RingCentral Inc (RNG) Reports 10% YoY Increase in Q3 2023 Revenue
RingCentral Inc (NYSE:RNG) reported a 10% year-over-year increase in total revenue, reaching $558 million in Q3 2023.
The company's non-GAAP operating margin rose significantly, up 560 basis points year-over-year to 19.1%.
RingCentral's GAAP operating margin improved to (9.7%) compared to (35.9%) in the prior year.
The company's cash and cash equivalents stood at $432 million at the end of Q3 2023, up from $225 million at the end of Q2 2023.
On November 6, 2023, RingCentral Inc (NYSE:RNG), a leading provider of AI-powered global enterprise cloud communications, video meetings, collaboration, and contact center solutions, announced its financial results for the third quarter ended September 30, 2023.
Financial Highlights
The company's total revenue increased by 10% year over year to $558 million, with subscriptions revenue also increasing by 10% year over year to $531 million. The Annualized Exit Monthly Recurring Subscriptions (ARR) increased by 11% year over year to $2.26 billion, with mid-market and Enterprise ARR increasing by 13% year over year to $1.41 billion.
RingCentral's GAAP operating margin improved significantly to (9.7%), compared to (35.9%) in the prior year. The non-GAAP operating margin was 19.1%, up 560 basis points year-over-year. The company's GAAP net loss per share was ($0.45), compared to ($2.98) in the same period last year. Diluted non-GAAP net income per share was $0.78, compared to $0.55 per share in the same period last year.
Financial Outlook
For the full year 2023, RingCentral is updating its subscriptions revenue range to $2.095 to $2.101 billion, representing annual growth of 11%. The total revenue range is updated to $2.198 to $2.205 billion, representing annual growth of 11%. The company is raising its non-GAAP operating margin range to 19.0%, up from 18.5% to 19.0% previously. The company also expects to generate $290 to $300 million of adjusted, unlevered free cash flow in 2023, up from the prior outlook of $270 to $290 million.
Balance Sheet Overview
As of September 30, 2023, RingCentral's cash and cash equivalents stood at $432 million, compared to $225 million at the end of the second quarter of 2023. Accounts receivable, net, were reported at $347.9 million, and total current assets were $1.05 billion. The company's total assets were $2.18 billion, while total liabilities stood at $2.39 billion.
RingCentral's solid third quarter results demonstrate its ability to drive long-term durable, profitable growth, leveraging its leading position in Unified Communications to transform into an AI-first, multi-product company.
Explore the complete 8-K earnings release (here) from RingCentral Inc for further details.
This article first appeared on GuruFocus.
