Margin gains as IDT (NYSE: IDT) raises FY 2026 EBITDA guidance
Rhea-AI Filing Summary
IDT Corporation reported solid third-quarter fiscal 2026 results, highlighted by record consolidated quarterly gross profit. Revenue grew 5% to $315.7 million, while gross profit rose 9% to $122.5 million and income from operations increased 12% to $29.8 million versus 3Q25.
GAAP diluted EPS was $0.87, up from $0.86, and Adjusted EBITDA climbed 13% to $37.5 million. High-margin growth engines performed well: income from operations at NRS, Fintech, and net2phone rose 33%, 29%, and 76%, respectively.
IDT ended April 30, 2026 with $251.4 million in cash, cash equivalents, and current securities and no outstanding debt, but quarterly operating cash flow declined to $18.5 million, mainly due to working capital timing. The company raised FY 2026 Adjusted EBITDA guidance to $150–$152 million, 15% above FY 2025, and declared a quarterly dividend of $0.07 per share.
Positive
- FY 2026 guidance raised: IDT increased its consolidated Adjusted EBITDA outlook to $150–$152 million, a 15% increase versus FY 2025 Adjusted EBITDA of $131.7 million, signaling confidence in ongoing earnings growth.
- Strong high-margin segment performance: Income from operations rose 33% at NRS, 29% in Fintech, and 76% at net2phone in 3Q26, reinforcing the shift toward higher-margin, growth-oriented businesses.
- Robust balance sheet: As of April 30, 2026, IDT held $251.4 million in cash, cash equivalents, and current securities and had no outstanding debt, providing financial flexibility.
- Ongoing shareholder returns: IDT repurchased approximately 84,000 Class B shares for $4.0 million in 3Q26 and declared a quarterly dividend of $0.07 per share payable on June 18, 2026.
Negative
- Sharp decline in operating cash flow: Net cash provided by operating activities dropped to $18.5 million in 3Q26 from $75.7 million in 3Q25, with management attributing the change to working capital timing related to prepaid weekend funding needs.
Insights
IDT delivered profitable growth across key segments and raised full-year EBITDA guidance.
IDT posted 3Q26 revenue of $315.7 million (up 5% year over year) with gross profit up 9% to $122.5 million. Income from operations increased 12% to $29.8 million and Adjusted EBITDA rose 13% to $37.5 million, indicating expanding profitability.
Growth was driven by higher-margin businesses: NRS, Fintech, and net2phone grew income from operations by 33%, 29%, and 76%, respectively. At the same time, the Traditional Communications segment continued to generate meaningful operating income and cash, helping fund newer segments and shareholder returns.
The balance sheet remains conservative with $251.4 million in cash, cash equivalents, and current securities and no outstanding debt as of April 30, 2026. However, operating cash flow fell sharply to $18.5 million from $75.7 million in 3Q25, which management attributes entirely to timing effects around prepaid funding. Investors will likely focus on whether cash generation normalizes in subsequent quarters and how the updated FY 2026 Adjusted EBITDA guidance of $150–$152 million—15% above FY 2025—translates into sustained earnings and capital returns, including continued buybacks and the $0.07 quarterly dividend.
8-K Event Classification
Key Figures
Key Terms
Adjusted EBITDA financial
Non-GAAP EPS financial
Rule of 40 financial
Digital Send Volume financial
customer fund deposits financial
Non-GAAP adjusted measure of net cash provided by operating activities financial
Earnings Snapshot
FY 2026 consolidated Adjusted EBITDA guidance increased to $150–$152 million, 15% above FY 2025 Adjusted EBITDA of $131.7 million.
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Title of Each Class | Trading Symbol(s) | Name of each exchange on which registered |
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(d) | Exhibits. |
Exhibit No. | Document |
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99.1 | Earnings Release, dated June 3, 2026, reporting operational and financial results for IDT Corporation’s fiscal quarter ended April 30, 2026. |
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104 | Cover Pager Interactive Data File, formatted in Inline XBRL document |
IDT CORPORATION |
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By: | /s/ Shmuel Jonas |
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Name: | Shmuel Jonas |
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Title: | Chief Executive Officer |
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Exhibit | ||
Number | Document |
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99.1 | Earnings Release, dated June 3, 2026, reporting operational and financial results for IDT Corporation’s fiscal quarter ended April 30, 2026. |
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104 | Cover Pager Interactive Data File, formatted in Inline XBRL document |
Exhibit 99.1
IDT Corporation Reports Third Quarter Fiscal Year 2026 Results
Record consolidated quarterly gross profit and gross profit margin
Income from operations at NRS, Fintech, and net2phone segments increased by 33%, 29% and 76%, respectively
FY 2026 guidance raised to $150-$152 million in Adjusted EBITDA*
NEWARK, NJ — June 3, 2026: IDT Corporation (NYSE: IDT), a global provider of fintech and communications solutions, today reported results for the third quarter of its fiscal year 2026, the three months ended April 30, 2026.
3Q26 CONSOLIDATED HIGHLIGHTS
Throughout this release, unless otherwise noted, results for the third quarter of fiscal year 2026 (3Q26) are compared to the third quarter of fiscal year 2025 (3Q25).
($ in millions except for per share figures)
Revenue …………………….. +5% to $315.7 from $302.0
Gross Profit…………………. +9% to $122.5 from $112.0
Gross Profit Margin………… +170 bps to 38.8% from 37.1%
Income from Operations……. +12% to $29.8 from $26.6
GAAP EPS…………………. +$0.01 to $0.87 from $0.86
Non-GAAP EPS*…………… +$0.04 to $0.94 from $0.90
Adjusted EBITDA………….. +13% to $37.5 from $33.1
*This release discloses certain Non-GAAP financial measures and Key Performance Metrics. Please see the explanations of those measures and metrics, the reasons for their inclusion, and reconciliations of non-GAAP measures to their closest GAAP measures, at the end of this release.
REMARKS BY SHMUEL JONAS, CEO
“IDT’s year-over-year revenue and earnings growth was again powered by the continued expansion and operating leverage of our three high-margin businesses, paired with another quarter of steady cash generation from our Traditional Communications segment.
“NRS recurring revenue increased 22% and revenue per terminal increased approximately 10% year-over-year driven by Merchant Services and SaaS Fees revenue. We expect both categories will continue driving growth in the coming quarters. After the quarter close, we acquired a controlling stake in OnCore Digital, a digital media brokerage.
“At BOSS Money, our digital channel revenue growth rate accelerated sequentially as we gained market share following implementation of the new federal remittance tax.
“net2phone continued its growth trajectory, helped by strong CCaaS results and ongoing U.S. and Mexico expansion. We are gaining traction with our AI offerings and expect they will become accretive growth drivers in fiscal year 2027. All net2phone offerings will also benefit from the recent release of Integrate by net2phone. Integrate is an integration layer that enables our clients to easily - through a straightforward, no-code interface - use our offerings with the tools they already work with every day including popular CRMs and ERPs.
“Across our business segments, we are integrating machine learning and AI tools to better understand and meet the expectations of our customers, develop and provide new features, enhance customer service, refine pricing strategies, accelerate product and feature delivery, create marketing campaigns, and streamline back-office operations, to name just a few. We expect that our AI efforts, in some cases, will serve as the basis for AI-based offerings to our customers.”
3Q26 RESULTS BY SEGMENT
National Retail Solutions (NRS)
($ in millions except recurring revenue per terminal. Numbers may not foot due to rounding.) | | 3Q26 | | | 2Q26 | | | 3Q25 | | | 3Q26-3Q25 (%, ∆) |
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Terminals and payment processing accounts | | | | | | | | | | | | | | | |
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Active POS terminals | | | 39,300 | | | | 38,900 | | | | 35,600 | | | +10 | % |
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Payment processing accounts | | | 29,200 | | | | 28,100 | | | | 25,500 | | | +14 | % |
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Recurring revenue* | | | | | | | | | | | | | | | |
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Merchant Services & Other | | $ | 25.8 | | | $ | 24.0 | | | $ | 19.7 | | | +31 | % |
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Advertising & Data | | $ | 5.7 | | | $ | 9.0 | | | $ | 5.9 | | | | (3 | )% |
SaaS Fees | | $ | 4.5 | | | $ | 4.4 | | | $ | 3.9 | | | +17 | % |
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Total recurring revenue | | $ | 36.0 | | | $ | 37.5 | | | $ | 29.4 | | | +22 | % |
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POS Terminal Sales | | $ | 2.0 | | | $ | 1.9 | | | $ | 1.7 | | | +16 | % |
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Total revenue | | $ | 38.0 | | | $ | 39.4 | | | $ | 31.1 | | | +22 | % |
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Monthly average recurring revenue per terminal* | | $ | 307 | | | $ | 325 | | | $ | 279 | | | +10 | % |
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Gross profit | | $ | 34.3 | | | $ | 36.3 | | | $ | 28.4 | | | +21 | % |
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Gross profit margin | | | 90.2 | % | | | 92.2 | % | | | 91.3 | % | | | (110 | ) bps |
SG&A | | $ | 23.4 | | | $ | 23.5 | | | $ | 20.0 | | | +17 | % |
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Technology & development | | $ | 2.7 | | | $ | 2.5 | | | $ | 2.3 | | | +21 | % |
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Income from operations | | $ | 8.2 | | | $ | 10.2 | | | $ | 6.2 | | | +33 | % |
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Adjusted EBITDA | | $ | 9.8 | | | $ | 11.8 | | | $ | 7.8 | | | +25 | % |
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CapEx | | $ | 0.8 | | | $ | 1.7 | | | $ | 1.9 | | | | (59 | )% |
NRS Take-Aways
| ● | NRS added approximately 500 net active terminals and 1,100 net payment processing accounts during 3Q26. Net active terminal additions in 3Q26 reflect the impact of seasonal churn among specialized retailers serving the year-end holidays. |
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| ● | NRS’ ‘Rule of 40’* score was 50 in 3Q26, indicating a productive balance between growth and profitability. |
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| ● | Following the quarter close, IDT acquired OnCore Digital. Through the acquisition, NRS will integrate OnCore’s ad tech, demand, and publisher networks with its screen network and first-party transaction data into a more unified offering. |
2
BOSS Money and Fintech Segment
($ in millions except for average revenue per transaction. Numbers may not foot due to rounding.) | | 3Q26 | | | 2Q26 | | | 3Q25 | | | 3Q26-3Q25 (%, ∆) | |
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BOSS Money transactions* | | | 6.9 | | | | 6.4 | | | | 6.0 | | | | +15 | % |
Digital channel | | | 6.0 | | | | 5.5 | | | | 5.0 | | | | +20 | % |
Retail channel | | | 0.9 | | | | 1.0 | | | | 1.0 | | | | (14 | )% |
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Fintech segment revenue | | | | | | | | | | | | | | | | |
BOSS Money | | $ | 39.7 | | | $ | 36.3 | | | $ | 34.4 | | | | +15 | % |
Digital channel | | $ | 31.0 | | | $ | 26.8 | | | $ | 24.5 | | | | +27 | % |
Retail channel | | $ | 8.6 | | | $ | 9.5 | | | $ | 9.9 | | | | (13 | )% |
Other | | $ | 5.3 | | | $ | 4.9 | | | $ | 4.2 | | | | +27 | % |
Total Fintech segment revenue | | $ | 45.0 | | | $ | 41.2 | | | $ | 38.6 | | | | +17 | % |
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Average BOSS Money revenue per transaction* | | $ | 5.76 | | | $ | 5.63 | | | $ | 5.74 | | | | +0 | % |
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Fintech segment | | | | | | | | | | | | | | | | |
Gross profit | | $ | 28.3 | | | $ | 25.0 | | | $ | 22.6 | | | | +25 | % |
Gross profit margin | | | 62.8 | % | | | 60.6 | % | | | 58.5 | % | | | +430 | bps |
SG&A | | $ | 20.2 | | | $ | 18.2 | | | $ | 16.0 | | | | +26 | % |
Technology & development | | $ | 2.5 | | | $ | 2.7 | | | $ | 2.2 | | | | +15 | % |
Income from operations | | $ | 5.6 | | | $ | 4.1 | | | $ | 4.3 | | | | +29 | % |
Adjusted EBITDA | | $ | 6.6 | | | $ | 5.6 | | | $ | 5.1 | | | | +30 | % |
CapEx | | $ | 1.0 | | | $ | 1.1 | | | $ | 0.8 | | | | +20 | % |
BOSS Money and Fintech Take-Aways:
| ● | BOSS Money digital channel send volume*- the amount of principal transferred by BOSS Money customers using the BOSS Money and BOSS Revolution apps - increased by 40% in 3Q26 compared to 3Q25, reflecting increases in both transaction volume and average dollars sent per transaction. |
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| ● | The Fintech segment’s year-over-year increases in income from operations and Adjusted EBITDA were driven by BOSS Money’s digital transaction growth, increased revenue and gross margin per digital transaction, and improved economics from other, smaller, businesses within the Fintech segment. |
3
net2phone
($ in millions. Numbers may not foot due to rounding.) | | 3Q26 | | | 2Q26 | | | 3Q25 | | | 3Q26-3Q25 (%, ∆) | |
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Seats | | | 441 | | | | 435 | | | | 415 | | | | +6 | % |
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Revenue | | | | | | | | | | | | | | | | |
Subscription revenue* | | $ | 24.0 | | | $ | 23.4 | | | $ | 21.5 | | | | +12 | % |
Other | | $ | 0.4 | | | $ | 0.4 | | | $ | 0.5 | | | | (14 | )% |
Total revenue | | $ | 24.4 | | | $ | 23.9 | | | $ | 22.0 | | | | +11 | % |
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Gross profit | | $ | 19.6 | | | $ | 19.3 | | | $ | 17.5 | | | | +12 | % |
Gross profit margin | | | 80.6 | % | | | 80.7 | % | | | 79.6 | % | | | +130 | bps |
SG&A | | $ | 14.1 | | | $ | 13.9 | | | $ | 13.0 | | | | +9 | % |
Technology & development | | $ | 3.1 | | | $ | 3.1 | | | $ | 2.9 | | | | +5 | % |
Income from operations | | $ | 2.4 | | | $ | 2.2 | | | $ | 1.4 | | | | +76 | % |
Adjusted EBITDA | | $ | 4.1 | | | $ | 3.9 | | | $ | 3.2 | | | | +30 | % |
CapEx | | $ | 1.8 | | | $ | 1.7 | | | $ | 1.4 | | | | +30 | % |
net2phone Take-Aways:
| ● | Subscription revenue increased faster than seats served, reflecting an increase in CCaaS seats, which generate higher revenue per seat than our UCaaS offerings, augmented by the positive FX impact of strengthening local currencies versus the U.S. dollar in certain Latin American markets. |
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| ● | net2phone generated substantial year-over-year increases in income from operations and Adjusted EBITDA during 3Q26, benefitting from customer acquisition cost discipline and continued operating leverage. |
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Traditional Communications
($ in millions. Numbers may not foot due to rounding.) | | 3Q26 | | | | 2Q26 | | | 3Q25 | | | 3Q26-3Q25 (%, ∆) | |
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Revenue | | | | | | | | | | | | | | | | | |
IDT Digital Payments | | $ | 103.9 | | | | $ | 104.4 | | | $ | 102.6 | | | | +1 | % |
IDT Global | | $ | 55.6 | | | | $ | 60.2 | | | $ | 50.0 | | | | +11 | % |
BOSS Revolution | | $ | 43.4 | | | | $ | 45.7 | | | $ | 51.7 | | | | (16 | )% |
Other revenue | | $ | 5.5 | | | | $ | 5.8 | | | $ | 5.8 | | | | (6 | )% |
Total revenue | | $ | 208.3 | | | | $ | 216.1 | | | $ | 210.2 | | | | (1 | )% |
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Gross profit | | $ | 40.3 | | | | $ | 40.7 | | | $ | 43.4 | | | | (7 | )% |
Gross profit margin | | 19.4 | | % | | | 18.9 | % | | | 20.7 | % | | | (130 | )bps |
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SG&A | | $ | 17.9 | | | | $ | 20.3 | | | $ | 20.5 | | | | (13 | )% |
Technology & development | | $ | 5.6 | | | | $ | 5.8 | | | $ | 5.4 | | | | +4 | % |
Income from operations | | $ | 16.7 | | | | $ | 14.3 | | | $ | 17.3 | | | | (4 | )% |
Adjusted EBITDA | | $ | 19.7 | | | | $ | 18.8 | | | $ | 19.6 | | | | +1 | % |
CapEx | | $ | 1.5 | | | | $ | 1.6 | | | $ | 1.3 | | | | +17 | % |
Traditional Communications Take-Away:
| ● | IDT continues to minimize Traditional Communications' overhead and improve its cost structure. This effort resulted in a $2.6 million decrease in segment SG&A in 3Q26 compared to the year ago quarter, particularly in employee compensation and legal expense. |
4
OTHER FINANCIAL RESULTS
Consolidated results for all periods presented include corporate overhead. Corporate G&A expense increased 22% to $3.2 million in 3Q26 from $2.7 million in 3Q25, primarily as a result of increased stock-based compensation.
As of April 30, 2026, IDT held $251.4 million in cash, cash equivalents, and current debt and equity securities, exclusive of restricted cash. Also as of April 30, 2026, current assets totaled $592.7 million and current liabilities totaled $308.0 million. IDT had no outstanding debt at quarter end.
Net cash provided by operating activities in 3Q26 was $18.5 million compared to $75.7 million in 3Q25. Exclusive of changes in customer funded deposits at IDT’s Fintech segment businesses, adjusted net cash provided by operating activities* in 3Q26 was $16.0 million compared to $66.1 million in 3Q25. The decline in operating cash generation is due entirely to working capital timing, as 3Q26 ended on a Thursday which, along with Friday, is typically when cash levels are lowest because of prepaid weekend funding requirements for the BOSS Money and IDT Digital Payments businesses.
Capital expenditures decreased to $5.1 million in 3Q26 from $5.4 million in 3Q25.
During 3Q26, IDT repurchased approximately 84,000 shares of its Class B common stock for $4.0 million. For the nine months ended April 30, 2026, IDT repurchased approximately 391,000 shares for $19.0 million.
FY 2026 FINANCIAL OUTLOOK
IDT is increasing its previous FY 2026 guidance for consolidated Adjusted EBITDA from $147-$149 million to $150-$152 million. At the midpoint, the updated guidance represents an increase of 15% from FY 2025 Adjusted EBITDA of $131.7 million.
Reconciliations of Adjusted EBITDA to net income and income from operations for all periods presented are included in the Non-GAAP reconciliations provided at the end of this release.
DIVIDEND
IDT’s Board of Directors has declared a quarterly cash dividend of $0.07 per share of IDT Class A and Class B Common stock payable on June 18, 2026 to stockholders of record as of June 9, 2026.
IDT EARNINGS ANNOUNCEMENT INFORMATION
This release is available for download in the “Investors & Media” section of the IDT Corporation website (https://www.idt.net/investors-and-media) and has been filed on a current report (Form 8-K) with the SEC.
IDT will host an earnings conference call beginning at 5:30 PM Eastern this evening with management’s discussion of results followed by Q&A with investors. To listen to the call and participate in the Q&A, dial 1-877-545-0523 (toll-free from the US) or 1-973-528-0016 (international) and provide the following access code: 181062.
A replay of the conference call will be available approximately three hours after the call concludes through June 17th, 2026. To access the call replay, dial 1-877-481-4010 (toll-free from the US) or 1-919-882-2331 (international) and provide this replay passcode: 54085. The replay will also be accessible via streaming audio at the IDT investor relations website.
5
ABOUT IDT CORPORATION
IDT Corporation (NYSE: IDT) is a global provider of fintech and communications solutions through a portfolio of synergistic businesses: National Retail Solutions’ (NRS) point-of-sale (POS) platform enables independent retailers to process transactions and operate more effectively while providing advertisers and marketers with reach into underserved consumer markets; BOSS Money facilitates innovative international remittances and fintech payments solutions; net2phone provides businesses with unified communications and AI-driven workflow solutions to enhance customer experience at scale; IDT Digital Payments and the BOSS Revolution calling service make sharing prepaid products and services and speaking with friends and family around the world convenient and reliable; and, IDT Global and IDT Express enable communications services to provision and manage international voice and SMS messaging.
All statements above that are not purely about historical facts, including, but not limited to, those in which we use the words “believe,” “anticipate,” “expect,” “plan,” “intend,” “estimate,” “target” and similar expressions, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. While these forward-looking statements represent our current judgment of what may happen in the future, actual results may differ materially from the results expressed or implied by these statements due to numerous important factors. Our filings with the SEC provide detailed information on such statements and risks and should be consulted along with this release. To the extent permitted under applicable law, IDT assumes no obligation to update any forward-looking statements.
CONTACT
IDT Corporation Investor Relations
Bill Ulrey
william.ulrey@idt.net
973-438-3838
6
IDT CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
| | April 30, 2026 | | | July 31, 2025 | |
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(in thousands, except per share data) | | (Unaudited) | | | | | |
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Assets | | | | | | | | |
Current assets: | | | | | | | | |
Cash and cash equivalents | | $ | 214,957 | | | $ | 226,505 | |
Restricted cash and cash equivalents | | | 128,385 | | | | 115,327 | |
Debt securities | | | 26,557 | | | | 21,649 | |
Equity investments | | | 9,913 | | | | 5,637 | |
Trade accounts receivable, net of allowance for credit losses of $8,039 at April 30, 2026 and $9,097 at July 31, 2025 | | | 41,750 | | | | 44,932 | |
Settlement assets, net of reserve of $1,816 at April 30, 2026 and $1,367 at July 31, 2025 | | | 35,033 | | | | 28,014 | |
Disbursement prefunding | | | 96,396 | | | | 37,097 | |
Prepaid expenses | | | 8,889 | | | | 12,440 | |
Other current assets | | | 30,829 | | | | 28,702 | |
Total current assets | | | 592,709 | | | | 520,303 | |
Property, plant, and equipment, net | | | 41,010 | | | | 38,869 | |
Goodwill | | | 26,600 | | | | 26,488 | |
Other intangibles, net | | | 4,177 | | | | 5,056 | |
Equity investments | | | 5,879 | | | | 6,658 | |
Operating lease right-of-use assets | | | 1,247 | | | | 1,878 | |
Deferred income tax assets, net | | | 18,200 | | | | 18,790 | |
Other assets | | | 8,207 | | | | 8,161 | |
Total assets | | $ | 698,029 | | | $ | 626,203 | |
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Liabilities, redeemable noncontrolling interest, and stockholders' equity | | | | | | | | |
Current liabilities: | | | | | | | | |
Trade accounts payable | | $ | 15,229 | | | $ | 19,435 | |
Accrued expenses | | | 90,548 | | | | 97,295 | |
Deferred revenue | | | 26,207 | | | | 27,726 | |
Customer fund deposits | | | 130,081 | | | | 114,708 | |
Settlement liabilities | | | 17,125 | | | | 13,922 | |
Other current liabilities | | | 28,846 | | | | 19,910 | |
Total current liabilities | | | 308,036 | | | | 292,996 | |
Operating lease liabilities | | | 621 | | | | 1,103 | |
Other liabilities | | | 926 | | | | 1,688 | |
Total liabilities | | | 309,583 | | | | 295,787 | |
Commitments and contingencies | | | | | | | | |
Redeemable noncontrolling interest | | | 12,022 | | | | 11,459 | |
Equity: | | | | | | | | |
Preferred stock, $.01 par value; authorized shares - 10,000; no shares issued | | | - | | | | - | |
Class A common stock, $.01 par value; authorized shares - 35,000; 3,272 shares issued and 1,574 shares outstanding at April 30, 2026 and July 31, 2025 | | | 33 | | | | 33 | |
Class B common stock, $.01 par value; authorized shares - 200,000; 28,564 and 28,528 shares issued and 23,290 and 23,656 shares outstanding at April 30, 2026 and July 31, 2025, respectively | | | 285 | | | | 285 | |
Additional paid-in capital | | | 317,474 | | | | 308,111 | |
Treasury stock, at cost, consisting of 1,698 and 1,698 shares of Class A common stock and 5,274 and 4,872 shares of Class B common stock at April 30, 2026 and July 31, 2025, respectively | | | (163,380 | ) | | | (143,853 | ) |
Accumulated other comprehensive loss | | | (13,809 | ) | | | (16,569 | ) |
Retained earnings | | | 217,284 | | | | 157,124 | |
Total IDT Corporation stockholders' equity | | | 357,887 | | | | 305,131 | |
Noncontrolling interests | | | 18,537 | | | | 13,826 | |
Total equity | | | 376,424 | | | | 318,957 | |
Total liabilities, redeemable noncontrolling interest, and equity | | $ | 698,029 | | | $ | 626,203 | |
7
IDT CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
| | Three Months Ended April 30, | | | Nine Months Ended April 30, | |
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(in thousands, except per share amounts) | | 2026 | | | 2025 | | | 2026 | | | 2025 | |
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Revenues | | $ | 315,713 | | | $ | 301,985 | | | $ | 958,981 | | | $ | 914,901 | |
Direct cost of revenues | | | 193,210 | | | | 190,023 | | | | 597,022 | | | | 583,201 | |
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Gross profit | | | 122,503 | | | | 111,962 | | | | 361,959 | | | | 331,700 | |
Operating expenses: | | | | | | | | | | | | | | | | |
Selling, general, and administrative | | | 78,843 | | | | 72,267 | | | | 231,696 | | | | 214,039 | |
Technology and development | | | 13,944 | | | | 12,744 | | | | 41,698 | | | | 38,115 | |
Severance | | | 107 | | | | 190 | | | | 538 | | | | 600 | |
Other operating (income) expense, net | | | (180 | ) | | | 175 | | | | 67 | | | | 403 | |
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Total operating expenses | | | 92,714 | | | | 85,376 | | | | 273,999 | | | | 253,157 | |
| | | | | | | | | | | | | | | | |
Income from operations | | | 29,789 | | | | 26,586 | | | | 87,960 | | | | 78,543 | |
Interest income | | | 1,561 | | | | 1,566 | | | | 4,909 | | | | 4,347 | |
Other income, net | | | 904 | | | | 2,608 | | | | 623 | | | | 2,533 | |
| | | | | | | | | | | | | | | | |
Income before income taxes | | | 32,254 | | | | 30,760 | | | | 93,492 | | | | 85,423 | |
Provision for income taxes | | | (8,507 | ) | | | (7,798 | ) | | | (22,825 | ) | | | (21,766 | ) |
| | | | | | | | | | | | | | | | |
Net income | | | 23,747 | | | | 22,962 | | | | 70,667 | | | | 63,657 | |
Net income attributable to noncontrolling interests | | | (2,134 | ) | | | (1,270 | ) | | | (5,744 | ) | | | (4,448 | ) |
| | | | | | | | | | | | | | | | |
Net income attributable to IDT Corporation | | $ | 21,613 | | | $ | 21,692 | | | $ | 64,923 | | | $ | 59,209 | |
| | | | | | | | | | | | | | | | |
Earnings per share attributable to IDT Corporation common stockholders: | | | | | | | | | | | | | | | | |
Basic | | $ | 0.87 | | | $ | 0.86 | | | $ | 2.59 | | | $ | 2.35 | |
Diluted | | $ | 0.87 | | | $ | 0.86 | | | $ | 2.59 | | | $ | 2.34 | |
Weighted-average number of shares used in calculation of earnings per share: | | | | | | | | | | | | | | | | |
Basic | | | 24,893 | | | | 25,165 | | | | 25,041 | | | | 25,177 | |
Diluted | | | 24,915 | | | | 25,249 | | | | 25,054 | | | | 25,312 | |
| | | | | | | | | | | | | | | | |
(i) Stock-based compensation included in total operating expenses | | $ | 2,420 | | | $ | 946 | | | $ | 8,783 | | | $ | 2,720 | |
8
IDT CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
| | Nine Months Ended April 30, | |
|||||
(in thousands) | | 2026 | | | 2025 | |
||
Operating activities: | | | | | | | | |
Net income | | $ | 70,667 | | | $ | 63,657 | |
Adjustments to reconcile net income to net cash from operating activities: | | | | | | | | |
Depreciation and amortization | | | 16,054 | | | | 15,702 | |
Deferred income taxes | | | 561 | | | | 18,902 | |
Provision for credit losses and reserve for settlement assets | | | 3,466 | | | | 4,465 | |
Stock-based compensation expense | | | 8,783 | | | | 2,720 | |
Other | | | 1,316 | | | | 1,735 | |
Change in operating assets and liabilities: | | | | | | | | |
Trade accounts receivable | | | 934 | | | | (4,206 | ) |
Prepaid expenses, other current assets, and other assets | | | 4,278 | | | | 7,424 | |
Settlement assets and disbursement prefunding | | | (66,838 | ) | | | (16,799 | ) |
Trade accounts payable, accrued expenses, settlement liabilities, other current liabilities, and other liabilities | | | (2,374 | ) | | | (19,486 | ) |
Customer fund deposits | | | 12,101 | | | | 25,327 | |
Deferred revenue | | | (2,285 | ) | | | (3,382 | ) |
Net cash provided by operating activities | | | 46,663 | | | | 96,059 | |
Investing activities: | | | | | | | | |
Capital expenditures | | | (17,070 | ) | | | (15,507 | ) |
Purchase of equity investments | | | (1,650 | ) | | | - | |
Purchase of convertible preferred stock in equity method investment | | | - | | | | (926 | ) |
Purchases of debt securities and equity securities | | | (42,981 | ) | | | (29,083 | ) |
Proceeds from maturities and sales of debt and equity securities | | | 34,607 | | | | 35,005 | |
Net cash used in investing activities | | | (27,094 | ) | | | (10,511 | ) |
Financing activities: | | | | | | | | |
Dividends paid | | | (4,763 | ) | | | (4,036 | ) |
Distributions to noncontrolling interests | | | (90 | ) | | | (100 | ) |
Proceeds from borrowings under revolving credit facility | | | 21,421 | | | | 24,551 | |
Repayments on borrowings under revolving credit facility | | | (21,421 | ) | | | (24,551 | ) |
Proceeds from borrowings | | | 185 | | | | - | |
Repayments of borrowings | | | (100 | ) | | | - | |
Proceeds from exercise of stock options | | | 200 | | | | - | |
Repurchases of Class B common stock | | | (19,526 | ) | | | (17,773 | ) |
Net cash used in financing activities | | | (24,094 | ) | | | (21,909 | ) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash and cash equivalents | | | 6,035 | | | | 3,982 | |
Net increase in cash, cash equivalents, and restricted cash and cash equivalents | | | 1,510 | | | | 67,621 | |
Cash, cash equivalents and restricted cash and cash equivalents, beginning of period | | | 341,832 | | | | 255,456 | |
Cash, cash equivalents and restricted cash and cash equivalents, end of period | | $ | 343,342 | | | $ | 323,077 | |
| | | | | | | | |
Supplemental cash flow information | | | | | | | | |
| | | | | | | | |
Cash paid during the period for: | | | | | | | | |
Income taxes paid | | $ | 14,151 | | | $ | - | |
| | | | | | | | |
Non-Cash Financing Activities | | | | | | | | |
Shares of the Company's Class B common stock issued to executive officer for bonus | | $ | - | | | $ | 1,824 | |
Value of the Company's DSUs exchanged for National Retail Solutions shares | | $ | 3,547 | | | $ | 442 | |
9
Reconciliation of Non-GAAP Financial Measures for the Third Quarter Fiscal 2026 and 2025
In addition to disclosing financial results that are determined in accordance with generally accepted accounting principles in the United States of America (GAAP), IDT also disclosed (a) Adjusted EBITDA for 3Q26, 2Q26, and 3Q25, among other quarters (b) non-GAAP earnings per diluted share (Non-GAAP EPS) for 3Q26 and 3Q25 (c) NRS’ ‘Rule of 40’ score for 3Q26 and (d) non-GAAP adjusted net cash provided by or used in operating activities for 3Q26 and 3Q25. These are non-GAAP financial measures intended to provide useful information that supplements IDT’s or the respective segment’s results in accordance with GAAP. The following explains these terms and their respective reconciliations to the most directly comparable GAAP measures.
Generally, a non-GAAP measure is a numerical measure of a company’s performance, financial position, or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP.
IDT’s measure of Adjusted EBITDA starts with net income from operations in accordance with GAAP and adds depreciation and amortization, severance expense, stock-based compensation, and other operating expenses, and deducts other operating income.
IDT’s measure of Non-GAAP EPS is calculated by dividing non-GAAP net income by the diluted weighted-average shares. IDT’s measure of non-GAAP net income starts with net income attributable to IDT in accordance with GAAP and adds severance expense, stock-based compensation, and other operating expenses, and deducts other operating income. These additions and subtractions are non-cash and/or non-routine items in the relevant fiscal 2026 and fiscal 2025 periods.
Management believes that IDT’s Adjusted EBITDA and Non-GAAP EPS are measures which provide useful information to both management and investors by excluding certain expenses and non-routine gains and losses that may not be indicative of IDT’s or the respective segment’s core operating results. Management uses Adjusted EBITDA, among other measures, as a relevant indicator of core operational strengths in its financial and operational decision making. In addition, management uses Adjusted EBITDA and Non-GAAP EPS to evaluate operating performance in relation to IDT’s competitors. Disclosure of these financial measures may be useful to investors in evaluating performance and allow for greater transparency of the underlying supplemental information used by management in its financial and operational decision-making. In addition, IDT has historically reported similar financial measures and believes such measures are commonly used by readers of financial information in assessing performance, therefore the inclusion of comparative numbers provides consistency in financial reporting.
Management refers to Adjusted EBITDA, as well as the GAAP measures income (loss) from operations and net income, on a segment and/or consolidated level to facilitate internal and external comparisons to the segments’ and IDT's historical operating results, in making operating decisions, for budget and planning purposes, and to form the basis upon which management is compensated.
While depreciation and amortization are considered operating costs under GAAP, these expenses primarily represent the non-cash current period allocation of costs associated with long-lived assets acquired or capitalized in prior periods. IDT’s Adjusted EBITDA, which is exclusive of depreciation and amortization, is a useful indicator of its current performance.
Severance expense is excluded from the calculation of Adjusted EBITDA and Non-GAAP EPS. Severance expense is reflective of decisions made by management in each period regarding the aspects of IDT’s and its segments’ businesses to be focused on in light of changing market realities and other factors. While there may be similar charges in other periods, the nature and magnitude of these charges can fluctuate markedly and do not reflect the performance of IDT’s core and continuing operations.
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Other operating income (expense), net, which is a component of income (loss) from operations, is excluded from the calculation of Adjusted EBITDA and Non-GAAP EPS. Other operating expense, net primarily includes legal fees net of insurance claims related to Straight Path Communications Inc.’s stockholders’ class action, legal settlements, and gains from the write-off of contingent consideration liabilities. From time-to-time, IDT may have gains or incur costs related to non-routine legal, tax, and other matters, however, these various items generally do not occur each quarter. IDT believes the gains and losses from these non-routine matters are not components of IDT’s or the respective segment’s core operating results.
Stock-based compensation recognized by IDT and other companies may not be comparable because of the variety of types of awards as well as the various valuation methodologies and subjective assumptions that are permitted under GAAP. Stock-based compensation is excluded from IDT’s calculation of Adjusted EBITDA and Non-GAAP EPS because management believes this allows investors to make more meaningful comparisons of the operating results per share of IDT’s core business with the results of other companies. Stock-based compensation continues to be a significant expense for IDT and an important part of employees’ compensation that impacts their performance.
Adjusted EBITDA and Non-GAAP EPS should be considered in addition to, not as a substitute for, or superior to, income (loss) from operations, cash flow from operating activities, net income, basic and diluted earnings per share or other measures of liquidity and financial performance prepared in accordance with GAAP. In addition, IDT’s measurements of Adjusted EBITDA and Non-GAAP EPS may not be comparable to similarly titled measures reported by other companies.
The ‘Rule of 40’ score is a metric used to evaluate the performance of SaaS and other subscription-based providers. It postulates that a SaaS provider’s revenue growth rate plus its EBITDA margin should equal or exceed 40 percent. The ‘Rule of 40’ is typically used to assess a company's balance between growth and profitability. A total of over 40 is thought to indicate a healthy combination of expansion and financial stability, making it a useful tool for management and investors to gauge the potential for long-term success and make informed decisions about resource allocation and business strategy.
NRS’ ‘Rule of 40’ score is computed by adding (a) the growth rate of NRS’ recurring revenue for the relevant period compared to the corresponding year ago period to (b) NRS’ Adjusted EBITDA margin for the twelve-month period through the end of the current period. NRS’ recurring revenue is calculated by subtracting NRS’ revenue from POS terminal sales from its total GAAP revenue. Adjusted EBITDA is a non-GAAP measure as discussed above. Adjusted EBITDA margin is calculated by dividing Adjusted EBITDA by GAAP revenue for the relevant period.
IDT’s Non-GAAP adjusted measure of net cash provided by operating activities is calculated by excluding the impact of changes in customer funds deposits held from net cash provided by operating activities. Customer funds deposits represent, for the most part, funds loaded by customers of the various prepaid debit card programs issued under IDT’s wholly-owned bank in Gibraltar. As such, these funds are held for customers and are not available for use by the Company. This adjusted measure of net cash provided by operating activities provides a more meaningful measure of the cash generated by our core business operations, making it a more useful tool for management and investors to evaluate the cash generation of our business operations, and to compare IDT’s cash generation with companies that do not have, or have different levels of, customer deposits. Customer deposits are, by regulation, not available to fund IDT’s operating activities.
Following are reconciliations of Adjusted EBITDA and Non-GAAP EPS to the most directly comparable GAAP measure, which are, (a) for Adjusted EBITDA, (i) income (loss) from operations for IDT’s reportable segments and corporate and (ii) net income for IDT on a consolidated basis, and (b) for Non-GAAP EPS, diluted earnings per share. Also following is NRS’ ‘Rule of 40’ score computation including the reconciliation of NRS’ Adjusted EBITDA to the most directly comparable GAAP measure, NRS’ income from operations, and IDT’s Non-GAAP adjusted measure of net cash provided by operating activities reconciled to GAAP net cash provided by operating activities.
11
IDT Corporation
Reconciliation of Net Income to Adjusted EBITDA for the three months ended 3Q26, 2Q26, and 3Q25
(unaudited) in millions. Figures may not foot or cross-foot due to rounding
| | Total IDT Corporation | | | Traditional Comm. | | | net2phone | | | NRS | | | Fintech | | | Corporate | |
||||||
| | | | | | | | | | | | | | | | | | | | | | | | |
3Q26 | | | | | | | | | | | | | | | | | | | | | | | | |
Net income attributable to IDT Corporation | | $ | 21.6 | | | | | | | | | | | | | | | | | | | | | |
Adjustments: | | | | | | | | | | | | | | | | | | | | | | | | |
Net income attributable to noncontrolling interests | | | (2.1 | ) | | | | | | | | | | | | | | | | | | | | |
Net income | | $ | 23.7 | | | | | | | | | | | | | | | | | | | | | |
Provision for income taxes | | | (8.5 | ) | | | | | | | | | | | | | | | | | | | | |
Income before income taxes | | $ | 32.3 | | | | | | | | | | | | | | | | | | | | | |
Interest income, net | | | 1.6 | | | | | | | | | | | | | | | | | | | | | |
Other expense, net | | | 0.9 | | | | | | | | | | | | | | | | | | | | | |
Income (loss) from operations | | $ | 29.8 | | | $ | 16.7 | | | $ | 2.4 | | | $ | 8.2 | | | $ | 5.6 | | | $ | (3.0 | ) |
Depreciation and amortization | | | 5.4 | | | | 1.8 | | | | 1.7 | | | | 1.2 | | | | 0.7 | | | | 0.0 | |
Stock-based compensation | | | 2.4 | | | | 1.2 | | | | - | | | | 0.4 | | | | 0.4 | | | | 0.4 | |
Other operating income, net | | | (0.2 | ) | | | 0.0 | | | | 0.0 | | | | 0.0 | | | | - | | | | (0.2 | ) |
Severance expense | | | 0.1 | | | | 0.1 | | | | 0.0 | | | | 0.0 | | | | 0.0 | | | | - | |
Adjusted EBITDA | | $ | 37.5 | | | $ | 19.7 | | | $ | 4.1 | | | $ | 9.8 | | | $ | 6.6 | | | $ | (2.8 | ) |
| | Total IDT Corporation | | | Traditional Comm. | | | net2phone | | | NRS | | | Fintech | | | Corporate | |
||||||
| | | | | | | | | | | | | | | | | | | | | | | | |
2Q26 | | | | | | | | | | | | | | | | | | | | | | | | |
Net income attributable to IDT Corporation | | $ | 20.9 | | | | | | | | | | | | | | | | | | | | | |
Adjustments: | | | | | | | | | | | | | | | | | | | | | | | | |
Net income attributable to noncontrolling interests | | | (1.9 | ) | | | | | | | | | | | | | | | | | | | | |
Net income | | $ | 22.8 | | | | | | | | | | | | | | | | | | | | | |
Provision for income taxes | | | (6.2 | ) | | | | | | | | | | | | | | | | | | | | |
Income before income taxes | | $ | 29.1 | | | | | | | | | | | | | | | | | | | | | |
Interest income, net | | | 1.6 | | | | | | | | | | | | | | | | | | | | | |
Other expense, net | | | 0.2 | | | | | | | | | | | | | | | | | | | | | |
Income (loss) from operations | | $ | 27.2 | | | $ | 14.3 | | | $ | 2.2 | | | $ | 10.2 | | | $ | 4.1 | | | $ | (3.5 | ) |
Depreciation and amortization | | | 5.4 | | | | 1.8 | | | | 1.7 | | | | 1.2 | | | | 0.8 | | | | - | |
Stock-based compensation | | | 4.3 | | | | 2.4 | | | | - | | | | 0.4 | | | | 0.8 | | | | 0.7 | |
Other operating expense, net | | | 0.8 | | | | 0.2 | | | | - | | | | - | | | | - | | | | 0.7 | |
Severance expense | | | 0.2 | | | | 0.1 | | | | 0.1 | | | | - | | | | - | | | | - | |
Adjusted EBITDA | | $ | 38.0 | | | $ | 18.8 | | | $ | 3.9 | | | $ | 11.8 | | | $ | 5.6 | | | $ | (2.1 | ) |
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| | Total IDT Corporation | | | Traditional Comm. | | | net2phone | | | NRS | | | Fintech | | | Corporate | |
||||||
3Q25 | | | | | | | | | | | | | | | | | | | | | | | | |
Net income attributable to IDT Corporation | | $ | 21.7 | | | | | | | | | | | | | | | | | | | | | |
Adjustments: | | | | | | | | | | | | | | | | | | | | | | | | |
Net income attributable to noncontrolling interests | | | (1.3 | ) | | | | | | | | | | | | | | | | | | | | |
Net income | | $ | 23.0 | | | | | | | | | | | | | | | | | | | | | |
Provision for income taxes | | | (7.8 | ) | | | | | | | | | | | | | | | | | | | | |
Income before income taxes | | $ | 30.8 | | | | | | | | | | | | | | | | | | | | | |
Interest income, net | | | 1.6 | | | | | | | | | | | | | | | | | | | | | |
Other expense, net | | | 2.6 | | | | | | | | | | | | | | | | | | | | | |
Income (loss) from operations | | $ | 26.6 | | | $ | 17.3 | | | $ | 1.4 | | | $ | 6.2 | | | $ | 4.3 | | | $ | (2.6 | ) |
Depreciation and amortization | | | 5.2 | | | | 1.9 | | | | 1.6 | | | | 1.0 | | | | 0.7 | | | | - | |
Stock-based compensation | | | 0.9 | | | | 0.3 | | | | - | | | | 0.6 | | | | 0.1 | | | | - | |
Other operating expense, net | | | 0.2 | | | | - | | | | 0.2 | | | | - | | | | - | | | | - | |
Severance expense | | | 0.2 | | | | 0.2 | | | | - | | | | - | | | | - | | | $ | - | |
Adjusted EBITDA | | $ | 33.1 | | | $ | 19.6 | | | $ | 3.2 | | | $ | 7.8 | | | $ | 5.1 | | | $ | (2.6 | ) |
13
IDT Corporation
Reconciliation of Earnings Per Share (EPS) to Non-GAAP EPS for 3Q26 and 3Q25
(unaudited) in millions, except for per share data. Figures may not foot due to rounding
| | 3Q26 | | | 3Q25 | |
||
| | | | | | | | |
| | | | | | | | |
Net income attributable to IDT Corporation | | $ | 21.6 | | | $ | 21.7 | |
Adjustments (add) subtract: | | | | | | | | |
| | | | | | | | |
Stock-based compensation | | | (2.4 | ) | | | (0.9 | ) |
Severance expense | | | (0.1 | ) | | | (0.2 | ) |
Other operating income (expense), net | | | 0.2 | | | | (0.2 | ) |
Total adjustments | | | (2.3 | ) | | | (1.3 | ) |
Income tax effect of total adjustments | | | (0.6 | ) | | | (0.3 | ) |
| | | 1.7 | | | | 1.0 | |
Non-GAAP net income | | $ | 23.3 | | | $ | 22.7 | |
| | | | | | | | |
Earnings per share: | | | | | | | | |
| | | | | | | | |
Basic | | $ | 0.87 | | | $ | 0.86 | |
Total adjustments | | | 0.07 | | | | 0.04 | |
Non-GAAP - basic | | $ | 0.94 | | | $ | 0.90 | |
| | | | | | | | |
Weighted-average number of shares used in calculation of basic earnings per share | | | 24.9 | | | | 25.2 | |
| | | | | | | | |
| | | | | | | | |
Diluted | | $ | 0.87 | | | $ | 0.86 | |
Total adjustments | | | 0.07 | | | | 0.04 | |
Non-GAAP - diluted | | $ | 0.94 | | | $ | 0.90 | |
| | | | | | | | |
Weighted-average number of shares used in calculation of diluted earnings per share | | | 24.9 | | | | 25.2 | |
14
IDT Corporation
NRS’ ‘Rule of 40’ Score
For 3Q26
(unaudited) in millions. Figures may not foot due to rounding
| | | | | | | | | | | | | | | | | | Trailing twelve months (TTM) | |
|
| | 4Q25 | | | 1Q26 | | | 2Q26 | | | 3Q26 | | | 3Q26 | |
|||||
Reconciliation of NRS’ Income from Operations to Adjusted EBITDA | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | |
Income from operations | | $ | 5.8 | | | $ | 8.9 | | | $ | 10.2 | | | $ | 8.2 | | | $ | 33.2 | |
Depreciation and amortization | | | 1.1 | | | | 1.1 | | | | 1.2 | | | | 1.2 | | | | 4.6 | |
Stock-based compensation | | | 0.2 | | | | 0.2 | | | | 0.4 | | | | 0.4 | | | | 1.2 | |
Other operating expense, net | | | 2.4 | | | | 0.0 | | | | 0.0 | | | | 0.0 | | | | 2.4 | |
Severance expense | | | 0.0 | | | | 0.0 | | | | 0.0 | | | | 0.0 | | | | 0.1 | |
Adjusted EBITDA | | $ | 9.5 | | | $ | 10.3 | | | $ | 11.8 | | | $ | 9.8 | | | $ | 41.4 | |
NRS’ ‘Rule of 40’ Score | | | | | | | | |
| | 3Q26 | | | 3Q25 | |
||
NRS recurring revenue | | $ | 36.0 | | | $ | 29.4 | |
NRS other revenue | | | 2.0 | | | | 1.7 | |
NRS total revenue | | $ | 38.0 | | | $ | 31.1 | |
| | | | | | | | |
NRS recurring revenue growth rate | | | 22 | % | | | | |
| | | | | | | | |
| | | | | | | | |
NRS TTM Adjusted EBITDA (from above) | | $ | 41.4 | | | | | |
NRS TTM total revenue | | $ | 148.7 | | | | | |
NRS TTM Adjusted EBITDA margin | | | 28 | % | | | | |
‘Rule of 40’ score | | | 50 | % | | | | |
15
IDT Corporation
Adjusted net cash provided by operating activities for 3Q26 and 3Q25
(unaudited) in millions. Figures may not foot due to rounding
(in millions) | | | | | | | | |
Three months ended April 30, 2026 | | 3Q26 | | | 3Q25 | |
||
Net cash provided by operating activities (GAAP) | | $ | 18.5 | | | $ | 75.7 | |
Changes in customer deposits | | $ | 2.5 | | | $ | 9.6 | |
Adjusted net cash provided by operating activities | | $ | 16.0 | | | $ | 66.1 | |
Explanation of Key Performance Metrics
net2phone Subscription Revenue is calculated by subtracting net2phone’s equipment revenue and revenue generated by a legacy SIP trunking offering in Brazil from its revenue in accordance with GAAP. net2phone’s cloud communications and contact center offerings are priced on a per-seat basis, with customers paying based on the number of users in their organization. The number of seats served and subscription revenue trends and comparisons between periods are used in the analysis of net2phone’s revenues and direct cost of revenues and are strong indications of the top-line growth and performance of the business.
NRS’ Monthly Average Recurring Revenue per Terminal is calculated by dividing NRS’ recurring revenue as defined in the Reconciliation of Non-GAAP Financial Measures by the average number of active POS terminals during the period. The average number of active POS terminals is calculated by adding the beginning and ending number of active POS terminals during the period and dividing by two. NRS’ recurring revenue divided by the average number of active POS terminals is divided by three when the period is a fiscal quarter. Recurring Revenue and Monthly Average Recurring Revenue per Terminal are useful for comparisons of NRS’ revenue and revenue per customer to prior periods and to competitors and others in the market, as well as for forecasting future revenue from the customer base.
BOSS Money Transactions are a nonfinancial metric that measures customer usage during a reporting period. Average BOSS Money Revenue per Transaction measures the revenue productivity of BOSS Money’s remittance business. It is calculated by dividing BOSS Money revenue during the period by the number of transactions. Average BOSS Money Revenue per Transaction is a key metric for evaluating the productivity and operational performance of the business. BOSS Money’s Digital Send Volume is the aggregate amount of principal remitted by BOSS Money’s digital customers – those using the BOSS Money and BOSS Revolution apps to originate remittances. Digital Send Volume is a key metric for evaluating the operational performance of the digital channel of the remittance business, and for comparing the performance of BOSS Money’s digital channel to competitors in the remittance business as well as to performance to other temporal periods.
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