Ooma Reports Fiscal Second Quarter 2025 Financial Results

Ooma, Inc. (NYSE: OOMA), a smart communications platform for businesses and consumers, today released financial results for the fiscal second quarter ended July 31, 2024.

Fiscal Second Quarter 2025 Financial Highlights:

  • Revenue: Total revenue was $64.1 million, up 10% year-over-year. Subscription and services revenue increased to $59.6 million from $54.7 million in the second quarter of fiscal 2024, and was 93% of total revenue, primarily driven by the growth of Ooma Business and contribution from 2600hz.
  • Net Income/Loss: GAAP net loss was $2.1 million, or $0.08 per basic and diluted share, compared to GAAP net income of $0.3 million, or $0.01 per basic and diluted share, in the second quarter of fiscal 2024. GAAP net income in the second quarter of fiscal 2024 included a $1.0 million gain for consolidation of facilities. Non-GAAP net income was $4.1 million, or $0.15 per diluted share, compared to non-GAAP net income of $3.8 million, or $0.15 per diluted share in the prior year period.
  • Adjusted EBITDA: Adjusted EBITDA was $5.6 million, compared to $4.9 million in the second quarter of fiscal 2024.

For more information about non-GAAP net income and Adjusted EBITDA, see the section below titled "Non-GAAP Financial Measures" and the reconciliation provided in this release.

“Ooma made strong progress in Q2 with revenues of $64.1 million and non-GAAP net income of $4.1 million and is well positioned, we believe, for the second half of fiscal 2025,” said Eric Stang, chief executive officer of Ooma. “Ooma executed well in Q2 on both the top and bottom line, driving 10% revenue growth year over year and record levels for Adjusted EBITDA and Cash Flow from Operations. Progress continued across the business with new feature enhancements, customer expansion, and the addition of new resale partners for AirDial. Looking ahead, we believe Ooma’s premier position in each of its business segments and key new customer wins in the first half of this year create the opportunity for continued strong performance.”

Business Outlook:

For the third quarter of fiscal 2025, Ooma expects:

  • Total revenue in the range of $64.2 million to $64.6 million.
  • GAAP net loss in the range of $1.7 million to $1.9 million and GAAP net loss per share in the range of $0.06 to $0.07.
  • Non-GAAP net income in the range of $4.1 million to $4.3 million and non-GAAP net income per share in the range of $0.15 to $0.16.

For the full fiscal year 2025, Ooma expects:

  • Total revenue in the range of $254.0 million to $255.5 million.
  • GAAP net loss in the range of $7.7 million to $8.2 million, and GAAP net loss per share in the range of $0.30 to $0.32.
  • Non-GAAP net income in the range of $15.7 million to $16.2 million, and non-GAAP net income per share in the range of $0.57 to $0.59.

The following is a reconciliation of GAAP net loss to non-GAAP net income and GAAP basic and diluted net loss per share to non-GAAP diluted net income per share guidance for the third fiscal quarter ending October 31, 2024 and the fiscal year ending January 31, 2025 (in millions, except per share data):

Projected range
Three Months Ending Fiscal Year Ending
October 31, 2024 January 31, 2025

(unaudited)

GAAP net loss

($1.7)-($1.9)

 

($7.7)-($8.2)

Stock-based compensation and related taxes

4.6

 

18.4

Amortization of intangible assets

1.4

 

5.8

Gain on note conversion

 

(1.0)

Restructuring costs

 

0.7

Non-GAAP net income

$4.1-$4.3

 

$15.7-$16.2

 

 

 

GAAP net loss per share

($0.06)-($0.07)

 

($0.30)-($0.32)

Stock-based compensation and related taxes

0.17

 

0.68

Amortization of intangible assets

0.05

 

0.22

Gain on note conversion

 

(0.04)

Restructuring costs

 

0.03

Non-GAAP net income per share

$0.15-$0.16

 

$0.57-$0.59

 

 

 

Weighted-average number of shares used in per share amounts:

 

 

 

Basic

26.8

 

26.6

Diluted

27.5

 

27.5

Conference Call Information:

The company will host a conference call and live webcast for analysts and investors at 5:00 p.m., Eastern time on August 27, 2024. The news release with the financial results will be accessible from the company's website prior to the conference call.

To access the call by phone, please visit https://register.vevent.com/register/BIe5edc5716919495290b391503aab86ee to register and receive the dial-in details. To avoid delays, Ooma encourages participants to dial into the conference call ten minutes ahead of the scheduled start time. For webcast listening, please visit Ooma’s Events & Presentations page https://investors.ooma.com/news-events/events-presentation for a link.

Following the call, an archived version of the webcast will be available on the Ooma investor relations site at https://investors.ooma.com for 12 months.

Non-GAAP Financial Measures

In addition to disclosing financial measures prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), this press release and the accompanying tables contain certain non-GAAP financial measures, including: non-GAAP net income, non-GAAP net income per share, non-GAAP gross profit and gross margin, non-GAAP operating income, and Adjusted EBITDA. Adjusted EBITDA represents the net income before interest and other income, income taxes, depreciation and amortization of capital expenditures, amortization of intangible assets and acquisition related costs, stock-based compensation and related taxes, litigation costs, facilities consolidation gain, restructuring costs, and gain on note conversion.

Other non-GAAP financial measures exclude stock-based compensation expense and related taxes, amortization of intangible assets, acquisition related costs, non-recurring gains, such as facilities consolidation gain and gain on note conversion, litigation costs and restructuring costs. Non-GAAP weighted-average diluted shares include the effect of potentially dilutive securities from the company’s stock-based benefit plans.

These non-GAAP financial measures are presented to provide investors with additional information regarding our financial results and core business operations. Ooma considers these non-GAAP financial measures to be useful measures of the operating performance of the company, because they contain adjustments for unusual events or factors that do not directly affect what management considers to be Ooma's core operating performance and are used by the company's management for that purpose. Management also believes that these non-GAAP financial measures allow for a better evaluation of the company's performance by facilitating a meaningful comparison of the company's core operating results in a given period to those in prior and future periods. In addition, investors often use similar measures to evaluate the operating performance of a company.

Non-GAAP financial measures are presented for supplemental informational purposes only to aid an understanding of the company's operating results. The non-GAAP financial measures should not be considered a substitute for financial information presented in accordance with GAAP and may be different from non-GAAP financial measures presented by other companies. A limitation of the non-GAAP financial measures presented is that the adjustments relate to items that the company generally expects to continue to recognize. The adjustment of these items should not be construed as an inference that the adjusted gains or expenses are unusual, infrequent or non-recurring. Therefore, both GAAP financial measures of Ooma's financial performance and the respective non-GAAP measures should be considered together. Please see the reconciliation of non-GAAP financial measures to the most directly comparable GAAP measure in the tables below.

Disclosure Information

Ooma uses the investor relations section on its website as a means of complying with its disclosure obligations under Regulation FD. Accordingly, investors should monitor Ooma's investor relations website in addition to following Ooma's press releases, Securities and Exchange Commission (“SEC”) filings, and public conference calls and webcasts.

Legal Notice Regarding Forward-Looking Statements

This press release contains forward-looking statements under the Private Securities Litigation Reform Act of 1995. In particular, the financial projections under “Business Outlook” and the statements contained in the quotations of our Chief Executive Officer may constitute forward-looking statements. Forward-looking statements can be identified by the fact that they do not relate strictly to historical facts and generally contain words such as "believes”, "expects”, "may”, "will”, "should”, "seeks”, "approximately”, "intends”, "plans”, "estimates”, "anticipates”, and other expressions that are predictions of or indicate future events. Although the forward-looking statements contained in this press release are based upon information available at the time the statements are made and reflect management's good faith beliefs, forward-looking statements inherently involve known and unknown risks, uncertainties and other factors, which may cause the actual results, performance or achievements to differ materially from anticipated future results. Important factors that could cause actual results to differ materially from expectations include, among others: our inability to attract new customers on a cost-effective basis; our inability to retain customers; our inability to realize expected returns from our investments made in connection with our international operations and development of new product features; our ability to successfully integrate our acquisitions and to achieve their expected benefits; failure to retain former employees and customers of 2600hz; failure to realize AirDial opportunities; intense competition; loss of key retailers and reseller partnerships; our reliance on vendors to manufacture the on-premise appliances and end-point devices we sell; our reliance on third parties for our network connectivity and co-location facilities; our reliance on third parties for some of our software development, quality assurance and operations; our reliance on third parties to provide the majority of our customer service and support representatives; and interruptions to our service. You should not place undue reliance on these forward-looking statements, which speak only as of the date hereof. We do not undertake to update or revise any forward-looking statements after they are made, whether as a result of new information, future events, or otherwise, except as required by applicable law.

The forward-looking statements contained in this press release are also subject to other risks and uncertainties, including those more fully described in our filings which we make with the SEC from time to time, including the risk factors contained in our Quarterly Report on Form 10-Q for the quarter ended April 30, 2024, filed with the SEC on June 7, 2024. The forward-looking statements in this press release are based on information available to Ooma as of the date hereof, and Ooma disclaims any obligation to update any forward-looking statements, except as required by law.

About Ooma, Inc.

Ooma (NYSE: OOMA) creates powerful connected experiences for businesses, consumers and service providers, delivered through smart cloud-based communications platforms and services. For businesses of all sizes, Ooma offers advanced voice and collaboration features including messaging, intelligent virtual receptionists and video meetings. Ooma’s all-in-one replacement for analog phone lines helps businesses maintain mission-critical systems by moving connectivity to the cloud. For consumers, Ooma’s residential phone service provides PureVoice HD voice quality, advanced features and integration with mobile devices. Learn more at www.ooma.com or www.ooma.ca in Canada.

OOMA, INC
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited, amounts in thousands)
 
 
July 31, January 31,

 

2024

 

 

2024

 

Assets
Current assets:
Cash and cash equivalents

$

16,585

 

$

17,536

 

Accounts receivable, net

 

8,189

 

 

9,864

 

Inventories

 

15,237

 

 

19,782

 

Other current assets

 

15,559

 

 

16,497

 

Total current assets

 

55,570

 

 

63,679

 

Property and equipment, net

 

10,957

 

 

9,897

 

Operating lease right-of-use assets

 

15,833

 

 

17,041

 

Intangible assets, net

 

24,997

 

 

27,952

 

Goodwill

 

23,069

 

 

23,069

 

Other assets

 

21,044

 

 

17,615

 

Total assets

$

151,470

 

$

159,253

 

 
Liabilities and stockholders' equity
Current liabilities:
Accounts payable

$

6,967

 

$

7,848

 

Accrued expenses and other current liabilities

 

24,388

 

 

26,586

 

Deferred revenue

 

17,123

 

 

17,041

 

Total current liabilities

 

48,478

 

 

51,475

 

Long-term operating lease liabilities

 

12,635

 

 

13,676

 

Debt, net of current portion

 

8,500

 

 

16,000

 

Other liabilities

 

18

 

 

15

 

Total liabilities

 

69,631

 

 

81,166

 

 
Stockholders' equity:
Common stock

 

5

 

 

5

 

Additional paid-in capital

 

219,388

 

 

211,361

 

Accumulated other comprehensive loss

 

 

 

(1

)

Accumulated deficit

 

(137,554

)

 

(133,278

)

Total stockholders' equity

 

81,839

 

 

78,087

 

Total liabilities and stockholders' equity

$

151,470

 

$

159,253

 

 
OOMA, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited, amounts in thousands, except share and per share data)
 
Three Months Ended Six Months Ended
July 31,

2024
July 31,

2023
July 31,

2024
July 31,

2023
Revenue:
Subscription and services

$

59,566

 

$

54,726

 

$

117,955

 

$

107,775

 

Product and other

 

4,563

 

 

3,627

 

 

8,673

 

 

7,430

 

Total revenue

 

64,129

 

 

58,353

 

 

126,628

 

 

115,205

 

 
Cost of revenue:
Subscription and services

 

17,654

 

 

15,456

 

 

35,114

 

 

30,181

 

Product and other

 

7,775

 

 

6,309

 

 

14,699

 

 

12,484

 

Total cost of revenue

 

25,429

 

 

21,765

 

 

49,813

 

 

42,665

 

Gross profit

 

38,700

 

 

36,588

 

 

76,815

 

 

72,540

 

 
Operating expenses:
Sales and marketing

 

19,256

 

 

18,842

 

 

38,737

 

 

36,832

 

Research and development

 

13,640

 

 

11,768

 

 

27,433

 

 

23,721

 

General and administrative

 

7,400

 

 

5,972

 

 

14,978

 

 

12,589

 

Total operating expenses

 

40,296

 

 

36,582

 

 

81,148

 

 

73,142

 

(Loss) income from operations

 

(1,596

)

 

6

 

 

(4,333

)

 

(602

)

Interest and other (expense) income, net

 

(103

)

 

532

 

 

820

 

 

947

 

(Loss) income before income taxes

 

(1,699

)

 

538

 

 

(3,513

)

 

345

 

Income tax provision

 

(438

)

 

(267

)

 

(763

)

 

(400

)

Net (loss) income

$

(2,137

)

$

271

 

$

(4,276

)

$

(55

)

 
Net (loss) income per share of common stock:
Basic and diluted

$

(0.08

)

$

0.01

 

$

(0.16

)

$

(0.00

)

 
Weighted-average shares of common stock outstanding:
Basic

 

26,556,754

 

 

25,330,545

 

 

26,392,351

 

 

25,327,255

 

Diluted

 

26,556,754

 

 

25,935,018

 

 

26,392,351

 

 

25,327,255

 

 
OOMA, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited, amounts in thousands)
 
Three Months Ended Six Months Ended
July 31,

2024
July 31,

2023
July 31,

2024
July 31,

2023
Cash flows from operating activities:
Net (loss) income

$

(2,137

)

$

271

 

$

(4,276

)

$

(55

)

Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Stock-based compensation expense

 

4,595

 

 

3,624

 

 

8,958

 

 

7,124

 

Depreciation and amortization of capital expenditures

 

1,038

 

 

1,125

 

 

2,073

 

 

2,188

 

Amortization of intangible assets

 

1,471

 

 

692

 

 

2,955

 

 

1,433

 

Amortization of operating lease right-of-use assets

 

734

 

 

813

 

 

1,517

 

 

1,460

 

Gain on note conversion

 

 

 

 

 

(980

)

 

 

Facilities consolidation gain

 

 

 

(956

)

 

 

 

(956

)

Other

 

70

 

 

(2

)

 

108

 

 

(4

)

Changes in operating assets and liabilities:
Accounts receivable, net

 

2,644

 

 

122

 

 

1,675

 

 

(1,481

)

Inventories and deferred inventory costs

 

1,946

 

 

2,382

 

 

4,527

 

 

3,347

 

Prepaid expenses and other assets

 

(2,053

)

 

(730

)

 

(1,571

)

 

(1,485

)

Accounts payable, accrued expenses and other liabilities

 

(1,871

)

 

(4,544

)

 

(4,399

)

 

(6,896

)

Deferred revenue

 

650

 

 

755

 

 

85

 

 

161

 

Net cash provided by operating activities

 

7,087

 

 

3,552

 

 

10,672

 

 

4,836

 

 
Cash flows from investing activities:
Proceeds from maturities and sales of short-term investments

 

 

 

500

 

 

 

 

2,250

 

Capital expenditures

 

(1,742

)

 

(2,144

)

 

(3,192

)

 

(3,518

)

Business acquisition, working capital adjustments

 

 

 

 

 

 

 

300

 

Net cash used in investing activities

 

(1,742

)

 

(1,644

)

 

(3,192

)

 

(968

)

 
Cash flows from financing activities:
Proceeds from issuance of common stock

 

167

 

 

164

 

 

1,584

 

 

1,888

 

Shares repurchased for tax withholdings on vesting of restricted stock units

 

(884

)

 

(483

)

 

(1,624

)

 

(914

)

Payments for repurchases of common stock

 

(891

)

 

 

 

(891

)

 

 

Repayments of long-term debt

 

(3,000

)

 

 

 

(7,500

)

 

 

Net cash (used in) provided by financing activities

 

(4,608

)

 

(319

)

 

(8,431

)

 

974

 

Net increase (decrease) in cash and cash equivalents

 

737

 

 

1,589

 

 

(951

)

 

4,842

 

Cash and cash equivalents, at beginning of period

 

15,848

 

 

27,390

 

 

17,536

 

 

24,137

 

Cash and cash equivalents, at end of period

$

16,585

 

$

28,979

 

$

16,585

 

$

28,979

 

 
OOMA, INC.
Reconciliation of Non-GAAP Financial Measures
(Unaudited, amounts in thousands, except percentages, shares and per share data)
 
Three Months Ended Six Months Ended
July 31,

2024
July 31,

2023
July 31,

2024
July 31,

2023
Revenue $

64,129

 

$

58,353

 

$

126,628

 

$

115,205

 

 
GAAP gross profit $

38,700

 

$

36,588

 

$

76,815

 

$

72,540

 

Stock-based compensation and related taxes

285

 

 

260

 

558

 

 

520

 

Amortization of intangible assets and acquisition-related costs

771

 

 

82

 

1,558

 

 

192

 

Non-GAAP gross profit $

39,756

 

$

36,930

 

$

78,931

 

$

36,322

 

 
Gross margin on a GAAP basis

60

%

 

63

%

61

%

 

63

%

Gross margin on a Non-GAAP basis

62

%

 

63

%

62

%

 

64

%

 
GAAP operating (loss) income $

(1,596

)

$

6

 

$

(4,333

)

$

(602

)

Stock-based compensation and related taxes

4,627

 

 

3,695

 

9,135

 

 

7,290

 

Amortization of intangible assets and acquisition-related costs

1,471

 

 

692

 

2,955

 

 

1,433

 

Facilities consolidation gain

 

 

(956

)

 

 

(956

)

Litigation costs

95

 

 

300

 

95

 

 

300

 

Restructuring costs

 

 

 

710

 

 

 

Non-GAAP operating income $

4,597

 

$

3,737

 

$

8,562

 

$

7,465

 

 
GAAP net (loss) income $

(2,137

)

$

271

 

$

(4,276

)

$

(55

)

Stock-based compensation and related taxes

4,627

 

 

3,695

 

9,135

 

 

7,290

 

Amortization of intangible assets and acquisition-related costs

1,471

 

 

501

 

2,955

 

 

1,433

 

Facilities consolidation gain

 

 

(956

)

 

 

(956

)

Litigation costs

95

 

 

300

 

95

 

 

300

 

Restructuring costs

 

 

 

710

 

 

 

Gain on note conversion

 

 

 

(980

)

 

 

Non-GAAP net income $

4,056

 

$

3,811

 

$

7,639

 

$

8,012

 

 
GAAP diluted net (loss) income per share $

(0.08

)

$

0.01

 

$

(0.16

)

 

 

Stock-based compensation and related taxes

0.17

 

 

0.14

 

0.34

 

 

0.28

 

Amortization of intangible assets and acquisition-related costs

0.05

 

 

0.02

 

0.11

 

 

0.06

 

Facilities consolidation gain

 

 

(0.03

)

 

 

(0.04

)

Litigation costs

0.01

 

 

0.01

 

 

 

0.01

 

Restructuring costs

 

 

 

0.03

 

 

 

Gain on note conversion

 

 

 

(0.04

)

 

 

Non-GAAP net income per basic share $

0.15

 

$

0.15

 

$

0.28

 

$

0.31

 

Non-GAAP net income per diluted share $

0.15

 

$

0.15

 

$

0.29

 

$

0.31

 

 
GAAP weighted-average basic shares

26,556,754

 

 

25,330,545

 

26,392,351

 

 

25,327,255

 

GAAP weighted-average diluted shares

26,556,754

 

 

25,935,018

 

26,392,351

 

 

25,327,255

 

Non-GAAP weighted-average diluted shares

26,821,420

 

 

25,935,018

 

26,712,880

 

 

25,883,010

 

 
GAAP net (loss) income $

(2,137

)

$

271

 

$

(4,276

)

$

(55

)

Reconciling items:
Interest and other expense (income), net

103

 

 

(532

)

160

 

 

(947

)

Income tax provision

438

 

 

267

 

763

 

 

400

 

Depreciation and amortization of capital expenditures

1,038

 

 

1,125

 

2,073

 

 

2,188

 

Amortization of intangible assets and acquisition-related costs

1,471

 

 

692

 

2,955

 

 

1,433

 

Stock-based compensation and related taxes

4,627

 

 

3,695

 

9,135

 

 

7,290

 

Litigation costs

95

 

 

300

 

95

 

 

300

 

Facilities consolidation gain

 

 

(956

)

 

 

(956

)

Restructuring costs

 

 

 

710

 

 

 

Gain on note conversion

 

 

 

(980

)

 

 

Adjusted EBITDA $

5,635

 

$

4,862

 

$

10,635

 

$

9,653

 

 

Contacts

INVESTOR CONTACT:

Matthew S. Robison

Director of IR and Corporate Development

Ooma, Inc.

ir@ooma.com

(650) 300-1480

MEDIA CONTACT:

Mike Langberg

Director of Corporate Communications

Ooma, Inc.

press@ooma.com

(650) 566-6693

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