Core Insights - RADCOM Ltd. (RDCM) is expected to report second-quarter 2025 results on August 13, with revenue estimates of $17 million, reflecting a 14.9% year-over-year growth, and earnings estimates of 22 cents per share, indicating a 10% increase from the previous year [1][9] Financial Performance - RDCM has consistently beaten the Zacks Consensus Estimate in the last four quarters, with an average surprise of 22.3%. The company's shares have increased by 32.7% over the past year, compared to a 54.4% growth in the Zacks Computer-Networking industry [2] Growth Drivers - The company's growth in the second quarter is attributed to its focus on AI, 5G assurance, and cloud-native solutions, supported by strong margins and visibility into new AI/5G contracts [3][9] - RADCOM's automated, AI-driven assurance platform, RADCOM ACE, provides real-time insights into service performance and customer experience, which is a key strength for the company [3] Strategic Initiatives - Management anticipates rising demand for data and insights as new AI-driven use cases emerge, investing in agentic AI through partnerships with leading customer care and service management platforms [4] - The company is also focusing on accelerated computing and GenAI to enhance real-time user and service insights, which include customer experience metrics and predictive models for satisfaction [5][10] Partnerships and Market Position - RADCOM has established key partnerships, such as with ServiceNow, to enhance AI-driven complaint resolution and predictive customer experience, positioning itself as a leader in integrating AI for seamless workflows [6] - The global telecom market is expanding, driven by 5G standalone networks and high-value use cases like IoT and private 5G, with RADCOM positioned to support operators in delivering intelligent user experiences [7][10] Recent Developments - In May 2025, RADCOM secured a multi-year, eight-figure contract renewal with a major North American telecom operator, reinforcing its role in ensuring network performance and service quality [12]

Financial Data and Key Metrics Changes - The company achieved a record revenue of $16.6 million for the first quarter of 2025, reflecting a 17.5% year-over-year growth [21] - Operating margins improved by over 6.5% year-over-year, with a positive cash flow of $4.4 million [6] - Non-GAAP operating income reached $3.1 million, representing 19% of revenues for the quarter [21] - Non-GAAP net income was $4.1 million or $0.25 per diluted share, compared to $2.8 million or $0.18 per diluted share in the same quarter last year [23] Business Line Data and Key Metrics Changes - The company continues to invest strategically in R&D, with non-GAAP gross R&D expenses of $4.3 million, up 5.8% year-over-year [22] - Sales and marketing expenses increased to $4.2 million, reflecting a focus on promoting offerings to existing and prospective customers [23] Market Data and Key Metrics Changes - The global telecom market is growing, driven by the demand for 5G standalone networks and AI-driven applications [14] - The company is well-positioned to capitalize on the data-centric demands of emerging AI technologies [15] Company Strategy and Development Direction - The strategic objective is to become a key provider of real-time user and service experience insights for AI-powered telecom operators [10] - The company is investing in accelerated computing technologies and Agenetic AI to enhance customer care and service management [10][11] - Partnerships with ServiceNow and NVIDIA are aimed at fast-tracking the development of automated customer experience solutions [12][18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strategic direction and execution, projecting revenue growth for the sixth consecutive year [7] - The full-year 2025 revenue growth outlook has been raised from 12%-15% to 15%-18%, with a midpoint of $71.1 million [18] Other Important Information - The company ended the first quarter with cash and cash equivalents of $99.1 million and no debt [6] - The company received a grant of $25,000 from the Israel Innovation Authority during the quarter [22] Q&A Session Summary Question: Expansion on Authentic AI functionality and monetization - The company plans to invest in R&D for Generative AI and Agenetic AI use cases, with flexible monetization models being discussed [28] Question: Free cash flow generation and capital use - The company is exploring M&A opportunities and prioritizing actions around its ecosystem [29][30] Question: Growth expectations for customer count and standalone networks - The company projects similar growth rates as seen previously, with increased demand for customer management and real-time user analytics [34] Question: Gross margins and revenue mix - Gross margins typically range from 72% to 76%, influenced by the revenue mix, with less third-party components improving margins this quarter [35][36] Question: ServiceNow relationship and customer base overlap - The partnership with ServiceNow is expected to expand pipeline opportunities, particularly in North America, Europe, and Japan [39] Question: Deployment model with NVIDIA - The integration involves using GPUs that can be installed in standard servers, enhancing performance in user analytics [40][41]

Financial Data and Key Metrics Changes - In Q1 2025, the company achieved record revenue of $16.6 million, reflecting a 17.5% year-over-year growth [20] - Operating margins improved by over 6.5% year-over-year, with a positive cash flow of $4.4 million [6] - Non-GAAP operating income reached $3.1 million, representing 19% of revenues for the quarter [22] - Non-GAAP gross margin for Q1 2025 was 76.3% [20] - Net income on a non-GAAP basis was $4.1 million or $0.25 per diluted share, compared to $2.8 million or $0.18 per diluted share in Q1 2024 [22][23] Business Line Data and Key Metrics Changes - The company is focusing on its automated intelligence assurance solution, RADCOM ACE, which provides real-time service and customer experience insights [7] - Investments in R&D increased by 5.8% year-over-year, totaling $4.3 million, reflecting a commitment to innovation and portfolio expansion [21] Market Data and Key Metrics Changes - The global telecom market is growing, driven by the demand for 5G standalone networks and AI-driven applications [13] - The company is well-positioned to capitalize on the data-centric demands of emerging AI technologies [14] Company Strategy and Development Direction - The strategic objective is to become a key provider of real-time user and service experience insights for AI-powered telecom operators [9] - The company is investing in accelerated computing technologies and Agenetic AI to enhance customer care and service management [9][10] - Partnerships with ServiceNow and NVIDIA are aimed at fast-tracking the development of automated customer experience solutions [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strategic direction and execution, projecting revenue growth for the sixth consecutive year [6] - The full-year 2025 revenue growth outlook was raised from 12%-15% to 15%-18%, with a midpoint of $71.1 million [17] Other Important Information - The company ended Q1 2025 with cash and cash equivalents of $99.1 million and no debt [6][23] - The company received a grant of $25,000 from the Israel Innovation Authority during the quarter [21] Q&A Session Summary Question: Expansion on Authentic AI functionality and monetization - Management plans to invest in R&D for Generative AI and Agenetic AI use cases, with flexible monetization models being discussed [26][27] Question: Free cash flow generation and capital use - The company is exploring M&A opportunities and prioritizing actions around its ecosystem [28][29] Question: Growth expectations for standalone networks - Management projects similar growth rates as seen previously, with increased demand for customer management and real-time user analytics [32][33] Question: Gross margins and revenue mix - Gross margins typically range from 72% to 76%, influenced by the revenue mix, with less third-party components improving margins this quarter [34][35] Question: ServiceNow relationship and customer base overlap - The partnership with ServiceNow is expected to expand pipeline opportunities, particularly in North America, Europe, and Japan [36] Question: Deployment model with NVIDIA - The integration with NVIDIA allows for GPU installation in standard servers, enhancing performance in user analytics [37][38]

Company Overview - RADCOM Ltd. is a leading provider of advanced, intelligent assurance solutions with integrated AI Operations (AIOps) capabilities [3] - The flagship platform, RADCOM ACE, utilizes AI-driven analytics and generative AI (GenAI) to enhance customer experiences [3] - RADCOM's advanced 5G portfolio offers end-to-end network observability, covering the radio access network (RAN) to the core [3] Product Features - RADCOM's solutions are designed to be open, vendor-neutral, and cloud-agnostic, promoting next-generation network automation, optimization, and efficiency [4] - By leveraging AI-powered intelligence, RADCOM reduces operational costs and enables predictive customer insights [4] - The platform integrates seamlessly with business support systems (BSS), operations support systems (OSS), and service management platforms, providing a complete, real-time view of mobile and fixed networks [4] Upcoming Events - RADCOM's CEO Benny Eppstein and CFO Hadar Rahav will participate in the 20th Annual Needham Technology, Media & Consumer Virtual Conference on May 8, 2025 [1] - Management will be available for virtual one-on-one meetings throughout the day [2]