RingCentral Reports $644M Q4 Revenue, Beats EPS and Raises FY26 Guidance
RingCentral reported Q4 revenue of $644 million (+4.8% year-on-year) and non-GAAP EPS of $1.18 (+4.1% above estimates), with operating margin rising to 6.6% from 2.5% last year. The company raised FY26 EPS guidance to $4.87 (2.1% above forecasts) and partnered with OpenAI to enhance its enterprise voice AI offerings.
1. Q4 Financial Performance
RingCentral delivered $644 million in Q4 revenue, up 4.8% year-over-year, with subscription revenue of $622 million (+6%). Non-GAAP EPS reached $1.18, beating estimates by 4.1%, while GAAP EPS improved to $0.26 from a loss of $0.08. The company achieved a 6.6% GAAP operating margin (vs. 2.5% last year) and a 22.8% non-GAAP margin, alongside $149 million in operating cash flow (+12%) and $126 million in free cash flow (+13%).
2. FY26 Guidance
Management guided Q1 revenue at approximately $642.5 million and raised full-year non-GAAP EPS guidance to $4.87, a 2.1% uplift over consensus. The company targets 20% GAAP operating margins within three to four years and anticipates mid-single-digit sales growth, reflecting cautious demand expectations in a competitive cloud communications market.
3. AI Partnership and Capital Allocation
RingCentral reported that ARR from users of its monetized AI products more than doubled year-over-year and now comprises nearly 10% of total ARR. The firm announced a strategic partnership with OpenAI to drive new enterprise voice AI capabilities. It also initiated its first quarterly dividend of $0.075 per share, repurchased $135 million of shares in Q4, and expanded its share repurchase authorization to $500 million while investing over $250 million annually in innovation.