OOMA Ooma Inc

Ooma, Inc. (NYSE: OOMA), a smart communications platform for businesses and consumers, today released financial results for the fiscal first quarter ended April 30, 2024.

Fiscal First Quarter 2025 Financial Highlights:

• Revenue: Total revenue was $62.5 million, up 10% year-over-year. Subscription and services revenue increased to $58.4 million from $53.0 million in the first quarter of fiscal 2024, and was 93% of total revenue, primarily driven by the growth of Ooma Business and the acquisition of 2600hz, Inc.
• Net Income/Loss: GAAP net loss was $2.1 million, or $0.08 per basic and diluted share, compared to GAAP net loss of $0.3 million, or $0.01 per basic and diluted share, in the first quarter of fiscal 2024. Non-GAAP net income was $3.6 million, or $0.14 per diluted share, compared to non-GAAP net income of $4.0 million, or $0.16 per diluted share in the prior year period.
• Adjusted EBITDA: Adjusted EBITDA was $5.0 million, compared to $4.8 million in the first 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 a solid start to fiscal 2025 by delivering $62.5 million in revenue and $3.6 million of non-GAAP net income for our first quarter,” said Eric Stang, chief executive officer of Ooma. “Year-over-year, we achieved 18% growth in business services revenue and 10% growth in overall revenue. Cash flow from operations was significantly higher than a year ago, allowing us to pay down $4.5 million of debt during the quarter. We remain focused on growing Ooma business services revenue and believe we made good progress in Q1. Our continued feature expansion, addition of new reseller partners, launch of AirDial in Canada, and key customer wins in the quarter make us optimistic about our outlook for fiscal 2025.”

Business Outlook:

For the second quarter of fiscal 2025, Ooma expects:

• Total revenue in the range of $62.5 million to $63.0 million.
• GAAP net loss in the range of $2.2 million to $2.5 million and GAAP net loss per share in the range of $0.08 to $0.09.
• Non-GAAP net income in the range of $3.6 million to $3.9 million and non-GAAP net income per share in the range of $0.13 to $0.14.

For the full fiscal year 2025, Ooma expects:

• Total revenue in the range of $250.7 million to $253.0 million.
• GAAP net loss in the range of $7.7 million to $8.7 million, and GAAP net loss per share in the range of $0.30 to $0.33.
• Non-GAAP net income in the range of $15.0 million to $16.0 million, and non-GAAP net income per share in the range of $0.55 to $0.58.

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 second fiscal quarter ending July 31, 2024 and the fiscal year ending January 31, 2025 (in millions, except per share data):

  Projected range Three Months Ending Fiscal Year Ending July 31, 2024 January 31, 2025 (unaudited) GAAP net loss

($2.2)-($2.5)

($7.7)-($8.7)

Stock-based compensation and related taxes

4.6

18.2

Amortization of intangible assets

1.5

5.8

Gain on note conversion

—

(1.0)

Restructuring costs

—

0.7

Non-GAAP net income $3.6-$3.9 $15.0-$16.0   GAAP net loss per share

($0.08)-($0.09)

($0.30)-($0.33)

Stock-based compensation and related taxes

0.16

0.68

Amortization of intangible assets

0.06

0.21

Gain on note conversion

—

(0.04)

Restructuring costs

—

0.03

Non-GAAP net income per share $0.13-$0.14 $0.55-$0.58   Weighted-average number of shares used in per share amounts: Basic

26.6

26.7

Diluted

26.9

27.4

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 May 28, 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/BIe82336616ca641eba291cdec09634e4c 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, restructuring costs, non-recurring gains, and stock-based compensation expense and related taxes.

Other non-GAAP financial measures exclude stock-based compensation expense and related taxes, amortization of intangible assets, non-recurring gain, such as gain on note conversion 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 Annual Report on Form 10-K for the year ended January 31, 2024, filed with the SEC on April 2, 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)     April 30, January 31,

 

2024

 

 

2024

 

Assets Current assets: Cash and cash equivalents

$

15,585

 

$

17,536

 

Accounts receivable, net

 

10,833

 

 

9,864

 

Inventories

 

17,263

 

 

19,782

 

Other current assets

 

13,701

 

 

16,497

 

Total current assets

 

57,382

 

 

63,679

 

Property and equipment, net

 

10,648

 

 

9,897

 

Operating lease right-of-use assets

 

16,596

 

 

17,041

 

Intangible assets, net

 

26,468

 

 

27,952

 

Goodwill

 

23,069

 

 

23,069

 

Other assets

 

21,072

 

 

17,615

 

Total assets

$

155,235

 

$

159,253

 

  Liabilities and stockholders' equity Current liabilities: Accounts payable

$

10,803

 

$

7,848

 

Accrued expenses and other current liabilities

 

22,136

 

 

26,586

 

Deferred revenue

 

16,474

 

 

17,041

 

Total current liabilities

 

49,413

 

 

51,475

 

Long-term operating lease liabilities

 

13,317

 

 

13,676

 

Debt, net of current portion

 

11,500

 

 

16,000

 

Other liabilities

 

17

 

 

15

 

Total liabilities

 

74,247

 

 

81,166

 

  Stockholders' equity: Common stock

 

5

 

 

5

 

Additional paid-in capital

 

216,401

 

 

211,361

 

Accumulated other comprehensive loss

 

(1

)

 

(1

)

Accumulated deficit

 

(135,417

)

 

(133,278

)

Total stockholders' equity

 

80,988

 

 

78,087

 

Total liabilities and stockholders' equity

$

155,235

 

$

159,253

 

  OOMA, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited, amounts in thousands, except share and per share data)   Three Months Ended April 30,2024 April 30,2023 Revenue: Subscription and services

$

58,389

 

$

53,049

 

Product and other

 

4,110

 

 

3,803

 

Total revenue

 

62,499

 

 

56,852

 

  Cost of revenue: Subscription and services

 

17,460

 

 

14,725

 

Product and other

 

6,924

 

 

6,175

 

Total cost of revenue

 

24,384

 

 

20,900

 

Gross profit

 

38,115

 

 

35,952

 

  Operating expenses: Sales and marketing

 

19,481

 

 

17,990

 

Research and development

 

13,793

 

 

11,953

 

General and administrative

 

7,578

 

 

6,617

 

Total operating expenses

 

40,852

 

 

36,560

 

Loss from operations

 

(2,737

)

 

(608

)

Interest and other income, net

 

923

 

 

415

 

Loss before income taxes

 

(1,814

)

 

(193

)

Income tax provision

 

(325

)

 

(133

)

Net loss

$

(2,139

)

$

(326

)

  Net loss per share of common stock: Basic and diluted

$

(0.08

)

$

(0.01

)

  Weighted-average shares of common stock outstanding: Basic and diluted

 

26,224,396

 

 

25,178,008

 

  OOMA, INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited, amounts in thousands)   Three Months Ended April 30,2024 April 30,2023 Cash flows from operating activities: Net loss

$

(2,139

)

$

(326

)

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

 

4,363

 

 

3,500

 

Depreciation and amortization of capital expenditures

 

1,035

 

 

1,063

 

Amortization of intangible assets

 

1,484

 

 

741

 

Amortization of operating lease right-of-use assets

 

783

 

 

647

 

Gain on note conversion

 

(980

)

 

—

 

Other

 

38

 

 

(2

)

Changes in operating assets and liabilities: Accounts receivable, net

 

(969

)

 

(1,603

)

Inventories and deferred inventory costs

 

2,581

 

 

965

 

Prepaid expenses and other assets

 

482

 

 

(755

)

Accounts payable, accrued expenses and other liabilities

 

(2,528

)

 

(2,352

)

Deferred revenue

 

(565

)

 

(594

)

Net cash provided by operating activities

 

3,585

 

 

1,284

 

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

 

—

 

 

1,750

 

Capital expenditures

 

(1,450

)

 

(1,374

)

Business acquisition, working capital adjustments

 

—

 

 

300

 

Net cash (used in) provided by investing activities

 

(1,450

)

 

676

 

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

 

1,417

 

 

1,724

 

Shares repurchased for tax withholdings on vesting of restricted stock units

 

(740

)

 

(431

)

Repayments of long-term debt

 

(4,500

)

 

—

 

Net cash (used in) provided by financing activities

 

(3,823

)

 

1,293

 

Net (decrease) increase in cash, cash equivalents and restricted cash

 

(1,688

)

 

3,253

 

Cash and cash equivalents, at beginning of period

 

17,536

 

 

24,137

 

Cash, cash equivalents and restricted cash, at end of period

$

15,848

 

$

27,390

 

  OOMA, INC. Reconciliation of Non-GAAP Financial Measures (Unaudited, amounts in thousands, except percentages, shares and per share data)   Three Months Ended April 30,2024 April 30,2023 Revenue $

62,499

 

$

56,852

 

  GAAP gross profit $

38,115

 

$

35,952

 

Stock-based compensation and related taxes

273

 

 

260

 

Amortization of intangible assets

787

 

 

110

 

Non-GAAP gross profit $

39,175

 

$

36,322

 

  Gross margin on a GAAP basis

61

%

 

63

%

Gross margin on a Non-GAAP basis

63

%

 

64

%

  GAAP operating loss $

(2,737

)

$

(608

)

Stock-based compensation and related taxes

4,508

 

 

3,595

 

Amortization of intangible assets

1,484

 

 

741

 

Restructuring costs

710

 

 

—

 

Non-GAAP operating income $

3,965

 

$

3,728

 

  GAAP net loss $

(2,139

)

$

(326

)

Stock-based compensation and related taxes

4,508

 

 

3,595

 

Amortization of intangible assets

1,484

 

 

741

 

Restructuring costs

710

 

 

—

 

Gain on note conversion

(980

)

 

—

 

Non-GAAP net income $

3,583

 

$

4,010

 

  GAAP diluted net loss per share $

(0.08

)

$

(0.01

)

Stock-based compensation and related taxes

0.17

 

 

0.14

 

Amortization of intangible assets

0.06

 

 

0.03

 

Restructuring costs

0.03

 

 

—

 

Gain on note conversion

(0.04

)

 

—

 

Non-GAAP net income per basic share $

0.14

 

$

0.16

 

Non-GAAP net income per diluted share $

0.14

 

$

0.16

 

  GAAP weighted-average basic and diluted shares

26,224,396

 

 

25,178,008

 

Non-GAAP weighted-average diluted shares

26,508,465

 

 

25,665,906

 

  GAAP net loss $

(2,139

)

$

(326

)

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

57

 

 

(415

)

Gain on note conversion

(980

)

 

—

 

Income tax provision

325

 

 

133

 

Depreciation and amortization of capital expenditures

1,035

 

 

1,063

 

Amortization of intangible assets

1,484

 

 

741

 

Stock-based compensation and related taxes

4,508

 

 

3,595

 

Restructuring costs

710

 

 

—

 

Adjusted EBITDA $

5,000

 

$

4,791

 

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20240528573061/en/

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