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- **Revenue & AI Growth**: Q3 revenue $639M (+5% YoY), AI products on track for $100M ARR by year-end. AIR adoption up 80% QoQ, ACE used by 4,300 customers.
- **Agentic AI Leadership**: Launch of AVA and WFM integration completes end-to-end AI suite. Televero Health saw 20% revenue uplift using AIR.
- **Financial Strength**: Operating margin 22.8%, free cash flow $130M (23% YoY). Free cash flow per share $5.71, best-in-class growth.
- **Strategic Moves**: $200M shares repurchased, debt reduced by $275M. Target $1B gross debt by 2026. GSP partnerships drive >10% revenue growth.

**【CEO Summary Section】**
- **Q3 Revenue Growth**: Total revenue of $639 million, up 5% YoY, with subscription revenue at $616 million (6% YoY). AI-led products contribute strongly, on track to exceed $100 million ARR by year-end.
- **RingCentral 3.0 Strategy**: Transitioning to agentic voice AI with AIR, AVA, and ACE. AIR adoption grew 80% QoQ, ACE now used by 4,300 customers. Core voice platform remains mission-critical, processing 100 million call minutes daily.
- **Market Expansion**: 1/3 of inbound traffic now uses informal contact center features. RingCX grows double-digit sequentially, integrated with AI modules for seamless customer engagement.

**【COO Summary Section】**
- **AI Product Adoption**: AIR now serves 5,800 paying customers, ACE adoption up 19% QoQ. AVA launched to enhance real-time agent support. CommunityWFM integration completes WEM suite, offering end-to-end workforce management.
- **Internal AI Efficiency**: RingCentral on RingCentral reduces handle time by 15%, ACE improves sales performance by 10%. AI-driven cost savings and scalability drive margin expansion.
- **Customer Success**: Examples include Televero Health (20% revenue uplift) and Modisoft (enhanced customer sentiment analysis).

**【CFO Financial Commentary】**
- **Profitability**: Operating margin 22.8% (up 180bps YoY), non-GAAP EPS $1.30 (19% YoY growth). Subscription gross margin 81%, SBC as % of revenue down 350bps YoY to 11%.
- **Cash Flow**: Q3 free cash flow $130 million (23% YoY), full-year guidance raised to $525-530 million (30% YoY growth). Free cash flow per share $5.71, best-in-class.
- **Capital Allocation**: $275 million debt paid down YTD, $200 million shares repurchased. Share count to 92 million in 2025, down from 2020 levels. Target $1 billion gross debt by end-2026.

**【Q&A Highlights】**
- **RingCentral 3.0 Benefits**: Fortune 500 customers gain AI-driven efficiency across pre-call, during, and post-call workflows. AIR/AVA/ACE integration enhances customer experience and operational efficiency.
- **GSP Momentum**: GSPs contribute >10% of revenue, growing double-digit. AT&T deploying AIR, expanding reach via 200,000+ resellers.
- **Free Cash Flow Sustainability**: Driven by SBC reduction, offshoring, and AI adoption. Free cash flow per share up 35% YoY, targeting further expansion.
- **Contact Center Growth**: RingCX double-digit QoQ growth, 50% of $1M+ deals include AI modules. WFM acquisition accelerates land-and-expand strategy.
- **Market Position**: Unique combination of scale, voice expertise, and AI innovation positions RingCentral to capture $100 billion+ TAM in AI communications.

RingCentral, Inc. (RNG) Q3 2025 Earnings Call Transcript

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