Earnings call transcript: Bandwidth beats Q2 2025 earnings expectations

Bandwidth Inc. reported its second-quarter 2025 earnings, surpassing expectations with an earnings per share (EPS) of $0.38, compared to the forecasted $0.32, marking an 18.75% surprise. Revenue reached $180 million, slightly above the anticipated $178.87 million. According to InvestingPro analysis, the company appears undervalued at current levels, with 4 analysts recently revising their earnings estimates upward. Despite these positive results, Bandwidth’s stock saw a premarket dip of 1.6%, trading at $15.95, after closing at $16.21 the previous day.

Key Takeaways

• Bandwidth reported an EPS of $0.38, beating the forecast by 18.75%.
• Revenue for Q2 2025 was $180 million, exceeding expectations.
• Stock price decreased by 1.6% in premarket trading despite positive earnings.
• The company launched several AI-powered innovations.
• Bandwidth expects full-year revenue growth of 10%.

Company Performance

Bandwidth Inc. demonstrated robust performance in Q2 2025, with a 9% year-over-year increase in total revenue, driven by growth in its cloud communications segment. The company reported a strong non-GAAP gross profit of $79 million, up 11% from the previous year, and an adjusted EBITDA of $22 million, marking a 17% increase. InvestingPro data shows the company maintains healthy liquidity with a current ratio of 1.31, while its market capitalization stands at $482 million. The net retention rate remained healthy at 112%, indicating strong customer loyalty and recurring revenue.

Financial Highlights

• Revenue: $180 million, up 9% YoY
• Cloud Communications Revenue: $136 million, up 8% YoY
• Non-GAAP Gross Profit: $79 million, up 11% YoY
• Adjusted EBITDA: $22 million, up 17% YoY
• Free Cash Flow: $26 million, representing a 19% margin
• Net Retention Rate: 112%

Earnings vs. Forecast

Bandwidth exceeded earnings expectations with an EPS of $0.38 compared to the forecasted $0.32, resulting in an 18.75% surprise. Revenue also surpassed estimates, reaching $180 million against the expected $178.87 million, reflecting a 0.64% positive surprise. This marks a continuation of the company’s trend of outperforming market expectations.

Market Reaction

Despite the positive earnings report, Bandwidth’s stock fell by 1.6% in premarket trading, settling at $15.95. This decline comes after a previous close of $16.21, suggesting that investors may have had higher expectations or concerns about future growth. InvestingPro notes that the stock’s movements are quite volatile, with a beta of 1.84. The stock remains within its 52-week range, with a low of $11.33 and a high of $23.90. Subscribers to InvestingPro have access to detailed volatility metrics and 8 additional ProTips for deeper analysis.

Outlook & Guidance

Looking ahead, Bandwidth projects a full-year revenue growth of 10%, with an estimated EBITDA of $88 million. The company anticipates organic growth of 10% in Q3 and 13% in Q4, driven by its AI-powered innovations and expanding enterprise communications services.

Executive Commentary

CEO David Morkin highlighted the strategic importance of AI in the company’s growth, stating, "Voice is the most durable and important channel for customer engagement. And with the rise of AI, it will be even more indispensable." He emphasized Bandwidth’s role as a leading platform in the enterprise AI voice revolution.

Risks and Challenges

• Market competition: Increasing competition in the AI voice communications space.
• Economic conditions: Potential macroeconomic pressures affecting enterprise spending.
• Technological advancements: Rapid changes in technology requiring continuous innovation.
• Regulatory changes: Compliance with evolving regulations in key markets.

Q&A

During the earnings call, analysts focused on the impact of AI use cases on revenue, with CEO Morkin noting that AI interactions could significantly increase voice minutes on Bandwidth’s network. Questions also addressed the company’s global expansion plans and the expected growth in messaging services aligned with market trends.

Full transcript - Bandwidth Inc (BAND) Q2 2025:

Conference Operator: Good day, and welcome to the Bandwidth, Inc. Second Quarter twenty twenty five Earnings Conference Call. All participants will be in listen only mode. After today’s presentation, there will be an opportunity to ask questions. Please note this event is being recorded.

I’d now like to turn the conference over to your host today, Sarah Wallace, Vice President of IR. Please go ahead.

Sarah Wallace, Vice President of Investor Relations, Bandwidth: Good morning, and welcome to Bandwidth’s Second Quarter twenty twenty five Earnings Call. I’m joined today by David Morkin, our CEO and Daryl Raeford, our CFO. They will begin with prepared remarks, and then we will open up the call for Q and A. Our earnings press release was issued earlier today. The press release and an earnings presentation with historical financial highlights and a reconciliation of GAAP to non GAAP financial results can be found on the Investor Relations page at investors.bandwidth.com.

During the call, we will make statements related to our business that may be considered forward looking, including statements concerning our financial guidance for the third quarter and full year 2025. We caution you not to put undue reliance on these forward looking statements as they may involve risks and uncertainties that could cause actual results to vary materially from any future results or outcomes expressed or implied by the forward looking statements. Any forward looking statements made on this call and in the presentation slides reflect our analysis as of today, and we have no plans or obligation to update them. For a discussion of material risks and other important factors that could affect our actual results, please refer to those contained in our latest 10 ks filing as updated by other SEC filings. With that, let me turn the discussion over to David.

David Morkin, CEO, Bandwidth: Thank you, Sarah, and good morning, everyone. Welcome to Bandwidth’s second quarter twenty twenty five earnings call. We delivered a solid second quarter, demonstrating continued momentum and disciplined execution across the business. Revenue of $180,000,000 and adjusted EBITDA of $22,000,000 exceeded expectations. We gained good traction in customer acquisition and achieved continued improvement in operating metrics.

This quarter underscores a strong performance over the last twelve months, where we grew revenue 15%, EBITDA 36%, and free cash flow 26%. The demand for mission critical enterprise communications is durable, and our platform is essential for companies transforming customer experience with AI. To our customers, thank you for your partnership. To our Bandmates, thank you for your incredible work and dedication. And I thank God for blessing our journey together.

The story of this quarter is the tangible progress of our AI strategy. Our investments in AI voice are now translating into customer adoption and laying the groundwork for a powerful new layer of revenue. We’re seeing meaningful traction, including new $1,000,000 plus multiyear deals as enterprises leverage the software driven capabilities of Maestro and AI Bridge within the Bandwidth Communications Cloud, allowing them to seamlessly integrate AI voice into their customer experience call flows. These platforms provide the essential APIs and orchestration tools for advanced deployment. This is particularly evident with our existing customers in the financial services, health care, and hospitality verticals.

We believe Bandwidth is the essential platform for the enterprise AI voice revolution. Whether a customer is using a standalone AI model or the tools embedded in their CCaaS platform, they rely on Bandwidth for the scale, reliability, and orchestration required to succeed. Let me share how this is creating value today. A longtime customer, one of the largest banks in The US, utilized our Maestro platform’s robust software integrations to seamlessly incorporate a third party conversational AI provider. This provided them with the programming flexibility to innovate across their multiple CCaaS systems, leveraging Maestro’s agnostic orchestration layer.

And combined with our network level voice anomaly detection, the bank can deliver even more reliable, resilient, and intelligent customer experiences across all their business lines. The impact is clear. They can now test and deploy new AI powered customer experiences with speed and confidence, all while maintaining control of their technology stack? This is a blueprint for how we will expand our business across our enterprise customer base. Another large existing customer, a leader in digital banking, is using the native AI features within their Genesys contact center.

In this scenario as well, bandwidth is critical. The low latency, high call quality, and high availability of our communications cloud was essential. As their team told us directly, our AI story only works with bandwidth. This is powerful validation that the underlying communications cloud is the linchpin for any successful AI voice strategy. These examples highlight a fundamental shift that is expanding our economic engine.

As we’ve said before, AI is not replacing voice. It’s enriching it. Each AI powered call has the potential to drive significantly more usage of our cloud platform, largely due to the software driven value added services we layer on. With capabilities like Maestro’s orchestration modules, integrated transcription, and our fraud detection software solutions, we see a path to potentially generating as much as three to four times the revenue of a standard voice call. This is a powerful consumption multiplier that expands our share of wallet and makes our platform stickier.

In regulated sectors like financial services, customers rely upon us for compliance and security, as well as performance. As AI is further integrated into enterprise workflows, ensuring trust and transparency in voice applications is becoming as essential as uptime and may also drive future revenue opportunities. Every new enterprise win this quarter included our Maestro platform, underscoring its role as a core software differentiator. This isn’t just an add on. It’s the programmable intelligence layer that drives higher revenue per customer and deeper integration, enabling sophisticated call routing and service orchestration that legacy systems cannot match.

This AI driven growth potential is built upon the strong foundation of our core voice business. This quarter, we continued to win high value customers, reinforcing the strength of both our integrated direct and channel sales strategies. Our direct sales team closed one of Tennessee’s largest health care providers, serving millions of customers. They initially planned to split their traffic between two vendors, but ultimately selected Bandwidth as their sole provider. Why?

Because the resilience of our CallAssure solution was the only one that could meet their strict uptime requirements for essential Medicare and Medicaid services. When service cannot fail, enterprises choose Bandwidth. We also won a leading insurance brokerage with more than 10,000 associates across 200 offices nationwide. They needed to migrate both their UC and contact center to the cloud and chose Bandwidth after our proof of concept demonstrated not only the technical excellence of our support team, but also the programmable power of Maestro’s software to handle their sophisticated multi site call routing requirements. This win, once again, showcases our role as the go to partner for complex cloud migrations in regulated industries.

Our channel partnerships are also becoming a powerful growth engine, delivering a record number of deals this quarter across a variety of industry verticals. A great example is our work with a top systems integrator, where we’ve built a successful playbook for migrating large enterprises from on premises Cisco systems to the cloud. Two of this partner’s significant healthcare accounts were moving to Cisco Webex Contact Center. Both had a critical need for reliability and each chose bandwidth because we de risked the entire migration. With proven uptime, automated porting, and total visibility through our dashboard, we gave them the confidence to move to the cloud without fear of disruption.

The message to the market is clear. For the thousands of enterprises that are still on premises, Bandwidth is the fastest and most reliable path to the cloud. To summarize, we are executing on a clear and focused strategy. First, we continue to prioritize business execution, delivering solid financial results, exceeding our guidance, and demonstrating the efficiency of our business model. Second, we are scaling our global enterprise business by winning larger customers with multiyear higher margin engagements who rely on us for their most mission critical communications.

And third, we’re accelerating our AI voice innovation, creating a powerful revenue multiplier and cementing our role as the essential platform for the future of the AI powered customer experience. Voice is the most durable and important channel for customer engagement. And with the rise of AI, it will be even more indispensable. We are uniquely positioned to lead this market, and we are confident in our ability to create significant long term value for our shareholders. Now I’ll turn it over to Daryl to discuss the financial results in more detail.

Daryl Raeford, CFO, Bandwidth: Thank you, David, and good morning, everyone. We’re pleased to report a solid second quarter driven by accelerating momentum in our core voice offerings. This performance demonstrates the strength of Bandwidth’s cloud communications platform, The effectiveness of our go to market strategy and our ability to scale efficiently, our team’s execution led to solid revenue performance with adjusted EBITDA exceeding the high end of our guidance. Looking at our second quarter twenty twenty five results, total revenue of $180,000,000 increased 9% year over year normalized for 2024 cyclical political campaign revenue of $8,000,000 Included within that result, cloud communications revenue reached $136,000,000 an 8% year over year increase on a normalized basis. Non GAAP gross profit of $79,000,000 marked an increase of 11% year over year or 13% growth when normalized.

Non GAAP gross margin improved to 58%, a two percentage point increase year over year. Adjusted EBITDA grew by 17% year over year to $22,000,000 driven by higher revenue and stronger margins. Free cash flow was $26,000,000 representing 19% margin. Focusing on our three market offers, enterprise voice revenue grew 29% year over year, fueled by robust demand on our core platform from both customers expanding usage and new customers migrating contact centers and employee communications to the cloud. Global voice plans, our largest customer category, grew revenue 7% year over year, which is our highest growth rate achieved since 2021, driven by channel partnership traction, along with continued expansion from long term customers and onboarding of new ones.

Programmable messaging likewise achieved a normalized 7% year over year growth. Moving to operating metrics. Net retention rate for the first quarter was 112%. Customer name retention remained well above 99%. Average annual revenue per customer set another record at $230,000 or a record $216,000 when excluding political campaign revenue.

After reaching midyear, we’re encouraged by our strong performance with first half revenue growth in our core voice offerings exceeding expectations due to higher demand from existing customers and the addition of new ones. We also achieved record high first half non GAAP gross margins, EBITDA and operating cash flows. Looking ahead to the remainder of 2025, three months ago, we raised our full year 2025 guidance, anticipating continued acceleration in the second half, following solid second quarter results. And while monitoring the expected typical holiday season uptick, we remain confident in the second half acceleration, which underpins our previously raised full year guidance. We continue to project 10% organic revenue growth at the midpoint for the full year and are once again increasing our full year EBITDA outlook to $88,000,000 at the midpoint.

We believe this outlook for the second half is an achievable plan that keeps us firmly on track toward our strategic and financial goals. In summary, we are pleased with our operating and financial performance in the first half. We’re building on a foundation of strong execution, expanding customer value through AI powered use cases and leveraging our platform scale and flexibility. As David remarked, we’re executing with discipline, scaling our global enterprise presence and accelerating AI voice innovation to place bandwidth at the center of the AI powered customer experience. This strategy positions us to deliver sustained revenue growth, continued margin expansion and robust cash generation.

With that, I’ll now turn the call over to the operator for the question and answer portion of today’s call.

Conference Operator: And the first question comes from Joshua Riley with Needham.

Joshua Riley, Analyst, Needham: All right. Thanks for taking my questions. Nice job on the quarter here. It seems like the thesis thesis for AI use cases for customer support is kind of playing out as expected here in terms of driving additional voice minutes on the platform. How are you thinking about the outlook?

Maybe get some more color here. I know you made a couple of comments about the second half ramping these use cases relative to leaving your full year revenue guidance unchanged after this quarter.

David Morkin, CEO, Bandwidth: Thanks, Josh. This is David. And yes, I want to affirm your observation indeed. Maestro was a critical component of every single one of our enterprise wins, and the AI use case thesis that we’ve had continues to manifest, and we’re really pleased with that. The second part of your question was regarding guidance and let me ask Daryl to address that.

Daryl Raeford, CFO, Bandwidth: Good morning, Josh. It’s nice to say hello to you and thank you for joining the call. Do expect, as I said in my prepared remarks, we do expect that our second half will accelerate over our first half growth. First half ended up setting, as I said, a record in terms of our financial metrics over prior first half. Second half is set to accelerate.

Our guidance at the midpoint in terms of total revenue normalized, we’ll expect for the third quarter a 10% organic growth. And then if you do the math for the full year and you back into the fourth quarter, what we’re calling for is 13%. So you can see the sequencing in terms of the acceleration of what I was referring to.

Joshua Riley, Analyst, Needham: Got it. That’s helpful. And then in terms of the Maestro add ons that you’ve seen over the last several quarters here, can you just give us a sense, it seems like the average revenue per customer continues to pick up here. How much of that is being driven by Maestro add ons or other add ons or any other considerations that we should be considering here for ARPU growth?

David Morkin, CEO, Bandwidth: Thank you, Josh. This is David again. We’ve invited our Chief Product Officer, John Bell, to join us on the call. John, why don’t you take that one?

John Bell, Chief Product Officer, Bandwidth: Yes. We continue to see a mix. As we mentioned, we are seeing more adoption of Maestro and Maestro services. So that is an important part of the uptick from our customers, and we are enthusiastic as we see adoption of more and more components of the platform by our customers.

Joshua Riley, Analyst, Needham: Got it. Thanks, guys.

Conference Operator: Thank you. And the next question comes from Meta Marshall with Morgan Stanley.

Meta Marshall, Analyst, Morgan Stanley: Great, thanks. Maybe just on Maestro, just kind of what is the pace of some of the integrations integrations that that you you guys guys are are gonna do into the platform and just kind of the work you’re doing with other companies because I’m sure they would like to get on to that platform at this point. And then maybe just as a second question, you kind of talked about this voice multiplier over time that you see kind of as you move towards AI voice. Just how is that going to be step function? Is that going to be gradual?

Just how you see that developing? Thanks.

David Morkin, CEO, Bandwidth: Thanks Meta. This is David. Annually, we have a conference that’s very close now about, just a little bit over a month away. And Reverb is where we’re excited about talking about Maestro’s latest developments and announcements integrations and product features and the benefits for our customer base that is engaging with and adopting AI. So we’ll be excited to announce, new things at Reverb, but interestingly one of our integrations, Cognigy, just announced that they were acquired by another Maestro customer of ours, NICE.

And so it just illustrates and confirms that both these great customers that we have engaged with the Maestro platform and we’re thrilled with that combination and we think other integrations similarly in this AI era are going to benefit both partners and customers in unique ways. But at the Reverb conference, have more to say about it. And then in terms of the second part of your question, let me ask Darryl to opine or John to opine on the PACE. Go ahead, John.

John Bell, Chief Product Officer, Bandwidth: Yeah. So from the pace, we see a very, I’d say, very standard adoption pattern with our customers. We see often customers start up the Maestro platform moving from on prem to the cloud, usually with a fixed platform. And then once they’re in the cloud, they have the flexibility to continue to add more services, perhaps add other applications into their call flows. And we continue to layer on more services, as we mentioned one of our customer examples with a large bank in the call.

It’s a very normal pattern we see with customer adoption.

Meta Marshall, Analyst, Morgan Stanley: Great. Thank you.

Conference Operator: Thank you. And the next question comes from Argoon Badia with William Blair.

Argoon Badia, Analyst, William Blair: Thank you. Actually, I can just follow-up on the last question. I think, David, you had mentioned in your prepared remarks that the AI potential per call is three to four times that of a non AI voice call. Is that measuring any sort of AI call versus a regular voice call? Or is that something that’s using all of your Maestro services, some of your Maestro services?

Like, how how should we think about what that multiplier actually relates to and where kind of you have customers that are realized that where you’re realizing this sort of uplift already or is this sort of a potential further down the road?

David Morkin, CEO, Bandwidth: But it’s it’s being realized in real time, and I think it’s reflected in the increased usage that we see in voice for our global communications plans as well as as enterprise. And indeed, each AI interaction on a call can generate, multiple examples of voice minutes on our network. So you can fork a call, fork the media, because there’s an AI agent or engine on the other end that’s doing sentiment or transcription or fraud detection or any number of different important services in call synchronously in real time. Those are what drive the potential to add three to four times the call revenue for us. And that’s happening today.

That’s not in the future. We’re excited about the additional value being added by those different engines or agents for our customers, whether it’s in the contact center or again in GCP. And so, uniquely in the past, a voice call was really monetized just based on a single stream of media and signaling that we handle on behalf of the customer. And today, what we’re seeing is, and we expect even more so in the future, with the rise of voice agents, you’re gonna have sub agents and really valuable things happening simultaneously that require the intelligence and orchestration of the Maestro platform. So it’s beginning to be realized today, and we think that it’ll even increase in the future.

And then let me again invite my bandmate and colleague John Bell to add to my remarks.

John Bell, Chief Product Officer, Bandwidth: Yeah, I think I just second what David said. There are a lot of services running in parallel that are enabling that multiplier. And as there are more and more agents being developed, more and more applications for enterprises to use, that creates the opportunity for us to serve them multiple streams and multiple applications at the same time.

Argoon Badia, Analyst, William Blair: Okay. Perfect. That’s very helpful. And then I also wanted to just touch on messaging. It seems like there was a little bit of slowdown this quarter.

I’m curious what maybe the puts and takes are on that business. And then broadly, as we kind of step back, how do you think about bandwidth competitive differentiation in messaging versus some of the other players out there where messaging is a bigger portion of their business and would love to hear some like where you’re focusing on in terms of compliance reliability, etcetera. Thank you.

David Morkin, CEO, Bandwidth: You bet. So, in the quarter, our messaging growth was 7% for commercial messaging, and that was driven by customers in e commerce, financial services, civic engagement. Our assumption for commercial messaging is high single digit growth for the full year, which is in line with our market with the market growth rate for commercial messaging. There are some deals that you might expect us not to pursue because they’re not margin accretive, and we’re focused on large enterprises with large scale opportunities so long as they contribute to our long range plan for profitability. So our focus is on expanding messaging and specifically messaging formats like RCS, RBM, and we’re targeting larger customers where our excellent service is required, but profitability is a big component.

We do have opportunities to grow messaging, and we are winning large we are winning away large senders that have outgrown their existing platforms. They’re looking for things like scalability and reliability and how we deliver those messages and support that. So we’re cross selling into enterprises. But again, our assumption is in line with market growth for the rest of this year.

Argoon Badia, Analyst, William Blair: All right, wonderful. Thank you.

Conference Operator: Thank you. And the next question comes from Will Powell with Baird.

Will Powell, Analyst, Baird: Okay, great. Thanks. Yes, I wanted to come back to the Global Voice Plan segment, your largest. I think you called out strongest growth in a few years, which is nice to see. So it’d great to get any other color as to kind of the core drivers there.

It sounds like an increased presence with partners is helping. So maybe if you can kind of dissect how much that’s partner driven versus maybe core trends within UCaaS, CCaaS, etcetera, would be great.

David Morkin, CEO, Bandwidth: You bet, Will. So the growth in GCP was 7% up from 2% year over year in the year ago quarter, and the total voice business is growing 9% versus 3% year over year. And your question is, where in the world is all this voice growth coming from? And what we are seeing is that there are many, many new use cases where you have AI voice. And you have examples of that in UCaaS and CCaaS.

The Cognigy NICE announcement really illustrates that just this week. We understand how indispensable voice is for our enterprise customers. They understand that as well. And the rise of AI, I think, is being reflected in the actual results in our voice business. Let me pause and invite John or Daryl to add, though, to my remarks.

John Bell, Chief Product Officer, Bandwidth: Yeah. I’ll just add maybe two other dimensions to that. One, AI is enabling a number of new entrants in the market who are becoming Bandwidth customers customers there. And also, our global expansion that continues as we continue to help our GVP customers expand globally.

Daryl Raeford, CFO, Bandwidth: Okay. Will, this Just is to put a remark on to a fine point on David’s comments. When we grew our voice revenue when we doubled the growth rate in the first quarter, we did signal that embedded in our raised outlook for the full year, we expected voice to double its growth rate over last year. I think the second quarter is just very much on track to achieving that much higher growth rate that we’re calling for in the for the full year embedded in our guide and we’ve clearly positions us for the future beyond that.

Will Powell, Analyst, Baird: Great. Thank you.

Conference Operator: Thank you. And the next question is a follow-up from James Fish with Piper Sandler.

Will Powell, Analyst, Baird: Hey, guys. Look, wanting to build off of, some of the prior questions, but any we’ve always thought of lower cost as an advantage for bandwidth, but what are you guys seeing with pricing on the messaging side in particular as one of your competitors clearly changed how they’re pricing? And does this give you any pricing leverage to take your own sort of hire?

Daryl Raeford, CFO, Bandwidth: This is Daryl. Pricing for so with respect to the specifics, pricing for the quarter was in our price volume analysis was improved over this time last year as well as volume. We believe that the higher value services that we provide to our larger customers allows us to price at a level that reflects that value. And indeed, the stickiness of our customer base is evident with the logo retention rate of always greater than 99%. We think that we’re in a good place when it comes to voice price and especially when it comes to the value add that we are providing as AI is enabled across that installed base.

David Morkin, CEO, Bandwidth: And recent pricing moves by others that you mentioned are opening up competitive opportunities for us as customers are evaluating options directly related to the price increases. So we’re seeing that in real time.

Will Powell, Analyst, Baird: Got it. Thanks.

Conference Operator: Thank you. And the next question comes from Patrick Walravens with Citizens.

Sarah Wallace, Vice President of Investor Relations, Bandwidth0: Great, thank you. I have a couple and congratulations on the results. So, hey David, can we go back to this nice Cognigy deal yesterday because I think there’s a number of wrinkles to it that make it super interesting for you guys. So number one, they were both partners, right? But can you just explain to us how they differ?

Right? So what did they do differently as partners and why does it make sense for them to be together?

David Morkin, CEO, Bandwidth: Thanks, Pat. Both indeed were Maestro customers. NICE was pre integrated within the Maestro environment so that enterprise customers could easily take advantage of the NICE contact center capabilities. Cognigy, which does extraordinary AI voice, features and capabilities, were also a AI bridge integration in Maestro so that enterprise customers that were using NICE in the contact center could easily add the Cognigy voice agent capabilities to their call flows. And what’s really cool is that Cognigy, a phenomenal company really pioneering the voice AI agent space and NICE, the contact center company that powers many, many seats of, agents in the contact center by getting together.

What it shows us is both the relevance and importance of Maestro in terms of an orchestration layer. But their combination, think, really points to the future, which is you’re going to have millions and millions and millions of new users of the global phone network and system, but many, many of them will be PhD level intelligent, highly emotionally empathetic, AI voice agents adding extraordinarily, high value to different call flows in the contact center. And NICE effectively, I think, is going to be able to add many, many, many, many, many seats, an infinite number of seats of voice AI agents to add value to their customers. And we’re excited, to support both, and we think the combination is fantastic.

Sarah Wallace, Vice President of Investor Relations, Bandwidth0: Alright, great. And so I guess the two sort of wrinkles on this are NICE paid almost a billion dollars, right, for Fagaji which is gonna do like 85,000,000 exiting next year, right? You guys are doing like $750,000,000 sort of at the midpoint of the range traded half of that, right? So what is the disconnect here and how does BAND capture more of that perceived future value?

David Morkin, CEO, Bandwidth: I think there’s a lot of good conversation going on about infrastructure globally in data centers right now for compute and inference related to AI. There has not been much conversation about infrastructure and software layers important for voice AI infrastructure. And once that’s recognized, I think valuations may change. Right now, we’re excited about seeing the impact of AI voice use cases in our global voice revenue run rate for the year. That’s been exciting to see manifest and become real.

But to your good point, I think that, time will tell, but global AI voice use cases require global AI voice infra, and we are pioneers and leaders in that. And our Maestro platform on top of that global universal platform for both regular voice conversations and AI voice conversations is something we’ve worked on for years, we’re excited about supporting this wave that is happening with voice agents globally.

Sarah Wallace, Vice President of Investor Relations, Bandwidth0: Okay, great. Thank you.

Conference Operator: Thank you. And that concludes both the question session as well as the call. Thank you so much for attending today’s presentation. You may now disconnect your lines.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.