8x8's 2026 Q1 Earnings Call: Navigating Contradictions in CPaaS Growth, Fuze Transition, and Macroeconomic Challenges

CPaaS and AI growth strategy, Fuze transition impact, macroeconomic challenges, CPaaS market traction and opportunity, and Fuze migration impact on service revenue are the key contradictions discussed in 8x8's latest 2026Q1 earnings call.



Revenue and Platform Growth:
- 8x8 returned to year-over-year growth in Q1 2026, exceeding the midpoint of service revenue guidance by more than $3 million.
- The growth was fueled by strong growth in CPaaS solutions, ongoing platform adoption, and increased usage-based consumption models.

Usage-Based Revenue and Margin Profile:
- Usage-based revenue accounted for approximately 17% of total service revenue, up from 12% in Q1 2025.
- The shift towards usage-based revenue impacted gross margin, which was down year-over-year and sequentially.

Fuze Platform Migration:
- The proportion of total service revenue from the Fuze platform declined to approximately 4% from 8% in Q1 2025.
- The migration is expected to be fully completed by the fiscal year-end, reducing complexity and unlocking margin leverage.

Customer Engagement and Market Trends:
- Over 50% of CX leaders now prefer consumption-based pricing for customer engagement solutions.
- 8x8's alignment with market trends, such as AI integration and flexible pricing models, is driving customer adoption and platform expansion.