Sangoma Technologies (STC) Q3 2026 earnings summary

Executive summary

• Business is transitioning from a product collection to an integrated platform, focusing on infrastructure-led growth and longer-term value creation.

• Revenue for Q3 FY2026 was $51.0 million, less than 1% lower sequentially, with revenue mix aligned to expectations.

• Data networking, voice networking, and MSP segments grew 9–17% year-over-year, driven by demand for secure, reliable communications.

• Strategic review initiated by the board to evaluate alternatives for unlocking shareholder value, including partnerships, business combinations, or investments.

• Go-to-market strategy is shifting to larger, integrated, multi-product deployments with longer-term contracts and higher customer lifetime value.

Financial highlights

• Q3 revenue was CAD 51 million ($51.0 million), with gross margin at 71%, down from 74% in Q2.

• Adjusted EBITDA for Q3 was CAD 7.5 million ($7.5 million, 15% of revenue); free cash flow was CAD 3.6 million ($3.6 million) or CAD 0.11 ($0.11) per diluted share.

• Net cash from operating activities in Q3 was CAD 6 million ($6.0 million), with an 80% conversion rate from adjusted EBITDA.

• Total debt at quarter end was CAD 32.5 million ($32.5 million); cash was CAD 15.2 million after $15.5 million term loan repayment and $1.0 million share repurchases.

• Operating expenses were $38.5 million, down 4% sequentially due to cost management.

Outlook and guidance

• FY2026 revenue guidance revised to CAD 204–205 million ($204–$205 million), reflecting international headwinds, pricing pressure, and macroeconomic conditions.

• Adjusted EBITDA margin guidance lowered to 15–16% from previous 17–18%.

• Margin expansion anticipated over time as infrastructure revenue grows and larger contracts scale.