AudioCodes Clocks 7% Revenue Growth In Q4 Backed By Microsoft, Zoom

AudioCodes Ltd (NASDAQ: AUDC) reported fourth-quarter FY22 revenue growth of 6.9% year-on-year to $70.7 million, missing the consensus of $72.4 million.
Product revenue rose 0.8% Y/Y to $42.02 million, while Services revenue grew 17.2% Y/Y to $28.64 million. The company said it saw ongoing momentum of AudioCodes Live managed services.
Margins: The non-GAAP gross margin contracted 180 basis points to 65.8% due to higher component costs.
The non-GAAP operating margin contracted 270 basis points to 17.7%.
The non-GAAP EPS of $0.36 missed the consensus of $0.37.
AudioCodes generated $0.42 million in operating cash flow and held $124.3 million in cash and equivalents.
Dividend: The board declared a semi-annual cash dividend of $0.18 per share.
CEO Shabtai Adlersberg said, "We see growing business activity in UCaaS and CX, and with the ongoing proliferation of AI in the enterprise, we believe we are well-positioned to extend our leadership in applying AI to voice applications and emerge a stronger and more competitive player."
"Primary growth engine during the year came from our Microsoft-related business, which grew 12% year-over-year in the quarter and 18% for the full year. Our Microsoft Corp MSFT Microsoft Teams business grew 33% for the full year. We saw ongoing momentum of AudioCodes Live managed services, which exited the year at over $30 million, growing close to 80% year-over-year, with TCV expanding to over $100 million. Service revenue grew 18% year-over-year and accounted for 40.3% of revenues, up from 37.7% a year ago. Another growth vector in UCaaS is our business in the Zoom Video Communications, Inc ZM Zoom ecosystem, which grew above 50% year over year."
Price Action: AUDC shares closed lower by 3.19% at $19.75 on Monday.

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