Ooma 2026 Q3 Earnings Strong Turnaround with 158.9% Net Income Surge

Ooma (OOMA) reported fiscal 2026 Q3 earnings on Dec 9, 2025, delivering a strong turnaround in profitability while narrowly missing revenue expectations. The stock price fell sharply post-earnings, reflecting mixed market sentiment despite improved GAAP results.

Revenue

Total revenue rose 3.8% to $67.63 million in Q3 2026, driven by robust subscription and services revenue of $61.95 million, which accounted for 92% of total sales. Product and other revenue added $5.67 million, reflecting a strategic shift toward recurring revenue streams.

Earnings/Net Income

Ooma returned to profitability with GAAP net income of $1.39 million ($0.05 EPS), a 158.9% improvement from a $2.36 million loss in the prior year. Non-GAAP net income surged to $7.7 million ($0.27 EPS), underscoring operational efficiency. The EPS turnaround from a loss to a profit of $0.05 highlights Ooma’s improved cost management and revenue growth.

Price Action

Post-Earnings Price Action Review

Following the earnings report, Ooma’s stock price declined 8.64% in the latest trading day, 3.91% for the week, and 10.57% month-to-date. The sell-off contrasts with the company’s positive financial results, as investors appeared to focus on weaker GAAP metrics compared to non-GAAP figures and cautious Q4 guidance. Analysts noted that the stock’s 52-week high of $15.70 remains out of reach, despite a 27% recovery from November lows. The muted reaction suggests lingering skepticism about the sustainability of Ooma’s profitability amid sector volatility.

CEO Commentary

Eric Stang, CEO and President, highlighted Q3’s “solid” results, including $67.6 million in revenue and $7.7 million in non-GAAP net income. He emphasized growth in Ooma Business, new AirDial partnerships, and strategic acquisitions of FluentStream and Phone.com, which are expected to add $24–25 million in annual revenue. Stang expressed optimism about AI-driven product enhancements and a $100 million recurring revenue target for AirDial by 2027.

Guidance

For Q4 2026, Ooma expects revenue of $71.3–71.9 million and non-GAAP net income of $8.4–8.9 million ($0.30–0.32 EPS). Full-year guidance includes $270.3–270.9 million in revenue and $1–1.02 EPS. The company cautioned that GAAP results may lag due to acquisition-related costs, with Phone.com’s impact excluded from Q4 projections.

Additional News

Ooma closed its acquisition of FluentStream, expected to add $24–25 million in annual revenue and $9.5–10.5 million in EBITDA. The pending Phone.com acquisition, slated for late December, aims to bolster AI capabilities and customer data analytics. The company also secured a major hospitality contract for a Vegas hotel and launched an updated, cost-optimized AirDial version. These moves align with Ooma’s strategy to expand business solutions and achieve 300,000 AirDial lines by 2027.