Financial Data and Key Metrics Changes - The company reported Q2 service revenue of 175.1million,reflectinggrowthinbothsubscriptionandusageonthe8x8platform,despiteadeclineinrevenuefromcustomersontheFuzeplatform,whichrepresentedapproximately712.3 million in Q2, marking the 15th consecutive quarter of positive cash flow from operations [28][38] Business Line Data and Key Metrics Changes - Communications Platform as a Service (CPaaS) revenue increased over 20% year-over-year, achieving the highest single platform usage revenue day in early September [10][8] - Sales of new products rose more than 60% year-over-year, with AI-based new products increasing over 50% sequentially and more than 200% year-over-year [13][16] Market Data and Key Metrics Changes - The company noted a significant increase in engagement through public APIs and a 50% year-over-year growth in sales of non-SMS products [10][8] - The remaining performance obligation increased by 20millionsequentially,indicatingimprovementinmultiyearcustomercontractbacklog[37]CompanyStrategyandDevelopmentDirection−Thecompanyisfocusedonseveraltransformationinitiatives,includingacceleratinginnovationincontactcenters,establishingleadershipinCPaaSofferingsinAsiaPacific,andimprovingsalesproductivity[9][8]−Thestrategyincludesmaintainingastrongbalancesheetbyreducingdebtandcontrollingcosts,withacommitmenttoinvest15369 million, representing a 32% reduction since the end of fiscal Q2 2023 [28][36] - Stock-based compensation as a percentage of revenue was 5.2%, the lowest in at least five years, contributing to GAAP operating profitability in Q2 [33][27] Q&A Session Summary Question: What drove the sequential growth improvement in services revenue? - Management attributed the growth to robust platform usage revenue and growth in the core business on the 8x8 platform [47][48] Question: What is driving the increased sales of AI-based solutions? - Management noted that customers are more willing to adopt AI solutions now, as these technologies are increasingly solving business problems [49][48] Question: What could drive future growth for the company? - Future growth is expected to come from new products becoming a larger part of revenue and the continued migration of customers from the Fuze platform [53][54] Question: What is the outlook for gross margin? - Management indicated that gross margin may experience slight compression due to a mix shift towards lower-margin CPaaS products [56][58] Question: What trends are seen in AI adoption among customers? - Customers are currently adding AI capabilities to enhance agent productivity rather than reducing the number of agents [61][62] Question: How is the transition from Fuze progressing? - The transition is ongoing, with management expressing a desire to accelerate the upgrade cycle [68][67]
