- Vonage Holdings Corp VG reported second-quarter FY21 revenue growth of 13.2% to $351.5 million, beating the analyst consensus of $335.3 million.
- Service revenues grew 12.2% Y/Y to $332.6 million. USF revenues rose 34.9% Y/Y to $18.9 million.
- Vonage Communications Platform revenue increased 22.2% Y/Y to $276.4 million. VCP service revenues increased 23% Y/Y to $260 million.
- API revenues grew 40%, driven by strong growth from new and existing customers, and Unified Communications (UC) and Contact Center (CC) service revenue growth increased to 7%.
- VCP Service revenue per customer rose 24% Y/Y to $632 per month, VCP Service revenue churn of 1.0% was essentially flat.
- Consumer revenues declined 11% Y/Y to $75 million, and Customer churn was unchanged at 1.5%.
- The average revenue per line (ARPU) was $29.37, an increase of $1.78. Vonage ended Q2 with 836 thousand consumer subscriber lines.
- Vonage Communications Platform segment gross margin contracted 30 bps to 46.4%. Consumer segment gross margin declined 70 bps to 72.5%.
- Adjusted EBITDA improved 17.5% Y/Y to $48.8 million.
- Adjusted EPS of $0.05 beat the analyst consensus of $0.04.
- Vonage generated $42 million in operating cash flow and held $42.1 million in cash and equivalents.
- Customer needs are rapidly growing across their communications and engagement platforms, driven by secular tailwinds like cloud migration, digital transformation, and, more recently, hybrid working models.
- Outlook: Vonage sees Q3 revenue of $345 million - $349 million above the analyst consensus of $$337.5 million.
- Price action: VG shares traded higher by 5.35% at $15.08 on the last check Thursday.
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