Bandwidth (BAND) Q4 2024 earnings summary

Executive summary

• Achieved record 2024 revenue and profitability, with 27% Q4 revenue growth and 25% EBITDA growth, driven by strong enterprise adoption, AI-driven product innovation, and robust Voice and Messaging performance.

• Maintained high customer loyalty with over 99% name retention, 122% net retention rate, and a median top 20 customer tenure of 11 years as of December 31, 2024.

• Secured major customer wins, including a Fortune 25 healthcare company and a global cruise line, and was named a Leader in the IDC MarketScape CPaaS 2025 assessment for the fourth consecutive year.

• Hundreds of enterprises now use the Maestro platform, with AI Bridge enabling new voice AI capabilities and expanded integrations.

• Positioned as a CPaaS leader, powering global communications for major UCaaS and CCaaS providers and mission-critical enterprise clients.

Financial highlights

• FY 2024 revenue reached $748M, up 25% year-over-year; cloud communications revenue was $540M, up 13% year-over-year.

• Q4 2024 total revenue rose 27% to $210M; cloud communications revenue up 15% YoY to $144M.

• Adjusted EBITDA for 2024 was $82M, up 70% year-over-year, with a 15% margin; Q4 Adjusted EBITDA was $23M, up from $19M.

• Free cash flow for 2024 was $59M, up 206% year-over-year; Q4 free cash flow was $30M.

• Non-GAAP gross margin for 2024 was 57%, up from 55% in 2023; Q4 non-GAAP gross margin reached 58%.

Outlook and guidance

• 2025 revenue guidance: $740M–$760M, reflecting 8–11% normalized growth, with Adjusted EBITDA guidance of $82M–$90M.

• Q1 2025 revenue guidance: $168M–$170M; Adjusted EBITDA: $16M–$18M.

• 2025 EBITDA expected to grow to $86M at midpoint, with continued margin and free cash flow expansion.

• On track to achieve 20% adjusted EBITDA margin by 2026.