Ooma Reports $65.1 Million Revenue in Q3 Fiscal 2025, Net Loss of $2.4 Million

Ooma, Inc. reported a total revenue of $65.1 million for the third quarter of fiscal 2025, reflecting a 9% increase compared to $59.9 million in the same period last year. The growth was primarily driven by a 7% rise in subscription and services revenue, which reached $60.1 million, attributed to an increase in core users and the contribution from the recently acquired 2600Hz. However, the company recorded a net loss of $2.4 million, a decline from a net income of $2.3 million in the prior year, largely due to increased operating expenses and the absence of a prior year tax benefit.

In terms of operational metrics, Ooma's core user count remained stable at 1.24 million, with the annualized exit recurring revenue (AERR) increasing to $234 million, up from $225 million year-over-year. The net dollar subscription retention rate held steady at 99%, indicating strong customer retention. The company’s total cash and cash equivalents stood at $17.1 million as of October 31, 2024, a slight decrease from $17.5 million at the end of the previous fiscal period. Ooma's total debt was reduced to $3 million from $16 million, reflecting a strategic focus on debt repayment.

Ooma's operating expenses increased by 9% year-over-year to $41.6 million, driven by higher sales and marketing costs, which rose by 7% to $19.2 million, and research and development expenses, which increased by 14% to $14.2 million. The company continues to invest in its growth strategy, including the integration of 2600Hz, which was acquired for approximately $32.2 million in cash. This acquisition is expected to enhance Ooma's business communications offerings.

The company has also initiated a stock repurchase program, authorizing up to $4 million for the repurchase of its common stock. During the quarter, Ooma repurchased approximately 204,209 shares for a total of $2 million. Looking ahead, Ooma anticipates continued growth in its subscription services, particularly within the business segment, while managing costs and enhancing operational efficiencies. The company remains focused on expanding its market presence and improving its product offerings to drive future revenue growth.