 1.07%).
Extreme Networks is coming off a series of big acquisitions. In 2021 the company purchased Ipanema, the SD-WAN division of Infovista for $73 million and in 2019 it purchased cloud networking company Aerohive Networks for $272 million. In 2017 Extreme bought Brocade’s data center networking assets for $55 million and purchased Avaya’s network business for around $100 million.
Ready to innovate
Analysts say that Extreme has spent the past few years combining the various assets from these acquisitions and consolidating platforms. As a result, the company is now ready to innovate. “Extreme has caught its stride over the past year,” wrote Analyst Zeus Karravela with ZK Research in a recent blog post. “With much of the messy work behind it, Extreme can focus more on innovation.”
That innovation includes the company’s cloud-based computing platform called ExtremeCloudEdge, which it introduced in May in conjunction with its Extreme Connect event held in Berlin.
ExtremeCloudEdge combines Extreme’s ExtremeCloud applications with its CoPilot AI-based management tools and wraps it together with SD-WAN. Extreme said that this edge product eliminates any cloud sovereignty concerns because customers can locate ExtremeCloudEdge in their edge data center and all the data stays there. Plus, it also brings cloud computing power closer to the user. At the same time, because it’s a bundled platform, users can manage all cloud deployment types with a single application, which in turn reduces cost and complexity.
At Extreme Connect the company also debuted a new Wi-Fi 6E access point, the AP300, which it says can aggregate data rates up to 4.8 Gbps in the 6 GHz, 5 GHZ and 2.4 GHz spectrum bands.Extreme has won several sizable customers with its access points. Earlier this year Comcast Business said it was partnering with Extreme to deliver a Wi-Fi 6E network to Oracle Park in San Francisco. The network will be managed by Comcast using the ExtremeCloudIQ platform. This follows a similar announcement in 2022 with Verizon Business in which the two companies partnered to deploy Wi-Fi 6 access points at Liverpool FC’s Anfield Stadium in Liverpool, England.