8x8 (EGHT) Q3 2026 earnings summary

Executive summary

• Achieved record service revenue of $180M and total revenue of $185.1M, up 3.6% and 3.5% year-over-year, respectively, with 20th consecutive quarter of positive operating cash flow.

• Strategic investments in innovation, operational efficiency, and distribution drove measurable results, with usage-based and AI solutions gaining traction.

• Completed migration of all Fuze customers to the integrated platform, improving operational efficiency and customer satisfaction.

• 14% year-over-year growth in customers with three or more products, and focus on expanding mid-market, enterprise, and public sector customer base.

• 20th consecutive quarter of positive operating cash flow, totaling $20.7 million.

Financial highlights

• Total revenue reached $185.1M and service revenue $179.7M, both up over 3% year-over-year and exceeding guidance.

• Usage-based offerings grew nearly 60% year-over-year, now representing 21% of service revenue, up from 14% a year ago.

• Gross profit was $120M with a gross margin of 64.8% (non-GAAP) and 63.9% (GAAP), slightly down sequentially due to mix shift toward lower-margin usage-based revenue.

• Operating income was $21.7M (non-GAAP, 11.7% margin) and $9.7M (GAAP), both up year-over-year and above guidance.

• Net income was $17.1M (non-GAAP) and $5.1M (GAAP); fully diluted EPS $0.12 (non-GAAP), $0.04 (GAAP).

• Cash flow from operations was $20.7M; quarter ended with $88.2M in cash after $5M debt prepayment.

Outlook and guidance

• Raised Q4 guidance: service revenue expected between $173.5M–$178.5M, total revenue $178.5M–$183.5M, both $7M above prior guidance midpoints.

• Q4 gross margin expected at 64–65%, operating margin 8.5–9.5%, and EPS $0.07–$0.08.

• Full-year service revenue guidance increased to $708.6M–$713.6M, total revenue $729M–$734M, gross margin 65–66%, operating margin 9.5–10%, and EPS $0.36–$0.37.

• FY 2026 cash flow from operations projected at $42M–$45M.

• Fiscal 2027 will see headwinds from Fuze churn, especially in the first half, but service revenue growth is still expected.