8x8 Inc /de/ (EGHT) · Nov 4, 2026 · Earnings
Beat — Non-GAAP diluted EPS $0.12 vs ~$0.07 consensus; revenue $192.0M vs ~$187.6M consensus
8x8 earnings beat Q2 expectations, with AI and platform usage driving growth and management raising its fiscal 2027 outlook despite lower margins.
8x8 is trying to reaccelerate a mature cloud-communications business by shifting toward usage-based communications APIs, AI interactions and a broader unified CX platform; its three-year model explicitly assumes platform usage becomes a larger share of revenue, even at lower gross margins.
The quarter beat on the metrics that matter most. Total revenue reached $192.0 million, above the published consensus of roughly $187.6 million, while non-GAAP diluted EPS reached $0.12 versus roughly $0.07 expected. Revenue growth remains modest at 4% year over year, but the company again outperformed its own quarterly targets and raised its full-year outlook.
| Metric | Q2 2027 | Q2 2026 | Consensus / guidance |
|---|---|---|---|
| Total revenue (Financial Statements) | $192.0M (+4%) | $184.1M | ~$187.6M |
| Non-GAAP diluted EPS (Reconciliation) | $0.12 | $0.09 | ~$0.07 |
| Non-GAAP operating income (Financial Highlights) | $20.7M (+20%) | $17.3M | $17.0M–$19.0M guidance |
| Non-GAAP operating margin (Financial Highlights) | 10.8% | 9.4% | 8.0%–9.0% guidance |
| GAAP gross margin (Financial Statements) | 59.7% | 64.8% | — |
| Operating cash flow (Operating Cash Flow and Cash Balance) | $13.1M | — | $9M–$11M guidance |
The growth engine is becoming more visible, but it is not yet a clean margin story. Platform usage revenue grew 51% year over year and rose to approximately 28% of service revenue from 19% a year ago. AI recurring revenue grew 58%, and customers using three or more revenue-producing products increased 19%. Those are meaningful signs that the AI, CPaaS and cross-sell strategy is gaining adoption, rather than existing only as product positioning.
The trade-off is lower gross profit quality as usage scales. The faster-growing usage business carries lower gross margins, pulling GAAP gross margin down to 59.7% from 64.8% and non-GAAP total gross margin to 60.1% from 65.7%. Management offset that pressure through lower sales and marketing expense, producing higher operating profit and a 10.8% non-GAAP operating margin.
Cash generation and debt reduction make the improved profitability more credible. Operating cash flow was $13.1 million, above the company’s $9 million to $11 million target, marking the 23rd consecutive positive quarter. After another $12.5 million repayment in October, term-loan principal fell to $95.0 million, easing the refinancing burden ahead of the August 2027 maturity.
Bottom line: This was a clearly better-than-expected quarter that strengthens 8x8’s reacceleration and cash-generation story. The main qualification is that AI and usage growth are arriving with lower margins, so the raised outlook still depends on converting higher volume into durable profit dollars rather than merely more revenue.
Term-loan refinancing ahead of August 2027 maturity
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