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Table of Contents

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

| FORM | 10-Q |

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2025
or
☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ________to _________
Commission file number: 001-38312
_________________
8x8, INC.
(Exact name of Registrant as Specified in its Charter)
_________________

Delaware |  | 77-0142404
(State or Other Jurisdiction of Incorporation or Organization) |  | (I.R.S. Employer Identification Number)

675 Creekside Way
Campbell, CA 95008

(Address of principal executive offices)

(408) 727-1885

(Registrant's telephone number, including area code)

_________________
Securities registered pursuant to Section 12(b) of the Act:

Title of each class | Trading Symbol | Name of each exchange on which registered
COMMON STOCK, PAR VALUE $0.001 PER SHARE | EGHT | Nasdaq Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ Yes ☐ No
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.

| Large accelerated filer | ☐ |  | Accelerated filer | ☒ |
| Non-accelerated filer | ☐ |  | Smaller reporting company | ☒ |
|  |  |  | Emerging growth company | ☐ |

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
The number of shares of the Registrant's Common Stock outstanding as of October 31, 2025 was 138,640,363.

Table of Contents
8X8, INC.
INDEX TO QUARTERLY REPORT ON FORM 10-Q
FOR THE QUARTER ENDED SEPTEMBER 30, 2025

| Page
Forward-Looking Statements and Risk Factors | 2
PART I. FINANCIAL INFORMATION | 3
Item 1. Financial Statements (unaudited): | 3
Condensed Consolidated Balance Sheets | 3
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) | 4
Condensed Consolidated Statements of Stockholders' Equity | 5
Condensed Consolidated Statements of Cash Flows | 6
Notes to Unaudited Condensed Consolidated Financial Statements | 7
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations | 21
Item 3. Quantitative and Qualitative Disclosures About Market Risk | 31
Item 4. Controls and Procedures | 31
PART II. OTHER INFORMATION | 32
Item 1. Legal Proceedings | 32
Item 1A. Risk Factors | 32
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds | 32
Item 3. Defaults Upon Senior Securities | 32
Item 4. Mine Safety Disclosures | 32
Item 5. Other Information | 32
Item 6. Exhibits | 33
Signature | 34

1

Table of Contents
Forward-Looking Statements and Risk Factors
Statements contained in this quarterly report on Form 10-Q, or this "Quarterly Report", regarding our expectations, beliefs, estimates, intentions or strategies are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. For example, words such as "may," "will," "should," "estimates," "predicts," "potential," "continue," "strategy," "believes," "anticipates," "plans," "expects," "intends," and similar expressions are intended to identify forward-looking statements. These forward-looking statements include, but are not limited to, statements regarding: industry trends; our number of customers; growth and cost of service revenue; research and development expenses; costs related to our continued growth initiatives; sales and marketing expenses; gross profit margin; general and administrative expenses in future periods; liquidity; indebtedness; capital; cash, cash equivalents and investment balances; and anticipated cash flows. You should not place undue reliance on these forward-looking statements. Actual results and trends may differ materially from historical results and those projected in any such forward-looking statements depending on a variety of factors. These factors include, but are not limited to:
•the impact of economic downturns on us and our customers;
•the impact of cost increases and general inflationary pressures, as well as supply chain shortages and disruptions, on our operating expenses;
•risks related to our secured term loan facility due in 2027 and convertible senior notes due in 2028, including the impact of increased interest expense and timing of any future repayments or refinancing on our stock price;
•customer cancellations and rate of customer churn;
•ongoing volatility and tensions in the political and economic environment, including from government shutdown and threats of shutdowns, trade wars and tariffs, the impact of Russia’s invasion of Ukraine and conflicts in the Middle East, and any related macro-economic impacts;
•customer acceptance and demand for our new and existing cloud communication and collaboration services and features, including voice, contact center, video, messaging, and communication application programming interfaces;
•competitive market pressures, and any changes in the competitive dynamics of the markets in which we compete;
•the quality and reliability of our services;
•our ability to scale our business;
•customer acquisition costs;
•our reliance on a network of channel partners to provide substantial new customer demand;
•complexity and length of enterprise customer sales cycle;
•dependence on new products and services to maintain and grow our business;
•the amount and timing of costs associated with recruiting, training, and integrating new employees and retaining existing employees;
•our reliance on the infrastructure of third-party network service providers;
•risk of failure in our physical infrastructure;
•risk of defects or bugs in our software;
•risk of cybersecurity breaches;
•our ability to maintain the compatibility of our software with third-party applications and mobile platforms;
•continued compliance with industry standards and regulatory and privacy requirements, globally;
•introduction and adoption of our cloud software solutions in markets outside of the United States;
•risks that any reduction in spending may not achieve the desired result or may result in a reduction in revenue;
•risks related to the acquisition and integration of businesses we have acquired or may acquire in the future;
•risks related to our plans to sunset the Fuze platform and migrate customers to our own platform following our earlier acquisition of Fuze, Inc.;
•risks related to the fluctuations in the value of the United States Dollar and other currencies that underlie our business transactions;
•risks related to our substantial amount of indebtedness, which could have important consequences to our business;
•potential past and future liabilities related to federal, state, local and international taxes, fees, surcharges and levees;
•potential future intellectual property infringement claims and other litigation that could adversely impact our business and operating results;
•risk of inability to use third-party or open-source software; and
•risks related to natural disasters, war, terrorist attacks, global pandemics and other unforeseen events.
Please refer to the "Risk Factors" section of our annual report on Form 10-K for the fiscal year ended March 31, 2025, as filed with the SEC on May 22, 2025 (the "Form 10-K"), and subsequent Securities and Exchange Commission ("SEC") filings for additional factors that could materially affect our financial performance. All forward-looking statements included in this Quarterly Report are based on information available to us on the date hereof, and we assume no obligation to update any such forward-looking statements. Readers are urged to carefully review and consider the various disclosures made in this Quarterly Report, which attempts to advise interested parties of the risks and factors that may affect our business, financial condition, results of operations and prospects. Our fiscal year ends on March 31 of each calendar year. Each reference to a fiscal year in this Quarterly Report refers to the fiscal year ended March 31 of the calendar year indicated (for example, fiscal year 2026 refers to the fiscal year ending March 31, 2026). Unless the context requires otherwise, references to "we," "us," "our," "8x8," and the "Company" refer to 8x8, Inc. and its consolidated subsidiaries. All dollar amounts within this Quarterly Report are in thousands of United States Dollars ("Dollars") unless otherwise noted.
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PART I. FINANCIAL INFORMATION
ITEM 1. Financial Statements
8X8, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited, in thousands, except per share amounts)

| September 30, 2025 |  | March 31, 2025
ASSETS |  |  |
Current assets: |  |  |
Cash and cash equivalents | $ | 75,872 |  |  | $ | 88,050 |
Restricted cash | 812 |  |  | 462 |
Accounts receivable, net | 66,889 |  |  | 49,680 |
Deferred contract acquisition costs | 27,733 |  |  | 30,935 |
Other current assets | 34,316 |  |  | 34,739 |
Total current assets | 205,622 |  |  | 203,866 |
Property and equipment, net | 47,394 |  |  | 47,919 |
Operating lease, right-of-use assets | 30,424 |  |  | 33,508 |
Intangible assets, net | 60,973 |  |  | 67,949 |
Goodwill | 273,803 |  |  | 271,530 |
Restricted cash, non-current | — |  |  | 812 |
Deferred contract acquisition costs, non-current | 39,252 |  |  | 44,239 |
Other assets, non-current | 13,288 |  |  | 13,354 |
Total assets | $ | 670,756 |  |  | $ | 683,177 |
LIABILITIES AND STOCKHOLDERS' EQUITY |  |  |
Current liabilities: |  |  |
Accounts payable | $ | 43,307 |  |  | $ | 45,773 |
Accrued and other liabilities | 66,872 |  |  | 63,025 |
Operating lease liabilities | 10,740 |  |  | 11,102 |
Deferred revenue | 43,569 |  |  | 37,751 |
Term loan, current | 19,173 |  |  | 11,593 |
Total current liabilities | 183,661 |  |  | 169,244 |
Operating lease liabilities, non-current | 44,420 |  |  | 49,196 |
Deferred revenue, non-current | 477 |  |  | 706 |
Convertible senior notes, non-current | 199,317 |  |  | 198,790 |
Term loan | 107,299 |  |  | 139,581 |
Other liabilities, non-current | 2,420 |  |  | 3,456 |
Total liabilities | 537,594 |  |  | 560,973 |
Commitments and contingencies (Note 7) |  |  |
Stockholders' equity: |  |  |
Preferred stock: $0.001 par value, 5,000 shares authorized, none issued and outstanding as of September 30, 2025 and March 31, 2025 | — |  |  | — |
Common stock: $0.001 par value, 300,000 shares authorized, 138,569 shares and 134,355 shares issued and outstanding as of September 30, 2025 and March 31, 2025, respectively | 139 |  |  | 134 |
Additional paid-in capital | 1,028,971 |  |  | 1,018,902 |
Accumulated other comprehensive loss | (4,679) |  |  | (9,111) |
Accumulated deficit | (891,269) |  |  | (887,721) |
Total stockholders' equity | 133,162 |  |  | 122,204 |
Total liabilities and stockholders' equity | $ | 670,756 |  |  | $ | 683,177 |

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
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8X8, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
(Unaudited, in thousands except per share amounts)

| Three Months Ended September 30, |  | Six Months Ended September 30,
| 2025 |  | 2024 |  | 2025 |  | 2024
Service revenue | $ | 179,094 |  |  | $ | 175,075 |  |  | $ | 355,402 |  |  | $ | 347,876 |
Other revenue | 5,001 |  |  | 5,923 |  |  | 10,054 |  |  | 11,269 |
Total revenue | 184,095 |  |  | 180,998 |  |  | 365,456 |  |  | 359,145 |
Cost of service revenue | 57,699 |  |  | 50,251 |  |  | 111,521 |  |  | 99,747 |
Cost of other revenue | 7,056 |  |  | 7,572 |  |  | 14,155 |  |  | 15,263 |
Total cost of revenue | 64,755 |  |  | 57,823 |  |  | 125,676 |  |  | 115,010 |
Gross profit | 119,340 |  |  | 123,175 |  |  | 239,780 |  |  | 244,135 |
Operating expenses: |  |  |  |  |  |  |
Research and development | 27,918 |  |  | 31,291 |  |  | 56,282 |  |  | 63,428 |
Sales and marketing | 63,835 |  |  | 64,867 |  |  | 132,019 |  |  | 131,973 |
General and administrative | 22,238 |  |  | 19,848 |  |  | 45,565 |  |  | 42,939 |
Total operating expenses | 113,991 |  |  | 116,006 |  |  | 233,866 |  |  | 238,340 |
Income from operations | 5,349 |  |  | 7,169 |  |  | 5,914 |  |  | 5,795 |
Interest expense | (4,842) |  |  | (7,905) |  |  | (8,810) |  |  | (17,861) |
Other income (expense), net | 468 |  |  | (12,709) |  |  | 832 |  |  | (10,993) |
Income (loss) before provision for income taxes | 975 |  |  | (13,445) |  |  | (2,064) |  |  | (23,059) |
Provision for income taxes | 208 |  |  | 1,098 |  |  | 1,484 |  |  | 1,774 |
Net income (loss) | $ | 767 |  |  | $ | (14,543) |  |  | $ | (3,548) |  |  | $ | (24,833) |
Net income (loss) per share: |  |  |  |  |  |  |
Basic | $ | 0.01 |  |  | $ | (0.11) |  |  | $ | (0.03) |  |  | $ | (0.19) |
Diluted | $ | 0.01 |  |  | $ | (0.11) |  |  | $ | (0.03) |  |  | $ | (0.19) |
Weighted average number of shares: |  |  |  |  |  |  |
Basic | 136,970 |  |  | 129,250 |  |  | 135,895 |  |  | 127,633 |
Diluted | 141,561 |  |  | 129,250 |  |  | 135,895 |  |  | 127,633 |
Comprehensive income (loss) |  |  |  |  |  |  |
Net income (loss) | $ | 767 |  |  | $ | (14,543) |  |  | $ | (3,548) |  |  | $ | (24,833) |
Unrealized loss on investments in securities | — |  |  | — |  |  | — |  |  | (5) |
Foreign currency translation adjustment | (1,826) |  |  | 8,363 |  |  | 4,432 |  |  | 8,009 |
Comprehensive income (loss) | $ | (1,059) |  |  | $ | (6,180) |  |  | $ | 884 |  |  | $ | (16,829) |

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
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8X8, INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(Unaudited, in thousands)

| Common Stock |  | Additional Paid-in Capital |  | Accumulated Other Comprehensive Loss |  | Accumulated Deficit |  | Total
| Shares |  | Amount |
Balance at March 31, 2025 | 134,355 |  |  | $ | 134 |  |  | $ | 1,018,902 |  |  | $ | (9,111) |  |  | $ | (887,721) |  |  | $ | 122,204 |
Issuance of common stock under stock plans | 2,692 |  |  | 3 |  |  | (3) |  |  | — |  |  | — |  |  | — |
Common shares withheld for settlement of taxes in connection with equity-based compensation | (300) |  |  | — |  |  | (489) |  |  | — |  |  | — |  |  | (489) |
Repurchase of common stock | (1,000) |  |  | (1) |  |  | (1,847) |  |  | — |  |  | — |  |  | (1,848) |
Stock-based compensation expense | — |  |  | — |  |  | 6,380 |  |  | — |  |  | — |  |  | 6,380 |
Foreign currency translation adjustment | — |  |  | — |  |  | — |  |  | 6,258 |  |  | — |  |  | 6,258 |
Net loss | — |  |  | — |  |  | — |  |  | — |  |  | (4,315) |  |  | (4,315) |
Balance at June 30, 2025 | 135,747 |  |  | $ | 136 |  |  | $ | 1,022,943 |  |  | $ | (2,853) |  |  | $ | (892,036) |  |  | $ | 128,190 |
Issuance of common stock under stock plans | 2,231 |  |  | 2 |  |  | (2) |  |  | — |  |  | — |  |  | — |
Common shares withheld for settlement of taxes in connection with equity-based compensation | (226) |  |  | — |  |  | (479) |  |  | — |  |  | — |  |  | (479) |
ESPP share issuance | 817 |  |  | 1 |  |  | 1,227 |  |  | — |  |  | — |  |  | 1,228 |
Stock-based compensation expense | — |  |  | — |  |  | 5,282 |  |  | — |  |  | — |  |  | 5,282 |
Foreign currency translation adjustment | — |  |  | — |  |  | — |  |  | (1,826) |  |  | — |  |  | (1,826) |
Net income | — |  |  | — |  |  | — |  |  | — |  |  | 767 |  |  | 767 |
Balance at September 30, 2025 | 138,569 |  |  | $ | 139 |  |  | $ | 1,028,971 |  |  | $ | (4,679) |  |  | $ | (891,269) |  |  | $ | 133,162 |

| Common Stock |  | Additional Paid-in Capital |  | Accumulated Other Comprehensive Loss |  | Accumulated Deficit |  | Total
| Shares |  | Amount |
Balance at March 31, 2024 | 125,194 |  |  | $ | 125 |  |  | $ | 973,895 |  |  | $ | (11,553) |  |  | $ | (860,509) |  |  | $ | 101,958 |
Issuance of common stock under stock plans | 2,769 |  |  | 3 |  |  | (3) |  |  | — |  |  | — |  |  | — |
Stock-based compensation expense | — |  |  | — |  |  | 13,279 |  |  | — |  |  | — |  |  | 13,279 |
Unrealized investment loss | — |  |  | — |  |  | — |  |  | (5) |  |  | — |  |  | (5) |
Foreign currency translation adjustment | — |  |  | — |  |  | — |  |  | (354) |  |  | — |  |  | (354) |
Net loss | — |  |  | — |  |  | — |  |  | — |  |  | (10,290) |  |  | (10,290) |
Balance at June 30, 2024 | 127,963 |  |  | $ | 128 |  |  | $ | 987,171 |  |  | $ | (11,912) |  |  | $ | (870,799) |  |  | $ | 104,588 |
Issuance of common stock under stock plans | 1,479 |  |  | 2 |  |  | (2) |  |  | — |  |  | — |  |  | — |
ESPP share issuance | 1,075 |  |  | 1 |  |  | 1,682 |  |  | — |  |  | — |  |  | 1,683 |
Stock-based compensation expense | — |  |  | — |  |  | 9,721 |  |  | — |  |  | — |  |  | 9,721 |
Foreign currency translation adjustment | — |  |  | — |  |  | — |  |  | 8,363 |  |  | — |  |  | 8,363 |
Net loss | — |  |  | — |  |  | — |  |  | — |  |  | (14,543) |  |  | (14,543) |
Balance at September 30, 2024 | 130,517 |  |  | $ | 131 |  |  | $ | 998,572 |  |  | $ | (3,549) |  |  | $ | (885,342) |  |  | $ | 109,812 |

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
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8X8, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited, in thousands)

| Six Months Ended September 30,
| 2025 |  | 2024
Cash flows from operating activities: |  |  |
Net loss | $ | (3,548) |  |  | $ | (24,833) |
Adjustments to reconcile net loss to net cash provided by operating activities: |  |  |
Depreciation | 3,391 |  |  | 3,756 |
Amortization of intangible assets | 7,003 |  |  | 10,198 |
Amortization of capitalized internal-use software costs | 5,685 |  |  | 7,022 |
Amortization of debt discount and issuance costs | 698 |  |  | 1,718 |
Amortization of deferred contract acquisition costs | 17,402 |  |  | 19,697 |
Allowance for credit losses | 375 |  |  | 1,269 |
Operating lease expense, net of accretion | 5,529 |  |  | 6,038 |
Stock-based compensation expense | 11,715 |  |  | 22,177 |
Loss on debt extinguishment | 127 |  |  | 11,996 |
Gain on remeasurement of warrants | (246) |  |  | (2,010) |
Other | (402) |  |  | (3,626) |
Changes in assets and liabilities: |  |  |
Accounts receivable, net | (16,392) |  |  | (5,314) |
Deferred contract acquisition costs | (8,407) |  |  | (12,447) |
Other current and non-current assets | (1,332) |  |  | 850 |
Accounts payable and accruals | (6,053) |  |  | (8,886) |
Deferred revenue | 5,163 |  |  | 2,860 |
Net cash provided by operating activities | 20,708 |  |  | 30,465 |
Cash flows from investing activities: |  |  |
Purchases of property and equipment | (1,519) |  |  | (1,589) |
Capitalized internal-use software costs | (7,140) |  |  | (5,892) |
Purchase of cost investment | — |  |  | (771) |
Maturities of investments | — |  |  | 1,048 |
Net cash used in investing activities | (8,659) |  |  | (7,204) |
Cash flows from financing activities: |  |  |
Proceeds from issuance of common stock under employee stock plans | 1,228 |  |  | 1,682 |
Payments for repurchases of common stock | (1,848) |  |  | — |
Payments for debt issuance and amendment costs | (70) |  |  | (1,114) |
Repayment of principal on term loan | (25,000) |  |  | (225,000) |
Gross proceeds from term loan | — |  |  | 200,000 |
Other financing activities | (969) |  |  | (704) |
Net cash used in financing activities | (26,659) |  |  | (25,136) |
Effect of exchange rate changes on cash | 1,970 |  |  | 3,019 |
Net increase (decrease) in cash and cash equivalents | (12,640) |  |  | 1,144 |
Cash, cash equivalents and restricted cash, beginning of period | 89,324 |  |  | 116,723 |
Cash, cash equivalents and restricted cash, end of period | $ | 76,684 |  |  | $ | 117,867 |
Supplemental disclosures of cash flow information: |  |  |
Interest paid | $ | 9,038 |  |  | $ | 16,324 |
Income taxes paid | $ | 1,373 |  |  | $ | 2,386 |
Payables and accruals for property and equipment | $ | 108 |  |  | $ | 3,207 |

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
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8X8, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS — UNAUDITED
1. The Company and Significant Accounting Policies
The Company
8x8, Inc. ("8x8" or the "Company") was incorporated in California in February 1987 and was reincorporated in Delaware in December 1996. The Company trades under the symbol "EGHT" on the Nasdaq Global Select Market.
The Company is a leading Software-as-a-Service ("SaaS") provider of contact center, voice, video, chat, and enterprise-class API solutions powered by one global cloud communications platform. 8x8 empowers workforces worldwide by connecting individuals and teams, so they can collaborate faster and work smarter from anywhere. 8x8 provides real-time business analytics and intelligence, giving its customers unique insights across all interactions and channels on its platform, so they can support a distributed and hybrid working model while delighting their end-customers and accelerating their business. A majority of all revenue is generated from communication services subscriptions and platform usage. The Company also generates revenue from sales of hardware and professional services, which are complementary to the delivery of its integrated technology platform.
Basis of Presentation and Consolidation
The accompanying condensed consolidated financial statements are unaudited and have been prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP") and regulations of the Securities and Exchange Commission ("SEC") regarding interim financial reporting. Accordingly, certain information and disclosures normally included in the Company's annual consolidated financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. These condensed consolidated financial statements should be read in conjunction with the Company's audited consolidated financial statements as of and for the fiscal year ended March 31, 2025 and notes thereto included in the Form 10-K. There were no material changes during the three and six months ended September 30, 2025 to the Company's significant accounting policies as described in the Form 10-K.
The unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All material intercompany accounts and transactions have been eliminated in consolidation. The Company conducts its operations through one reportable segment.
In the opinion of the Company's management, these condensed consolidated financial statements reflect all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair statement of the Company's financial position, results of operations and cash flows for the periods presented. The results of operations for the interim periods presented are not necessarily indicative of the results to be expected for any subsequent quarter or for the entire year ending March 31, 2026.
Use of Estimates
The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities and equity, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, the Company evaluates its estimates, including, but not limited to, those related to current expected credit losses, returns reserve for expected cancellations, fair value of and/or potential impairment of goodwill and value and useful life of long-lived assets (including intangible assets and right-of-use assets), capitalized internal-use software costs, benefit period for deferred commissions, stock-based compensation, incremental borrowing rate used to calculate operating lease liabilities, income and sales tax liabilities, convertible senior notes fair value, litigation, and other contingencies. The Company bases its estimates on known facts and circumstances, historical experience, and various other assumptions. Actual results could differ from those estimates under different assumptions or conditions.
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Recently Issued Not Yet Adopted Accounting Pronouncements
In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which expands disclosures in an entity’s income tax rate reconciliation table and disclosures regarding cash taxes paid both in the U.S. and foreign jurisdictions. The standard is effective for annual periods beginning after December 15, 2024, and will therefore be adopted by the Company in its Form 10-K for the fiscal year ending March 31, 2026. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements and annual income tax disclosures.
In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses (Topic 220): Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures, and issued subsequent amendments to the implementation guidance (including ASU 2025-01), which requires companies to disclose additional information about specific expense categories in the notes to financial statements. The update will be effective for annual periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. The Company is currently evaluating the impact this guidance will have on the presentation of its consolidated financial statements and accompanying notes.
In November 2024, the FASB issued ASU 2024-04, Debt (Topic 470): Debt with Conversion and Other Options, which clarifies whether the induced conversion guidance can be applied to the settlement of a convertible debt instrument that does not require the issuance of equity securities upon conversion. This ASU is effective for fiscal years beginning after December 15, 2025, and interim periods within fiscal years beginning after December 15, 2026. The Company is currently evaluating the impact this guidance will have on the presentation of its consolidated financial statements and accompanying notes.
In July 2025, the FASB issued ASU 2025-05, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets, providing a practical expedient to calculating current expected credit loss by assuming that the current conditions as of the balance sheet date will not change for the remaining life of the asset. This expedient can only be applied to current accounts receivable and current contract assets. This update is effective for annual reporting periods beginning after December 15, 2025, and interim periods within those annual periods, and this update is applied prospectively. The Company is evaluating the impact this guidance will have on its consolidated financial statements and accompanying notes.
In September 2025, the FASB issued ASU 2025-06, Intangibles - Goodwill and Other - Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which updates the accounting model by replacing the project stage approach with a probable-to-complete threshold, relocates website development guidance into Subtopic 350-40, and requires enhanced disclosures for capitalized software costs. The amendments are effective for annual periods beginning after December 15, 2027, and interim periods within those annual reporting periods. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements and accompanying notes.
There have been no other recent accounting pronouncements, changes in accounting pronouncements or recently adopted accounting guidance during the six months ended September 30, 2025 that are of significance or potential significance to us.
2. Revenue
Disaggregation of Revenue
The Company believes that the nature, amount, timing and uncertainty of its revenue and cash flows and how they are affected by economic factors are most appropriately depicted by (i) geographic region, and (ii) type of revenue or service provided.
The following tables set forth the revenue geographic information based on the billing address for the customers for each period (in thousands):

| Three Months Ended September 30, |  | Six Months Ended September 30,
| 2025 |  | 2024 |  | 2025 |  | 2024
United States | $ | 113,938 |  |  | $ | 121,459 |  |  | $ | 227,029 |  |  | $ | 244,317 |
United Kingdom | 32,636 |  |  | 32,428 |  |  | 63,367 |  |  | 61,634 |
Other International1 | 37,521 |  |  | 27,111 |  |  | 75,060 |  |  | 53,194 |
Total revenue | $ | 184,095 |  |  | $ | 180,998 |  |  | $ | 365,456 |  |  | $ | 359,145 |

Service revenue and other revenue were 97.3% and 2.7% of total revenue for three months ended September 30, 2025, respectively, and 96.7% and 3.3% of total revenue for the three months ended September 30, 2024, respectively. Service revenue and other revenue were 97.2% and 2.8% of total revenue for six months ended September 30, 2025, respectively, and 96.9% and 3.1% of total revenue for the six months ended September 30, 2024, respectively.
1 No individual other international country represented 10% or more of the Company’s total revenue for the three or six months ended September 30, 2025 or 2024.
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Service revenue consists of communication services subscriptions and platform usage revenue and related fees from our UCaaS, CCaaS and CPaaS offerings. Subscription and Platform usage revenue was 80.6% and 19.4% of total service revenue for the three months ended September 30, 2025, respectively, and 86.9% and 13.1% of total service revenue for the three months ended September 30, 2024, respectively. Subscription and Platform usage revenue was 81.9% and 18.1% of total service revenue for the six months ended September 30, 2025, respectively, and 87.3% and 12.7% of total service revenue for the six months ended September 30, 2024, respectively.
Contract Balances
The following table provides amounts of contract assets and deferred revenue from contracts with customers (in thousands):

| September 30, 2025 |  | March 31, 2025
Contract assets, current (component of Other current assets) | $ | 6,828 |  |  | $ | 7,009 |
Contract assets, non-current (component of Other non-current assets) | 7,362 |  |  | 7,268 |
Deferred revenue, current | 43,569 |  |  | 37,751 |
Deferred revenue, non-current | 477 |  |  | 706 |

Contract assets are recorded for contract consideration not yet invoiced but for which the performance obligations are completed. Contract assets, net of allowances for credit losses, are included in other current assets or other assets in the Company's condensed consolidated balance sheets, depending on if their reduction will be recognized during the succeeding twelve-month period or beyond.
The change in contract assets was primarily driven by billing customers for amounts that had previously been recognized in revenue but not yet billed. The Company recognized revenues of approximately $28.5 million and $27.1 million that were included in deferred revenue at the beginning of the fiscal year during the six months ended September 30, 2025 and 2024, respectively.
Remaining Performance Obligations
The Company's subscription terms typically range from one year to five years. Contract revenue from the remaining performance obligations that had not yet been recognized as of September 30, 2025 was approximately $710 million. This amount excludes contracts with an original expected length of less than one year. The Company expects to recognize revenue on approximately 85% of the remaining performance obligations over the next 24 months and approximately 15% over the remainder of the subscription period. For purposes of this disclosure, the Company excludes contracts with an original expected length of less than one year.
Deferred Contract Acquisition Costs
Deferred sales commissions are considered incremental and recoverable costs of acquiring customer contracts. Amortization of deferred contract acquisition costs for the three months ended September 30, 2025 and 2024 was approximately $8.4 million and $9.9 million, respectively, and $17.4 million and $19.7 million during the six months ended September 30, 2025 and 2024, respectively. There were no material write-offs during the six months ended September 30, 2025 and 2024.
The following table provides amounts of deferred contract acquisition costs from contracts with customers (in thousands):

| September 30, 2025 |  | March 31, 2025
Deferred contract acquisition costs | $ | 27,733 |  |  | $ | 30,935 |
Deferred contract acquisition costs, non-current | 39,252 |  |  | 44,239 |

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3. Fair Value Measurements
Cash, cash equivalents, and available-for-sale investments were as follows (in thousands):

|  | As of September 30, 2025
|  | Amortized Costs |  |  |  |  |  | Estimated Fair Value |  | Cash and Cash Equivalents |  | Restricted Cash (Current) |  |
Cash |  | $ | 58,729 |  |  |  |  |  |  | $ | 58,729 |  |  | $ | 57,917 |  |  | $ | 812 |  |  |
Level 1: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Money market funds |  | 17,955 |  |  |  |  |  |  | 17,955 |  |  | 17,955 |  |  | — |  |  |
Total assets |  | $ | 76,684 |  |  |  |  |  |  | $ | 76,684 |  |  | $ | 75,872 |  |  | $ | 812 |  |  |

|  | As of March 31, 2025
|  | Amortized Costs |  |  |  |  |  | Estimated Fair Value |  | Cash and Cash Equivalents |  | Restricted Cash (Current & Non-Current) |  |
Cash |  | $ | 64,765 |  |  |  |  |  |  | $ | 64,765 |  |  | $ | 63,953 |  |  | $ | 812 |  |  |
Level 1: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Money market funds |  | 24,559 |  |  |  |  |  |  | 24,559 |  |  | 24,097 |  |  | 462 |  |  |
Total assets |  | $ | 89,324 |  |  |  |  |  |  | $ | 89,324 |  |  | $ | 88,050 |  |  | $ | 1,274 |  |  |

As of September 30, 2024, cash, cash equivalents and restricted cash of $117.9 million included $117.4 million and $0.5 million of cash and cash equivalents and restricted cash, respectively.
To support its current operations, the Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. The restricted cash component of the money market funds is comprised of letters of credit securing leases for certain office facilities and an accrued holdback related to a business combination.
The Company uses the Black-Scholes option-pricing valuation model to value its detachable warrants from inception and at each reporting period. During the three months ended September 30, 2025, the Company used historical volatility to determine the fair value of the warrants liability due to the low trading volume and moneyness assessment as of September 30, 2025. Changes in the fair values of the detachable warrants liability are recorded as a gain (loss) on warrants remeasurement within other income (expense), net in the condensed consolidated statements of operations and comprehensive income (loss).
The following table presents additional information about valuation techniques and inputs used for the detachable warrants (see Note 8, Convertible Senior Notes and Term Loan) that are measured at fair value and categorized within Level 3 as of September 30, 2025 and March 31, 2025 (dollars in thousands):

| September 30, 2025 |  | March 31, 2025
Estimated fair value of detachable warrants | $ | 850 |  | $ | 1,096
Unobservable inputs: |  |  |
Stock volatility | 79.0 | % |  | 79.8 | %
Risk-free rate | 3.6 | % |  | 3.9 | %
Expected term | 1.9 years |  | 2.4 years

As of September 30, 2025 and March 31, 2025, the estimated fair value of the Company’s convertible senior notes due in 2028 was $176.3 million and $171.1 million, respectively (see Note 8, Convertible Senior Notes and Term Loan). The fair value of the convertible senior notes was determined based on the closing price of each of the securities on the last trading day of the reporting period, and each is Level 2 in the fair value hierarchy due to limited trading activity of the debt instruments. As of September 30, 2025 and March 31, 2025, the carrying value of the Company’s 2024 Term Loan approximates its estimated fair value.
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4. Financial Statement Components
Accounts receivable, net consisted of the following (in thousands):

| September 30, 2025 |  | March 31, 2025
Trade accounts receivable | $ | 67,268 |  |  | $ | 50,839 |
Unbilled trade accounts receivable | 5,690 |  |  | 4,972 |
Less: allowance for credit losses | (1,704) |  |  | (1,898) |
Less: allowance for sales reserves | (4,365) |  |  | (4,233) |
Total accounts receivable, net | $ | 66,889 |  |  | $ | 49,680 |

Allowance for credit losses and sales reserves consisted of the following (in thousands):

| Six Months Ended September 30, 2025 |  | Year Ended March 31, 2025
| Credit Losses |  | Sales Reserves |  | Credit Losses |  | Sales Reserves
Beginning balance | $ | (1,898) |  |  | $ | (4,233) |  |  | $ | (2,746) |  |  | $ | (2,502) |
(Reserve) provision | (560) |  |  | (6,122) |  |  | (1,001) |  |  | (5,355) |
Write-offs (recoveries) | 754 |  |  | 5,990 |  |  | 1,849 |  |  | 3,624 |
Ending balance | $ | (1,704) |  |  | $ | (4,365) |  |  | $ | (1,898) |  |  | $ | (4,233) |

The following tables set forth the property and equipment, net, geographic information for each period (in thousands):

| September 30, 2025 |  | March 31, 2025
United States | $ | 45,217 |  |  | $ | 45,677 |
International | 2,177 |  |  | 2,242 |
Total property and equipment, net | $ | 47,394 |  |  | $ | 47,919 |

Other current assets consisted of the following (in thousands):

| September 30, 2025 |  | March 31, 2025
Prepaid expense | $ | 22,200 |  |  | $ | 21,769 |
Contract assets | 6,828 |  |  | 7,009 |
Other current assets | 5,288 |  |  | 5,961 |
Total other current assets | $ | 34,316 |  |  | $ | 34,739 |

Accrued and other liabilities consisted of the following (in thousands):

| September 30, 2025 |  | March 31, 2025
Accrued compensation | $ | 20,189 |  |  | $ | 17,745 |
Accrued taxes | 25,117 |  |  | 24,186 |
Other accrued liabilities | 21,566 |  |  | 21,094 |
Total accrued and other liabilities | $ | 66,872 |  |  | $ | 63,025 |

Other income (expense), net consisted of the following (in thousands):

| Three Months Ended September 30, |  | Six Months Ended September 30,
| 2025 |  | 2024 |  | 2025 |  | 2024
Loss on debt extinguishment | $ | (46) |  |  | $ | (11,996) |  |  | $ | (127) |  |  | $ | (11,996) |
Gain on warrants remeasurement | 37 |  |  | 263 |  |  | 246 |  |  | 2,010 |
Interest income | 453 |  |  | 936 |  |  | 929 |  |  | 1,977 |
Other income (expense) | 24 |  |  | (1,912) |  |  | (216) |  |  | (2,984) |
Other income (expense), net | $ | 468 |  |  | $ | (12,709) |  |  | $ | 832 |  |  | $ | (10,993) |

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5. Intangible Assets and Goodwill
The carrying value of intangible assets consisted of the following (in thousands):

| September 30, 2025 |  | March 31, 2025
| Weighted Average Remaining Useful Life (in years) |  | Gross Carrying Amount |  | Accumulated Amortization |  | Net Carrying Amount |  | Gross Carrying Amount |  | Accumulated Amortization |  | Net Carrying Amount
Customer relationships | 5.3 |  | $ | 105,894 |  |  | $ | (46,646) |  |  | $ | 59,248 |  |  | $ | 105,881 |  |  | $ | (40,670) |  |  | $ | 65,211 |
Developed technology | 1.0 |  | 46,735 |  |  | (45,050) |  |  | 1,685 |  |  | 46,696 |  |  | (44,003) |  |  | 2,693 |
Trade names and domains | 2.4 |  | 637 |  |  | (597) |  |  | 40 |  |  | 630 |  |  | (585) |  |  | 45 |
Total acquired identifiable intangible assets |  |  | $ | 153,266 |  |  | $ | (92,293) |  |  | $ | 60,973 |  |  | $ | 153,207 |  |  | $ | (85,258) |  |  | $ | 67,949 |

At September 30, 2025, annual amortization of intangible assets, based upon existing intangible assets and current useful lives, is estimated to be the following (in thousands):

Remainder of fiscal year 2026 | $ | 7,003 |
2027 | 11,869 |
2028 | 11,148 |
2029 | 11,053 |
2030 and thereafter | 19,900 |
Total | $ | 60,973 |

The following table provides a summary of the changes in the carrying amounts of goodwill (in thousands):

Balance as of March 31, 2025 | $ | 271,530 |
Foreign currency translation | 2,273 |
Balance as of September 30, 2025 | $ | 273,803 |

6. Leases
The components of lease expense were as follows (in thousands):

| Three Months Ended September 30, |  | Six Months Ended September 30,
| 2025 |  | 2024 |  | 2025 |  | 2024
Operating lease expense | $ | 2,675 |  |  | $ | 2,873 |  |  | $ | 5,529 |  |  | $ | 6,038 |
Variable lease expense | $ | 965 |  |  | $ | 967 |  |  | $ | 1,915 |  |  | $ | 2,048 |

The supplemental cash flow information related to leases was as follows (in thousands):

| Three Months Ended September 30, |  | Six Months Ended September 30,
| 2025 |  | 2024 |  | 2025 |  | 2024
Cash outflows from operating leases | $ | 3,438 |  |  | $ | 3,653 |  |  | $ | 6,940 |  |  | $ | 7,395 |
Right-of-use assets obtained in exchange for operating lease obligations | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 1,954 |

Short-term lease expense was immaterial during the six months ended September 30, 2025 and 2024, respectively.
The following table presents supplemental lease information:

| September 30, 2025 |  | March 31, 2025
Weighted-average remaining lease term | 5.0 years |  | 5.4 years
Weighted-average discount rate | 4.6% |  | 4.7%

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The following table presents maturity of lease liabilities under the Company's non-cancellable operating leases as of September 30, 2025 (in thousands):

Remainder of fiscal year 2026 | $ | 6,752 |
2027 | 12,305 |
2028 | 11,560 |
2029 | 11,430 |
2030 | 11,430 |
Thereafter | 7,945 |
Total lease payments | 61,422 |
Less: imputed interest | (6,262) |
Present value of lease liabilities | $ | 55,160 |
Operating lease liabilities | 10,740 |
Operating lease liabilities, non-current | $ | 44,420 |

The Company continues to evaluate its leases for potential impairments, noting no further impairments during the six months ended September 30, 2025.
7. Commitments and Contingencies
Indemnifications
In the normal course of business, the Company may agree to indemnify other parties, including customers, lessors, and parties to other transactions with the Company with respect to certain matters, such as breaches of representations or covenants or intellectual property infringement or other claims made by third parties. These agreements may limit the time within which an indemnification claim can be made and the amount of the claim. In addition, the Company has entered into indemnification agreements with its officers and directors.
It is not possible to determine the maximum potential amount of the Company's exposure under these indemnification agreements due to the limited history of prior indemnification claims and the unique facts and circumstances involved in each particular agreement. Historically, payments made by the Company under these agreements have not had a material impact on the Company's operating results, financial position, or cash flows. Under some of these agreements, however, the Company's potential indemnification liability might not have a contractual limit.
Operating Leases
The Company's lease obligations consist of the Company's principal facility and various leased facilities under operating lease agreements. See Note 6, Leases, for more information on the Company's leases and the future minimum lease payments.
Purchase Obligations
The Company's purchase obligations include contracts with third-party customer support vendors and third-party network service providers. These contracts include minimum monthly commitments and the requirements to maintain the service level for several months.
During the six months ended September 30, 2025, the Company increased its non-cancellable three-year hosting service contract commitment from $24.1 million to $54.0 million. Under this agreement, $4.8 million remains due during fiscal year 2026, $10.0 million will be due during fiscal year 2027 and $10.0 million will be due during fiscal year 2028.
Legal Proceedings
The Company may be involved in various claims, lawsuits, investigations, and other legal proceedings, including intellectual property, commercial, regulatory compliance, securities, and employment matters that arise in the normal course of business. The Company determines whether an estimated loss from a contingency should be accrued by assessing whether a loss is deemed probable and can be reasonably estimated. The Company regularly evaluates current information to determine whether any accruals should be adjusted and whether new accruals are required. Actual claims could settle or be adjudicated against the Company in the future for materially different amounts than the Company has accrued due to the inherently unpredictable nature of litigation. Legal costs are expensed as incurred.
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The Company believes it has recorded adequate provisions for any such lawsuits and claims and proceedings as of September 30, 2025. The Company believes that damage amounts claimed in these matters are not meaningful indicators of potential liability. Some of the matters pending against the Company involve potential compensatory, punitive, or treble damage claims or sanctions that, if granted, could require the Company to pay damages or make other expenditures in amounts that could have a material adverse effect on its condensed consolidated financial statements. Given the inherent uncertainties of litigation, the ultimate outcome of the ongoing matters described herein cannot be predicted, and the Company believes it has valid defenses with respect to the legal matters pending against it. Nevertheless, the condensed consolidated financial statements could be materially adversely affected in a particular period by the resolution of one or more of these contingencies.
State and Local Taxes and Surcharges
From time to time, the Company has received inquiries from a number of state and local taxing agencies with respect to the remittance of sales, use, telecommunications, excise, and income taxes. Several jurisdictions currently are conducting tax audits of the Company's records. The Company collects and/or accrues amounts for all taxes and surcharges that it believes are required. The amounts that have been remitted have historically been within the accruals established by the Company. The Company conducts periodic reviews of the taxability of its services with respect to sales, use, telecommunications or other similar indirect taxes and adjusts its accrual when facts relating to specific exposures warrant such adjustment. A similar review was performed on the taxability of services provided by Fuze, Inc., and it was determined that certain services may be subject to sales, use, telecommunications or other similar indirect taxes in certain jurisdictions. Accordingly, the Company recorded contingent indirect tax liabilities. Based on such assessments, as of September 30, 2025 and March 31, 2025, the Company had accrued contingent indirect tax liabilities of $10.6 million and $11.1 million, respectively.
8. Convertible Senior Notes and Term Loan
Components of convertible senior notes and term loans were as follows as of September 30, 2025 and March 31, 2025, respectively (in thousands):

| September 30, 2025 |  | March 31, 2025
| 2024 Term Loan |  |  |  | 2028 Notes |  | Total |  | 2024 Term Loan |  |  |  | 2028 Notes |  | Total
Principal | $ | 127,000 |  |  |  |  | $ | 201,914 |  |  | $ | 328,914 |  |  | $ | 152,000 |  |  |  |  | $ | 201,914 |  |  | $ | 353,914 |
Unamortized debt discount and issuance costs | (528) |  |  |  |  | (2,597) |  |  | (3,125) |  |  | (826) |  |  |  |  | (3,124) |  |  | (3,950) |
Net carrying amount | $ | 126,472 |  |  |  |  | $ | 199,317 |  |  | $ | 325,789 |  |  | $ | 151,174 |  |  |  |  | $ | 198,790 |  |  | $ | 349,964 |
Current portion of long-term debt | 19,173 |  |  |  |  | — |  |  | 19,173 |  |  | 11,593 |  |  |  |  | — |  |  | 11,593 |
Non-current portion of long-term debt | $ | 107,299 |  |  |  |  | $ | 199,317 |  |  | $ | 306,616 |  |  | $ | 139,581 |  |  |  |  | $ | 198,790 |  |  | $ | 338,371 |

Components of debt interest expense were as follows as of the three and six months ended September 30, 2025 and 2024, respectively (in thousands):

| Three Months Ended September 30, 2025 |  | Three Months Ended September 30, 2024
| 2024 Term Loan |  |  |  | 2028 Notes |  |  |  | Total |  | 2024 Term Loan |  | 2022 Term Loan |  | 2028 Notes |  | Total
Contractual interest expense | $ | 2,461 |  |  |  |  | $ | 2,019 |  |  |  |  | $ | 4,480 |  |  | $ | 2,619 |  |  | $ | 2,611 |  |  | $ | 2,019 |  |  | $ | 7,249 |
Amortization of debt discount and issuance costs1 | 84 |  |  |  |  | 278 |  |  |  |  | 362 |  |  | 104 |  |  | 286 |  |  | 266 |  |  | 656 |
Total debt interest expense | $ | 2,545 |  |  |  |  | $ | 2,297 |  |  |  |  | $ | 4,842 |  |  | $ | 2,723 |  |  | $ | 2,897 |  |  | $ | 2,285 |  |  | $ | 7,905 |

1 Amount represents the non-cash amortization of debt discount and issuance costs associated with the Company's debt instruments. These costs are amortized to interest expense over the respective terms of the debt using the effective interest method.
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| Six Months Ended September 30, 2025 |  | Six Months Ended September 30, 2024
| 2024 Term Loan |  |  |  | 2028 Notes |  |  |  | Total |  | 2024 Term Loan |  | 2022 Term Loan |  | 2028 Notes |  | Total
Contractual interest expense | $ | 5,000 |  |  |  |  | $ | 4,038 |  |  |  |  | $ | 9,038 |  |  | $ | 2,619 |  |  | $ | 9,466 |  |  | $ | 4,058 |  |  | $ | 16,143 |
Amortization of debt discount and issuance costs1 | 171 |  |  |  |  | 527 |  |  |  |  | 698 |  |  | 104 |  |  | 1,110 |  |  | 504 |  |  | 1,718 |
Total debt interest expense2 | $ | 5,171 |  |  |  |  | $ | 4,565 |  |  |  |  | $ | 9,736 |  |  | $ | 2,723 |  |  | $ | 10,576 |  |  | $ | 4,562 |  |  | $ | 17,861 |

The 2024 Term Loan (as defined below) is the Company’s senior secured obligation and ranks senior in right of payment to any of the Company’s indebtedness. The 2028 Notes are the Company’s senior unsecured obligation but rank junior in right of payment to any of the Company’s secured indebtedness to the extent of such security.
2024 Delayed Draw Term Loan
On July 11, 2024, the Company entered into a new term loan credit agreement with Wells Fargo Bank, National Association, as administrative agent, and the lenders thereto (the “2024 Credit Agreement”). The 2024 Credit Agreement establishes a delayed draw term loan facility in an aggregate principal amount of up to $200.0 million maturing on August 15, 2027.
On August 5, 2024, the Company drew upon the entire facility of $200.0 million under the delayed draw term loan facility (the "2024 Term Loan") and used the proceeds of the 2024 Term Loan and cash on hand of approximately $29.0 million to repay in full the $225.0 million of outstanding principal amount and accrued interest of the 2022 Term Loan (defined below) and the fees incurred in connection with the repayment (the "Repayment"). For additional information, refer to the "2022 Term Loan and Warrants" section below.
The 2024 Term Loan bears interest at an annual rate equal to the Term Standard Overnight Financing Rate (the "Term SOFR"), plus a margin of either 2.50%, 2.75% or 3.00% based on the consolidated total net leverage ratio of the Company and its subsidiaries. The initial margin was 3.00% for the fiscal quarter ending September 30, 2024 and remained 3.00% as of September 30, 2025. The Company has the option to pay interest monthly, quarterly, or semi-annually. During the three months ended September 30, 2025, the Company elected monthly interest payment terms resulting in contractual interest expense of $2.5 million. As of September 30, 2025, the debt issuance costs were amortized to interest expense over the term of the 2024 Term Loan at an effective interest rate of 8.65%.
Under the terms of the 2024 Credit Agreement, the Company has the right to prepay the 2024 Term Loan at any time without any premium or penalty. The Company completed three principal repayments of the 2024 Term Loan during fiscal year 2025 for a total of $48.0 million in aggregate principal amount. The Company completed two principal repayments of the 2024 Term Loan during fiscal year 2026 for a total of $25.0 million in aggregate principal amount. As of September 30, 2025, the scheduled remaining principal repayments are $44.5 million in fiscal year 2027 ($7.0 million on June 30, 2026 and $12.5 million on September 30, 2026 and each quarter thereafter through maturity), and $82.5 million principal is due before or upon maturity in fiscal year 2028. These annualized repayments will be made in quarterly installments. As of September 30, 2025, the Company has paid $37.5 million, $3.0 million, and $10.0 million of the originally scheduled principal repayments for fiscal year 2026, 2027, and 2028 respectively, and the remaining principal amount of the 2024 Term Loan after the payments is $127.0 million.
On July 29, 2025, the Company executed the First Amendment (the "Amendment") to the 2024 Credit Agreement. The Amendment is designed to provide additional financial flexibility and support future strategic initiatives. The Amendment reflects the Company's continued commitment to financial discipline as it executes long-term growth priorities and investor return initiatives. Under the terms of the 2024 Credit Agreement, the Company may prepay the 2024 Term Loan at any time without incurring a premium or penalty. The Amendment also modified, among other things, the requirements to meet certain financial ratio tests in connection with permitted acquisitions and an adjustment to maintain the existing consolidated total net leverage ratio (a measure of total debt relative to Adjusted Cash EBITDA) at its current level for the duration of the 2024 Credit Agreement. In connection with the Amendment, the Company prepaid $10.0 million of the remaining long-term principal payment due in August 2027 under the 2024 Term Loan. This prepayment did not adjust the scheduled quarterly principal payments.
These short-term principal debt repayments are accounted for as partial debt extinguishment transactions. The carrying value of the 2024 Term Loan, including the unamortized debt discount and issuance costs, was derecognized. The difference of $0.5 million between the cash consideration paid to partially extinguish the 2024 Term Loan and the carrying value of the 2024 Term Loan was recognized as a loss on debt extinguishment included in the loss on debt extinguishment line item recorded in other expense in the condensed consolidated statement of operations.
1 Amount represents the non-cash amortization of debt discount and issuance costs associated with the Company's debt instruments. These costs are amortized to interest expense over the respective terms of the debt using the effective interest method.
2 Total debt interest expense excludes the impact of capitalized interest related to property, plant and equipment from general borrowing costs during the six months ended September 30, 2025.
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The obligations under the 2024 Credit Agreement are guaranteed by the Company’s wholly-owned subsidiaries, subject to certain customary exceptions, and secured by a perfected security interest in substantially all of the Company’s tangible and intangible assets, as well as substantially all of the tangible and intangible assets of the guarantors.
Mandatory prepayments of the 2024 Term Loan are required to be made upon the occurrence of certain events, including, without limitation, (i) sales of certain assets, (ii) receipt of certain casualty and condemnation awards proceeds, and (iii) the incurrence of non-permitted indebtedness, subject to certain thresholds and reinvestment rights. Voluntary prepayments are permitted at any time without premium or penalty, subject to certain customary break funding payments.
The 2024 Credit Agreement contains a consolidated interest coverage ratio financial covenant, a maximum consolidated total net leverage ratio financial covenant and a maximum consolidated secured leverage ratio financial covenant, and contains affirmative and negative covenants customary for transactions of this type, including limitations with respect to share repurchases, indebtedness, liens, investments, dividends, disposition of assets, change in business, and transactions with affiliates. As of September 30, 2025, the Company was in compliance with all covenants set forth in the 2024 Credit Agreement.
2022 Term Loan and Warrants
The Company borrowed $250.0 million in a senior secured term loan facility (the “2022 Term Loan”) under a term loan credit agreement (the “2022 Credit Agreement”) entered into on August 3, 2022 with Wilmington Savings Fund Society, FSB, as administrative agent, and certain affiliates of Francisco Partners (“FP”), with aggregate debt issuance costs and a discount of approximately $20.0 million, including $2.8 million paid in the form of shares of the Company's common stock. The 2022 Term Loan bore interest at an annual rate equal to the Term SOFR (which will be subject to a floor of 1.00% and a credit spread adjustment of 0.10%), plus a margin of 6.50%. The debt discount and debt issuance costs were amortized to interest expense over the term of the 2022 Term Loan at an effective interest rate of 11.9%.
In connection with the 2022 Credit Agreement, the Company issued detachable warrants (the “Warrants”) to affiliates of FP to purchase an aggregate of 3.1 million shares of the Company’s common stock with a five-year term and an exercise price of $7.15 per share (subject to adjustment) that represents a 27.5% premium over the closing price per share of the Company’s common stock on August 3, 2022. The Warrants are classified as liabilities as the Warrants contain certain terms that could result in cash settlement as a result of events outside of the Company’s control. Accordingly, the Company recognizes the Warrants as liabilities at fair value initially and adjusts the Warrants to fair value at each reporting period. As of September 30, 2025 and March 31, 2025, the fair value of the Warrants was $0.9 million and $1.1 million, respectively, and was recorded within other liabilities, non-current on the condensed consolidated balance sheets. The subsequent changes in fair value were recorded through other income (expense), net on the Company’s condensed consolidated statement of operations and comprehensive income (loss). See Note 3, Fair Value Measurements, for further details.
On August 5, 2024, the Company repaid in full the outstanding principal amount and accrued interest of the 2022 Term Loan using the proceeds of the 2024 Term Loan and cash on hand. The Repayment was accounted for as a debt extinguishment. The carrying value of the 2022 Term Loan, including the unamortized debt discount and issuance costs, was derecognized. The difference of $12.0 million between the cash consideration paid to extinguish the 2022 Term Loan and the carrying value of the 2022 Term Loan was recognized as a loss on debt extinguishment included in the loss on debt extinguishment line item recorded in other expense in the condensed consolidated statement of operations and comprehensive income (loss). The Warrants continue to be outstanding, with no change in terms in connection with the Repayment or issuance of the 2024 Term Loan.
2028 Notes
As of September 30, 2025 and March 31, 2025, the Company had $201.9 million aggregate principal amount of 4.00% convertible senior notes due 2028 (the “2028 Notes”), with debt issuance costs of approximately $5.6 million, of which 50% was paid in the form of shares of the Company's common stock. The 2028 Notes are senior obligations of the Company that accrue interest, payable semi-annually in arrears on February 1 and August 1 of each year. The 2028 Notes will mature on February 1, 2028, unless earlier converted, redeemed or repurchased. The initial conversion rate is 139.8064 shares of the Company’s common stock per $1,000 principal amount of the 2028 Notes (equivalent to an initial conversion price of approximately $7.15 per share), subject to customary adjustments. Upon conversion of the 2028 Notes, the Company may elect to satisfy the conversion obligation with cash, shares of the Company’s common stock, or a combination of cash and shares of the Company’s stock. As of September 30, 2025, the Company was in compliance with all covenants set forth in the indenture governing the 2028 Notes. The debt discount and debt issuance costs are amortized to interest expense over the term of the 2028 Notes at an effective interest rate of 4.70%.
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9. Stock-Based Compensation and Stockholders' Equity
Common Stock Reserved for Future Issuance
Shares of common stock reserved for future issuance related to outstanding equity awards and employee equity incentive plans as of September 30, 2025, were as follows (in thousands):

| Common Stock Reserved for Future Issuance
Stock options outstanding | 15 |
Restricted stock units outstanding | 16,332 |
Shares available under the 2017 Plan | 302 |
Shares available under the 2022 Plan | 11,359 |
Shares available for future issuance under ESPP | 5,460 |
Total shares of common stock reserved | 33,468 |

The maximum number of shares reserved for the grant of awards under the 2022 Plan will be equal to the sum of the following: (i) 8.0 million shares available for grant under the 2022 Amended and Restated Equity Incentive Plan (the "2022 Plan") when it was initially adopted by shareholders on July 12, 2022, plus (ii) 14.0 million new shares approved by shareholders on August 15, 2024, plus (iii) 8.5 million new shares approved by shareholders on July 25, 2025, plus (iv) the number of shares subject to stock options granted under the Amended and Restated 2012 Equity Incentive Plan (the “Prior Plan”) that were outstanding as of 12:01 a.m. Pacific Time on June 22, 2022 (the “Prior Plan Expiration Time”), but only to the extent such stock options expire, terminate, are cancelled without having been exercised in full or are settled in cash after the Prior Plan Expiration Time without the delivery of shares, plus (v) the number of shares subject to restricted stock, RSUs and performance units granted under the Prior Plan that were outstanding as of the Prior Plan Expiration Time, but only to the extent such awards are forfeited by the holder, are reacquired by the Company at less than their then market value as a means of effecting a forfeiture, or are settled in cash after the Prior Plan Expiration Time without the delivery of shares (with the number of shares that recycle based on the Applicable Ratio, which is defined in the 2022 Plan), in each case, subject to adjustment upon certain changes in the Company’s capitalization.
The 2022 Plan provides for the granting of incentive stock options to employees and non-statutory stock options to employees, directors or consultants, and granting of stock appreciation rights, restricted stock, restricted stock units and performance units, qualified performance-based awards, and stock grants. The stock option price of incentive stock options granted cannot be less than the fair market value on the effective date of the grant. Options, restricted stock, and restricted stock units generally vest over three years or four years and expire ten years after the grant. As of September 30, 2025, 11.4 million shares remained available for future grants under the 2022 Plan.
Stock-Based Compensation
The following table presents stock-based compensation expense (in thousands):

| Three Months Ended September 30, |  | Six Months Ended September 30,
| 2025 |  | 2024 |  | 2025 |  | 2024
Cost of service revenue | $ | 218 |  |  | $ | 824 |  |  | $ | 490 |  |  | $ | 1,948 |
Cost of other revenue | 89 |  |  | 291 |  |  | 227 |  |  | 692 |
Research and development | 1,132 |  |  | 3,494 |  |  | 2,522 |  |  | 8,317 |
Sales and marketing | 1,786 |  |  | 2,153 |  |  | 3,785 |  |  | 5,101 |
General and administrative | 2,138 |  |  | 2,613 |  |  | 4,691 |  |  | 6,119 |
Total | $ | 5,363 |  |  | $ | 9,375 |  |  | $ | 11,715 |  |  | $ | 22,177 |

The Company accounts for stock-based compensation through the measurement and recognition of compensation expense for share-based payment awards made to employees, directors or consultants over the related requisite service period, including restricted stock, restricted stock units ("RSUs") and performance stock units ("PSUs"), qualified performance-based awards, and stock grants (all issuable under the Company's equity incentive plans).
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As of September 30, 2025, unrecognized stock-based compensation expense by award type and their expected weighted-average recognition periods are summarized as follows (in thousands, except years):

| RSU |  | PSU |  | ESPP
Unrecognized stock-based compensation expense | $ | 21,518 |  |  | $ | 2,721 |  |  | $ | 1,160 |
Weighted-average amortization period | 2.1 years |  | 1.1 years |  | 0.8 years

Restricted Stock Units
The following table presents the RSU activity (shares in thousands):

| Number of Shares |  | Weighted Average Grant Date Fair Value |  | Weighted Average Remaining Contractual Term (in Years)
Balance as of March 31, 2025 | 10,229 |  |  | $ | 2.67 |  |  | 0.94
Granted | 7,062 |  |  | 1.84 |  |  |
Vested and released | (4,247) |  |  | 2.79 |  |  |
Forfeited | (820) |  |  | 2.52 |  |  |
Balance as of September 30, 2025 | 12,224 |  |  | $ | 2.16 |  |  | 1.17

Performance Stock Units
Market-Based PSUs
Market-based PSUs are granted to certain employees, including executive officers, with vesting that is contingent on a combination of stock performance and continued service. These awards are eligible to be earned over a period of one year to four years based on Total Shareholder Return ("TSR"), relative to specified market indices, or the achievement of specific pre-established absolute stock price hurdles.
The grant date fair value of market-based PSUs is determined using a Monte Carlo simulation model. Stock-based compensation expense is recognized over the requisite service period, regardless of whether the market condition is ultimately achieved. During the three months ended September 30, 2025 and 2024, the Company determined that the market conditions were not achieved and therefore no shares have been earned.
Performance-Based PSUs
Performance-based PSUs are granted to certain employees, including executive officers, with vesting based on the achievement of specific financial or operational goals, such as revenue growth or cash flow from operations ("CFFO"). The grant date fair value of performance-based PSUs are valued based on the Company’s stock price at the grant date. Stock-based compensation expense is recognized over the requisite service period based on the number of units expected to vest, which is reassessed during each reporting period based on the Company’s evaluation of the probability of achieving the applicable performance conditions.
The Company determined that the CFFO and revenue targets for the performance period were probable of being achieved and recognized $0.6 million and $0.9 million of related compensation expense for the three and six months ended September 30, 2025, respectively. The Company recognized a de minimis amount of related stock-based compensation expense for the three and six months ended September 30, 2024, respectively.
The following table presents the PSU activity (shares in thousands):

| Number of Shares |  | Weighted Average Grant Date Fair Value |  | Weighted Average Remaining Contractual Term (in Years)
Balance as of March 31, 2025 | 3,880 |  |  | $ | 2.88 |  |  | 0.85
Granted1 | 1,295 |  |  | 1.82 |  |  |
Vested and released | (676) |  |  | 1.88 |  |  |
Forfeited | (392) |  |  | 5.28 |  |  |
Balance as of September 30, 2025 | 4,107 |  |  | $ | 2.48 |  |  | 1.14

1 Represents performance-based PSUs granted based on achievement of specific financial or operational goals, such as revenue growth or CFFO.
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Employee Stock Purchase Plan ("ESPP")
As of September 30, 2025, a total of 5.5 million shares were available for issuance under the ESPP.
Share Repurchase Program
In May 2017, the Company's board of directors authorized the Company to purchase $25.0 million of its common stock from time to time under the 2017 Repurchase Plan (the "2017 Plan"). The 2017 Plan expires when the maximum purchase amount is reached, or upon the earlier revocation or termination by the board of directors. During the six months ended September 30, 2025, the Company repurchased 1.0 million shares of common stock in the open market for approximately $1.8 million at an average price of $1.83 per share. The total purchase price of the common stock repurchased and retired was reflected as a reduction to consolidated stockholders' equity during the repurchase period. The remaining amount of shares of the Company's common stock available for repurchase under the 2017 Plan as of September 30, 2025 was approximately $5.2 million.
10. Income Taxes
The Company's effective tax rate was 21.3% and (8.2)% for the three months ended September 30, 2025 and 2024, respectively, and (71.9)% and (7.7)% for the six months ended September 30, 2025 and 2024, respectively. The difference in the effective tax rate and the U.S. federal statutory rate was primarily due to the full valuation allowance that the Company maintains against its U.S. deferred tax assets after adjusting for the impact of certain provisions enacted under the Tax Cuts and Jobs Act, current tax liabilities of profitable foreign subsidiaries subject to different local income tax rates, and state taxes in the United States. The effective tax rate is calculated by dividing the provision for income taxes by the income (loss) before provision for income taxes.
One Big Beautiful Bill Act
On July 4, 2025, the United States enacted tax reform legislation through the One Big Beautiful Bill Act (the "OBBBA") (formally known as An Act to provide for reconciliation, pursuant to title II of H. Con. Res. 14). Included in this legislation are provisions that allow the immediate expensing of domestic U.S. research and development expenses, immediate expensing of certain capital expenditures, and other changes to the U.S. taxation of profits derived from foreign operations. The legislation has multiple effective dates, with certain provisions coming into effect for the Company in its fiscal year ending March 31, 2026 and other provisions coming into effect in subsequent years.
The Company has evaluated the impact of the legislation and has reflected applicable changes to its tax provision, including the reduction of taxes payable for the fiscal year ending March 31, 2026. Since some of the changes in the legislation will require Treasury to issue new interpretive guidance and there is uncertainty around state-level conformity, the Company’s assessment of the OBBBA remains ongoing.
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11. Net Income (Loss) Per Share
The following is a reconciliation of the weighted average number of common shares outstanding used in calculating basic and diluted net income (loss) per share (in thousands, except per share data):

| Three Months Ended September 30, |  | Six Months Ended September 30,
| 2025 |  | 2024 |  | 2025 |  | 2024
Net income (loss) | $ | 767 |  |  | $ | (14,543) |  |  | $ | (3,548) |  |  | $ | (24,833) |
Weighted average common shares outstanding - basic | 136,970 |  |  | 129,250 |  |  | 135,895 |  |  | 127,633 |
Weighted average common shares outstanding - diluted | 141,561 |  |  | 129,250 |  |  | 135,895 |  |  | 127,633 |
Net income (loss) per share - basic | $ | 0.01 |  |  | $ | (0.11) |  |  | $ | (0.03) |  |  | $ | (0.19) |
Net income (loss) per share - diluted | $ | 0.01 |  |  | $ | (0.11) |  |  | $ | (0.03) |  |  | $ | (0.19) |

For the fiscal periods where the Company is in a loss position, basic and diluted net loss per share are the same, as the inclusion of all potential shares of potential dilutive shares would have had an anti-dilutive effect. The following potentially weighted-average common shares were excluded from the calculation of diluted earnings per share because their inclusion would have been anti-dilutive (shares in thousands):

| Three Months Ended September 30, |  | Six Months Ended September 30,
| 2025 |  | 2024 |  | 2025 |  | 2024
Stock options | 49 |  |  | 358 |  |  | 85 |  |  | 358 |
Restricted stock units and Performance stock units | 2,725 |  |  | 6,414 |  |  | 3,352 |  |  | 7,309 |
Potential shares attributable to the ESPP | 1,719 |  |  | 3,408 |  |  | 1,593 |  |  | 3,589 |
Warrants to purchase common stock | 3,100 |  |  | 3,100 |  |  | 3,100 |  |  | 3,100 |
Total anti-dilutive shares | 7,593 |  |  | 13,280 |  |  | 8,130 |  |  | 14,356 |

12. Related Party Transactions
The Company has conducted business with an outside sales and marketing vendor since December 2017, which became a related party in July 2022 when a member of the Company's board of directors joined the vendor's board of directors. During the year ended March 31, 2025, the Company renewed its existing two-year contract with the vendor for an additional one-year contractual term valued at $0.8 million. During the six months ended September 30, 2025, the Company paid $0.4 million for services rendered to this vendor.
13. Subsequent Event
Under the terms of the 2024 Credit Agreement, the Company has the right to prepay the 2024 Term Loan at any time without any premium or penalty. On October 31, 2025, the Company prepaid $5.0 million of quarterly principal payments due under the 2024 Term Loan. This short-term principal debt repayment is accounted for as a partial debt extinguishment transaction. As a result, the recognition of any associated unamortized debt discount and issuance costs of the Term Loan will be recognized within other income (expense), net, in the condensed consolidated statement of operations for the three months ended December 31, 2025. The remaining principal amount of the Term Loan after the repayments is $122.0 million. The Company has no remaining short-term obligations due for fiscal year 2026 and the next quarterly payment is due on June 30, 2026.
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ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our condensed consolidated financial statements and related notes appearing elsewhere in this Quarterly Report. As discussed in the section titled “Forward-Looking Statements,” the following discussion and analysis contain forward-looking statements that involve risks and uncertainties, as well as assumptions that, if they never materialize or prove incorrect, could cause our results to differ materially from those expressed or implied by such forward-looking statements. Factors that could cause or contribute to these differences include, but are not limited to, those discussed below and elsewhere in this Quarterly Report, particularly those set forth under the section entitled "Risk Factors" in the Form 10-K.
Overview
8x8, Inc. is a global provider of integrated customer experience and business communications solutions, purpose-built to unify customer and employee engagement across the enterprise. Our Platform for CX™ combines contact center, business communications, and application programmable interfaces, or APIs, for communications into a single, secure, AI-powered system that delivers seamless, data-driven interactions. Designed for agility and scale, our platform helps businesses eliminate silos, improve operational efficiency, and turn every conversation into actionable intelligence. By aligning technology with measurable outcomes, we empower organizations to transform how they connect, serve, and grow from first interactions to lasting relationships.
We serve a broad customer base, from small businesses to large global enterprises across every major industry. Our strategic focus has increasingly shifted toward mid-market, small and mid-sized enterprise, and public sector organizations, particularly those with 500 to 10,000 employees. These customers often have more complex communication and customer service needs and are more likely to benefit from and invest in multiple services across our platform. This focus aligns with our strengths, eliminating communication silos and enabling businesses to transform every customer interaction into a strategic asset. We also invest resources in retaining our small business customers, including world-class onboarding and customer care specialists that are a single point of contact for all service and support needs.
We reach customers through a diversified go-to-market strategy that includes both direct and indirect channels. We utilize a diversified partner ecosystem to complement our direct sales efforts and expand our global market reach. Our go-to-market strategy includes technology solutions distributors, or TSDs, and their sub-agent networks, who contribute to pipeline growth through referrals. We also engage value-added resellers, or VARs, who market, sell, implement, and support our solutions, helping to drive customer acquisition and optimize our routes to market.
In addition, we collaborate closely with strategic technology partners, particularly those with whom we maintain deep integrations or original equipment manufacturer, or OEM, relationships, via structured referral agreements and coordinated lead flow processes. Our carrier partnerships extend our service availability to over 100 countries and territories, ensuring high-quality, reliable communications that support our international footprint.
To further enhance deployment speed and geographic coverage, we leverage third-party service providers, enabling us to deliver implementation and support services efficiently on a global scale.
With our unified approach to communication and a commitment to continuous innovation, 8x8 enables businesses to deliver intelligent, connected experiences that securely scale across the enterprise.
We generate service revenue from subscriptions to our communications services, as well as from usage of our platform. Our service subscription plans are sold on a per-user basis and are structured with increasing levels of functionality, based on the specific communication needs and customer engagement profile of each user. Platform usage revenue is revenue recognized from sales of products on an as-used basis, such as telephony minutes, messaging, SMS, and communications APIs, and digital and voice chat bot interactions.
We generate other revenue from professional services and the sale of office phones and other hardware equipment. We define a “customer” as one or more legal entities to which we provide services pursuant to a single contractual arrangement. In some cases, we may have multiple billing relationships with a single customer (for example, where we establish separate billing accounts for a parent company and each of its subsidiaries).
Macroeconomic and Other Factors
We are subject to risks and exposures, including those caused by adverse economic conditions. Macroeconomic conditions that could adversely affect our business include geopolitical instability, tariffs, continued inflation, increased interest rates, supply chain disruptions, decreased economic output and fluctuations in currency exchange rates. We continuously monitor the direct and indirect impacts of these factors, as well as the overall global economy and geopolitical landscape on our business and financial results.
While the implications of macroeconomic events on our business, results of operations, and overall financial position remain uncertain over the long term, we expect that adverse economic conditions could adversely impact our business in future periods. For example, our installed base includes more than 50,000 small businesses, which tend to be disproportionately impacted by macroeconomic headwinds.
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Summary and Outlook
As part of our long-term strategy to grow our revenue and increase profitability and cash flow, we are focused on retaining our existing customers and expanding our mid-market, enterprise and public sector customer base. We believe that continued innovation is a critical factor in attracting and retaining our customers and is an important variable in achieving sustainable growth. We are committed to maintaining a high level of investment in research and development to deliver innovation across our Platform for CX, expand our ecosystem of integrated third-party applications, and maintain the high platform availability our customers require.
Our primary focus involves the following: (i) accelerating innovation, particularly in enhancing our platform and contact center with artificial intelligence-based capabilities, and (ii) leveraging our CPaaS leadership in the Asia-Pacific region to expand globally. We continue to introduce new products like 8x8 Engage, add capabilities that allow our customers to enhance employee and customer experience, and expand our Technology Partner Ecosystem to provide complete solutions tailored to specific use cases. We are also enhancing our platform foundation with cutting edge technology, such as the Customer Interaction Data Platform and composable agent and supervisor user interfaces. These innovations enable tightly integrated solutions that prioritize ease-of-use, out-of-the-box functionality, and rapid deployment.
Our investment in innovation has been complemented by initiatives to manage the cost of delivering our services and improve our sales efficiency. We continue to monitor factors that could have an impact on customer buying behavior and demand, including macroeconomic conditions, the competitive environment, contract duration, churn, upsell and down-sell, renewals, and payment terms, all of which have caused variability in our results and may continue to do in the future. We expect the cost of delivering our communication services, both in total dollars and as a percentage of service revenue, to vary with the amount of service revenue and the mix of subscription and usage revenue within service revenue. To improve our sales efficiency over time, we continue to invest in marketing programs to drive awareness for our solutions, and we have increased training for our sales teams, and invested in tools to increase productivity. We have also expanded our reseller partner programs to extend our reach within our target customer market, placing increased emphasis on developing a community of value-added resellers who provide implementation services and Tier 1 customer support in addition to sales. To support our customers and partners, we have expanded our customer success organization and continue to invest in improvements to our back-office processes to increase our operational efficiency over time.
Key GAAP Operating Results
To assess the success of our strategies to achieve growth and increase our cash flow, management reviews our financial performance as presented in our consolidated financial statements, including trends in revenue, gross profit margin, income (loss) from operations, and cash flow generated by operations in absolute dollars and as a percentage of revenue as presented in the following table:

| Fiscal Year 2026 |  | Fiscal Year 2025
| Three Months Ended |  | Three Months Ended
(In thousands, except percentages) | September 30, 2025 |  | June 30, 2025 |  | March 31, 2025 |  | December 31, 2024 |  | September 30, 2024 |  | June 30, 2024
Service revenue | $ | 179,094 |  | $ | 176,308 |  | $ | 171,588 |  | $ | 173,459 |  | $ | 175,075 |  | $ | 172,801
% of Total Revenue | 97.3 | % |  | 97.2 | % |  | 96.9 | % |  | 97.0 | % |  | 96.7 | % |  | 97.0 | %
Gross profit | $ | 119,340 |  | $ | 120,440 |  | $ | 120,052 |  | $ | 121,085 |  | $ | 123,175 |  | $ | 120,960
% of Total Revenue | 64.8 | % |  | 66.4 | % |  | 67.8 | % |  | 67.7 | % |  | 68.1 | % |  | 67.9 | %
Income (loss) from operations | $ | 5,349 |  | $ | 565 |  | $ | 419 |  | $ | 8,979 |  | $ | 7,169 |  | $ | (1,374)
% of Total Revenue | 2.9 | % |  | 0.3 | % |  | 0.2 | % |  | 5.0 | % |  | 4.0 | % |  | (0.8) | %
Net income (loss) | $ | 767 |  | $ | (4,315) |  | $ | (5,401) |  | $ | 3,022 |  | $ | (14,543) |  | $ | (10,290)
% of Total Revenue | 0.4 | % |  | (2.4) | % |  | (3.1) | % |  | 1.7 | % |  | (8.0) | % |  | (5.8) | %
Net cash provided by operating activities | $ | 8,835 |  | $ | 11,873 |  | $ | 5,873 |  | $ | 27,216 |  | $ | 12,317 |  | $ | 18,148

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Components of Results of Operations
Service Revenue
Service revenue consists of communication services subscriptions and platform usage revenue and related fees from our UCaaS, CCaaS and CPaaS offerings. We plan to increase service revenue through a combination of new customer acquisition, cross-sell of additional products to existing customers, including new products resulting from our increased investment in innovation, artificial intelligence, geographic expansion of our customer base outside the United States, innovation in our products and technologies, and through strategic acquisitions of technologies and businesses.
Other Revenue
Other revenue consists of revenue from professional services, primarily in support of deployment of our solutions and/or platform, and revenue from sales and rentals of IP telephones in conjunction with our cloud telephony service. Other revenue is dependent on the number of customers who choose to purchase or rent IP telephone hardware in conjunction with our service instead of using the solution on their cell phone, computer, or other compatible device, and/or choose to engage our professional services organization for implementation and deployment of our cloud services.
Cost of Service Revenue
Cost of service revenue consists primarily of costs associated with network operations and related personnel, technology licenses, amortization of capitalized internal-use software, other communication origination and termination services provided by third-party carriers, outsourced customer service call center operations, and other costs such as customer service, and technical support costs. We allocate overhead costs, such as information technology and facilities, to cost of service revenue, as well as to each of the operating expense categories, generally based on relative headcount. Our information technology costs include costs for information technology infrastructure and personnel. Facilities costs primarily consist of office leases and related expenses.
Cost of Other Revenue
Cost of other revenue consists primarily of direct and indirect costs associated with the purchase and shipping and handling of IP telephone hardware as well as the scheduling, shipping and handling, personnel costs, and other expenditures incurred in connection with the professional services associated with the deployment and implementation of our products, and allocated information technology and facilities costs.
Research and Development
Research and development expenses consist primarily of personnel and related costs, third-party development, software and equipment costs necessary for us to conduct our product, platform development and engineering efforts, as well as allocated information technology and facilities costs.
Sales and Marketing
Sales and marketing expenses consist primarily of personnel and related costs, sales commissions, including those to the channel, trade shows, advertising and other marketing, demand generation, and promotional expenses, as well as allocated information technology and facilities costs.
General and Administrative
General and administrative expenses consist primarily of personnel and related costs, professional services fees, corporate administrative costs, tax and regulatory fees, and allocated information technology and facilities costs.
Interest Expense
Interest expense consists primarily of interest expense related to our term loan and convertible notes, and amortization of debt discount and issuance costs.
Other Expense, Net
Other expense, net, consists primarily of losses on debt extinguishment, gain or loss on warrant remeasurement, interest income, gains or losses on foreign exchange transactions, as well as other income.
Provision for Income Taxes
Provision for income taxes consists primarily of foreign income taxes and state taxes in the United States. As we expand the scale of our international business activities, any changes in the United States and foreign taxation of such activities may increase our overall provision for income taxes in the future. We have a valuation allowance for our U.S. deferred tax assets, including federal and state net operating loss carryforwards. We expect to maintain this valuation allowance until it becomes more likely than not that the benefit of our federal and state deferred tax assets will be realized by way of expected future taxable income in the United States.
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Results of Operations
Revenue
Service revenue

| Three Months Ended September 30, |  | Six Months Ended September 30,
(In thousands, except percentages) | 2025 |  | 2024 |  | Change |  | 2025 |  | 2024 |  | Change
Service revenue | $ | 179,094 |  | $ | 175,075 |  | $ | 4,019 |  |  | 2.3 | % |  | $ | 355,402 |  | $ | 347,876 |  | $ | 7,526 |  |  | 2.2 | %
Percentage of total revenue | 97.3 | % |  | 96.7 | % |  |  |  |  |  | 97.2 | % |  | 96.9 | % |  |  |  |

Three Months Ended
Service revenue increased by $4.0 million, or 2.3%, for the three months ended September 30, 2025, compared to the three months ended September 30, 2024. This change was driven by an increase of $11.9 million in platform usage revenue generated primarily in the Asia-Pacific region. This increase was partially offset by a decrease in subscription revenue of $7.9 million consisting predominantly of former Fuze customers.
Six Months Ended
Service revenue increased by $7.5 million, or 2.2%, for the six months ended September 30, 2025, compared to the six months ended September 30, 2024. This change was driven by an increase of $20.1 million in platform usage revenue generated primarily in the Asia-Pacific region. This increase was partially offset by a decrease in subscription revenue of $12.6 million consisting predominantly of former Fuze customers.
Other revenue

| Three Months Ended September 30, |  | Six Months Ended September 30,
(In thousands, except percentages) | 2025 |  | 2024 |  | Change |  | 2025 |  | 2024 |  | Change
Other revenue | $ | 5,001 |  | $ | 5,923 |  | $ | (922) |  |  | (15.6) | % |  | $ | 10,054 |  | $ | 11,269 |  | $ | (1,215) |  |  | (10.8) | %
Percentage of total revenue | 2.7 | % |  | 3.3 | % |  |  |  |  |  | 2.8 | % |  | 3.1 | % |  |  |  |

Three Months Ended
Other revenue decreased by $0.9 million, or 15.6%, for the three months ended September 30, 2025, compared to the three months ended September 30, 2024, due to lower product revenue of $0.8 million and decreased professional service revenue of $0.1 million.
Six Months Ended
Other revenue decreased by $1.2 million, or 10.8%, for the six months ended September 30, 2025, compared to the six months ended September 30, 2024, due to lower product revenue of $1.6 million, partially offset by an increase in professional service revenue of $0.4 million.
Cost of Revenue
Cost of service revenue

| Three Months Ended September 30, |  | Six Months Ended September 30,
(In thousands, except percentages) | 2025 |  | 2024 |  | Change |  | 2025 |  | 2024 |  | Change
Cost of service revenue | $ | 57,699 |  | $ | 50,251 |  | $ | 7,448 |  |  | 14.8 | % |  | $ | 111,521 |  | $ | 99,747 |  | $ | 11,774 |  |  | 11.8 | %
Percentage of service revenue | 32.2 | % |  | 28.7 | % |  |  |  |  |  | 31.4 | % |  | 28.7 | % |  |  |  |

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Three Months Ended
Cost of service revenue increased by $7.4 million, or 14.8%, for the three months ended September 30, 2025, compared to the three months ended September 30, 2024, primarily due to increases of $10.1 million in costs to deliver our subscription and platform usage services and $0.3 million in salaries, benefits and consulting costs. These increases were partially offset by decreases of $1.6 million in amortization of intangible assets, $0.8 million in stock-based compensation, and $0.6 million in amortization of capitalized software.
Six Months Ended
Cost of service revenue increased by $11.8 million, or 11.8%, for the six months ended September 30, 2025, compared to the six months ended September 30, 2024, primarily due to increases of $17.3 million in costs to deliver our subscription and platform usage services and $1.4 million in salaries, benefits and consulting costs. These increases were partially offset by decreases of $3.2 million in amortization of intangible assets, $2.3 million in stock-based compensation, and $1.4 million in amortization of capitalized software.
Cost of other revenue

| Three Months Ended September 30, |  | Six Months Ended September 30,
(In thousands, except percentages) | 2025 |  | 2024 |  | Change |  | 2025 |  | 2024 |  | Change
Cost of other revenue | $ | 7,056 |  | $ | 7,572 |  | $ | (516) |  |  | (6.8) | % |  | $ | 14,155 |  | $ | 15,263 |  | $ | (1,108) |  |  | (7.3) | %
Percentage of other revenue | 141.1 | % |  | 127.8 | % |  |  |  |  |  | 140.8 | % |  | 135.4 | % |  |  |  |

Three Months Ended
Cost of other revenue decreased by $0.5 million, or 6.8%, for the three months ended September 30, 2025, compared to the three months ended September 30, 2024, primarily due to decreases of $0.5 million in lower product costs associated with IP telephone hardware and $0.2 million of stock-based compensation. These decreases were partially offset by an increase of $0.2 million in salaries, benefits, and consulting costs to deliver our professional services.
Six Months Ended
Cost of other revenue decreased by $1.1 million, or 7.3%, for the six months ended September 30, 2025, compared to the six months ended September 30, 2024, primarily due to decreases of $1.1 million in lower product costs associated with IP telephone hardware and $0.5 million of stock-based compensation. These decreases were partially offset by an increase of $0.5 million in salaries, benefits, and consulting costs to deliver our professional services.
Operating Expenses
Research and development

| Three Months Ended September 30, |  | Six Months Ended September 30,
(In thousands, except percentages) | 2025 |  | 2024 |  | Change |  | 2025 |  | 2024 |  | Change
Research and development | $ | 27,918 |  | $ | 31,291 |  | $ | (3,373) |  |  | (10.8) | % |  | $ | 56,282 |  | $ | 63,428 |  | $ | (7,146) |  |  | (11.3) | %
Percentage of total revenue | 15.2 | % |  | 17.3 | % |  |  |  |  |  | 15.4 | % |  | 17.7 | % |  |  |  |

Three Months Ended
Research and development expenses decreased by $3.4 million, or 10.8%, for the three months ended September 30, 2025, compared to the three months ended September 30, 2024, primarily due to decreases of $2.1 million in stock-based compensation, $1.4 million in internally-developed software and other costs, and $0.6 million in costs to operate data centers and facilities. These decreases were partially offset by increases of $0.4 million in amortization of capitalized software and $0.3 million in combined salaries, benefits, and consulting costs necessary for us to conduct our product, platform development and engineering efforts.
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Six Months Ended
Research and development expenses decreased by $7.1 million, or 11.3%, for the six months ended September 30, 2025, compared to the six months ended September 30, 2024, primarily due to decreases of $5.2 million in stock-based compensation, $2.4 million in internally-developed software and other costs, and $1.0 million in costs to operate data centers and facilities. These decreases were partially offset by increases of $1.2 million in combined salaries, benefits, and consulting costs necessary for us to conduct our product, platform development and engineering efforts and $0.3 million in amortization of capitalized software.
Sales and marketing

| Three Months Ended September 30, |  | Six Months Ended September 30,
(In thousands, except percentages) | 2025 |  | 2024 |  | Change |  | 2025 |  | 2024 |  | Change
Sales and marketing | $ | 63,835 |  | $ | 64,867 |  | $ | (1,032) |  |  | (1.6) | % |  | $ | 132,019 |  | $ | 131,973 |  | $ | 46 |  |  | — | %
Percentage of total revenue | 34.7 | % |  | 35.8 | % |  |  |  |  |  | 36.1 | % |  | 36.7 | % |  |  |  |

Three Months Ended
Sales and marketing expenses decreased by $1.0 million, or 1.6%, for the three months ended September 30, 2025, compared to the three months ended September 30, 2024, primarily due to decreases of $3.3 million in channel commissions and amortization of deferred contract acquisition costs and $0.5 million in stock-based compensation expense. These decreases were partially offset by increases of $1.9 million in salaries, benefits, and consulting costs and $0.9 million in paid media and other marketing services costs.
Six Months Ended
Sales and marketing expenses were flat for the six months ended September 30, 2025, compared to the six months ended September 30, 2024, primarily due to increases of $5.3 million in salaries, benefits, and consulting costs and $2.6 million in paid media and other marketing services costs. These increases were partially offset by decreases of $6.1 million in channel commissions and amortization of deferred contract acquisition costs and $1.7 million in stock-based compensation expense.
General and administrative

| Three Months Ended September 30, |  | Six Months Ended September 30,
(In thousands, except percentages) | 2025 |  | 2024 |  | Change |  | 2025 |  | 2024 |  | Change
General and administrative | $ | 22,238 |  | $ | 19,848 |  | $ | 2,390 |  |  | 12.0 | % |  | $ | 45,565 |  | $ | 42,939 |  | $ | 2,626 |  |  | 6.1 | %
Percentage of total revenue | 12.1 | % |  | 11.0 | % |  |  |  |  |  | 12.5 | % |  | 12.0 | % |  |  |  |

Three Months Ended
General and administrative expenses increased by $2.4 million, or 12.0%, for the three months ended September 30, 2025, compared to the three months ended September 30, 2024, primarily due to increases of $3.6 million in legal and regulatory costs, $0.5 million in facilities costs, and $0.3 million in salaries, benefits, and consulting costs. These increases were partially offset by a decrease of $2.0 million in stock-based compensation and other costs.
Six Months Ended
General and administrative expenses increased by $2.6 million, or 6.1%, for the six months ended September 30, 2025, compared to the six months ended September 30, 2024, primarily due to increases of $4.2 million in legal and regulatory costs, $0.7 million in facilities costs, and $1.0 million in salaries, benefits, and consulting costs. These increases were partially offset by a decrease of $3.3 million in stock-based compensation and other costs.
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Other expense, net
Interest expense

| Three Months Ended September 30, |  | Six Months Ended September 30,
(In thousands, except percentages) | 2025 |  | 2024 |  | Change |  | 2024 |  | 2023 |  | Change
Interest expense | $ | (4,842) |  | $ | (7,905) |  | $ | 3,063 |  |  | (38.7) | % |  | $ | (8,810) |  | $ | (17,861) |  | $ | 9,051 |  |  | (50.7) | %
Percentage of total revenue | (2.6) | % |  | (4.4) | % |  |  |  |  |  | (2.4) | % |  | (5.0) | % |  |  |  |

Three Months Ended
Interest expense decreased by $3.1 million, or 38.7%, for the three months ended September 30, 2025, compared to the three months ended September 30, 2024, primarily due to a lower interest rate and principal balance on the 2024 Term Loan compared to the 2022 Term Loan. See Note 8, Convertible Senior Notes and Term Loan, for further details.
Six Months Ended
Interest expense decreased by $9.1 million, or 50.7%, for the six months ended September 30, 2025, compared to the six months ended September 30, 2024, primarily due to a lower interest rate and principal balance on the 2024 Term Loan compared to the 2022 Term Loan and capitalized interest related to property, plant and equipment from general borrowing costs. See Note 8, Convertible Senior Notes and Term Loan, for further details.
Other income (expense), net

| Three Months Ended September 30, |  | Six Months Ended September 30,
(In thousands, except percentages) | 2025 |  | 2024 |  | Change |  | 2025 |  | 2024 |  | Change
Other income (expense), net | $ | 468 |  | $ | (12,709) |  | $ | 13,177 |  |  | NM |  | $ | 832 |  | $ | (10,993) |  | $ | 11,825 |  |  | NM
Percentage of total revenue | 0.3 | % |  | (7.0) | % |  |  |  |  |  | 0.2 | % |  | (3.1) | % |  |  |  |

NM = not meaningful
Three Months Ended
We recognized $0.5 million of other income, net during the three months ended September 30, 2025, compared to $12.7 million of other expense, net during the three months ended September 30, 2024, primarily due to a decrease in the loss on debt extinguishment of $12.0 million, a $1.7 million decrease due to foreign exchange losses, and a $0.2 million reduction in other expense. These decreases were offset by a $0.5 million decrease in interest income earned on cash and cash equivalents and a reduced gain of $0.2 million on the remeasurement of Warrants issued in connection with the 2022 Term Loan.
Six Months Ended
We recognized $0.8 million of other income, net during the six months ended September 30, 2025, compared to $11.0 million of other expense, net during the six months ended September 30, 2024, primarily due to a decrease in the loss on debt extinguishment of $11.9 million and a $2.7 million decrease due to foreign exchange losses. These decreases were offset by a reduced gain of $1.8 million on the remeasurement of Warrants issued in connection with the 2022 Term Loan and a $1.0 million decrease in interest income earned on cash and cash equivalents.
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Provision for income taxes

| Three Months Ended September 30, |  | Six Months Ended September 30,
(In thousands, except percentages) | 2025 |  | 2024 |  | Change |  | 2025 |  | 2024 |  | Change
Provision for income taxes | $ | 208 |  | $ | 1,098 |  | $ | (890) |  |  | (81.1) | % |  | $ | 1,484 |  | $ | 1,774 |  | $ | (290) |  |  | (16.3) | %
Percentage of total revenue | 0.1 | % |  | 0.6 | % |  |  |  |  |  | 0.4 | % |  | 0.5 | % |  |  |  |

Three Months Ended
The provision for income taxes decreased by $0.9 million for the three months ended September 30, 2025, compared to the three months ended September 30, 2024, primarily driven by the effect of the OBBBA's federal and state tax provision for the three months ended September 30, 2025.
Six Months Ended
The provision for income taxes decreased by $0.3 million for the six months ended September 30, 2025, compared to the six months ended September 30, 2024, primarily driven by the effect of the OBBBA's federal and state tax provisions, which were partially offset by an increase in profit before tax of foreign profitable entities for the six months ended September 30, 2025 as compared to the six months ended September 30, 2024.
Liquidity and Capital Resources
We believe that our existing cash, cash equivalents and our anticipated cash flows from operations will be sufficient to meet our working capital, expenditure, and contractual obligation requirements for a minimum of the next twelve months and the foreseeable future. Although we believe we have adequate sources of liquidity for at least the next twelve months and for the foreseeable future, the success of our operations, the global economic outlook, and the pace of growth in our markets could impact our business and liquidity.
Cash and Cash Equivalents
The following is a summary of our cash and cash equivalents (in thousands):

| September 30, 2025 |  | March 31, 2025
Cash and cash equivalents | $ | 75,872 |  |  | $ | 88,050 |
Restricted cash, current 1 | 812 |  |  | 462 |
Restricted cash, non-current 1 | — |  |  | 812 |
Total | $ | 76,684 |  |  | $ | 89,324 |

(1) Restricted cash supports letters of credit securing leases for office facilities and certain equipment for the same periods, and an accrued holdback related to a business combination.
Our primary requirements for liquidity and capital are working capital needs due to delivery of our various products to customers, research and development, sales and marketing activities, principal and interest payments on our outstanding debt, and other general corporate needs. Historically, these cash requirements have been met from cash provided by operating activities and our cash and cash equivalents balances. Our current capital deployment strategy for fiscal year 2026 is to invest excess cash on hand to support our continued growth initiatives into select markets and planned software development activities, and pay down our debt. As of September 30, 2025, we are not party to any off-balance sheet arrangements that have had or are reasonably likely to have a current or future material effect on our financial condition, results of operations, liquidity, capital expenditures, or capital resources. Significant cash requirements for the fiscal year include our operating lease obligations, interest payments related to our debt obligations, and operating and capital purchase commitments. For information regarding our expected cash requirements and timing of payments related to leases and non-cancellable purchase commitments, see Note 6, Leases, and Note 7, Commitments and Contingencies, respectively, to the condensed consolidated financial statements. Additionally, refer to Note 8, Convertible Senior Notes and Term Loan, to the condensed consolidated financial statements for more information related to our debt obligations and applicable covenants.
Our outstanding 2024 Term Loan allows for voluntary prepayments. In order to reduce future cash interest payments, as well as future amounts due at maturity or upon redemption, we may, from time to time, make prepayments. The Company evaluates opportunities for stock repurchases and may utilize cash and cash equivalents to repurchase shares under the 2017 Plan. During the six months ended September 30, 2025, the Company repurchased 1.0 million shares of common stock in the open market for approximately $1.8 million at an average price of $1.83 per share. For more information, see Note 9, Stock-Based Compensation and Stockholders' Equity.
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As of September 30, 2025, our 2028 Notes were trading at a discount to their respective principal amount. We may seek to retire or purchase our outstanding debt through open-market purchases, privately negotiated transactions or otherwise, which may have an impact on our liquidity requirements. Any such transactions will be dependent upon several factors, including our liquidity requirements, contractual restrictions, prevailing market conditions, and other factors. Whether or not we engage in any such transactions will be determined at our discretion. For historical debt payments, see Note 8, Convertible Senior Notes and Term Loan.
Cash Flows
The following is a summary of our cash flows provided by (used in) operating, investing and financing activities (in thousands):

| Six Months Ended September 30,
| 2025 |  | 2024
Net cash provided by operating activities | $ | 20,708 |  |  | $ | 30,465 |
Net cash used in investing activities | (8,659) |  |  | (7,204) |
Net cash used in financing activities | (26,659) |  |  | (25,136) |
Effect of exchange rate changes on cash | 1,970 |  |  | 3,019 |
Net increase (decrease) in cash and cash equivalents | $ | (12,640) |  |  | $ | 1,144 |

Cash provided by operating activities decreased by $9.8 million to $20.7 million for the six months ended September 30, 2025, primarily due to changes in working capital, the timing of billings and customer collections, as well as the amount and timing of disbursements to our vendors. Cash used in investing activities increased $1.5 million to $8.7 million for the six months ended September 30, 2025, mainly due to an increase in capitalized internal-use software costs. Cash used in financing activities increased by $1.5 million to $26.7 million for the six months ended September 30, 2025, mainly due to principal repayments for our term loan, payments for repurchases of shares of common stock, and other financing activities.
Debt Obligations
See Note 8, Convertible Senior Notes and Term Loan, in the unaudited condensed consolidated financial statements included elsewhere in this Quarterly Report for information regarding our debt obligations.
2024 Delayed Draw Term Loan
On July 11, 2024, we entered into a new term loan credit agreement with Wells Fargo Bank, National Association, as administrative agent, and the lenders thereto (the “2024 Credit Agreement”). The 2024 Credit Agreement establishes a delayed draw term loan facility in an aggregate principal amount of up to $200.0 million maturing on August 15, 2027.
On August 5, 2024, we drew upon the entire facility of $200.0 million under the delayed draw term loan facility (the "2024 Term Loan") and used the proceeds of the 2024 Term Loan and cash on hand of approximately $29.0 million to repay in full the $225.0 million of outstanding principal amount and accrued interest of the 2022 Term Loan and the fees incurred in connection with the Repayment.
The 2024 Term Loan bears interest at an annual rate equal to the Term SOFR, plus a margin of either 2.50%, 2.75% or 3.00% based on the consolidated total net leverage ratio of the Company and its subsidiaries. The initial margin was 3.00% for the fiscal quarter ending September 30, 2024 and remained 3.00% as of September 30, 2025. We have the option to pay interest monthly, quarterly, or semi-annually. During the three months ended September 30, 2025, we elected monthly interest payment terms which resulted in cash payments of $2.5 million. For the three months ending December 31, 2025, we have elected quarterly interest payment terms, which will result in cash payments of approximately $2.2 million. As of September 30, 2025, the debt issuance costs were amortized to interest expense over the term of the 2024 Term Loan at an effective interest rate of 8.65%.
Under the terms of the 2024 Credit Agreement, the Company has the right to prepay the 2024 Term Loan at any time without any premium or penalty. The Company completed three principal repayments of the 2024 Term Loan during fiscal year 2025 for a total of $48.0 million in aggregate principal amount. The Company completed two principal repayments of the 2024 Term Loan during fiscal year 2026 for a total of $25.0 million in aggregate principal amount. As of September 30, 2025, the scheduled remaining principal repayments are $44.5 million in fiscal year 2027 ($7.0 million on June 30, 2026 and $12.5 million on September 30, 2026 and each quarter thereafter through maturity) and $82.5 million principal is due before or upon maturity in fiscal year 2028. These annualized repayments will be made in quarterly installments. As of September 30, 2025, the Company has paid $37.5 million, $3.0 million, and $10.0 million of the originally scheduled principal repayments for fiscal year 2026, 2027, and 2028 respectively, and the remaining principal amount of the 2024 Term Loan after the payments is $127.0 million.
On October 31, 2025, we prepaid $5.0 million of the short-term principal payment due in June 2026 under the 2024 Term Loan. See Note 13, Subsequent Event, for more information regarding this prepayment.
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These short-term principal debt repayments are accounted for as partial debt extinguishment transactions. The carrying value of the 2024 Term Loan, including the unamortized debt discount and issuance costs, was derecognized. The difference of $0.5 million between the cash consideration paid to partially extinguish the 2024 Term Loan and the carrying value of the 2024 Term Loan was recognized as a loss on debt extinguishment included in the loss on debt extinguishment line item recorded in other expense in the condensed consolidated statement of operations and comprehensive income (loss).
2022 Term Loan Extinguishment
On August 5, 2024, we repaid in full the outstanding principal amount and accrued interest of the 2022 Term Loan using the proceeds of the 2024 Term Loan and cash on hand. The Repayment was accounted for as a debt extinguishment. The carrying value of the 2022 Term Loan, including the unamortized debt discount and issuance costs, was derecognized. The difference of $12.0 million between the cash consideration paid to extinguish the 2022 Term Loan and the carrying value of the 2022 Term Loan was recognized as a loss on debt extinguishment included in the loss on debt extinguishment line item recorded in other expense in the condensed consolidated statement of operations and comprehensive income (loss). The Warrants continue to be outstanding with no change in terms in connection with the Repayment or issuance of the 2024 Term Loan.
Loans made under the 2022 Credit Agreement bore interest at an annual rate equal to the Term SOFR, subject to a floor of 1.00% and a credit spread adjustment of 0.10%, plus a margin of 6.50%. During the six months ended September 30, 2024, we paid $9.4 million of interest under the 2022 Term Loan.
Material Cash Requirements and Other Obligations
As of March 31, 2025, our material cash requirements and other obligations were $527.1 million. During the six months ended September 30, 2025, we increased our non-cancellable three-year hosting service contract commitment from $24.1 million to $54.0 million. Under this agreement, $4.8 million remains due during fiscal year 2026, $10.0 million will be due during fiscal year 2027 and $10.0 million will be due during fiscal year 2028. For information regarding our material cash requirements and other obligations, see Item 7, "Management's Discussion and Analysis", in the Form 10-K.
During the six months ended September 30, 2025, we reduced the 2024 Term Loan contractual principal by $25.0 million to $127.0 million. See Note 8, Convertible Senior Notes and Term Loan, for further details.
Critical Accounting Policies and Estimates
The discussion and analysis of our financial condition and results of operations are based upon our condensed consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosures of assets and liabilities. On an ongoing basis, we evaluate our critical accounting policies and estimates. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.
Our consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP"). See Note 1, The Company and Significant Accounting Policies, in the notes to the unaudited condensed consolidated financial statements included in this Quarterly Report, which describes the significant accounting policies and methods used in the preparation of our consolidated financial statements. There have been no significant changes during the six months ended September 30, 2025 to our critical accounting policies and estimates previously disclosed in our Form 10-K.
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ITEM 3. Quantitative and Qualitative Disclosures About Market Risk
There have been no material changes in our exposures to market risk since March 31, 2025. For details on the Company’s interest rate and foreign currency exchange risks, see Part I, Item 7A. “Quantitative and Qualitative Information About Market Risks” in our Form 10-K.
ITEM 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of our disclosure controls and procedures, as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, as of September 30, 2025. Based on such evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of September 30, 2025, our disclosure controls and procedures were effective at a reasonable assurance level.
Changes in Internal Control Over Financial Reporting
During the three months ended September 30, 2025, there was no change in our internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
Limitations on the Effectiveness of Controls
Our management, including the Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure controls or internal control over financial reporting will prevent all errors and all fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the control system's objectives will be met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected.
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PART II. OTHER INFORMATION
ITEM 1. Legal Proceedings
Information with respect to this item may be found in Note 7, Commitments and Contingencies, under the heading “Legal Proceedings” in the Notes to Unaudited Condensed Consolidated Financial Statements included in this Quarterly Report is incorporated by reference in response to this item.
ITEM 1A. Risk Factors
Investing in our securities involves risk. Prior to making a decision about investing in our securities, you should carefully consider the specific factors discussed below and under the heading “Risk Factors” in any prospectus supplement, together with all of the other information contained or incorporated by reference in this Quarterly Report. You should also consider the risk factors related to our business and operations described in Part I, Item 1A of the Form 10-K under the heading “Risk Factors”. Additional risks and uncertainties not presently known to us or that we currently deem immaterial may also affect our operations.
ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds
(a) Unregistered Sales of Equity Securities
None.
(b) Use of Proceeds from Registered Securities
None.
(c) Issuer Purchases of Equity Securities
In May 2017, the Company's board of directors authorized the Company to purchase $25.0 million of its common stock from time to time under the 2017 Repurchase Plan (the "2017 Plan"). The 2017 Plan expires when the maximum purchase amount is reached, or upon the earlier revocation or termination by the board of directors. The remaining amount of shares of our common stock available for repurchase under the 2017 Plan as of September 30, 2025 was approximately $5.2 million. There were no repurchases made during the three months ended September 30, 2025.
ITEM 3. Defaults Upon Senior Securities
None.
ITEM 4. Mine Safety Disclosures
Not applicable.
ITEM 5. Other Information
None of the Company's directors and officers (as defined in Rule 16a-1(f) under the Exchange Act) adopted or terminated a Rule 10b5-1 trading arrangement (as defined in Item 408(c) of Regulation S-K) during the three months ended September 30, 2025.
Our officers (as defined in Rule 16a-1(f) under the Exchange Act) have entered into sell-to-cover arrangements, which constitute non-Rule 10b5-1 trading arrangements (as defined in Item 408(c) of Regulation S-K), authorizing the pre-arranged sale of shares to satisfy tax withholding obligations of the Company arising exclusively from the vesting of restricted stock units (“RSUs”) and performance stock units (“PSUs”), as applicable, and the related issuance of shares. Any sale of shares under these arrangements will occur only if (i) the aggregate value of all of the shares withheld by the Company to satisfy such tax withholding obligations in the given fiscal year has reached a certain threshold, and (ii) the sale does not result in any short-swing liability under Section 16(b) of the Exchange Act. The amount of shares to be sold under these arrangements may vary and will be dependent on the trading price of the Company’s common stock at the time of the vesting of the RSUs and PSUs, as applicable. Each of these arrangements lasts until the final vesting date of the applicable RSUs or PSUs, or each officer’s earlier termination of employment.
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ITEM 6. Exhibits

|  | Incorporated by Reference |
Exhibit Number | Exhibit Description | Company Form | Filing Date | Exhibit Number | Filed Herewith
10.1 | First Amendment, dated as of July 29, 2025, to the Term Loan Credit Agreement, dated as of July 11, 2024, by and among 8x8, Inc., Wells Fargo Bank, National Association, as administrative agent, and the lenders party thereto. | 8-K | 8/4/2025 | 10.1 |
10.2 | 8x8, Inc. Amended and Restated 2022 Equity Incentive Plan | S-8 | 8/4/2025 | 10.1 |
10.3 | 8x8, Inc. Amended and Restated 1996 Employee Stock Purchase Plan | S-8 | 8/4/2025 | 10.2 |
31.1 | Certification of Chief Executive Officer of the Registrant pursuant to Rule 13a-14 |  |  |  | X
31.2 | Certification of Chief Financial Officer of the Registrant pursuant to Rule 13a-14 |  |  |  | X
32.1 | Certification of Chief Executive Officer of the Registrant pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |  |  |  | X
32.2 | Certification of Chief Financial Officer of the Registrant pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |  |  |  | X
101.INS | XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. |  |  |  | X
101.SCH | XBRL Taxonomy Schema Linkbase Document |  |  |  | X
101.CAL | XBRL Taxonomy Calculation Linkbase Document |  |  |  | X
101.DEF | XBRL Taxonomy Definition Linkbase Document |  |  |  | X
101.LAB | XBRL Taxonomy Labels Linkbase Document |  |  |  | X
101.PRE | XBRL Taxonomy Presentation Linkbase Document |  |  |  | X
104 | Cover Page Interactive Data File. Formatted as inline XBRL and contained in Exhibit 101. |  |  |  | X

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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant, 8x8, Inc., a Delaware corporation, has duly caused this Quarterly Report on Form 10-Q to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Campbell, State of California, on November 5, 2025.

|  | 8x8, Inc.
|  | /s/ Suzy Seandel
|  | Suzy Seandel
|  | Chief Accounting Officer
|  | (Principal Accounting Officer and Duly Authorized Officer)

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