8x8 Inc
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ITEM 1. Business
Overview
8x8, Inc. (“8x8”) is a global provider of integrated customer experience and business communications solutions, purpose-built to unify customer and employee engagement across the enterprise. Our Platform for CX™ combines contact center, business communications, and application programmable interfaces, or APIs, for communications into a single, secure, AI-powered system that delivers seamless, data-driven interactions. Designed for agility and scale, our platform helps businesses eliminate silos, improve operational efficiency, and turn every conversation into actionable intelligence. By aligning technology with measurable outcomes, we empower organizations to transform how they connect, serve, and grow — from first interactions to lasting relationships.
We serve a broad customer base—from small businesses to large global enterprises—across every major industry and in over 160 countries. Our strategic focus has increasingly shifted toward mid-market, small and mid-sized enterprise, and public sector organizations, particularly those with 500 to 10,000 employees. These customers often have more complex communication and customer service needs and are more likely to benefit from—and invest in—multiple services across our platform. This focus aligns with our strengths, eliminating communication silos and enabling businesses to transform every customer interaction into a strategic asset. We also invest resources in retaining our small business customers, including world class onboarding and customer care specialists that are a single point of contact for all service and support needs.
We reach customers through a diversified go-to-market strategy that includes both direct and indirect channels. We utilize a diversified partner ecosystem to complement our direct sales efforts and expand our global market reach. Our go-to-market strategy includes technology solutions distributors, or TSDs, and their sub-agent networks, who contribute to pipeline growth through referrals. We also engage value-added resellers, or VARs, who market, sell, implement, and support our solutions, helping to drive customer acquisition and optimize our routes to market.
In addition, we collaborate closely with strategic technology partners—particularly those with whom we maintain deep integrations or original equipment manufacturer, or OEM, relationships—via structured referral agreements and coordinated lead flow processes. Our carrier partnerships extend our service availability to over 100 countries and territories, ensuring high-quality, reliable communications that support our international footprint.
To further enhance deployment speed and geographic coverage, we leverage third-party service providers, enabling us to deliver implementation and support services efficiently at a global scale.
With our unified approach to communication and a commitment to continuous innovation, 8x8 enables businesses to deliver intelligent, connected experiences that securely scale across the enterprise.
Our Strategy
We believe there is a large market opportunity to provide customer experience and communication solutions to mid-market and small- and mid-sized enterprise organizations. Our integrated platform approach enables solutions that span the entire organization and bridge the gaps in communications and customer experience that result from siloed communications and contact center environments. Our solutions are intentionally engineered for effortless adoption, enabling information technology (“IT”), teams and customer experience leaders to improve customer satisfaction, increase employee productivity and drive better business outcomes as their needs evolve and mature over time.
Our strategy is built around six key pillars:
Unified Platform for Customer Experience ("CX"): Our cloud-native 8x8 Platform for CX integrates contact center, unified communications, and communications platform-as-a-service capabilities into a single, secure architecture. The platform is powered by our Customer Interaction Data Platform, which captures, connects, and contextualizes interaction data across the organization. With embedded artificial intelligence and omnichannel functionality, the 8x8 Platform for CX enables consistent, intelligent customer and employee experiences across voice, video, chat, and messaging—helping businesses drive operational efficiency, elevate service quality, and unlock actionable insights at scale.
Outcome-Driven Innovation: We invest in innovation designed to reduce complexity for our customers, help our customers elevate their experience, improve agent and employee productivity and modernize legacy systems. Flexible user interfaces and artificial intelligence-based features are enabled across our platform to improve productivity and drive proactive customer engagement. Features such as real-time call summaries, sentiment analysis, AI-based routing, and AI coaching on next-best-action enable proactive, personalized service and faster outcomes.
Customer Focus: Mid-Market, Enterprise, and Public Sector: Our go-to-market strategy and innovation efforts are centered on serving mid-market, small to mid-sized enterprises, and public sector organizations—segments that often face complex communication and engagement challenges. With a modular platform and a comprehensive suite of capabilities, we enable these customers—many of whom may not have dedicated customer experience engineering teams—to easily adopt and integrate multiple products. This approach drives greater value and improved outcomes and fosters long-term, strategic partnerships.
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Modern Go-To-Market Approach: We reach customers through a hybrid approach that includes direct sales, digital channels, value-added resellers, and strategic integrations with large platforms like Microsoft Teams and Salesforce. This allows us to scale efficiently while tailoring our approach to different customer segments.
Customer Lifecycle Success: Our customer success teams deliver a full lifecycle engagement model focused on rapid onboarding and long-term adoption based on account potential, resulting in increased share of wallet over time. This proactive approach is intended to drive higher customer satisfaction, increased cross-sell of additional products, and higher customer retention.
Technology Partner Ecosystem and Platform Extensibility: Our Technology Partner Ecosystem—a carefully curated set of technology innovators—enables customers to integrate best-of-breed customer experience solutions through deep platform integration for a native-like experience. The extensibility of our platform enables rapid innovation, tailored solutions, and faster deployment of best-of-breed and emerging technologies while eliminating integration complexity.
Our Platform for CX
8x8 delivers an integrated, AI-powered Platform for CX that unifies contact center-as-a-service ("CCaaS"), unified communications-as-a-service ("UCaaS"), and communications platform-as-a-service ("CPaaS") capabilities into a single cloud-native solution. At the core of the platform is the 8x8 Customer Interaction Data Platform, which captures, connects, and contextualizes interaction data across the organization. This comprehensive, high-fidelity data foundation powers a growing portfolio of AI-based features—including intelligent routing, sentiment analysis, live agent guidance, and journey optimization—that enables our customers to drive operational efficiency and proactive, personalized customer engagement with their end customers. The unified nature of our Platform for CX ensures seamless data capture, consistent processing and analytics, and continuous AI learning, offering a strategic advantage in delivering scalable, outcome-driven customer experience for our customers.
The platform also includes tools such as AI Orchestrator for managing multi-vendor virtual agent environments, JourneyIQ for visualizing end-to-end customer journeys and moving customer engagement from reactive to proactive, and 8x8 Engage™, a mobile-inclusive solution extending modern customer experience capabilities beyond the contact center to all customer-facing teams with the right-sized tool as well as visibility to all customer data, interactions and touchpoints. With support for omnichannel communications—including short messaging service (“SMS”), rich messaging services, or RCS, for business messaging, WhatsApp, video, and voice—plus AI-powered features like real-time transcription, live summaries, Customer 360, Agent Assist, customer AI-health scoring, and Compose with AI for message generation, 8x8 enables enterprises to deliver faster, more intelligent, and more empathetic customer service across every channel and interaction.
To address specialized customer needs, the 8x8 Platform for CX is supported by a curated Technology Partner Ecosystem, integrating best-of-breed solutions across areas such as workforce management, compliance, social listening, vertical-specific analytics, and more. This open, modular architecture allows enterprises to quickly incorporate emerging innovations, swap out technologies as new leaders emerge, and tailor deployments to their unique business goals with no added integration complexity or data silos. As the contact center landscape rapidly evolves—with new entrants driving innovation in targeted features—this integration flexibility enables 8x8 and its customer to remain agile and future-ready.
Our Solutions
We deliver a portfolio of cloud-based business communications and contact center solutions that integrate voice, video, messaging, and team collaboration channels through our Platform for CX. This platform leverages shared services—including a unified data model, advanced analytics, transcriptions, translations and workflow automation—to enhance productivity, scalability, customer experience and interaction intelligence. Our offerings are designed to support both horizontal and vertical use cases and are extensible through application programmable interfaces and integrations with our technology partner ecosystem.
Our solutions incorporate artificial intelligence across multiple touchpoints to improve business outcomes, optimize agent performance, and deliver more personalized and efficient customer experiences.
8x8 Work: 8x8 Work is our UCaaS solution designed to enable seamless collaboration and business continuity across voice, video, chat, and messaging. Delivered through a cloud-native platform, 8x8 Work empowers organizations to streamline communication, support hybrid work environments, and integrate with broader customer experience workflows. Key capabilities include:
•Integrated Voice, Video, Messaging, and Collaboration: A single application for business telephony, HD video meetings, team chat, and SMS enables more efficient internal and external communication, reducing tool sprawl and improving employee productivity.
•Enterprise-Grade Cloud Architecture and Global Reach: Built for resilience and scale, 8x8 Work offers secure, compliant communications with high availability in over 55 countries, supporting mobile and distributed teams with consistent reliability.
•Intelligent Integration and Platform Extensibility: Native integrations with Microsoft Teams and leading business applications, along with deep interoperability across the 8x8 Platform for CX, allow customers to unlock data-driven insights and seamlessly transition between unified communications and contact center functions.
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8x8 Contact Center: 8x8 Contact Center is a cloud-based CCaaS solution designed to deliver consistent, intelligent, and personalized customer engagement across voice, chat, email, and digital channels. Integrated into the 8x8 Platform for CX, it enables organizations to elevate service experiences, improve agent productivity, and unlock actionable insights through AI-driven capabilities. Key capabilities include:
•Omnichannel Customer Engagement: A single interface enables agents to manage voice, email, chat, SMS, and social interactions in real time, ensuring seamless and consistent customer experiences across all channels.
•AI-Driven Performance and Analytics: Embedded artificial intelligence powers features such as speech analytics, self-service virtual bots, agent assist capabilities, and sentiment tracking—providing supervisors with real-time visibility and enabling data-informed decisions to enhance customer satisfaction and operational efficiency.
•Flexible, Scalable Deployment and Global Availability: Delivered via a cloud-native architecture, 8x8 Contact Center supports global operations with robust reliability, security, and compliance. The platform allows for rapid scaling and easy integration with customer relationship management systems, workforce optimization tools, and third-party applications.
8x8 Engage: 8x8 Engage extends digital engagement tools to non-traditional customer-facing employees—sales, field service, finance—enabling them to deliver consistent, AI-informed customer experiences at their desk, in the field or on the go. Engage merges UCaaS and CCaaS capabilities, equipping users with a team-based, collaborative customer experience solution, including:
•Unified customer profiles, interaction history and sentiment tracking.
•AI-powered interaction summaries and action items.
•Real-time insights for context-aware service.
•All interactions captured in the customer’s journey to eliminate blindspots.
•Empowering team leaders and customer facing teams to turn customer engagement from reactive to proactive.
8x8 Communications as a Service: Our communications-as-a-service solutions allow businesses to embed communications directly into digital experiences via communications application programmable interfaces, or APIs. Services include voice, SMS, rich messaging services and numerous additional digital and social channels. AI is used in several areas to improve engagement and efficiency, including:
•Proactive customer engagement and campaign management, with AI-driven audience targeting, channel selection, and personalization.
•Analytics and attribution tools, enhanced by AI, to measure engagement across journeys.
•Integrated security and global reach for omnichannel messaging.
Solutions for Microsoft Teams Users: Our integrations with Microsoft Teams enable global telephony, customer engagement, and advanced analytics without leaving the Microsoft Teams interface. AI-driven features include:
•Real-time transcription and meeting summaries for Microsoft Teams meetings.
•Sentiment and intent analysis for customer interactions.
•Automated routing and escalation
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Financial statements
data from SEC XBRL filings. Values are as-reported; restatements supersede originals. Values reported in .
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ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our condensed consolidated financial statements and related notes appearing elsewhere in this Quarterly Report. As discussed in the section titled “Forward-Looking Statements,” the following discussion and analysis contain forward-looking statements that involve risks and uncertainties, as well as assumptions that, if they never materialize or prove incorrect, could cause our results to differ materially from those expressed or implied by such forward-looking statements. Factors that could cause or contribute to these differences include, but are not limited to, those discussed below and elsewhere in this Quarterly Report, particularly those set forth under the section entitled "Risk Factors" in the Form 10-K.
Overview
8x8, Inc. is a global provider of integrated customer experience and business communications solutions, purpose-built to unify customer and employee engagement across the enterprise. Our Platform for CX™ combines contact center, business communications, and application programmable interfaces, or APIs, for communications into a single, secure, AI-powered system that delivers seamless, data-driven interactions. Designed for agility and scale, our platform helps businesses eliminate silos, improve operational efficiency, and turn every conversation into actionable intelligence. By aligning technology with measurable outcomes, we empower organizations to transform how they connect, serve, and grow from first interactions to lasting relationships.
We serve a broad customer base, from small businesses to large global enterprises across every major industry. Our strategic focus has increasingly shifted toward mid-market, small and mid-sized enterprise, and public sector organizations, particularly those with 500 to 10,000 employees. These customers often have more complex communication and customer service needs and are more likely to benefit from and invest in multiple services across our platform. This focus aligns with our strengths, eliminating communication silos and enabling businesses to transform every customer interaction into a strategic asset. We also invest resources in retaining our small business customers, including world-class onboarding and customer care specialists that are a single point of contact for all service and support needs.
We reach customers through a diversified go-to-market strategy that includes both direct and indirect channels. We utilize a diversified partner ecosystem to complement our direct sales efforts and expand our global market reach. Our go-to-market strategy includes technology solutions distributors, or TSDs, and their sub-agent networks, who contribute to pipeline growth through referrals. We also engage value-added resellers, or VARs, who market, sell, implement, and support our solutions, helping to drive customer acquisition and optimize our routes to market.
In addition, we collaborate closely with strategic technology partners, particularly those with whom we maintain deep integrations or original equipment manufacturer, or OEM, relationships, via structured referral agreements and coordinated lead flow processes. Our carrier partnerships extend our service availability to over 100 countries and territories, ensuring high-quality, reliable communications that support our international footprint.
To further enhance deployment speed and geographic coverage, we leverage third-party service providers, enabling us to deliver implementation and support services efficiently on a global scale.
With our unified approach to communication and a commitment to continuous innovation, 8x8 enables businesses to deliver intelligent, connected experiences that securely scale across the enterprise.
We generate service revenue from subscriptions to our communications services, as well as from usage of our platform. Our service subscription plans are sold on a per-user basis and are structured with increasing levels of functionality, based on the specific communication needs and customer engagement profile of each user. Platform usage revenue is revenue recognized from sales of products on an as-used basis, such as telephony minutes, messaging, SMS, and communications APIs, and digital and voice chat bot interactions.
We generate other revenue from professional services and the sale of office phones and other hardware equipment. We define a “customer” as one or more legal entities to which we provide services pursuant to a single contractual arrangement. In some cases, we may have multiple billing relationships with a single customer (for example, where we establish separate billing accounts for a parent company and each of its subsidiaries).
Macroeconomic and Other Factors
We are subject to risks and exposures, including those caused by adverse economic conditions. Macroeconomic conditions that could adversely affect our business include geopolitical instability, tariffs, continued inflation, increased interest rates, supply chain disruptions, decreased economic output and fluctuations in currency exchange rates. We continuously monitor the direct and indirect impacts of these factors, as well as the overall global economy and geopolitical landscape on our business and financial results.
While the implications of macroeconomic events on our business, results of operations, and overall financial position remain uncertain over the long term, we expect that adverse economic conditions could adversely impact our business in future periods. For example, our installed base includes approximately 50,000 small businesses, which tend to be disproportionately impacted by macroeconomic headwinds.
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Summary and Outlook
As part of our long-term strategy to grow our revenue and increase profitability and cash flow, we are focused on retaining our existing customers and expanding our mid-market, enterprise and public sector customer base. We believe that continued innovation is a critical factor in attracting and retaining our customers and is an important variable in achieving sustainable growth. We are committed to continuing our investment in research and development to deliver innovation across our Platform for CX, expand our ecosystem of integrated third-party applications, and maintain the high platform availability our customers require.
Our primary focus involves the following: (i) accelerating innovation, particularly in enhancing our platform and contact center with artificial intelligence-based capabilities, and (ii) leveraging our CPaaS leadership in the Asia-Pacific region to expand globally. We continue to introduce new products like 8x8 Engage, add capabilities that allow our customers to enhance employee and customer experience, and expand our Technology Partner Ecosystem to provide complete solutions tailored to specific use cases. We are also enhancing our platform foundation with cutting edge technology, such as the Customer Interaction Data Platform and composable agent and supervisor user interfaces. These innovations enable tightly integrated solutions that prioritize ease-of-use, out-of-the-box functionality, and rapid deployment.
Our investment in innovation has been complemented by initiatives to manage the cost of delivering our services and improve our sales efficiency. We continue to monitor factors that could have an impact on customer buying behavior and demand, including technological changes in artificial intelligence ("AI") and AI-related developments, macroeconomic conditions, the competitive environment, contract duration, churn, upsell and down-sell, renewals, and payment terms, all of which have caused variability in our results and may continue to do in the future. We expect the cost of delivering our communication services, both in total dollars and as a percentage of service revenue, to vary with the amount of service revenue and the mix of subscription and usage revenue within service revenue. To improve our sales efficiency over time, we continue to invest in marketing programs to drive awareness for our solutions, and we have increased training for our sales teams and invested in tools to increase productivity. We have also expanded our reseller partner programs to extend our reach within our target customer market, placing increased emphasis on developing a community of value-added resellers who provide implementation services and Tier 1 customer support in addition to sales. To support our customers and partners, we have expanded our customer success organization and continue to invest in improvements to our back-office processes to increase our operational efficiency over time.
Key GAAP Operating Results
To assess the success of our strategies to achieve growth and increase our cash flow, management reviews our financial performance as presented in our consolidated financial statements, including trends in revenue, gross profit margin, income (loss) from operations, and cash flow generated by operations in absolute dollars and as a percentage of revenue as presented in the following table:
| Fiscal Year 2026 | Fiscal Year 2025 | |||||||||||||||||||||||||||||||||||||||
| Three Months Ended | Three Months Ended | |||||||||||||||||||||||||||||||||||||||
| (In thousands, except percentages) | December 31, 2025 | September 30, 2025 | June 30, 2025 | March 31, 2025 | December 31, 2024 | September 30, 2024 | June 30, 2024 | |||||||||||||||||||||||||||||||||
| Service revenue | $ | 179,682 | $ | 179,094 | $ | 176,308 | $ | 171,588 | $ | 173,459 | $ | 175,075 | $ | 172,801 | ||||||||||||||||||||||||||
| % of Total Revenue | 97.1 | % | 97.3 | % | 97.2 | % | 96.9 | % | 97.0 | % | 96.7 | % | 97.0 | % | ||||||||||||||||||||||||||
| Gross profit | $ | 118,216 | $ | 119,340 | $ | 120,440 | $ | 120,052 | $ | 121,085 | $ | 123,175 | $ | 120,960 | ||||||||||||||||||||||||||
| % of Total Revenue | 63.9 | % | 64.8 | % | 66.4 | % | 67.8 | % | 67.7 | % | 68.1 | % | 67.9 | % | ||||||||||||||||||||||||||
| Income (loss) from operations | $ | 9,694 | $ | 5,349 | $ | 565 | $ | 419 | $ | 8,979 | $ | 7,169 | $ | (1,374) | ||||||||||||||||||||||||||
| % of Total Revenue | 5.2 | % | 2.9 | % | 0.3 | % | 0.2 | % | 5.0 | % | 4.0 | % | (0.8) | % | ||||||||||||||||||||||||||
| Net income (loss) | $ | 5,090 | $ | 767 | $ | (4,315) | $ | (5,401) | $ | 3,022 | $ | (14,543) | $ | (10,290) | ||||||||||||||||||||||||||
| % of Total Revenue | 2.8 | % | 0.4 | % | (2.4) | % | (3.1) | % | 1.7 | % | (8.0) | % | (5.8) | % | ||||||||||||||||||||||||||
| Net cash provided by operating activities | $ | 20,692 | $ | 8,835 | $ | 11,873 | $ | 5,873 | $ | 27,216 | $ | 12,317 | $ | 18,148 | ||||||||||||||||||||||||||
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Components of Results of Operations
Service Revenue
Service revenue consists of communication services subscriptions and platform usage revenue and related fees from our UCaaS, CCaaS and CPaaS offerings. We plan to increase service revenue through a combination of new customer acquisition, cross-sell of additional products to existing customers, including new products resulting from our increased investment in innovation, artificial intelligence, geographic expansion of our customer base outside the United States, innovation in our products and technologies, and through strategic acquisitions of technologies and businesses.
Other Revenue
Other revenue consists of revenue from professional services, primarily in support of deployment of our solutions and/or platform, and revenue from sales and rentals of IP telephones in conjunction with our cloud telephony service. Other revenue is dependent on the number of customers who choose to purchase or rent IP telephone hardware in conjunction with our service instead of using the solution on their cell phone, computer, or other compatible device, and/or choose to engage our professional services organization for implementation and deployment of our cloud services.
Cost of Service Revenue
Cost of service revenue consists primarily of costs associated with network operations and related personnel, technology licenses, amortization of capitalized internal-use software, other communication origination and termination services provided by third-party carriers, outsourced customer service call center operations, and other costs such as customer service, and technical support costs. We allocate overhead costs, such as information technology and facilities, to cost of service revenue, as well as to each of the operating expense categories, generally based on relative headcount. Our information technology costs include costs for information technology infrastructure and personnel. Facilities costs primarily consist of office leases and related expenses.
Cost of Other Revenue
Cost of other revenue consists primarily of direct and indirect costs associated with the purchase and shipping and handling of IP telephone hardware as well as the scheduling, shipping and handling, personnel costs, and other expenditures incurred in connection with the professional services associated with the deployment and implementation of our products, and allocated information technology and facilities costs.
Research and Development
Research and development expenses consist primarily of personnel and related costs, third-party development, software and equipment costs necessary for us to conduct our product, platform development and engineering efforts, as well as allocated information technology and facilities costs.
Sales and Marketing
Sales and marketing expenses consist primarily of personnel and related costs, sales commissions, including those to the channel, trade shows, advertising and other marketing, demand generation, and promotional expenses, as well as allocated information technology and facilities costs.
General and Administrative
General and administrative expenses consist primarily of personnel and related costs, professional services fees, corporate administrative costs, tax and regulatory fees, and allocated information technology and facilities costs.
Interest Expense
Interest expense consists primarily of interest expense related to our term loan and convertible notes, and amortization of debt discount and issuance costs.
Other Expense, Net
Other expense, net, consists primarily of losses on debt extinguishment, gain or loss on warrant remeasurement, interest income, gains or losses on foreign exchange transactions, as well as other income.
Provision for Income Taxes
Provision for income taxes consists primarily of foreign income taxes and state taxes in the United States. As we expand the scale of our international business activities, any changes in the United States and foreign taxation of such activities may increase our overall provision for income taxes in the future. We have a valuation allowance for our U.S. deferred tax assets, including federal and state net operating loss carryforwards. We expect to maintain this valuation allowance until it becomes more likely than not that the benefit of our federal and state deferred tax assets will be realized by way of expected future taxable income in the United States.
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Results of Operations
Revenue
Service revenue
| Three Months Ended December 31, | Nine Months Ended December 31, | |||||||||||||||||||||||||||||||||||||||||||||
| (In thousands, except percentages) | 2025 | 2024 | Change | 2025 | 2024 | Change | ||||||||||||||||||||||||||||||||||||||||
| Service revenue | $ | 179,682 | $ | 173,459 | $ | 6,223 | 3.6 | % | $ | 535,084 | $ | 521,335 | $ | 13,749 | 2.6 | % | ||||||||||||||||||||||||||||||
| Percentage of total revenue | 97.1 | % | 97.0 | % | 97.2 | % | 96.9 | % | ||||||||||||||||||||||||||||||||||||||
Three Months Ended
Service revenue increased by $6.2 million, or 3.6%, for the three months ended December 31, 2025, compared to the three months ended December 31, 2024. This change was driven by an increase of $14.0 million in platform usage revenue generated primarily in the Asia-Pacific region, resulting from higher customer consumption volumes of our usage-based offerings, reflecting expanded customer adoption and usage of messaging, minutes and AI-based solutions during the period. This increase was partially offset by a decrease in subscription revenue of $7.8 million consisting predominantly of former Fuze customers.
Nine Months Ended
Service revenue increased by $13.7 million, or 2.6%, for the nine months ended December 31, 2025, compared to the nine months ended December 31, 2024. This change was driven by an increase of $34.2 million in platform usage revenue generated primarily in the Asia-Pacific region, resulting from higher customer consumption volumes of our usage-based offerings, reflecting expanded customer adoption and usage of messaging, minutes and AI-based solutions during the period. This increase was partially offset by a decrease in subscription revenue of $20.5 million consisting predominantly of former Fuze customers.
Other revenue
| Three Months Ended December 31, | Nine Months Ended December 31, | |||||||||||||||||||||||||||||||||||||||||||||
| (In thousands, except percentages) | 2025 | 2024 | Change | 2025 | 2024 | Change | ||||||||||||||||||||||||||||||||||||||||
| Other revenue | $ | 5,368 | $ | 5,423 | $ | (55) | (1.0) | % | $ | 15,422 | $ | 16,692 | $ | (1,270) | (7.6) | % | ||||||||||||||||||||||||||||||
| Percentage of total revenue | 2.9 | % | 3.0 | % | 2.8 | % | 3.1 | % | ||||||||||||||||||||||||||||||||||||||
Three Months Ended
Other revenue decreased by $0.1 million, or 1.0%, for the three months ended December 31, 2025, compared to the three months ended December 31, 2024, due to a decrease in professional service revenue of $0.5 million, partially offset by an increase in product revenue of $0.4 million.
Nine Months Ended
Other revenue decreased by $1.3 million, or 7.6%, for the nine months ended December 31, 2025, compared to the nine months ended December 31, 2024, due to lower product revenue and professional service revenue of $1.1 million and $0.2 million, respectively.
Cost of Revenue
Cost of service revenue
| Three Months Ended December 31, | Nine Months Ended December 31, | |||||||||||||||||||||||||||||||||||||||||||||
| (In thousands, except percentages) | 2025 | 2024 | Change | 2025 | 2024 | Change | ||||||||||||||||||||||||||||||||||||||||
| Cost of service revenue | $ | 59,515 | $ | 50,529 | $ | 8,986 | 17.8 | % | $ | 171,036 | $ | 150,276 | $ | 20,760 | 13.8 | % | ||||||||||||||||||||||||||||||
| Percentage of service revenue | 33.1 | % | 29.1 | % | 32.0 | % | 28.8 | % | ||||||||||||||||||||||||||||||||||||||
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Three Months Ended
Cost of service revenue increased by $9.0 million, or 17.8%, for the three months ended December 31, 2025, compared to the three months ended December 31, 2024, primarily due to increases of $10.9 million in network and carrier service provider costs to deliver our subscription and platform usage services to support our capacity needs and $0.6 million in salaries, benefits and consulting costs. These increases were partially offset by decreases of $1.6 million in amortization of intangible assets, $0.5 million in stock-based compensation, and $0.4 million in amortization of capitalized software.
Nine Months Ended
Cost of service revenue increased by $20.8 million, or 13.8%, for the nine months ended December 31, 2025, compared to the nine months ended December 31, 2024, primarily due to increases of $28.2 million in network and carrier service provider costs to deliver our subscription and platform usage services to support our capacity needs and $2.0 million in salaries, benefits and consulting costs. These increases were partially offset by decreases of $4.8 million in amortization of intangible assets, $2.7 million in stock-based compensation, and $1.9 million in amortization of capitalized software.
Cost of other revenue
| Three Months Ended December 31, | Nine Months Ended December 31, | |||||||||||||||||||||||||||||||||||||||||||||
| (In thousands, except percentages) | 2025 | 2024 | Change | 2025 | 2024 | Change | ||||||||||||||||||||||||||||||||||||||||
| Cost of other revenue | $ | 7,319 | $ | 7,268 | $ | 51 | 0.7 | % | $ | 21,474 | $ | 22,531 | $ | (1,057) | (4.7) | % | ||||||||||||||||||||||||||||||
| Percentage of other revenue | 136.3 | % | 134.0 | % | 139.2 | % | 135.0 | % | ||||||||||||||||||||||||||||||||||||||
Three Months Ended
Cost of other revenue increased by $0.1 million, or 0.7%, for the three months ended December 31, 2025, compared to the three months ended December 31, 2024, primarily due to an increase of $0.3 million in product costs associated with IP telephone hardware. This increase was partially offset by a decrease of $0.2 million in stock-based compensation.
Nine Months Ended
Cost of other revenue decreased by $1.1 million, or 4.7%, for the nine months ended December 31, 2025, compared to the nine months ended December 31, 2024, primarily due to decreases of $0.9 million in lower product costs associated with IP telephone hardware and $0.7 million of stock-based compensation. These decreases were partially offset by an increase of $0.5 million in salaries, benefits, and consulting costs to deliver our professional services.
Operating Expenses
Research and development
| Three Months Ended December 31, | Nine Months Ended December 31, | |||||||||||||||||||||||||||||||||||||||||||||
| (In thousands, except percentages) | 2025 | 2024 | Change | 2025 | 2024 | Change | ||||||||||||||||||||||||||||||||||||||||
| Research and development | $ | 27,191 | $ | 29,833 | $ | (2,642) | (8.9) | % | $ | 83,473 | $ | 93,261 | $ | (9,788) | (10.5) | % | ||||||||||||||||||||||||||||||
| Percentage of total revenue | 14.7 | % | 16.7 | % | 15.2 | % | 17.3 | % | ||||||||||||||||||||||||||||||||||||||
Three Months Ended
Research and development expenses decreased by $2.6 million, or 8.9%, for the three months ended December 31, 2025, compared to the three months ended December 31, 2024, primarily due to decreases of $2.2 million in stock-based compensation, $1.2 million in combined salaries, benefits, and consulting costs necessary for us to conduct our product, platform development and engineering efforts, and $0.7 million in costs to operate data centers. These decreases were partially offset by increases of $1.1 million in software licenses and other costs and $0.4 million in amortization of capitalized software.
Nine Months Ended
Research and development expenses decreased by $9.8 million, or 10.5%, for the nine months ended December 31, 2025, compared to the nine months ended December 31, 2024, primarily due to decreases of $7.4 million in stock-based compensation, $2.6 million in internally-developed software and other costs, and $1.7 million in costs to operate data centers and facilities. These decreases were partially offset by increases of $1.2 million in software licenses and $0.7 million in amortization of capitalized software.
26
Sales and marketing
| Three Months Ended December 31, | Nine Months Ended December 31, | |||||||||||||||||||||||||||||||||||||||||||||
| (In thousands, except percentages) | 2025 | 2024 | Change | 2025 | 2024 | Change | ||||||||||||||||||||||||||||||||||||||||
| Sales and marketing | $ | 60,513 | $ | 65,644 | $ | (5,131) | (7.8) | % | $ | 192,532 | $ | 197,617 | $ | (5,085) | (2.6) | % | ||||||||||||||||||||||||||||||
| Percentage of total revenue | 32.7 | % | 36.7 | % | 35.0 | % | 36.7 | % | ||||||||||||||||||||||||||||||||||||||
Three Months Ended
Sales and marketing expenses decreased by $5.1 million, or 7.8%, for the three months ended December 31, 2025, compared to the three months ended December 31, 2024, primarily due to decreases of $3.4 million in channel commissions and amortization of deferred contract acquisition costs, $1.4 million in stock-based compensation expense, and $0.7 million in paid media and other marketing services costs. These decreases were partially offset by an increase of $0.4 million in salaries, benefits, and consulting costs.
Nine Months Ended
Sales and marketing expenses decreased by $5.1 million, or 2.6% for the nine months ended December 31, 2025, compared to the nine months ended December 31, 2024, primarily due to decreases of $9.5 million in channel commissions and amortization of deferred contract acquisition costs and $3.1 million in stock-based compensation expense. These decreases were partially offset by increases of $5.7 million in salaries, benefits, and consulting costs and $1.8 million in paid media and other marketing services costs.
General and administrative
| Three Months Ended December 31, | Nine Months Ended December 31, | |||||||||||||||||||||||||||||||||||||||||||||
| (In thousands, except percentages) | 2025 | 2024 | Change | 2025 | 2024 | Change | ||||||||||||||||||||||||||||||||||||||||
| General and administrative | $ | 20,818 | $ | 16,629 | $ | 4,189 | 25.2 | % | $ | 66,383 | $ | 59,568 | $ | 6,815 | 11.4 | % | ||||||||||||||||||||||||||||||
| Percentage of total revenue | 11.2 | % | 9.3 | % | 12.1 | % | 11.1 | % | ||||||||||||||||||||||||||||||||||||||
Three Months Ended
General and administrative expenses increased by $4.2 million, or 25.2%, for the three months ended December 31, 2025, compared to the three months ended December 31, 2024, primarily due to an increase of $6.7 million in legal and regulatory costs. This increase was partially offset by a decrease of $2.5 million in stock-based compensation and other general corporate costs.
Nine Months Ended
General and administrative expenses increased by $6.8 million, or 11.4%, for the nine months ended December 31, 2025, compared to the nine months ended December 31, 2024, primarily due to increases of $10.9 million in legal and regulatory costs, $0.9 million in salaries, benefits, and consulting costs, and $0.6 million in facilities costs. These increases were partially offset by decreases of $2.6 million in stock-based compensation and $3.0 million in other general corporate costs.
27
Other expense, net
Interest expense
| Three Months Ended December 31, | Nine Months Ended December 31, | |||||||||||||||||||||||||||||||||||||||||||||
| (In thousands, except percentages) | 2025 | 2024 | Change | 2024 | 2023 | Change | ||||||||||||||||||||||||||||||||||||||||
| Interest expense | $ | (4,587) | $ | (5,842) | $ | 1,255 | (21.5) | % | $ | (13,397) | $ | (23,703) | $ | 10,306 | (43.5) | % | ||||||||||||||||||||||||||||||
| Percentage of total revenue | (2.5) | % | (3.3) | % | (2.4) | % | (4.4) | % | ||||||||||||||||||||||||||||||||||||||
Three Months Ended
Interest expense decreased by $1.3 million, or 21.5%, for the three months ended December 31, 2025, compared to the three months ended December 31, 2024, primarily due to a lower interest rate and principal balance on the 2024 Term Loan. See Note 8, Convertible Senior Notes and Term Loan, for further details.
Nine Months Ended
Interest expense decreased by $10.3 million, or 43.5%, for the nine months ended December 31, 2025, compared to the nine months ended December 31, 2024, primarily due to a lower interest rate and principal balance on the 2024 Term Loan compared to the 2022 Term Loan and capitalized interest related to property, plant and equipment from general borrowing costs. See Note 8, Convertible Senior Notes and Term Loan, for further details.
Other income (expense), net
| Three Months Ended December 31, | Nine Months Ended December 31, | |||||||||||||||||||||||||||||||||||||||||||||
| (In thousands, except percentages) | 2025 | 2024 | Change | 2025 | 2024 | Change | ||||||||||||||||||||||||||||||||||||||||
| Other income (expense), net | $ | 511 | $ | 793 | $ | (282) | (35.6) | % | $ | 1,343 | $ | (10,200) | $ | 11,543 | NM | |||||||||||||||||||||||||||||||
| Percentage of total revenue | 0.3 | % | 0.4 | % | 0.2 | % | (1.9) | % | ||||||||||||||||||||||||||||||||||||||
Three Months Ended
We recognized $0.5 million of other income, net during the three months ended December 31, 2025, compared to $0.8 million of other income, net during the three months ended December 31, 2024, primarily due to a decrease of $1.6 million due to reduced foreign exchange gains and a $0.3 million decrease in interest income earned on cash and cash equivalents. These decreases were offset by a reduced loss of $1.2 million on the remeasurement of Warrants issued in connection with the 2022 Term Loan, a reduction in the loss on debt extinguishment of $0.2 million, and a $0.2 million decrease in other expense.
Nine Months Ended
We recognized $1.3 million of other income, net during the nine months ended December 31, 2025, compared to $10.2 million of other expense, net during the nine months ended December 31, 2024, primarily due to a decrease in the loss on debt extinguishment of $12.1 million, a $1.0 million decrease due to reduced foreign exchange losses, and a decrease of $0.3 million in other expenses. These decreases were offset by $1.3 million decrease in interest income earned on cash and cash equivalents and a reduced gain of $0.6 million on the remeasurement of Warrants issued in connection with the 2022 Term Loan.
28
Provision for income taxes
Next expected filings
- ~2026-05-21 10-K expected by 2026-05-28 (in 1 day)
- ~2026-08-06 10-Q expected by 2026-08-10 (in 78 days)
- ~2026-11-05 10-Q expected by 2026-11-09 (in 169 days)
- ~2027-02-04 10-Q expected by 2027-02-08 (in 260 days)
Predicted from historical filing cadence; not an SEC commitment.
Recent SEC filings
- 2026-05-19 8-K Earnings Release; Financial Statements and Exhibits
- 2026-03-17 8-K Officer/Director Change
- 2026-02-04 10-Q Quarterly Report
- 2026-02-03 8-K Earnings Release; Financial Statements and Exhibits
- 2025-11-05 10-Q Quarterly Report
- 2025-11-04 8-K Earnings Release; Financial Statements and Exhibits
- 2025-08-06 10-Q Quarterly Report
- 2025-08-05 8-K Earnings Release; Financial Statements and Exhibits
- 2025-08-04 8-K Material Agreement Entered; Financial Statements and Exhibits
- 2025-06-05 8-K Changes in Auditor; Financial Statements and Exhibits
- 2025-05-22 10-K Annual Report
- 2025-05-19 8-K Earnings Release; Financial Statements and Exhibits
- 2025-02-05 10-Q Quarterly Report
- 2025-02-04 8-K Earnings Release; Financial Statements and Exhibits
- 2024-11-18 8-K Officer/Director Change; Financial Statements and Exhibits