8×8, Inc. (NYSE:EGHT) Q4 2025 Earnings Call Transcript
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Overview
The earnings call presents a mixed outlook. Positive aspects include stable financial performance, debt reduction, and strategic investments in R&D and multi-product strategy. However, challenges such as economic uncertainty, competitive pressures, and supply chain issues temper enthusiasm. The lack of a share repurchase or dividend program further neutralizes sentiment. The Q&A section reveals concerns about macroeconomic impacts and ongoing transitions, but also highlights potential growth areas. Overall, the combination of stable financial results and external challenges suggests a neutral stock price movement over the next two weeks.
Key Financial Performance
EPS $0.08 EPS, unchanged year-over-year.
Total Revenue $177 million, near the midpoint of guidance, reflecting a stable performance.
Service Revenue $171.6 million, near the midpoint of guidance, with a year-over-year growth of 2.8% compared to 1.8% in fiscal 2024.
Service Revenue Excluding Fuze 4.6% growth year-over-year, up from 2.7% in Q3, marking the highest growth rate in 10 quarters.
Gross Margin 69%, at the low end of guidance, impacted by a revenue mix shift as lower margin platform usage revenue grew to 13.5% of total revenue.
Operating Margin 10%, at the high end of guidance, reflecting effective cost management.
Operating Cash Flow $5.9 million in Q4, bringing full year cash flow to $63.6 million, within the provided range.
Net Debt to EBITDA Ratio Approximately 2.7 times, down from over 6 times in fiscal Q2 2023, enhancing financial flexibility.
Stock-Based Compensation 4.6% of total revenue, a multi-year low, down over $22 million year-over-year.
Remaining Performance Obligation $780 million, up approximately 1% year-over-year, reflecting strong multi-year contractual commitments.
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Operating Highlights
New AI-based capabilities: Introduced a series of platform level enhancements designed to solve systematic challenges in customer experience, employee efficiency, and digital transformation.
8×8 JourneyIQ: A new advanced CX solution that provides real-time visibility into the customer journey across every department and channel.
8×8 AI Orchestrator: Connects communications flows using a GUI across systems, ensuring seamless transitions between bots, agents, and departments.
RCS Business Messaging: First contact center provider to fully integrate rich communication services, enabling branded two-way messaging for digital channels.
8×8 Secure Pay: Launched Apple Pay and Google Pay support, streamlining transactions and expanding self-service payment options.
Customer Growth: The number of customers with three or more products increased 13% year-over-year to more than 700 customers.
Microsoft Teams Integrations: New license sales up 72% in Q4 2024, with cumulative licenses sold growing 30% year-over-year to over 550,000 seats.
Fuze Customer Transition: Substantial progress in upgrading customers from the Fuze service platform to 8×8, with expectations to complete by end of calendar year 2025.
Cash Flow: Combined cash flow from operations for fiscal 2024 and 2025 is the highest two years ever at 8×8, over half of market capitalization.
Debt Reduction: Reduced principal balance of debt by over $209 million or approximately 38% since August 2022.
Operating Cash Flow: Generated $5.9 million in operating cash flow in Q4, bringing full year cash flow to $63.6 million.
Go-to-Market Rebuild: Rebuilt go-to-market model around solution selling and partner enablement after slashing costs in fiscal 2023 and early fiscal 2024.
Focus on Enterprise Business: Investing in targeted programs to reach new logos and expand wallet share within existing customers while maintaining small business base.
Long-term Growth Strategy: Expecting high single-digit revenue growth and double-digit operating margins in the next few years.
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Risk or Challenges
Economic Uncertainty: The economic picture has shifted, with recent tariff actions and global uncertainty adding complexity to the business environment.
Transition Challenges: The company is navigating multiple transitions, including the upgrade of Fuze customers to the 8×8 platform, with a conservative estimate of revenue retention from those customers.
Competitive Pressures: The company faces competition from legacy vendors like Avaya, Mitel, and Cisco, particularly in the unified communications space.
Regulatory Issues: The integration of new AI capabilities and compliance with industry regulations may pose challenges as the company expands its technology partner ecosystem.
Supply Chain Challenges: The ongoing macroeconomic backdrop may affect supply chain dynamics, impacting operational efficiency and cost management.
Foreign Exchange Volatility: About one-third of the company's revenue is generated outside the U.S., exposing it to foreign exchange volatility.
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Guidance & Outlook
Transformation Initiatives: 8×8 began a massive transformation in fiscal 2023 post-acquisition of Fuze, focusing on fixing the financial model, investing in innovation, and improving customer experience.
Go-to-Market Rebuild: Rebuilt the go-to-market model around solution selling and partner enablement, enhancing sales organization and accountability.
AI Integration: Introduced AI-based capabilities across the platform, enhancing customer experience and operational efficiency.
Customer Transition: Significant progress in upgrading Fuze customers to the 8×8 platform, with expectations to complete the transition by the end of calendar year 2025.
Debt Reduction: Reduced debt by over $209 million or approximately 38% since August 2022, enhancing financial flexibility.
Fiscal 2026 Service Revenue Guidance: Expected service revenue between $682 million and $702 million.
Fiscal 2026 Total Revenue Guidance: Expected total revenue between $702 million and $724 million.
Fiscal 2026 Operating Margin Guidance: Projected operating margin between 9% and 10%.
Fiscal 2026 Non-GAAP EPS Guidance: Expected fully diluted non-GAAP EPS in the range of $0.34 to $0.37.
Fiscal 2026 Cash Flow Guidance: Anticipated cash flow from operations between $40 million and $50 million.
Long-term Growth Outlook: High single-digit revenue growth and double-digit operating margins are achievable in the next few years.
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Shareholder Return Plan
Share Repurchase Program: 8×8, Inc. has not explicitly mentioned a share repurchase program in the earnings call.
Dividend Program: 8×8, Inc. has not discussed any dividend program in the earnings call.
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Key Q&A
Q:Can you share with us what you’re hearing from your field reps, from your partners in terms of the macro impact?
A:In March, there was a bit of chaos in the US with elongated deal cycles and shrinking deal sizes. April was all over the place, but May has been calmer. The rest of the world seems to be chugging along.
Q:Can you clarify what remains in terms of your go to market?
A:It's a work in progress. We're about 60-70% through the reorganization of our sales and marketing engine, focusing on solution selling and outcome-based selling.
Q:Can you give us like an adjusted service revenue growth for fiscal 2026 excluding the Fuze?
A:Excluding Fuze, the revenue growth is 2.9% for fiscal 2026.
Q:How much of the growth is driven by go-to-market changes versus customer demand?
A:We don't forecast market changes; we base it on our increase in multi-product customers and improved distribution.
Q:What’s your assumption for cash flow for fiscal 2026?
A:We are making investments for growth, and while there may be some margin contraction, we expect to generate a good amount of cash flow.
Q:Why are you winning in the CCaaS piece of the business?
A:We offer a complete solution with best-in-breed technology from a single vendor, which is appealing to mid-market enterprises.
Q:What’s the status of how CPaaS is doing in the APAC region?
A:The CPaaS team continues to perform well and is a core part of our business.
Q:What takes you to the high single-digit revenue growth?
A:Once we get Fuze out of the way and continue to grow our multi-product customers, we expect to see higher retention rates and growth.
Q:Where has your focus shifted now that you’ve made it through your first priorities?
A:The focus is on getting back to growth and investing in CPaaS and distribution.
Q:Can you unpack the sequential step down in RPO?
A:It's mainly due to the Fuze transition.
Q:Review of Unclear Management Responses
A:Management avoided giving a direct answer regarding the specific forecast for revenue growth for fiscal 2027 and beyond, stating only that it would be a positive growth rate without providing concrete numbers.
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Earnings Word Cloud
The most frequently occurring keywords in this quarter's earning call
AI capability
CIDP
Fuze cash
Fuze customer
Fuze improvement
Fuze plan
Fuze platform
Fuze service
Inc inline
Pay
RCS
SpinSci EHR
TPES
UK
acquisition Fuze
challenge
channel AI
cohort Fuze
communication APIs
confidence
customer experience
customer interaction
decision Fuze
department
digit
earnest heel
environment
expectation Conference
feature
initiative
legacy
license
logo
message
momentum
platform CX
quality
stage
transition
voice team
EGHT Transcript
8x8, Inc. (EGHT) Q2 2026 Earnings Call Transcript
Positive11-5
The earnings call indicates strong financial performance with a revenue and EPS beat, disciplined capital management, and debt reduction. Despite some margin pressures, the overall profitability and cash flow are improving. The Q&A reveals a strategic focus on AI and M&A for growth, with international markets showing promising trends. While management was vague about certain future projections, the overall sentiment is positive due to strong financial metrics, optimistic guidance, and strategic initiatives.
8x8, Inc. (EGHT) Q1 2026 Earnings Call Transcript
Positive8-5
The earnings call presented a positive outlook, with strong revenue performance, debt reduction, and shareholder returns. Despite a slight decline in gross margin, the company is effectively managing cash flow and demonstrating growth in usage-based revenue. The Q&A highlighted challenges with the Fuze migration but also revealed growth opportunities in AI and CPaaS, especially in Asia. The stock buyback and debt reduction further support a positive sentiment. Overall, the company's strategic initiatives and financial health suggest a positive stock price movement in the short term.
8×8, Inc. (NYSE:EGHT) Q4 2025 Earnings Call Transcript
Unknown5-21
The earnings call presents a mixed outlook. Positive aspects include stable financial performance, debt reduction, and strategic investments in R&D and multi-product strategy. However, challenges such as economic uncertainty, competitive pressures, and supply chain issues temper enthusiasm. The lack of a share repurchase or dividend program further neutralizes sentiment. The Q&A section reveals concerns about macroeconomic impacts and ongoing transitions, but also highlights potential growth areas. Overall, the combination of stable financial results and external challenges suggests a neutral stock price movement over the next two weeks.
8x8, Inc. (EGHT) Q4 2025 Earnings Call Transcript
Unknown5-19
The earnings call presents a mixed picture. Basic Financial Performance shows stable revenue and debt reduction but has weak gross margins and uncertain cash flow projections. Product Development is positive with AI focus but faces macroeconomic challenges. Market Strategy is in transition, with incomplete sales and marketing changes. Expenses are managed well, but financial health concerns persist due to vague guidance. Shareholder Return Plan is positive with debt reduction but lacks strong incentives. Q&A reveals market volatility and management's unclear responses, adding uncertainty. Overall, the sentiment is Neutral, expecting a stock price movement between -2% to 2%.
EGHT Slides
EGHT Report
Frequently Asked Questions
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They are generated by a specialized financial-language model trained exclusively on 15+ years of earnings transcripts. The model extracts financial figures, guidance, and tone with 97%+ accuracy and is regularly validated against human analysts. The full raw transcript always remains available for verification.
