8X8 (NASDAQ:EGHT) Issues Earnings Results, Beats Expectations By $0.08 EPS

8X8 (NASDAQ:EGHT) announced its earnings results on Wednesday. The company reported $0.12 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $0.04 by $0.08, FiscalAI reports. The business had revenue of $192.00 million for the quarter. 8X8 had a return on equity of 28.72% and a net margin of 0.64%.

Here are the key takeaways from 8X8’s conference call:

• 8×8 posted its sixth consecutive quarter of year-over-year revenue growth, with Q2 total revenue up 4.3% to $192 million and service revenue up 4.9% to $187.8 million. Operating income, EPS, and cash flow also exceeded the high end of guidance.
• Platform usage revenue grew 51%, led by CPaaS in Asia Pacific and rising AI adoption; recurring revenue from AI solutions increased 58% year over year. The company raised its full-year revenue, operating income, EPS, and operating cash flow outlook.
• Growth in usage-based offerings is weighing on gross margin because those offerings carry lower margins; Q2 gross margin was 60.1%, and management expects the mix shift to continue pressuring the percentage. Executives said usage revenue is less predictable because it is not contracted, and forecast growth to moderate to 35%–45% in Q3.
• 8×8 has about $297 million of debt after an October repayment and said it is working on a refinancing solution for its term loan and 2028 notes ahead of the term loan’s August 2027 maturity. Management expressed confidence, but did not provide details of the refinancing.

8X8 Price Performance

NASDAQ EGHT traded up $0.07 during trading on Thursday, reaching $2.33. The company’s stock had a trading volume of 1,278,190 shares, compared to its average volume of 1,657,994. The firm has a fifty day moving average of $2.05 and a 200 day moving average of $2.03. 8X8 has a one year low of $1.57 and a one year high of $2.88. The company has a debt-to-equity ratio of 1.83, a current ratio of 1.05 and a quick ratio of 1.05. The stock has a market capitalization of $337.27 million, a PE ratio of 58.59, a P/E/G ratio of 1.43 and a beta of 1.91.

Insider Buying and Selling

In other 8X8 news, CFO Kevin Kraus sold 34,329 shares of the firm’s stock in a transaction dated Friday, August 7th. The stock was sold at an average price of $2.32, for a total value of $79,643.28. Following the transaction, the chief financial officer directly owned 958,324 shares of the company’s stock, valued at approximately $2,223,311.68. This trade represents a 3.46% decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which is accessible through this hyperlink. Also, Director Andrew F. Burton sold 107,085 shares of the company’s stock in a transaction dated Friday, September 11th. The stock was sold at an average price of $1.81, for a total value of $193,823.85. Following the completion of the sale, the director owned 151,615 shares of the company’s stock, valued at approximately $274,423.15. The trade was a 41.39% decrease in their position. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last three months, insiders have sold 150,847 shares of company stock valued at $290,635. Insiders own 2.13% of the company’s stock.

Institutional Inflows and Outflows

Several large investors have recently made changes to their positions in the stock. D Orazio & Associates Inc. purchased a new stake in shares of 8X8 during the 3rd quarter worth $55,000. Penn Capital Management Company LLC lifted its holdings in 8X8 by 29.1% in the 3rd quarter. Penn Capital Management Company LLC now owns 482,338 shares of the company’s stock worth $1,085,000 after buying an additional 108,818 shares in the last quarter. State of Wyoming grew its position in shares of 8X8 by 59.6% in the 3rd quarter. State of Wyoming now owns 313,787 shares of the company’s stock worth $706,000 after acquiring an additional 117,225 shares in the last quarter. Squarepoint Ops LLC boosted its position in 8X8 by 227.8% during the 2nd quarter. Squarepoint Ops LLC now owns 846,965 shares of the company’s stock worth $1,448,000 after acquiring an additional 588,564 shares during the period. Finally, Amundi acquired a new position in shares of 8X8 in the 2nd quarter worth $43,000. 93.99% of the stock is owned by institutional investors.

Wall Street Analyst Weigh In

EGHT has been the subject of a number of analyst reports. Rosenblatt Securities reaffirmed a “buy” rating and set a $3.00 price objective on shares of 8X8 in a research note on Thursday, September 10th. B. Riley Financial reaffirmed a “buy” rating and issued a $3.25 price target (up from $3.00) on shares of 8X8 in a research report on Wednesday, August 5th. Finally, Weiss Ratings reiterated a “sell (d)” rating on shares of 8X8 in a research report on Tuesday, September 1st. Two equities research analysts have rated the stock with a Buy rating, one has assigned a Hold rating and one has given a Sell rating to the company. According to MarketBeat.com, the stock presently has a consensus rating of “Hold” and a consensus price target of $3.12.

About 8X8

8×8, Inc is a cloud communications and customer experience technology company that provides voice, video, chat, contact center and communications application programming interface (API) services. Its platform is designed to help businesses manage employee communications and customer interactions through integrated, cloud-based tools.

The company’s offerings include 8×8 Work, a unified communications service for business calling, messaging and meetings, and 8×8 Contact Center, which supports customer service operations across voice and digital channels.