Bandwidth Q4 Earnings Fall Short of Estimates, Revenues Rise Y/Y

Core Viewpoint - Bandwidth Inc. reported mixed fourth-quarter 2024 results, with adjusted earnings missing estimates while revenues exceeded expectations [1][4]. Financial Performance - The company experienced a year-over-year revenue growth of 27%, reaching $210 million compared to$165.4 million in the prior-year quarter, driven by high demand for its universal Maestro platform and strong contributions from messaging services [6]. - For 2024, total revenues improved to $748.5 million from$601.1 million in 2023 [6]. - On a GAAP basis, the net loss for the fourth quarter was $1.76 million, or a loss of 6 cents per share, an improvement from a loss of$10.9 million, or 42 cents per share, in the prior-year quarter [3]. - Non-GAAP net income for the fourth quarter was $11.8 million, or 37 cents per share, compared to$11.1 million, or 38 cents per share, in the prior-year quarter [4]. - For the full year 2024, GAAP net loss was $6.52 million, or a loss of 24 cents per share, compared to a net loss of$16.3 million, or a loss of 64 cents per share, in 2023 [5]. - Non-GAAP net income for 2024 was $42 million, or$1.34 per share, compared to $24 million, or 83 cents per share, in 2023 [5]. Operational Metrics - Non-GAAP gross margin for the quarter was 58$23.4 million, exceeding guidance and up from $18.8 million in the prior-year period [7]. Cash Flow and Liquidity - In 2024, net cash from operating activities was$84 million, compared to $39 million in the prior year [8]. - As of December 31, 2024, cash and cash equivalents were$81.8 million, with convertible senior notes totaling $281.3 million [8]. Guidance - For the first quarter of 2025, Bandwidth expects revenues in the range of$168-$170 million and adjusted EBITDA between$16 million and $18 million [9]. - For the full year 2025, the company anticipates revenues between$740 million and $760 million, with adjusted EBITDA forecasted to be in the range of$82 million to $90 million [10]. Strategic Focus - The company aims to focus on winning large enterprises and becoming the best global CPaaS platform for scaling digital engagement, while also strengthening profitability and expanding cash flow generation [2].