Crexendo Posts 12% Revenue Growth to $68.2M, Acquires Estech Systems for $35M
For 2025, Crexendo delivered $68.2 million in revenue, up 12%, with adjusted EBITDA of $11.2 million (17% margin) and cash rising to $31.4 million. It will acquire Estech Systems for $35 million to boost recurring UCaaS revenue and pursue $100 million in annual sales with synergies and AI platform expansion.
1. Strong Full-Year 2025 Financials
Crexendo’s 2025 revenue grew 12% to $68.2 million with adjusted EBITDA rising to $11.2 million (17% margin). Cash and equivalents increased to $31.4 million, supported by $9.3 million in operating cash flow and a non-GAAP free cash flow margin of 14%.
2. Fourth-Quarter Segment Results
Fourth-quarter revenue rose 11% to $18.1 million, led by 18% growth in software solutions ($8.3 million) and 8% growth in service revenue ($8.6 million), while product revenue declined 6% to $1.1 million. Consolidated gross margin held at 60%, enabling a 6% operating margin versus 4% a year earlier.
3. ESI Acquisition Plans
Crexendo agreed to acquire Estech Systems for $35 million, comprising $27.3 million in cash and $7.7 million in common stock at approximately 1.35x unaudited 2025 revenue. The transaction, expected to close March 1, 2026, aims to accelerate recurring UCaaS revenue, earnings and cash flow through cost and channel synergies.
4. Platform Investments and AI Momentum
The company completed migration of hosted infrastructure to Oracle Cloud to enhance margins and security. Its CAIRO AI receptionist, launched in January, could boost average retail revenue per account by over 25%, while additional AI tools and ChatGPT-powered contact center offerings drive platform differentiation.