10-Q · April 30, 2026
Bandwidth reported strong Q1 2026 results with a total revenue of $209 million, up 20% from $174 million in Q1 2025. The company reversed its previous losses, achieving a net income of $4 million compared to a net loss…
Earnings analysis · 10-Q
BAND earnings analysis
Filed July 29, 2026 · Our reading of the company's report
The latest report
Bandwidth delivered Q2 revenue of $219.897 million, up 22% year over year and 5% sequentially, and turned to $2.387 million of GAAP net income from a $4.931 million prior-year loss. Growth was broad-based across cloud…
Read full summary
Bandwidth delivered Q2 revenue of $219.897 million, up 22% year over year and 5% sequentially, and turned to $2.387 million of GAAP net income from a $4.931 million prior-year loss. Growth was broad-based across cloud communications and messaging surcharges, but GAAP gross margin declined 4 percentage points year over year to 36% as pass-through messaging surcharges expanded. Cash generation remained positive at $23.739 million of quarterly free cash flow, while the company refinanced its debt stack with $316 million of 0% 2032 convertible notes and reduced 2028 notes to approximately $28 million.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
Where revenue came from
The business segments reported by the company.
Shares of the segments disclosed in this filing, largest first.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $-0.07
What stood out
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Revenue growth accelerated to 22% YoY
Q2 revenue rose 22% year over year to $219.897 million from $180.013 million, and increased 5% sequentially from $208.784 million in Q1 2026. Revenue was driven by $151.869 million of cloud communications revenue (+12%) and $68.028 million of messaging surcharges (+54%).
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GAAP profitability turns positive
GAAP net income was $2.387 million, versus a $4.931 million loss a year earlier; GAAP basic EPS was $0.07 versus a $(0.16) loss. Non-GAAP diluted EPS increased to $0.37 from $0.38 in the prior-year quarter, while adjusted EBITDA rose 27% to $27.768 million.
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Positive free cash flow maintained
Free cash flow was $23.739 million in Q2, with $28.772 million of operating cash flow and $5.033 million of capital-asset investment. This compares with $25.631 million of free cash flow in Q2 2025.
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Liquidity supported by cash and undrawn revolver
The company ended June with $170 million of cash and cash equivalents, $4 million of marketable securities, and $150 million of undrawn revolver capacity. It also had approximately $60 million remaining under its $80 million share-repurchase authorization after repurchasing $20 million year to date.
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Core product demand and customer scale grew
Cloud-communications growth reflected Global Voice Plans growth of 10%, Programmable Messaging growth of 22%, and Enterprise Voice growth of 8%. Average annual customer revenue increased 11% to $0.3 million.
What to watch
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Pass-through mix compresses gross margin
GAAP gross margin fell to 36% from 40% a year earlier and 37.3% in Q1 2026. Cost of revenue increased 30% to $141.354 million, chiefly reflecting $23 million of higher pass-through messaging surcharges.
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Net retention rate declined 5 points
Net retention rate declined to 107% from 112%, which management attributed to less political messaging over the prior four quarters. The lower retention rate points to a reduced contribution from existing-customer usage expansion.
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Regulatory, AI and capital-structure exposure
The risk factors newly emphasize AI, government-operation disruption, and financing exposure. The company has $344 million of convertible notes outstanding and cites a 2025 government shutdown that delayed FCC processes; a hypothetical 10% adverse FX move would have reduced six-month net income by approximately $3 million.
Management's outlook
The 10-Q does not provide a quantitative revenue or EPS outlook; outlook was deferred to communications outside the filing.
Earlier filings 4
10-K · February 19, 2026
Bandwidth positions itself as a cloud communications provider anchored by an owned global network and an AI-first enterprise offering (Maestro) to capture AI voice and cloud migration demand. Revenue was roughly flat…
10-Q · October 31, 2024
Bandwidth reported Q3 revenue of $193,883,000, up $41,870,000 (+27.6%) versus Q3 2023, with gross profit of $73,134,000 (gross margin ~37.7%). The company narrowed operating loss to $(898,000) from $(6,147,000) a year…
10-Q · August 1, 2024
Bandwidth reported Q2 revenue of $173,602,000, up $27,728,000 (+19.0%) year-over-year and slightly up versus the prior quarter ($171,033,000 computed from six-month totals). The company generated GAAP net income of…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.