Things Add Up for 8x8
January 28, 2013
By Paula Bernier
, Executive Editor, TMC
Investors are excited about 8x8's prospects, according to a recent piece by Dan Caplinger on The Motley Fool website, which notes the telecom service provider’s shares have risen nearly 25 percent since mid-October.
“8x8 (News - Alert) has done a good job of convincing customers to commit to its services, with customer churn levels well below Vonage's,” Caplinger writes. “Moreover, last quarter, businesses that use 8x8 adopted more of the telecom provider's services, leading to a nearly 25 percent boost in average monthly revenue per customer. That loyalty can lead to word-of-mouth referrals, which are crucial for anyone trying to tap the small-business segment.”
He indicated this could bode well for 8x8, and he was certainly right. The company released its third quarter fiscal 2013 results last week, where it revealed that its total revenue for the quarter increased by 17 percent year-over-year to a record $27.3 million – as compared to the $23.3 million it revealed in the same period of fiscal 2012.
Furthermore, its revenue from business customers grew a staggering 22 percent to comprise 97 percent of total revenue for the quarter. CEO Bryan Martin (News - Alert) said he was “pleasured to report another quarter of record revenue” for the company.
As discussed in the August 2011 issue of INTERNET TELEPHONY, a TMC (News - Alert) publication, the company has been working to expand its product set and focus on business customers.
Virtual Office is the name of the company’s flagship offering, which includes call center and UC functionality, call recording and presence management. Mobility is also a component of the solution, which includes soft clients and Web clients, as well as support for smartphones.
In a 2011 interview with INTERNET TELEPHONY, 8x8 CEO Bryan Martin explained that Virtual Office is a great replacement for very high end business phone systems, although it’s also suitable for small companies.
To further expand its offerings and growth, 8x8 in 2010 acquired a managed hosting company called Central Host out of Los Gatos, Calif. And in 2011 8x8 picked up Zerigo, a Littleton, Colo.-based company that provides virtual private servers, managed DNS services and monitoring tools for cloud-based server operations. The same year it snapped up Contactual (News - Alert), which sells cloud-based call center and customer interaction management tools.
Clearly, 8x8 is on a roll. Not only does this show in analysts’ clear excitement, but the proof can also be found in the company’s solid earnings.
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Edited by Allison Boccamazzo