Bandwidth Inc. Q1 FY2026 earnings call

Bandwidth entered 2026 with historic momentum. In the first quarter, it exceeded expectations with record revenue and adjusted EBITDA. It is executing against a strategy to power mission-critical communications for the AI-driven enterprise. Partnership with Salesforce is significant, adding CRM as a new category of platforms it powers. Secured large wins in financial services, including two new million-dollar-plus deals. Messaging business saw additional high-volume messaging customer. Supporting an ecosystem of AI developers building vertical applications on its platform.

In the first quarter, total revenue was $209 million, up 20% year-over-year. Cloud communications revenue (total revenue less messaging surcharge revenue of $59 million) reached $150 million, a 13% year-over-year increase. Voice solutions revenue was $121 million, growing 12%, with global voice plans category up 12% and enterprise voice category up 14% to $13 million. Programmable messaging revenue rose 15% year-over-year to approximately $30 million. Net retention rate for the first quarter was 102%, adjusted commercial net retention rate was 110%, customer name retention well above 99%, and average annual revenue per customer reached a new high of $244,000.

Raised full-year 2026 guidance. Total revenue expected to be in the range of $880 million and $900 million, representing 18% growth. Cloud communications revenue expected to be in the range of $616 million and $624 million, representing 10% growth. Adjusted EBITDA outlook to be in the range of $119 million and $125 million, representing 31% growth. Non-GAAP EPS to be in the range of $1.77 and $1.83, representing growth of 26%. Second quarter 2026 expected revenue to be in the range of $214 million and $220 million, adjusted EBITDA in the range of $24 million and $27 million, non-GAAP EPS in the range of $0.35 and $0.37.

Q: Eric Suppiger from B. Reilly Securities asked about developments with frontier model providers like Google and OpenAI and integration.

A: Bandwidth is excited about voice focus of frontier models, can support voice agents utilizing them fully.

Q: Patrick Walravens from Citizens asked about Salesforce partnership and how Bandwidth makes money.

A: Salesforce is re-architecting contact center, Bandwidth makes money on usage-based model based on interactions.

Q: Joshua Riley from Needham asked about Global Voice Plan revenue growth drivers.

A: Broad-based adoption of AI and integration of voice agent technologies by customers, mix of existing customers and new entrants.

Q: Arjun Bhatia from William Blair asked about messaging growth drivers and AI impact.

A: Strong commercial and civic engagement messaging, performance not due to political in quarter, next billion users of global PSTN to be voice agents.

Q: Jim Fish from Piper Sandler asked about political messaging impact and cloud conversions.

A: No meaningful political impact this quarter, nothing about regulatory change augurs negatively for Bandwidth, Maestro platform can voice agent enable even with on-prem human agents software.