8x8 (EGHT) Q1 2027 earnings summary

Executive summary

• Achieved record total revenue of $190.2 million, up 5.1% year-over-year, and record service revenue of $185.3 million, marking the fifth consecutive quarter of growth and exceeding guidance for revenue, non-GAAP operating margin, and operating cash flow.

• Non-GAAP operating margin reached 9.9%, with GAAP operating margin at 2.3%; operating income rose to $18.9 million non-GAAP and $4.4 million GAAP.

• Generated $17 million in operating cash flow, marking the 22nd consecutive quarter of positive operating cash flow.

• Accelerated adoption of AI solutions, with AI Studio adoption up 121% year-over-year and over 200 organizations deploying more than 2,900 AI agents within three and a half months of launch.

• Customers using three or more paid products rose 18% year-over-year, now representing 38% of recurring revenue.

Financial highlights

• Total revenue for Q1 was $190.2 million, up 4.9% year-over-year; service revenue was $185.3 million, up 5.1% year-over-year.

• Platform usage revenue grew 63% year-over-year, now 26% of service revenue; subscription revenue decreased by $9.5 million.

• GAAP gross margin was 61% (down from 66% year-over-year); non-GAAP gross margin was 62% (down from 68%).

• Adjusted EBITDA was $23.2 million (12.2% margin), up from $20.7 million (11.4% margin) year-over-year.

• Cash, cash equivalents, and restricted cash were $92.3 million as of June 30, 2026.

Outlook and guidance

• Q2 2027 guidance: service revenue $180–$185 million, total revenue $185–$190 million, non-GAAP gross margin 60.5%–61.5%, non-GAAP operating margin 8%–9%, non-GAAP EPS $0.07–$0.08.

• Full-year 2027 guidance raised: service revenue $725–$745 million, total revenue $745–$765 million, non-GAAP gross margin 60.5%–61.5%, non-GAAP operating margin 8.8%–9.8%, non-GAAP EPS $0.33–$0.38, operating cash flow $45–$52 million.

• Cash flow from operations for the year expected at $45–$52 million; $39.5 million in term loan principal payments planned.

• Management expects continued variability in results due to macroeconomic conditions, technological changes, and evolving customer demand, particularly in AI adoption and international markets.