Q4 Video Conferencing Earnings: Five9 (NASDAQ:FIVN) Impresses
The end of an earnings season can be a great time to discover new stocks and assess how companies are handling the current business environment. Let's take a look at how Five9 (NASDAQ:FIVN) and the rest of the video conferencing stocks fared in Q4.
Work is becoming more distributed, both across geographies and devices. In order for businesses to keep functioning efficiently, they need to be able to communicate as well as they did when the teams were co-located, which drives the demand for integrated communication platforms.
The 4 video conferencing stocks we track reported a mixed Q4. As a group, revenues beat analysts' consensus estimates by 1.1% while next quarter's revenue guidance was in line.
Amidst this news, share prices of the companies have had a rough stretch. On average, they are down 7.8% since the latest earnings results.
Best Q4: Five9 (NASDAQ:FIVN)
Started in 2001, Five9 (NASDAQ: FIVN) offers software-as-a-service that makes it easier for companies to set up and efficiently run call centers to offer more tailored customer support.
Five9 reported revenues of $278.7 million, up 16.6% year on year. This print exceeded analysts' expectations by 4%. Overall, it was a strong quarter for the company with an impressive beat of analysts' EBITDA estimates and a solid beat of analysts' billings estimates.
'We are very pleased to report strong year end results, with 2024 annual revenue exceeding $1 billion. Fourth quarter revenue growth accelerated to 17%, driven by our subscription revenue growing 19%. We reached an all-time record adjusted EBITDA margin of 23%, helping drive our highest ever quarterly operating cash flow of $50 million. Throughout the year, we extended our leadership position in AI by further enhancing our AI-powered platform to deliver the New CX. Our record results and strong traction in our AI business continue to demonstrate the power of our platform in enabling brands to elevate their CX in this rapidly evolving world of AI as evidenced by our Enterprise AI revenue growing 46% YoY in the fourth quarter. We believe we are well positioned with our AI-powered platform and trusted AI experts to continue driving durable long-term growth and look forward to building on our momentum in 2025.'
Five9 achieved the biggest analyst estimates beat, fastest revenue growth, and highest full-year guidance raise of the whole group. Investor expectations, however, were likely higher than Wall Street's published projections, leaving some wishing for even better results (analysts' consensus estimates are those published by big banks and advisory firms, not the investors who make buy and sell decisions). The stock is down 8.6% since reporting and currently trades at $38.22.
Is now the time to buy Five9? Access our full analysis of the earnings results here, it's free.
Zoom (NASDAQ:ZM)
Started by Eric Yuan who once ran engineering for Cisco's video conferencing business, Zoom (NASDAQ:ZM) offers an easy to use, cloud-based platform for video conferencing, audio conferencing and screen sharing.
Zoom reported revenues of $1.18 billion, up 3.3% year on year, in line with analysts' expectations. The business performed better than its peers, but it was unfortunately a mixed quarter with accelerating growth in large customers but full-year EPS guidance missing analysts' expectations significantly.
Although it had a fine quarter compared to its peers, the market seems unhappy with the results as the stock is down 8.5% since reporting. It currently trades at $74.20.
Is now the time to buy Zoom? Access our full analysis of the earnings results here, it's free.
Weakest Q4: RingCentral (NYSE:RNG)
Founded in 1999 during the dot-com era, RingCentral (NYSE:RNG) provides software as a service that unifies phone, text, fax, video calls and chat in one platform.
RingCentral reported revenues of $614.5 million, up 7.6% year on year, in line with analysts' expectations. It was a slower quarter as it posted EPS guidance for next quarter missing analysts' expectations significantly and a miss of analysts' annual recurring revenue estimates.
As expected, the stock is down 5.1% since the results and currently trades at $29.20.
Read our full analysis of RingCentral's results here.
8x8 (NASDAQ:EGHT)
Founded in 1987, 8x8 (NYSE:EGHT) provides software for organizations to efficiently communicate and collaborate with their customers, employees, and partners.
8x8 reported revenues of $178.9 million, down 1.2% year on year. This print met analysts' expectations. Zooming out, it was a slower quarter as it recorded a slight miss of analysts' billings estimates and revenue guidance for next quarter meeting analysts' expectations.
8x8 had the weakest performance against analyst estimates and slowest revenue growth among its peers. The stock is down 9.1% since reporting and currently trades at $2.60.
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