Sangoma Technologies (STC) Q1 2025 earnings summary

Executive summary

• Completed a major internal transformation in fiscal 2024, streamlining operations, modernizing systems, and strengthening leadership, setting the stage for a growth-focused fiscal 2025.

• Strategic priorities for 2025 include organic market expansion, channel expansion, and inorganic growth, with a renewed external focus.

• Q1 FY2025 revenue was $60.2M, down 5% year-over-year and 1% sequentially, slightly below guidance due to order delays from Hurricane Helene; delayed orders expected to ship in Q2.

• Adjusted EBITDA was $9.8M, at the high end of guidance, representing 16% of revenue.

• Net loss for the quarter was $1.9M, an improvement from $2.4M loss in Q1 FY2024.

Financial highlights

• Q1 revenue was $60.2 million, slightly below guidance due to delayed deals and hurricane disruptions, but expected to be recaptured in Q2.

• Gross profit was $41.2 million, representing 68% of revenue, consistent with the previous quarter and down slightly from $42.1M year-over-year.

• Adjusted EBITDA reached $9.8 million (16% of revenue), at the high end of guidance, driven by cost savings in sales, marketing, and G&A.

• Net cash from operating activities was $12.1 million, a 55% year-over-year increase, with strong cash conversion (124% of adjusted EBITDA).

• Operating expenses decreased 7% year-over-year to $42.1M.

Outlook and guidance

• Fiscal 2025 revenue guidance maintained at $250–$260 million, with adjusted EBITDA guidance of $42–$46 million.

• Committed to sequential revenue growth each quarter, with Q1 tracking to plan and confidence in achieving full-year targets.