Ooma Reports 10% Revenue Growth, Net Loss in Q2 and H1 Fiscal 2025

Ooma, Inc. reported its financial results for the second quarter and first half of fiscal 2025, revealing a 10% increase in revenue year-over-year. For the three months ended July 31, 2024, total revenue reached $64.1 million, up from $58.4 million in the same period of the previous year. Subscription and services revenue contributed significantly, totaling $59.6 million, a 9% increase from $54.7 million in the prior year. The growth was primarily driven by user expansion in Ooma Business, which accounted for approximately 61% of total revenue.

Despite the revenue growth, Ooma experienced a net loss of $2.1 million for the quarter, compared to a net income of $271,000 in the same quarter of 2023. The loss from operations was $(1.6 million), a decline from a slight income of $6,000 in the previous year. Total operating expenses increased to $40.3 million, up from $36.6 million, reflecting higher costs associated with personnel and infrastructure.

For the six months ended July 31, 2024, total revenue was $126.6 million, compared to $115.2 million in the same period of 2023. The net loss for this period was $(4.3 million), a significant increase from a net loss of $(55,000) in the prior year. The company reported net cash provided by operating activities of $10.7 million, an increase from $4.8 million in the same period last year.

Ooma's total assets decreased from $159.3 million as of January 31, 2024, to $151.5 million as of July 31, 2024. Current assets also fell to $55.6 million from $63.7 million. However, total stockholders' equity rose to $81.8 million, up from $78.1 million, supported by an increase in additional paid-in capital.

Strategically, Ooma completed the acquisition of 2600hz, Inc. on October 20, 2023, for approximately $32.2 million, which is expected to enhance its service offerings. The company also initiated a stock repurchase plan in June 2024, authorizing up to $4.0 million in common stock buybacks, with $0.9 million utilized during the quarter.

Ooma's cash and cash equivalents stood at $16.6 million as of July 31, 2024, down from $17.5 million at the end of January 2024, primarily due to debt repayments. The company had $8.5 million in outstanding borrowings under a credit agreement with Citizens Bank, with $21.5 million available for future borrowing.