Business Highlights - 8x8's Voice AI interactions increased nearly 75% from Q3 2025 [31] - The number of customers with 3 or more 8x8 products increased 13% from Q4 FY 2024 [31] - 8x8 announced Technology Partner EcoSystem partnerships with SpinSci Technologies [32] Financial Performance (Q4 2025) - Service Revenue reached $171.6 million [37, 41] - Total Revenue amounted to $177 million [37, 41] - Non-GAAP Operating Margin was 10% [37, 41] - Cash flow generated by operations was $6 million [37] - Cash, equivalents, and restricted cash at quarter-end totaled $89 million [37] Financial Performance (FY 2025) - Service Revenue was $692.9 million [40] - Total Revenue reached $715.1 million [40] - Non-GAAP Operating Margin was 11% [40] - Principal of term loan debt was reduced by $73 million [40] Guidance - Q1 2026 Service Revenue is projected to be between $170 million and $175 million [73] - Q1 2026 Total Revenue is expected to be between $175 million and $182 million [73] - FY 2026 Service Revenue is projected to be between $682 million and $702 million [74] - FY 2026 Total Revenue is expected to be between $702 million and $724 million [74]

Revenue Performance - Fourth quarter service revenue was $172 million, and total revenue was $177 million, reflecting a 2% decrease from the previous year[1]. - Fiscal year 2025 service revenue totaled $693 million, with total revenue at $715 million, down from $728.7 million in fiscal 2024[7]. - Total revenue for Q1 2025 was $177.043 million, a decrease of 1.9% from $179.413 million in Q1 2024[32]. - Service revenue for Q1 2025 was $171.588 million, down from $172.490 million in Q1 2024, reflecting a decline of 0.5%[32]. - Gross profit for Q1 2025 was $120.052 million, compared to $122.444 million in Q1 2024, indicating a decrease of 2.0%[32]. Profitability Metrics - GAAP operating income increased by 155% to $15.2 million compared to a loss of $27.6 million in fiscal 2024[7]. - Non-GAAP operating profit decreased by 17% to $78.4 million from $94.7 million in fiscal 2024[7]. - Non-GAAP operating profit for Q1 2025 was $419 thousand, compared to a loss of $14.219 million in Q1 2024[32]. - The net loss for the year ended March 31, 2025, was $27,212,000, an improvement from a net loss of $67,592,000 in 2024[37]. - GAAP net loss for the three months ended March 31, 2025, was $5,401,000, representing 3.1% of total revenue, compared to a loss of $23,591,000 (13.1%) for the same period in 2024[40]. Cash Flow and Liquidity - Cash flow from operations for fiscal year 2025 was $64 million, with $5.9 million in the fourth quarter[1][7]. - Cash and cash equivalents decreased to $88.050 million as of March 31, 2025, down from $116.262 million a year earlier[34]. - Net cash provided by operating activities for the year ended March 31, 2025, was $63,554,000, a decrease from $78,985,000 in 2024[37]. - Cash, cash equivalents, and restricted cash at the end of the year was $89,324,000, down from $116,723,000 at the beginning of the year[37]. Debt and Liabilities - The total principal amount of debt outstanding decreased to $353.9 million from $426.9 million at the end of fiscal 2024[10]. - Total liabilities decreased to $560.973 million as of March 31, 2025, down from $654.021 million a year earlier[34]. - The company incurred $273,000,000 in principal repayment on term loans during the year ended March 31, 2025[37]. Future Projections - The company expects first quarter fiscal 2026 service revenue to be between $170 million and $175 million, and total revenue between $175 million and $182 million[17]. - Non-GAAP net income per share for fiscal year 2026 is projected to be between $0.34 and $0.37, based on approximately 144 million shares[17]. Operational Developments - The company is focused on upgrading remaining customers on the Fuze service platform, expecting completion by the end of calendar year 2025[2]. - New AI-powered features have been introduced across the 8x8 Platform for CX to enhance customer engagement and operational efficiency[9][11]. Stock-Based Compensation and Expenses - Stock-based compensation expense for the year ended March 31, 2025, was $39,940,000, a decrease from $61,910,000 in 2024[37]. - Stock-based compensation expense for the three months ended March 31, 2025, was $8,615,000, down from $15,865,000 in the same period last year[40]. Comprehensive Loss - The company reported a comprehensive loss of $1.642 million for Q1 2025, compared to a comprehensive loss of $25.606 million in Q1 2024[32].

Core Insights - 8×8, Inc. is set to release its fourth-quarter earnings results on May 19, with analysts expecting earnings of 8 cents per share, unchanged from the previous year [1] - The projected quarterly revenue is $177.98 million, a decrease from $179.41 million a year earlier [1] - The company has recently expanded its market presence in Ireland through a partnership with CCMA Ireland [1] Analyst Ratings - Rosenblatt analyst Catherine Trebnick maintained a Buy rating but reduced the price target from $3.3 to $2.7 [7] - Wells Fargo analyst Michael Turrin maintained an Underweight rating and cut the price target from $2 to $1.5 [7] - Morgan Stanley analyst Meta Marshall also maintained an Underweight rating, lowering the price target from $2.6 to $1.9 [7] - Mizuho analyst Siti Panigrahi kept an Underperform rating and decreased the price target from $2.5 to $2 [7] - Barclays analyst Ryan Macwilliams maintained an Equal-Weight rating and raised the price target from $2.5 to $3 [7]

Core Viewpoint - The focus is on identifying undervalued stocks using the Zacks Rank system and Style Scores, with a specific emphasis on value investing strategies that have proven successful across various market conditions [2][3]. Company Analysis - 8x8 (EGHT) is highlighted as a stock to watch, currently holding a Zacks Rank of 2 (Buy) and a Value grade of A, indicating strong potential for value investors [3]. - EGHT has a Price-to-Book (P/B) ratio of 1.84, which is significantly lower than its industry's average P/B of 4.77, suggesting that the stock may be undervalued [4]. - The P/B ratio for EGHT has fluctuated between a high of 4.09 and a low of 1.84 over the past 52 weeks, with a median of 2.84 [4]. - The Price-to-Cash Flow (P/CF) ratio for EGHT is 5.49, which is also lower than the industry's average P/CF of 13.93, further indicating potential undervaluation [5]. - Over the past year, EGHT's P/CF has ranged from a high of 23.04 to a low of 5.49, with a median of 10.82 [5]. - The combination of these metrics suggests that EGHT is likely being undervalued, supported by a strong earnings outlook [6].

Core Viewpoint - 8x8, Inc. (EGHT) has experienced a significant decline in share price, dropping 19.6% since the release of its third-quarter fiscal 2025 results, underperforming both the broader technology sector and its industry peers [1][3]. Financial Performance - Total revenues for 8x8 fell by 1.2% year-over-year and sequentially, amounting to $179 million in the third quarter of fiscal 2025, primarily due to expected revenue declines from customers on the Fuze platform and over $2 million in forex headwinds [3][13]. - The Zacks Consensus Estimate for fourth-quarter fiscal 2025 earnings is 8 cents per share, indicating no year-over-year change, while revenues are expected to decline by 0.76% to $178.04 million [13]. - For the full fiscal year 2025, revenue estimates are pegged at $716.06 million, reflecting a 1.74% year-over-year decline, with earnings expected to be 36 cents per share, down 23.40% year-over-year [14]. Strategic Developments - 8x8 is enhancing its customer experience platform by integrating Contact Center, Unified Communications, and CPaaS, which aims to streamline customer interactions and improve operational efficiency [5]. - The company has expanded its 8x8 Secure Pay service to facilitate secure payments across various channels, enhancing customer experience through automation [6]. - The introduction of the 8x8 Intelligent Customer Assistant with a Voice Intelligent Directory aims to improve customer interactions by connecting callers to the right contacts more efficiently [7]. Growth Initiatives - The acquisition of Fuze has strengthened 8x8's Experience Communications as a Service (XCaaS) platform, expanding its global presence, particularly in Europe, and ensuring a smooth integration process [9]. - Partnerships, such as with CallCabinet, enhance compliance capabilities for users on Microsoft Teams, reinforcing 8x8's commitment to delivering certified solutions for business communications [10]. - 8x8 is focusing on expanding its international presence, particularly in the Asia-Pacific region, where it secured its largest deal to date with a leading auto manufacturer [11]. Market Engagement - A major U.S. retailer has engaged 8x8 for a new contact center, marking the largest follow-on deal in the company's history, indicating strong customer engagement and growth potential [12].

Core Viewpoint - 8x8 (EGHT) has been upgraded to a Zacks Rank 2 (Buy), indicating a positive outlook based on rising earnings estimates, which significantly influence stock prices [1][2]. Earnings Estimates and Stock Price Movement - The Zacks rating system emphasizes the correlation between changes in earnings estimates and stock price movements, making it a valuable tool for investors [2][3]. - Institutional investors utilize earnings estimates to determine the fair value of stocks, leading to price movements based on their buying or selling actions [3]. Company Performance and Outlook - The upgrade for 8x8 reflects an improvement in the company's underlying business, suggesting that investor sentiment may drive the stock price higher [4]. - The Zacks Consensus Estimate for 8x8 has increased by 300% over the past three months, although the expected earnings per share for the fiscal year ending March 2025 is projected to be $0.36, representing a year-over-year decline of 23.4% [7]. Zacks Rank System - The Zacks Rank system categorizes stocks into five groups based on earnings estimates, with a strong historical performance, particularly for Zacks Rank 1 stocks, which have averaged a +25% annual return since 1988 [6]. - The upgrade of 8x8 to a Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, indicating a strong potential for market-beating returns in the near term [9].

Core Insights - The article compares two stocks in the Internet - Software sector, 8x8 (EGHT) and BlackLine (BL), to determine which is more attractive to value investors [1] Valuation Metrics - 8x8 (EGHT) has a Zacks Rank of 2 (Buy), indicating a stronger earnings outlook compared to BlackLine (BL), which has a Zacks Rank of 4 (Sell) [3] - EGHT has a forward P/E ratio of 7.92, significantly lower than BL's forward P/E of 23.76, suggesting EGHT is undervalued [5] - The PEG ratio for EGHT is 0.68, while BL's PEG ratio is 4.70, indicating that EGHT is expected to grow earnings at a more favorable rate relative to its price [5] - EGHT's P/B ratio is 3.27, compared to BL's P/B of 6.90, further supporting the notion that EGHT is more attractively valued [6] - Based on these metrics, EGHT holds a Value grade of B, while BL has a Value grade of D, making EGHT the preferred choice for value investors [6]

Core Viewpoint - Investors are encouraged to consider 8x8 (EGHT) due to solid improvements in earnings estimates and positive short-term price momentum [1][2] Earnings Estimates - Analysts are increasingly optimistic about 8x8's earnings prospects, leading to higher estimates that are expected to positively impact the stock price [2] - The Zacks Rank system indicates a strong correlation between earnings estimate revisions and stock price movements [2] Current-Quarter Estimate Revisions - The current quarter's earnings estimate for 8x8 is projected at $0.08 per share, reflecting no year-over-year change [4] - Over the past 30 days, one estimate has increased while there were no negative revisions, resulting in a 50% increase in the Zacks Consensus Estimate [4] Current-Year Estimate Revisions - For the full year, the earnings estimate stands at $0.36 per share, which is a decrease of 23.4% from the previous year [5] - In the last month, four estimates have been revised upward with no negative revisions, leading to a 300% increase in the consensus estimate [5] Zacks Rank - The positive estimate revisions have earned 8x8 a Zacks Rank of 2 (Buy), indicating strong potential for outperformance [6] - Stocks with Zacks Rank 1 (Strong Buy) and 2 (Buy) have historically outperformed the S&P 500 [6] Stock Performance - 8x8 shares have increased by 10.9% over the past four weeks, suggesting investor confidence in the company's earnings growth prospects [7]

Core Viewpoint - Momentum investing focuses on "buying high and selling higher," contrasting with traditional strategies of "buying low and selling high" [1] Group 1: Momentum Investing Strategy - Momentum investing can be risky as stocks may lose momentum when their valuations exceed future growth potential [1] - Investing in bargain stocks with recent price momentum may be a safer approach [2] Group 2: Stock Analysis - 8x8 (EGHT) - 8x8 (EGHT) has shown a four-week price change of 10.9%, indicating growing investor interest [3] - The stock gained 3.6% over the past 12 weeks, demonstrating its ability to deliver positive returns over a longer timeframe [4] - EGHT has a beta of 1.66, suggesting it moves 66% more than the market in either direction [4] - The stock has a Momentum Score of A, indicating a favorable entry point for investors [5] - EGHT has a Zacks Rank 2 (Buy) due to upward revisions in earnings estimates, which attract more investors [6] - The stock is trading at a Price-to-Sales ratio of 0.52, suggesting it is undervalued at 52 cents for each dollar of sales [6] Group 3: Investment Opportunities - EGHT appears to have significant growth potential and is part of a broader list of stocks that meet the 'Fast-Paced Momentum at a Bargain' criteria [7] - There are over 45 Zacks Premium Screens available to help identify winning stock picks based on various investing styles [8]

Revenue Performance - Service revenue for the three months ended December 31, 2024, was $173.459 million, a decrease of $1.610 million or 0.9% compared to the same period in 2023[114]. - The percentage of service revenue to total revenue increased to 97.0% for the three months ended December 31, 2024, compared to 96.7% in the same period of 2023[114]. - Revenue from subscriptions decreased by $4.3 million primarily due to a decline in revenue from customers on the Fuze platform, partially offset by a $2.7 million increase in platform usage revenue[115]. - Service revenue decreased by $6.8 million, or 1.3%, for the nine months ended December 31, 2024 compared to the same period in 2023, driven by a decline in subscription revenue of $13.9 million[116]. - Other revenue decreased by $4.5 million, or 21.3%, for the nine months ended December 31, 2024, primarily due to lower professional service and product revenue of $2.7 million and $1.8 million, respectively[119]. - Other revenue represented 3.1% of total revenue for the nine months ended December 31, 2024, down from 3.9% in the same period of 2023[117]. Financial Performance - The company reported a net income of $3.022 million for the three months ended December 31, 2024, compared to a net loss of $14.543 million in the same period of 2023[102]. - The gross profit margin for the three months ended December 31, 2024, was 67.7%, slightly down from 69.0% in the same period of 2023[102]. - Interest expense decreased by $4.2 million, or 41.8%, for the three months ended December 31, 2024, compared to the same period in 2023, primarily due to the extinguishment of the 2022 Term Loan and decreased interest rates[140]. - For the nine months ended December 31, 2024, interest expense decreased by $6.5 million, or 21.4%, compared to the same period in 2023, attributed to similar factors as the quarterly results[141]. - The provision for income taxes increased by $0.4 million for the three months ended December 31, 2024, compared to the same period in 2023, driven by higher estimated cash taxes[146]. Cost Management - Cost of service revenue increased by $5.9 million, or 4.1%, for the nine months ended December 31, 2024, primarily due to an increase of $12.2 million in costs to deliver subscription and platform usage services[122]. - Research and development expenses decreased by $9.0 million, or 8.8%, for the nine months ended December 31, 2024, primarily due to decreases in stock-based compensation and other costs[129]. - Sales and marketing expenses decreased by $6.6 million, or 3.2%, for the nine months ended December 31, 2024, primarily due to decreases in stock-based compensation and channel commissions[132]. - General and administrative expenses decreased by $17.7 million, or 22.9%, for the nine months ended December 31, 2024, primarily due to a decrease associated with legal and regulatory matters[136]. - Cost of other revenue decreased by $1.0 million, or 4.3%, for the nine months ended December 31, 2024, primarily due to lower product costs associated with IP telephone hardware[125]. - Cost of service revenue as a percentage of service revenue increased to 28.8% for the nine months ended December 31, 2024, compared to 27.3% in the same period of 2023[120]. Strategic Initiatives - The company aims to increase service revenue through new customer acquisition, cross-selling additional products, and geographic expansion outside the United States[103]. - The company continues to focus on innovation, particularly in its platform and contact center as-a-service offerings, to attract and retain mid-market and enterprise customers[100]. - The company has expanded its customer success organization and invested in back-office process improvements to enhance operational efficiency[101]. - The company plans to maintain a high level of investment in engineering to deliver product innovation across its Platform for CX[99]. Debt and Cash Management - Cash and cash equivalents totaled $104.2 million as of December 31, 2024, down from $116.3 million as of March 31, 2024[149]. - Net cash provided by operating activities decreased by $8.7 million to $57.7 million for the nine months ended December 31, 2024, mainly due to increased cash paid to suppliers and employees[152]. - The company entered into a new term loan credit agreement with a principal amount of up to $200.0 million maturing on August 15, 2027[154]. - The 2024 Term Loan was fully drawn on August 5, 2024, to repay the outstanding principal and interest of the 2022 Term Loan, totaling $225.0 million[155]. - As of December 31, 2024, the remaining principal amount of the 2024 Term Loan after payments is $167.0 million[157]. - The company utilized proceeds from the 2022 Credit Agreement to fund the cash portion of an exchange involving approximately $403.8 million principal amount of 0.50% convertible senior notes due 2024 for cash plus approximately $201.9 million of 4.00% convertible senior notes due 2028[159]. - The company repurchased approximately $60.0 million of its common stock in conjunction with the convertible notes exchange[159]. Accounting and Compliance - The company's consolidated financial statements are prepared in accordance with U.S. GAAP, with no significant changes to critical accounting policies during the nine months ended December 31, 2024[162]. - The company has made estimates and judgments affecting reported amounts of assets, liabilities, revenue, and expenses based on historical experience and reasonable assumptions[161]. - The company continues to evaluate its critical accounting policies and estimates on an ongoing basis[161]. - There have been no material changes in the company's exposures to market risk since March 31, 2024[163].