Ooma 2026 Q3 Earnings Turns Profitable with 158.9% Net Income Surge

Ooma (OOMA) reported fiscal 2026 Q3 earnings on Dec 9, 2025, delivering a GAAP net income of $1.39 million (EPS $0.05) after a $2.36 million loss in the prior year. While revenue rose 3.8% to $67.63 million, the company missed revenue estimates by $3.8 million and guided Q4 revenue below expectations, contributing to an 11.7% post-earnings stock decline.

Revenue

Total revenue increased by 3.8% to $67.63 million, driven by a strong performance in subscription and services, which contributed $61.95 million, while product and other revenue added $5.67 million. The subscription segment accounted for 92% of total revenue, reflecting growth in Ooma Business solutions.

Earnings/Net Income

Ooma returned to profitability with GAAP net income of $1.39 million (EPS $0.05), a 158.9% reversal from a $2.36 million loss in 2025 Q3. Non-GAAP net income reached $7.7 million (EPS $0.27), exceeding analyst estimates. The EPS turnaround and significant net income improvement highlight Ooma’s positive financial shift.

Post-Earnings Price Action Review

The stock price of Ooma tumbled 8.64% during the latest trading day, dropped 3.91% during the most recent full trading week, and fell 10.57% month-to-date. Despite strong earnings, the revenue miss and revised Q4 guidance, which fell short of market expectations due to AirDial installation delays, triggered investor caution. The sharp post-earnings selloff contrasts with the company’s profitability milestone, underscoring market skepticism about execution risks and integration challenges from recent acquisitions.

CEO Commentary

CEO Eric Stang highlighted record adjusted EBITDA of $8.6 million and progress in business solutions, including 57% Pro/Pro Plus adoption in Ooma Office and 9 new AirDial resale partners. Strategic priorities include leveraging acquisitions of FluentStream and Phone.com for scale, profitability, and AI-driven features to boost Pro tier adoption. Stang emphasized confidence in synergies from these deals to enhance shareholder value.

Guidance

CFO Shigeyuki Hamamatsu outlined Q4 2026 revenue guidance of $71.3M–$71.9M, including $4.0M–$4.1M from FluentStream. For FY2026, revenue is projected at $270.3M–$270.9M, with non-GAAP net income of $28.2M–$28.7M. The guidance reflects optimism about AI-driven product enhancements and AirDial’s long-term potential but acknowledges near-term execution headwinds.

Additional News

Ooma completed the acquisition of FluentStream, expected to add $24–$25 million in annual revenue and $9.5–$10.5 million in adjusted EBITDA, and plans to finalize the Phone.com acquisition by late December. The company also launched an updated AirDial with cost reductions and improved features, aiming for 300,000 lines and $100 million in annual recurring revenue. CEO Eric Stang emphasized AI integration for Pro Plus tier enhancements, while CFO Hamamatsu cited cost management and tariff relief as contributors to Q3’s improved bottom line.