What guidance did RingCentral's management provide for the next earnings period?

What were the key takeaways from RingCentral's earnings call?

What does RingCentral do and what are its main business segments?

What were the key takeaways from RingCentral’s earnings call?

What is the revenue and EPS growth rate for RingCentral year over year?

What factors drove the changes in RingCentral's revenue and profit?

What is RingCentral's gross profit margin?

What is the market's earnings forecast for RingCentral next quarter?

- **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

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

RNG

RNG fundamentals

You can ask Aime