Crexendo Announces Strong Second Quarter 2026 Results
Rhea-AI Summary
Crexendo (NASDAQ:CXDO) reported second quarter 2026 results with total revenue up 49% year-over-year to $24.6 million. Service revenue rose 78% to $14.9 million, software solutions revenue grew 5% to $7.3 million, and product revenue increased 104% to $2.5 million. GAAP net income was $1.1 million, or $0.03 per share, versus $1.2 million a year earlier, while non-GAAP net income increased to $4.1 million, or $0.12 per share. EBITDA reached $3.0 million and adjusted EBITDA rose to $4.1 million.
For the first six months of 2026, revenue grew 39% to $45.4 million, with non-GAAP net income of $7.3 million and adjusted EBITDA of $7.3 million. Cash from operations increased to $4.8 million, but cash and equivalents declined to $18.3 million, mainly due to $26.2 million used for an acquisition. The company highlighted strong platform momentum, the contribution of the ESI acquisition, and expanding operating cash flow.
Positive
- Total Q2 2026 revenue up 49% YoY to $24.6 million
- Service revenue up 78% YoY in Q2 2026 to $14.9 million
- Product revenue up 104% YoY in Q2 2026 to $2.5 million
- Non-GAAP net income Q2 2026 rose to $4.1 million from $2.9 million
- Adjusted EBITDA Q2 2026 increased to $4.1 million from $2.8 million
- Operating cash flow six months 2026 improved to $4.8 million from $2.5 million
- Total revenue six months 2026 up 39% YoY to $45.4 million
- Stockholders’ equity increased to $78.1 million from $63.8 million at year-end 2025
Negative
- GAAP net income Q2 2026 slipped to $1.1 million from $1.2 million YoY
- GAAP net income six months 2026 declined to $1.6 million from $2.4 million
- Operating expenses Q2 2026 rose 53% YoY to $23.6 million
- Cash and cash equivalents fell to $18.3 million from $31.4 million at December 31, 2025
- Investing cash outflow of $26.2 million for a business acquisition in first half 2026
- Notes payable increased to $4.9 million from $0.1 million at year-end 2025
- Shares outstanding increased to about 33.25 million from 31.00 million, implying dilution
News Explained
The acquisition used cash and stock consideration; issuing that stock increased shares outstanding and reduced existing holders’ percentage ownership, absent offsetting changes.
The
Separately, financing activities provided
At
Key Figures
Previous Earnings Reports
| Date | Event | Sentiment | 24h Move | Catalyst |
|---|---|---|---|---|
| May 05 | Q1 earnings results | Positive | +17.2% | Revenue growth, profitability, acquisition contribution, and adjusted EBITDA expansion |
| Mar 03 | Q4 earnings results | Positive | -0.3% | Annual revenue growth, profitability, cash increase, and ESI acquisition announcement |
| Nov 04 | Q3 earnings results | Positive | +5.9% | Revenue growth, software solutions expansion, profitability, and operating cash flow |
| Aug 05 | Q2 earnings results | Positive | +2.6% | Revenue growth, GAAP profitability, software solutions expansion, and improved adjusted EBITDA |
| May 06 | Q1 earnings results | Positive | -1.9% | Revenue growth, software solutions expansion, profitability, and improved operating cash flow |
24h Move is the share-price change in the day after each event; other market factors may also have contributed.
Tag-specific earnings reactions were positive in three of five events and negative in two, with positive earnings news not consistently producing aligned reactions.
Key Terms
ucaas technical
non-gaap financial
ebitda financial
rsus financial
AI-generated analysis. How Rhea-AI works. Not financial advice.
PHOENIX, AZ / ACCESS Newswire / August 4, 2026 / Crexendo, Inc. (NASDAQ:CXDO), an award-winning software technology company that is a premier provider of cloud communication platform software and unified communications as a service (UCaaS) offerings, including voice, video, contact center, and managed IT services tailored to businesses of all sizes, today announced financial results for the second quarter ended June 30, 2026.
Second Quarter Financial highlights:
Total revenue increased
49% year-over-year to$24.6 million GAAP net income of
$1.1 million , or$0.03 per basic and diluted common share.Non-GAAP net income of
$4.1 million , or$0.12 per basic and diluted common share.
Financial Results for the Second Quarter of 2026
Total Revenue: Consolidated total revenue for the second quarter of 2026 increased
Service Revenue: Consolidated service revenue for the second quarter of 2026 increased
Software Solutions Revenue: Consolidated software solutions revenue for the second quarter of 2026 increased
Product Revenue: Consolidated product revenue for the second quarter of 2026 increased
Operating Expenses: Consolidated operating expenses for the second quarter of 2026 increased
Net Income/(Loss): The Company reported net income of
Non-GAAP: Non-GAAP net income of
EBITDA and Adjusted EBITDA: EBITDA for the second quarter of 2026 of
Financial Results for the six months ended June 30, 2026
Total Revenue: Consolidated total revenue for the six months ended June 30, 2026 increased
Service Revenue: Consolidated service revenue for the six months ended June 30, 2026 increased
Software Solutions Revenue: Consolidated software solutions revenue for the six months ended June 30, 2026 increased
Product Revenue: Consolidated product revenue for the six months ended June 30, 2026 increased
Operating Expenses: Consolidated operating expenses for the six months ended June 30, 2026 increased
Net Income/(Loss): The Company reported net income of
Non-GAAP: Non-GAAP net income of
EBITDA and Adjusted EBITDA: EBITDA for the six months ended June 30, 2026 of
Cash and Cash Equivalents: Total cash and cash equivalents at June 30, 2026 was
Cash Flow: Cash provided by operating activities for the six months ended June 30, 2026 was
Management Commentary
"Crexendo delivered another strong quarter, with total revenue increasing
Korn added "I am also very pleased with our continued margin improvement and the substantial expansion in operating cash flow, with cash provided by operating activities increasing
Conference Call
Crexendo management will hold a conference call today, August 4, 2026, at 4:30 PM Eastern time to discuss these results. Company CEO Jeff Korn, CFO Ron Vincent, and President and COO Doug Gaylor will host the call, followed by a question-and-answer period.
Dial-in Numbers:
Domestic Participants: 888-506-0062
International Participants: 973-528-0011
Participant Access Code: 550804
Please dial in five minutes prior to the beginning of the call at 4:30 PM Eastern time and reference participant access code 550804 and the Crexendo earnings call. A replay of the call will be available until August 18, 2026, by dialing toll-free at 877-481-4010 or 919-882-2331 for international callers. The replay passcode is 54291.
About Crexendo
Crexendo, Inc. is an award-winning software technology company that is a premier provider of cloud communication platform and services, video collaboration and managed IT services tailored to businesses of all sizes. Our solutions currently support over seven million end users globally, through our extensive global network of over 240 cloud communication platform software subscribers and our direct retail offering.
Safe Harbor Statement
This press release contains forward-looking statements. The Private Securities Litigation Reform Act of 1995 provides a "safe harbor" for such forward-looking statements. The words "believe," "expect," "anticipate," "estimate," "will" and other similar statements of expectation identify forward-looking statements. Specific forward-looking statements in this press release include Crexendo (i) being pleased and excited that it secured eleven new platform logos through the second quarter of 2026, with that reinforcing the belief that the Crexendo NetSapiens platform is increasingly the platform of choice for providers seeking a new, improved and scalable communications platform; (ii) believing these wins should provide a meaningful recurring revenue opportunity as these customers convert more of their existing subscriber bases to the platform, expand their businesses and purchase additional licenses in the future; (iii) being pleased with the ESI acquisition and the contributions the ESI team is already making with the integration progressing exceptionally well with having the employees engaged and sales are exceeding initial expectations; (iv) already realizing the benefits of combining our accounting, legal, marketing, and engineering capabilities; (v) believing ESI significantly improved revenue, strengthened customer base, and added an experienced team that shares the commitment to innovation and outstanding customer service; (vi) believing the acquisition performing exactly as hoped and further validates the disciplined approach to identifying and integrating strategic, accretive acquisitions; (vii) being pleased with continued margin improvement and the substantial expansion in operating cash flow; (viii) believing that the increased cash generation strengthens the balance sheet and provides greater flexibility to pursue additional strategic M&A opportunities while seeking to minimize dilution to shareholders; (ix) believing that recently released AI offerings receive strong praise and market acceptance and expecting adoption to continue expanding that AI-related revenue can become meaningful in 2027 and (x) believing that with accelerating platform momentum, a highly successful acquisition, improving margins and increasing cash generation being extremely enthusiastic about the ability to deliver profitable growth and enhance long-term shareholder value.
For a more detailed discussion of risk factors that may affect Crexendo's operations and results, please refer to the company's Form 10-K for the year ended December 31, 2025, quarterly Form 10-Qs as filed with the SEC. These forward-looking statements speak only as of the date on which such statements are made, and the company undertakes no obligation to update such forward-looking statements, except as required by law.
Company Contact
Crexendo, Inc.
Doug Gaylor
President and Chief Operating Officer
602-732-7990
dgaylor@crexendo.com
CREXENDO, INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(Unaudited, in thousands, except par value and share data)
June 30, 2026 | December 31, 2025 | |||||||
Assets |
|
| ||||||
Current assets: |
|
| ||||||
Cash and cash equivalents | $ | 18,289 | $ | 31,378 | ||||
Trade receivables, net of allowance of | 6,187 | 4,913 | ||||||
Contract assets, net of allowance of | 114 | - | ||||||
Inventories | 1,380 | 454 | ||||||
Equipment financing receivables, net of allowance of | 2,741 | 1,416 | ||||||
Contract costs | 4,156 | 2,318 | ||||||
Prepaid expenses | 1,663 | 892 | ||||||
Income tax receivable | 214 | 234 | ||||||
Other current assets | 58 | 292 | ||||||
Total current assets | 34,802 | 41,897 | ||||||
Contract assets, net of current portion, net of allowance of | 848 | 402 | ||||||
Long-term equipment financing receivables, net of allowance of | 5,351 | 3,223 | ||||||
Property and equipment, net | 376 | 195 | ||||||
Operating lease right-of-use assets | 751 | 1,006 | ||||||
Intangible assets, net | 38,302 | 17,860 | ||||||
Goodwill | 14,170 | 9,454 | ||||||
Contract costs, net of current portion | 6,077 | 3,319 | ||||||
Other long-term assets | 361 | 330 | ||||||
Total Assets | $ | 101,038 | $ | 77,686 | ||||
Liabilities and Stockholders' Equity | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 1,384 | $ | 649 | ||||
Accrued expenses | 10,561 | 8,391 | ||||||
Finance leases | 1 | 2 | ||||||
Notes payable | 454 | 114 | ||||||
Operating lease liabilities | 511 | 493 | ||||||
Income tax payable | 148 | 151 | ||||||
Contract liabilities | 3,856 | 2,528 | ||||||
Total current liabilities | 16,915 | 12,328 | ||||||
Contract liabilities, net of current portion | 1,334 | 1,008 | ||||||
Notes payable, net of current portion | 4,407 | - | ||||||
Operating lease liabilities, net of current portion | 269 | 529 | ||||||
Total liabilities | 22,925 | 13,865 | ||||||
Stockholders' equity: | ||||||||
Preferred stock, par value | - | - | ||||||
Common stock, par value | ||||||||
shares issued and outstanding as of June 30, 2026 and 31,004,327 shares issued | ||||||||
and outstanding as of December 31, 2025 | 33 | 31 | ||||||
Additional paid-in capital | 158,000 | 145,325 | ||||||
Accumulated deficit | (80,090 | ) | (81,719 | ) | ||||
Accumulated other comprehensive income | 170 | 184 | ||||||
Total stockholders' equity | 78,113 | 63,821 | ||||||
Total Liabilities and Stockholders' Equity | $ | 101,038 | $ | 77,686 | ||||
CREXENDO, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
(Unaudited, in thousands, except per share and share data)
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2026 | 2025 | 2026 | 2025 | |||||||||||||
Service revenue | $ | 14,868 | $ | 8,374 | $ | 25,429 | $ | 16,556 | ||||||||
Software solutions revenue | 7,327 | 6,975 | 15,050 | 13,843 | ||||||||||||
Product revenue | 2,451 | 1,203 | 4,877 | 2,210 | ||||||||||||
Total revenue | 24,646 | 16,552 | 45,356 | 32,609 | ||||||||||||
Operating expenses: | ||||||||||||||||
Cost of service revenue | 4,869 | 3,556 | 8,753 | 7,043 | ||||||||||||
Cost of software solutions revenue | 2,227 | 1,813 | 4,663 | 3,303 | ||||||||||||
Cost of product revenue | 1,361 | 687 | 3,034 | 1,286 | ||||||||||||
Selling and marketing | 7,968 | 4,371 | 13,622 | 8,660 | ||||||||||||
General and administrative | 5,336 | 3,585 | 10,392 | 7,104 | ||||||||||||
Research and development | 1,830 | 1,437 | 3,397 | 2,960 | ||||||||||||
Total operating expenses | 23,591 | 15,449 | 43,861 | 30,356 | ||||||||||||
Income/(loss) from operations | 1,055 | 1,103 | 1,495 | 2,253 | ||||||||||||
Other income/(expense): | ||||||||||||||||
Interest income | $ | 69 | $ | 126 | $ | 228 | $ | 210 | ||||||||
Interest expense | (62 | ) | (6 | ) | (62 | ) | (15 | ) | ||||||||
Other income/(expense), net | 14 | 57 | 22 | 47 | ||||||||||||
Total other income/(expense), net | 21 | 177 | 188 | 242 | ||||||||||||
Income/(loss) before income tax | 1,076 | 1,280 | 1,683 | 2,495 | ||||||||||||
Income tax benefit/(provision) | (25 | ) | (48 | ) | (54 | ) | (92 | ) | ||||||||
Net income/(loss) | $ | 1,051 | $ | 1,232 | $ | 1,629 | $ | 2,403 | ||||||||
Earnings per common share: | ||||||||||||||||
Basic | $ | 0.03 | $ | 0.04 | $ | 0.05 | $ | 0.08 | ||||||||
Diluted | $ | 0.03 | $ | 0.04 | $ | 0.05 | $ | 0.08 | ||||||||
Weighted-average common shares outstanding: | ||||||||||||||||
Basic | 32,771,741 | 29,430,050 | 32,156,074 | 28,731,048 | ||||||||||||
Diluted | 34,228,693 | 31,324,711 | 33,492,258 | 31,165,361 | ||||||||||||
CREXENDO, INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows
(Unaudited, in thousands)
Six Months Ended June 30, | ||||||||
2026 | 2025 | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES |
|
| ||||||
Net income/(loss) | $ | 1,629 | $ | 2,403 | ||||
Adjustments to reconcile net income/(loss) to net cash provided by/(used for) operating activities: | ||||||||
Depreciation and amortization | 3,066 | 1,627 | ||||||
Allowance for credit losses | 14 | (88 | ) | |||||
Share-based compensation | 1,636 | 1,488 | ||||||
Non-cash operating lease amortization | 13 | 16 | ||||||
Amortization of debt discount | 8 | - | ||||||
Changes in assets and liabilities: | ||||||||
Trade receivables | (894 | ) | (1,268 | ) | ||||
Contract assets | (43 | ) | (54 | ) | ||||
Equipment financing receivables | 157 | (281 | ) | |||||
Inventories | (24 | ) | (225 | ) | ||||
Contract costs | (583 | ) | (231 | ) | ||||
Prepaid expenses | (553 | ) | (421 | ) | ||||
Income tax receivable | 20 | (152 | ) | |||||
Other assets | 215 | (321 | ) | |||||
Accounts payable and accrued expenses | (298 | ) | (8 | ) | ||||
Income tax payable | (3 | ) | 4 | |||||
Contract liabilities | 428 | 44 | ||||||
Net cash provided by/(used for) operating activities | 4,788 | 2,533 | ||||||
CASH FLOWS FROM INVESTING ACTIVITIES | ||||||||
Acquisition of a business, net of cash acquired | (26,209 | ) | - | |||||
Purchase of property and equipment | - | (18 | ) | |||||
Net cash used for investing activities | (26,209 | ) | (18 | ) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||
Repayments made on finance leases | (1 | ) | (19 | ) | ||||
Repayments made on notes payable | (114 | ) | (236 | ) | ||||
Proceeds from exercise of options | 4,025 | 3,138 | ||||||
Taxes paid on the net settlement of stock options and RSUs | (417 | ) | (187 | ) | ||||
Proceeds from issuance of note payable | 5,000 | - | ||||||
Debt issuance costs paid | (147 | ) | - | |||||
Net cash provided by/(used for) financing activities | 8,346 | 2,696 | ||||||
Effect of exchange rate changes on cash | (14 | ) | 46 | |||||
NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS | (13,089 | ) | 5,257 | |||||
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD | 31,378 | 18,193 | ||||||
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD | $ | 18,289 | $ | 23,450 | ||||
Cash used during the year for: | ||||||||
Income taxes, net | $ | (34 | ) | $ | (243 | ) | ||
Interest expense | $ | (1 | ) | $ | (11 | ) | ||
Supplemental disclosure of non-cash investing and financing information: | ||||||||
Capitalized software development costs | $ | - | $ | 410 | ||||
Stock issued for the acquisition of a business | $ | 7,433 | $ | - | ||||
Use of Non-GAAP Financial Measures
To evaluate our business, we consider and use non-generally accepted accounting principles ("Non-GAAP") net income and Adjusted EBITDA as a supplemental measure of operating performance. These measures include the same adjustments that management takes into account when it reviews and assesses operating performance on a period-to-period basis. We consider Non-GAAP net income to be an important indicator of overall business performance because it allows us to evaluate results without the effects of share-based compensation and related taxes, acquisition related expenses, changes in fair value of contingent consideration, amortization of intangibles, and goodwill and long-lived asset impairment. We define EBITDA as U.S. GAAP net income/(loss) before interest expense, interest income and other expense/(income), the gain/(loss) on the sale of property and equipment, goodwill and long-lived asset impairments, provision/(benefit) for income taxes, and depreciation and amortization. We believe EBITDA provides a useful metric to investors to compare us with other companies within our industry and across industries. We define Adjusted EBITDA as EBITDA adjusted for acquisition related expenses, changes in fair value of contingent consideration and share-based compensation and related taxes. We use Adjusted EBITDA as a supplemental measure to review and assess operating performance. We also believe use of Adjusted EBITDA facilitates investors' use of operating performance comparisons from period to period, as well as across companies.
In our August 4, 2026 earnings press release, as furnished on Form 8-K, we included Non-GAAP net income, EBITDA and Adjusted EBITDA. The terms Non-GAAP net income, EBITDA, and Adjusted EBITDA are not defined under U.S. GAAP, and are not measures of operating income, operating performance or liquidity presented in analytical tools, and when assessing our operating performance, Non-GAAP net income, EBITDA, and Adjusted EBITDA should not be considered in isolation, or as a substitute for net income/(loss) or other consolidated income statement data prepared in accordance with U.S. GAAP. Some of these limitations include, but are not limited to:
EBITDA and Adjusted EBITDA do not reflect our cash expenditures or future requirements for capital expenditures or contractual commitments;
they do not reflect changes in, or cash requirements for, our working capital needs;
they do not reflect the interest expense, or the cash requirements necessary to service interest or principal payments, on our debt that we may incur;
they do not reflect income taxes or the cash requirements for any tax payments;
although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will be replaced sometime in the future, and EBITDA and Adjusted EBITDA do not reflect any cash requirements for such replacements;
while share-based compensation is a component of operating expense, the impact on our financial statements compared to other companies can vary significantly due to such factors as the assumed life of the options and the assumed volatility of our common stock; and
other companies may calculate EBITDA and Adjusted EBITDA differently than we do, limiting their usefulness as comparative measures.
We compensate for these limitations by relying primarily on our U.S. GAAP results and using Non-GAAP net income, EBITDA, and Adjusted EBITDA only as supplemental support for management's analysis of business performance. Non-GAAP net income, EBITDA and Adjusted EBITDA are calculated as follows for the periods presented.
Reconciliation of Non-GAAP Financial Measures
In accordance with the requirements of Regulation G issued by the SEC, we are presenting the most directly comparable U.S. GAAP financial measures and reconciling the unaudited Non-GAAP financial metrics to the comparable U.S. GAAP measures.
Reconciliation of U.S. GAAP Net Income/(Loss) to Non-GAAP Net Income
(Unaudited, in thousands, except for per share and share data)
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2026 | 2025 | 2026 | 2025 | |||||||||||||
U.S. GAAP net income/(loss) | $ | 1,051 | $ | 1,232 | $ | 1,629 | $ | 2,403 | ||||||||
Share-based compensation and related taxes (1) | 994 | 825 | 1,721 | 1,623 | ||||||||||||
Acquisition related expenses | 180 | - | 1,019 | - | ||||||||||||
Amortization of intangible assets | 1,834 | 801 | 2,958 | 1,507 | ||||||||||||
Non-GAAP net income | $ | 4,059 | $ | 2,858 | $ | 7,327 | $ | 5,533 | ||||||||
Non-GAAP earnings per common share: | ||||||||||||||||
Basic | $ | 0.12 | $ | 0.10 | $ | 0.23 | $ | 0.19 | ||||||||
Diluted | $ | 0.12 | $ | 0.09 | $ | 0.22 | $ | 0.18 | ||||||||
Weighted-average common shares outstanding: | ||||||||||||||||
Basic | 32,771,741 | 29,430,050 | 32,156,074 | 28,731,048 | ||||||||||||
Diluted | 34,228,693 | 31,234,711 | 33,492,258 | 31,165,361 | ||||||||||||
Reconciliation of U.S. GAAP Net Income/(Loss) to EBITDA to Adjusted EBITDA
(Unaudited, in thousands)
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2026 | 2025 | 2026 | 2025 | |||||||||||||
U.S. GAAP net income/(loss) | $ | 1,051 | $ | 1,232 | $ | 1,629 | $ | 2,403 | ||||||||
Depreciation and amortization | 1,897 | 856 | 3,066 | 1,627 | ||||||||||||
Interest expense | 62 | 6 | 62 | 15 | ||||||||||||
Other, net | (83 | ) | (183 | ) | (250 | ) | (257 | ) | ||||||||
Income tax provision | 25 | 48 | 54 | 92 | ||||||||||||
EBITDA | 2,952 | 1,959 | 4,561 | 3,880 | ||||||||||||
Share-based compensation and related taxes (1) | 994 | 825 | 1,721 | 1,623 | ||||||||||||
Acquisition related expenses | 180 | - | 1,019 | - | ||||||||||||
Adjusted EBITDA | $ | 4,126 | $ | 2,784 | $ | 7,301 | $ | 5,503 | ||||||||
(1) For the three months ended June 30, 2026 and 2025, employer payroll tax expense related to share-based compensation was
SOURCE: Crexendo, Inc.
View the original press release on ACCESS Newswire