8x8 (EGHT) Q3 2025 earnings summary

Executive summary

• Achieved 16th consecutive quarter of positive operating cash flow, with record $27.2M in Q3 and continued debt reduction, despite $2.2M FX headwind and slight revenue decline year-over-year.

• Transformation to a CX leader is progressing, with strong growth in AI-based products (up to 84% YoY), increased multi-product adoption, and successful integration of Fuze.

• Customer satisfaction remains high, with CSAT scores in the mid- to high-90% range for enterprise clients.

• GAAP net income reached $3.0M, a turnaround from a net loss of $21.2M in the prior year quarter.

• Received industry recognition, including Newsweek's Excellence 1000 Index and multiple analyst and industry awards.

Financial highlights

• Q3 total revenue: $178.9M; service revenue: $173.5M, both down ~1% YoY but near or above guidance midpoints.

• GAAP gross margin: 67.7%–69.5%; non-GAAP gross margin: 69.5%–70.2%; GAAP operating margin: 5.0%; non-GAAP operating margin: 10.7%.

• Adjusted EBITDA: $23.9M (13% of revenue), down 22% YoY.

• Net debt-to-EBITDA ratio improved to 2.3x–2.6x.

• Stock-based compensation at 5.3% of revenue, near multi-year lows.

Outlook and guidance

• Q4 2025 service revenue expected: $170M–$175M; total revenue: $175M–$181M; non-GAAP operating margin: 9%–10%.

• FY25 service revenue guidance: $691.3M–$696.3M; total revenue: $713M–$719M; non-GAAP operating margin: 10.7%–11%; non-GAAP EPS: $0.35–$0.37.

• FY25 operating cash flow: $61M–$65M.

• FY26 margin expected to be lower due to strategic investments in go-to-market initiatives.

• FX headwinds expected to impact FY25 revenue by ~$4.5M.