Ooma, Inc. Q3 FY2026 earnings call

• Ooma reported solid Q3 financial results with revenue growth to $67.6 million and new records in non-GAAP net income and adjusted EBITDA. - Business solutions performed well with Ooma Office, Enterprise, AirDial, and 2600Hz investments. Ooma Enterprise secured its largest hospitality win to date. AirDial added 9 new resale partners and launched an updated version. 2600Hz made progress with upselling and sales to new customers. - The company announced the closure of FluentStream acquisition and expects to close phone.com acquisition. Combined, the acquisitions add over 165,000 users, $45 million of revenue, and $10 million of adjusted EBITDA annually before synergies.

Ooma, Inc. reported Q3 2026 revenue of $67.6 million. Business subscription and services revenue grew 6% year over year in Q3, accounting for 63% of total subscription services revenue. Product and other revenue was $5.7 million, up 14% year over year due to growth in AirDial installations. Residential subscription and service revenue was down 1% year over year. Annual exit recurring revenue was $242.7 million, up 4% year over year. Blended average monthly subscription and services ARPU was $15.82, up 4% year over year. Non-GAAP net income for Q3 was $7.7 million, and adjusted EBITDA was $8.6 million, which was 13% of revenue.

• For Q4 2026, total revenue is expected to be in the range of $71.3 million to $71.9 million, including $4 to $4.1 million from FluentStream. Non-GAAP net income is expected to be in the range of $8.4 million to $8.9 million. - For full year 2026, total revenue is expected to be in the range of $270.3 million to $270.9 million, including approximately $4 million to $4.1 million from FluentStream. Non-GAAP net income is expected to be in the range of $28.2 million to $28.7 million, and adjusted EBITDA is expected to be $32.4 million to $32.9 million.

• Risks related to forward-looking statements not materializing, actual results differing from projections. - AirDial installations timing issues due to customer orders and seasonality.

Q: Josh Nichols asks about Q4 profitability jump and FluentStream synergy quantification.

A: Shig Hamamatsu mentions operating leverage, R&D actions, sales/marketing spend optimization, and lower tariff impact contributing to Q4 profitability. Eric Stang talks about modest synergies on the cost side with FluentStream and potential synergies on the revenue side with AirDial and product developments for phone.com.

Q: Eric Martinuzzi asks about AirDial pushouts and FluentStream customer base embrace.

A: Shig Hamamatsu explains AirDial pushouts are due to larger account proof of concept and installation timing. Eric Stang discusses integrating FluentStream by leveraging vendor relationships, AirDial channels, and avoiding rapid changes to maintain FluentStream's performance.

Q: Kincaid asks about AI developments and M&A learnings.

A: Eric Stang talks about AI in customer data analysis for sentiment and productivity, with features rolling out next year. On M&A learnings, he notes closer acquisitions to core business are easier to leverage.

Q: Matthew Harrigan asks about FluentStream non-cash charges and Vegas hotel penetration.

A: Shig Hamamatsu says non-cash charges related to FluentStream are uncertain as the process is ongoing. Eric Stang mentions the Vegas hotel win and Ooma Enterprise's goal to add over 50 hotels per quarter.

Q: Arjun Bhatia asks about absorbing acquisitions and competitive dynamics in hospitality.

A: Eric Stang discusses absorbing acquisitions at a pace, noting FluentStream and phone.com can be integrated without derailing existing operations, and in hospitality, Ooma is replacing legacy on-site PBX systems.