Ooma (NYSE:OOMA) Issues Earnings Results

Ooma (NYSE:OOMA) posted its quarterly earnings data on Wednesday. The technology company reported $0.35 earnings per share for the quarter, topping analysts’ consensus estimates of $0.33 by $0.02, FiscalAI reports. The company had revenue of $83.23 million during the quarter, compared to analysts’ expectations of $81.72 million. Ooma had a net margin of 3.57% and a return on equity of 23.89%. Ooma updated its FY 2027 guidance to 1.350-1.380 EPS and its Q3 2027 guidance to 0.340-0.350 EPS.

Here are the key takeaways from Ooma’s conference call:

• Q2 results exceeded expectations: Revenue rose 25% year over year to $83.2 million, while non-GAAP net income increased 58% to $10.2 million and adjusted EBITDA grew 74% to a record $12.4 million, or 15% of revenue.
• AirDial momentum is accelerating: The POTS-replacement service grew revenue 75% year over year, with more than 40 resale partners and two additions in Q2. Management cited increasing demand as carriers sunset legacy copper lines and is targeting one to two additional resale partners per quarter.
• AI and residential products provide additional growth avenues: Ooma launched AI transcription, insights, AI Answering, and AI Receptionist, expects to introduce an AI Productivity Pack in Q3, and reported strong initial customer interest. MyPhone helped reverse historical residential-user declines, while Star Dial is expected to launch in Q3 for Starlink customers.
• Fiscal 2027 guidance was raised or strengthened: Full-year revenue is expected at $332 million-$333.5 million, including approximately 32% business subscription growth, with adjusted EBITDA projected at $47.5 million-$48.3 million and non-GAAP EPS of $1.35-$1.38.
• Cash generation and cost discipline improved: Ooma generated $13.1 million of operating cash flow and $10.8 million of free cash flow in Q2, repurchased $4.4 million of stock, and reduced debt by $6.5 million to $47 million. Management also expects further savings from Phone.com integration actions beginning in Q3.

Ooma Trading Up 12.4%

Shares of OOMA opened at $23.07 on Friday. Ooma has a 52-week low of $9.79 and a 52-week high of $26.19. The stock has a market cap of $634.51 million, a PE ratio of 60.72 and a beta of 1.19. The firm’s fifty day moving average is $20.33 and its two-hundred day moving average is $17.13. The company has a quick ratio of 0.69, a current ratio of 0.94 and a debt-to-equity ratio of 0.50.

Ooma News Roundup

Here are the key news stories impacting Ooma this week:

• Positive Sentiment: Quarterly earnings and revenue beat estimates. Ooma reported adjusted earnings of $0.35 per share, ahead of the $0.33 consensus estimate and up from $0.23 a year earlier. Revenue reached approximately $83.2 million, exceeding expectations of roughly $81.7 million. Ooma Q2 Earnings and Revenues Top Estimates
• Positive Sentiment: Growth remained strong, particularly in recurring revenue. Total revenue increased 25% year over year, while subscription and services revenue rose to $75.6 million from $61.1 million. Recurring revenue represented 91% of total revenue, supporting the company’s more predictable revenue profile. Ooma Reports Fiscal Second Quarter 2027 Financial Results
• Positive Sentiment: Ooma’s outlook is well above analyst forecasts. The company guided fiscal 2027 earnings to $1.35–$1.38 per share and revenue to $332.0–$333.5 million, compared with consensus estimates of $1.21 per share and $327.3 million. Third-quarter guidance also exceeded expectations, with EPS of $0.34–$0.35 versus $0.29 expected and revenue of $83.7–$84.5 million versus $81.9 million expected. Ooma Fiscal 2027 Forecast
• Neutral Sentiment: The earnings call and presentation provided additional management commentary on the results and outlook, but the primary stock catalyst was the earnings beat and guidance above expectations. Ooma Q2 2027 Earnings Call Transcript

Insiders Place Their Bets

In other news, Director Russell Mann sold 20,000 shares of the stock in a transaction dated Wednesday, June 24th. The shares were sold at an average price of $18.35, for a total value of $367,000.00. Following the completion of the sale, the director directly owned 116,115 shares in the company, valued at $2,130,710.25. This represents a 14.69% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available at this link. Also, Director William D. Pearce sold 3,000 shares of the firm’s stock in a transaction dated Wednesday, June 10th. The stock was sold at an average price of $17.98, for a total transaction of $53,940.00. Following the completion of the transaction, the director directly owned 181,652 shares in the company, valued at approximately $3,266,102.96. This represents a 1.62% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Over the last three months, insiders sold 118,652 shares of company stock valued at $2,225,186. Corporate insiders own 9.90% of the company’s stock.

Institutional Trading of Ooma

A number of hedge funds have recently bought and sold shares of OOMA. IFC & Insurance Marketing Inc. acquired a new position in shares of Ooma during the 4th quarter worth approximately $34,000. Tower Research Capital LLC TRC grew its position in shares of Ooma by 225.2% in the second quarter. Tower Research Capital LLC TRC now owns 3,620 shares of the technology company’s stock valued at $47,000 after purchasing an additional 2,507 shares in the last quarter. Royal Bank of Canada grew its position in shares of Ooma by 24.1% in the fourth quarter. Royal Bank of Canada now owns 4,466 shares of the technology company’s stock valued at $53,000 after purchasing an additional 867 shares in the last quarter. Kemnay Advisory Services Inc. acquired a new stake in shares of Ooma in the fourth quarter valued at approximately $59,000. Finally, Lazard Asset Management LLC increased its holdings in shares of Ooma by 503.1% in the second quarter. Lazard Asset Management LLC now owns 4,927 shares of the technology company’s stock valued at $63,000 after purchasing an additional 4,110 shares during the last quarter. Institutional investors and hedge funds own 80.42% of the company’s stock.

Wall Street Analyst Weigh In

OOMA has been the subject of a number of research reports. Lake Street Capital reissued a “buy” rating and set a $25.00 target price on shares of Ooma in a research note on Thursday. Benchmark reaffirmed a “buy” rating on shares of Ooma in a research note on Monday, August 17th. B. Riley Financial lifted their price objective on Ooma from $24.00 to $27.00 and gave the stock a “buy” rating in a report on Thursday. Alliance Global Partners reiterated a “buy” rating on shares of Ooma in a research note on Thursday. Finally, Citigroup reissued a “market perform” rating on shares of Ooma in a report on Wednesday, May 27th. Five investment analysts have rated the stock with a Buy rating and one has assigned a Hold rating to the stock. According to data from MarketBeat, Ooma presently has a consensus rating of “Moderate Buy” and an average price target of $25.00.

About Ooma

Ooma, Inc, headquartered in Sunnyvale, California, is a leading provider of communication services for residential and business customers. Since its founding in 2004, Ooma has built a cloud-based platform that leverages Voice over Internet Protocol (VoIP) technology to deliver voice, video and data services over broadband networks. The company went public on the New York Stock Exchange in 2015 under the ticker OOMA and has continued to expand its service portfolio to meet evolving customer demands.

For residential users, Ooma offers an all-in-one home phone service that includes its flagship Telo device, mobile and web applications, and optional smart home security features.