Ooma Inc (NYSE:OOMA) Reports Mixed Q3 Results with Revenue Miss and Strong EPS Beat

Ooma Inc (NYSE:OOMA) reported financial results for its fiscal third quarter, delivering a mixed performance against analyst expectations. The company's headline numbers showed a slight revenue miss but a significant beat on profitability, a dynamic that appears to have contributed to a negative after-hours market reaction as investors digested the details.

Quarterly Performance vs. Estimates

The smart communications platform provider posted revenue of $67.6 million for the quarter ended October 31, 2025. This represents a 4% increase year-over-year but came in below the analyst consensus estimate of approximately $68.9 million. The company's profitability metrics, however, painted a stronger picture.

• Revenue: $67.6 million reported vs. $68.9 million estimated.
• Non-GAAP Earnings Per Share (EPS): $0.27 reported vs. $0.225 estimated.

The earnings beat was substantial, with non-GAAP net income reaching $7.7 million, a 67% increase from the $4.6 million reported in the same period last year. Adjusted EBITDA also hit a record $8.6 million, growing 50% year-over-year. This indicates the company is achieving improved operational efficiency and margin expansion even as top-line growth moderates.

Market Reaction and Price Action

Following the earnings release, Ooma's stock traded lower in after-hours activity, declining approximately 4.4%. This reaction suggests that investors may be focusing more on the revenue shortfall and the company's forward guidance rather than the strong bottom-line outperformance. Prior to the report, the stock had been relatively stable, showing modest gains over the past month and two-week period.

Key Highlights from the Earnings Report

Beyond the headline figures, management highlighted several important developments. CEO Eric Stang noted that growth was driven by the company's small business UCaaS, AirDial POTS replacement, and 2600Hz wholesale solutions. The quarter was also marked by strategic acquisition activity.

• The recently completed acquisition of FluentStream.
• The pending acquisition of Phone.com, expected to close in late December.

Management expressed confidence that these acquisitions present a "tremendous opportunity to build shareholder value" and are intended to boost Ooma's adjusted EBITDA, cash flow, and revenue growth.

Updated Business Outlook vs. Analyst Forecasts

Ooma provided updated guidance for the fourth quarter and full fiscal year 2026, which includes contributions from the FluentStream acquisition. The outlook offers a direct point of comparison with existing analyst estimates.

For Q4 Fiscal 2026:

• Ooma's Revenue Guidance: $71.3 million to $71.9 million (including $4.0-$4.1M from FluentStream).
• Analyst Sales Estimate: Approximately $70.5 million.
• Ooma's Non-GAAP EPS Guidance: $0.30 to $0.32.
• Analyst EPS Estimate: Approximately $0.226.

For Full-Year Fiscal 2026:

• Ooma's Revenue Guidance: $270.3 million to $270.9 million.
• Analyst Sales Estimate: Approximately $273.4 million.
• Ooma's Non-GAAP EPS Guidance: $1.00 to $1.02, raised from prior guidance of $0.87 to $0.89.
• Analyst EPS Estimate: Approximately $0.896.

The guidance reveals a nuanced picture. While the company's raised EPS outlook for the year handily exceeds the analyst consensus, its revenue forecast for both Q4 and the full year appears cautious relative to market expectations. This alignment—higher profitability on slightly lower sales—may be contributing to the market's tempered reaction, as it implies a focus on cost management and integration synergies over aggressive top-line expansion in the near term.

For a detailed breakdown of future earnings estimates and historical performance, you can review more data on Ooma's earnings and estimates page.

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Disclaimer: This article is for informational purposes only and does not constitute financial advice, a recommendation, or an offer or solicitation to buy or sell any securities. The information presented is based on data provided and should not be the sole basis for any investment decision.