The cloud is getting a lot of attention as of late. Businesses and consumers alike are beginning to understand the virtues, testing new offerings and moving some of their operations outside of their firewalls. For many, this means a shift in communications and putting their trust in an outside vendor.
A growing number of companies are naming 8x8 as this vendor to trust. The hosted PBX provider is finding the demand for its offerings hot and only getting hotter. In fact, the company posted record revenue for the second quarter this year, hitting $30.8 million. This figure excludes the $0.7 million in revenue related to its dedicated server hosting business that was divested on Sept. 30 of this year.
The second quarter posting is a 22-percent increase from comparable revenue for the second quarter of fiscal 2013. It seems that business customers are realizing they want the ability to streamline communications, pay on a per use basis and eliminate the need to worry about the infrastructure by leveraging proven hosted PBX capabilities.
This segment of the market represented 98 percent of its total revenue with an increase of 25 percent for 8x8 (News - Alert) to hit a record $30.3 million. Just one year ago, net profit was $1.7 million with totals reaching $2.2 million for this reporting. The number of services per business reached 12.2, an increase from 10.8 one year ago.
Customer churn also fell, demonstrating the company’s commitment to meeting needs and responding to customer demands. Last year, this figure stood at 2.4 percent, dropping to 1.5 percent for this year. An increase was also measured in cash, cash equivalents and investments as they increased $3.4 million in the second fiscal quarter to reach $61.3 million. This figure does not include the $3 million in proceeds from the sale of the company’s dedicated hosting business during the quarter.
The company’s stock is enjoying healthy activity, although recent trades are below the daily average volume. Shares have gained 7.25 percent in the last month and 18.68 percent in the last three months, fully outperforming the S&P 500. The company’s stock overall is trading above its 50-day and 200-day moving averages of $10.22 and $8.29, respectively.
Overall, it’s a good quarter to be 8x8 or an 8x8 shareholder. The demand for the hosted PBX (News - Alert) is likely to continue to grow, creating additional opportunities for strong returns.
Edited by Alisen Downey