8x8 (EGHT) Q3 2026 earnings summary

Executive summary

• Achieved record service revenue of $179.7 million and total revenue of $185.1 million, up 3.6% and 3.4% year-over-year, respectively, with 20th consecutive quarter of positive operating cash flow and improved operational efficiency.

• Strategic investments in innovation, operational efficiency, and distribution, including AI and usage-based offerings, drove measurable results and customer engagement.

• Completed migration of all Fuze customers to the integrated platform, improving efficiency and customer satisfaction.

• 14% year-over-year growth in customers with three or more products, with multi-product customers generating over 3x revenue compared to those with two products.

• Focused on expanding mid-market, enterprise, and public sector customer base, and accelerating innovation in AI-powered platform capabilities.

Financial highlights

• Total revenue was $185.1 million (+3.4% YoY); service revenue $179.7 million (+3.6% YoY), both exceeding guidance.

• Gross profit was ~$120 million, gross margin 64.8% (non-GAAP), 63.9% (GAAP), down sequentially due to mix shift toward usage-based revenue.

• Operating income was $21.7 million (non-GAAP, 11.7% margin), GAAP operating income $9.7 million; net income was $17.1 million (non-GAAP), $5.1 million (GAAP), EPS $0.12 (non-GAAP), $0.04 (GAAP).

• Adjusted EBITDA was $26.3 million, up 10% year-over-year.

• Ended quarter with $88.2 million in cash after $5 million debt prepayment; debt principal reduced by $224 million since August 2022.

Outlook and guidance

• Raised Q4 guidance: service revenue $173.5–$178.5 million, total revenue $178.5–$183.5 million, gross margin 64–65%, operating margin 8.5–9.5%.

• Full-year guidance: service revenue $708.6–$714 million, total revenue $729–$734 million, gross margin 65–66%, operating margin 9.5–10%, EPS $0.36–$0.37, cash flow from operations $42–$45 million.

• Expect Fuze-related revenue headwinds to persist into fiscal 2027, especially in H1, but anticipate service revenue growth for the year.

• Management expects continued investment in AI and platform enhancements to drive future growth.

• Believes existing liquidity and cash flows from operations are sufficient for at least the next twelve months.