8x8, Inc.

Q4 fiscal 2026 total revenue was $185.2 million, up 4.6% year over year, and service revenue was $180.2 million, up 5% year over year. Gross profit was approximately $118.9 million, and gross margin was 64.2%. Operating income was $19.8 million with a 10.7% operating margin, net income was $16.6 million, and fully diluted EPS was $0.11, $0.03 above the high end of guidance. Cash flow from operations was $14.4 million, and the company ended the quarter with $93.3 million in cash and cash equivalents and $323.9 million of principal debt outstanding, later reduced to about $309.4 million after a $14.5 million April payment. For fiscal Q1 2027, the company guided to service revenue of $175 million to $180 million, total revenue of $180 million to $185 million, gross margin of 63.5% to 64.5%, operating margin of 8.5% to 9.5%, EPS of $0.08 to $0.09, and cash flow from operations of $10 million to $12 million. For fiscal 2027 full year, guidance was service revenue of $707 million to $727 million, total revenue of $727 million to $747 million, gross margin of 62.5% to 63.5%, operating margin of 9% to 10%, EPS of $0.33 to $0.38, and cash flow from operations of $45 million to $52 million.

Samuel Wilson described fiscal 2026 as a turning point and said the business is benefiting from a strategy built around AI-driven communications, integrated orchestration, and usage-based pricing. He emphasized that customers want unified platforms rather than fragmented point solutions, and argued that voice and infrastructure become more important in an AI era. His tone was confident and strategic, repeatedly saying 8x8 is operating from a position of strength while expanding partnerships, acquisitions, and product innovation.

Kevin Kraus highlighted that Q4 exceeded guidance across service revenue, total revenue, operating profit, EPS, and cash flow. He pointed to gross profit of about $118.9 million, gross margin of 64.2%, operating income of $19.8 million, and cash flow from operations of $14.4 million, while noting operating expenses were down 5% year over year in Q4 and about 3% for the full year. He also cited debt reduction and interest savings, saying trailing 12-month cash interest paid declined approximately 51% and fell from about $35.6 million in fiscal 2024 to about $17.3 million in fiscal 2026; debt principal was cut to about $309.4 million after the April payment. For 2027, he reiterated guidance that includes $39.5 million of principal payments and called out a continued focus on operating discipline and cash generation.

Analysts focused on why fiscal 2027 guidance looks conservative despite four quarters of growth, and management said the main issue is limited visibility into usage revenue, which is now 23% of service revenue and not contracted far in advance. Sam also said about 40% of revenue is international, adding some geopolitical unpredictability, which supports a cautious forecast. On gross margin, management said the mix shift toward usage-based products and newer AI offerings pressures consolidated margin early, but they expect operating discipline, cheaper routes to market, and AI-enabled efficiencies to support double-digit operating margins over the long term. On capital allocation, Sam ranked uses as acquisitions that improve customer outcomes, then debt paydown, then buybacks, noting the company paid down another $14.5 million in April and expects roughly $39.5 million in debt payback in fiscal 2027.