Office and call centre communications software provider RingCentral (NYSE:RNG) will be reporting earnings tomorrow after the bell. Here’s what investors should know.
RingCentral met analysts’ revenue expectations last quarter, reporting revenues of $614.5 million, up 7.6% year on year. It was a slower quarter for the company, with EPS guidance for next quarter missing analysts’ expectations and a miss of analysts’ annual recurring revenue estimates.
Is RingCentral a buy or sell going into earnings? Read our full analysis here, it’s free.
This quarter, analysts are expecting RingCentral’s revenue to grow 4.5% year on year to $610.6 million, slowing from the 9.5% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.96 per share.
Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. RingCentral has missed Wall Street’s revenue estimates twice over the last two years.
Looking at RingCentral’s peers in the productivity software segment, some have already reported their Q1 results, giving us a hint as to what we can expect. Five9 delivered year-on-year revenue growth of 13.2%, beating analysts’ expectations by 2.6%, and Pegasystems reported revenues up 44.1%, topping estimates by 33.1%. Five9 traded down 1.1% following the results while Pegasystems was up 28.8%.
Read our full analysis of Five9’s results here and Pegasystems’s results here.
There has been positive sentiment among investors in the productivity software segment, with share prices up 17% on average over the last month. RingCentral is up 19.8% during the same time and is heading into earnings with an average analyst price target of $34.53 (compared to the current share price of $25.76).
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