AudioCodes Reports Second Quarter 2025 Results and Declares Semi-Annual Dividend of 20 cent per share

, /PRNewswire/ -- Second Quarter Highlights Quarterly revenues increase by 1.3% year-over-year to $61.1 million; Quarterly service revenues increased by 1.9% year-over-year to $32.6 million; GAAP results: Quarterly GAAP gross margin was 64.1%; Quarterly GAAP operating margin was 4.3%; Quarterly GAAP EBITDA was $3.6 million; Quarterly GAAP net income was $0.3 million, or $0.01 per diluted share. Non-GAAP results: Quarterly Non-GAAP gross margin was 64.5%; Quarterly Non-GAAP operating margin was 7.2%; Quarterly Non-GAAP EBITDA was $5.2 million; Quarterly Non-GAAP net income was $4.1 million, or $0.14 per diluted share. Net cash provided by operating activities was $7.7 million for the quarter. AudioCodes repurchased 715,732 of its ordinary shares during the quarter at an aggregate cost of $6.6 million. Details AudioCodes (NASDAQ: AUDC), a leading provider of unified communications voice, contact center and conversational AI applications and services for enterprises, today announced its financial results for the second quarter ended June 30, 2025. Revenues for the second quarter of 2025 were $61.1 million compared to $60.3 million for the second quarter of 2024. EBITDA for the second quarter of 2025 was $3.6 million compared to $6.2 million for the second quarter of 2024. On a Non-GAAP basis, EBITDA for the second quarter of 2025 was $5.2 million compared to $8.3 million for the second quarter of 2024. Net income was $0.3 million, or $0.01 per diluted share, for the second quarter of 2025 compared to net income of $3.8 million, or $0.12 per diluted share, for the second quarter of 2024. On a Non-GAAP basis, net income was $4.1 million, or $0.14 per diluted share, for the second quarter of 2025 compared to $5.5 million, or $0.18 per diluted share, for the second quarter of 2024. Non-GAAP net income excludes: (i) share-based compensation expenses; (ii) amortization expenses related to intangible assets; (iii) financial income (expenses) related to exchange rate differences in connection with revaluation of assets and liabilities in non-dollar denominated currencies; (iv) tax impact which relates to our Non-GAAP adjustments; and (v) in Q1 2024 non-cash lease expense which is required to be recorded during the quarter even though this is a free rent period under the lease for the Company's new headquarters. A reconciliation of net income on a GAAP basis to a non-GAAP basis is provided in the tables that accompany the condensed consolidated financial statements contained in this press release. Net cash provided by operating activities was $7.7 million for the second quarter of 2025. Cash and cash equivalents, short-term bank deposits, long and short-term marketable securities and long-term financial investments were $95.3 million as of June 30, 2025 compared to $93.9 million as of December 31, 2024. The increase in cash and cash equivalents, short-term bank deposits, long and short-term marketable securities and long-term financial investments was the result of cash generated from operating activities. This was partially offset by use of cash for the continued repurchasing of the Company's ordinary shares pursuant to its share repurchase program and the payment of a cash dividend during the first quarter. "I am pleased to report solid second quarter 2025 progress and results. Second quarter top-line growth was fueled mainly by growth of our Live managed services in the UCaaS and CX markets coupled with cross-selling our AI-powered business applications," said Shabtai Adlersberg, President and Chief Executive Officer of AudioCodes. We saw strong demand in UC, CX, and conversational AI, with Microsoft business rising 6.5% this quarter. Conversational AI remains a key growth area, supporting our 40%-50% segment growth outlook for 2025. Live managed services also grew, driving Annual Recurring Revenues (ARR) to $70 million, a 25% year-over-year increase. This quarter, we launched Live Platform, our integrated UCaaS and CX solution. With Webex Calling certification and Live CX services, it now supports comprehensive UC and CX features for all major global UCC vendors. In Conversational AI, we launched the Meeting Insights On-Prem (Mia OP) solution, which delivers secure meeting intelligence for enterprises detached from the cloud and/or the internet. Designed primarily for sectors like government, defense, healthcare, and finance, Mia OP has active customers in Israel with a growing number of proof-of-concept trials underway. The team is expanding international outreach and has received positive feedback from industry analysts. Operationally, we experienced increased expenses due to the implementation of new tariffs on US imports amounting to $1 million additional costs as well as a significant rise in costs within EMEA region driven by the strengthening of the Euro against the US dollar. These two factors impacted our net income generation in the quarter. Overall, we delivered on our business priorities in the quarter, making the necessary investments in product and sales with an eye towards accelerating our growth in revenues in our Conversational AI products and solutions. We believe these investments position us well for an improved top-line growth in the medium term," concluded Mr. Adlersberg. Share Buy Back Program During the quarter ended June 30, 2025, the Company acquired 715,732 of its ordinary shares under its share repurchase program for a total consideration of $6.6 million. In July 2025, the Company received court approval in Israel to purchase up to an aggregate amount of $20 million of additional ordinary shares. The court approval also permits AudioCodes to declare a dividend out of any part of this amount. The approval is valid through December 30, 2025. Cash Dividend AudioCodes also announced today that the Company's Board of Directors has declared a cash dividend in the amount of 20 cents per share. The aggregate amount of the dividend is approximately $5.7 million. The dividend is payable on August 28, 2025, to all of the Company's shareholders of record at the close of trading on the NASDAQ Global Select Market on August 14, 2025. In accordance with Israeli tax law, the dividend is subject to withholding tax at source at the rate of 25% of the dividend amount payable to each shareholder of record, subject to applicable exemptions. If the recipient of the dividend is at the time of distribution or was at any time during the preceding 12-month period the holder of 10% or more of the Company's share capital, the withholding rate is 30%. The dividend will be paid in U.S. dollars on the ordinary shares of AudioCodes Ltd. that are traded on the Nasdaq Global Select Market or the Tel-Aviv Stock Exchange. The amount and timing of any other dividends will be determined by the Board. Conference Call & Web Cast Information AudioCodes will conduct a conference call at 8:30 A.M., Eastern Time today to discuss the Company's second quarter of 2025 operating performance, financial results and outlook. Interested parties may participate in the conference call by dialing one of the following numbers: United States Participants: 888-506-0062 International Participants: +1 (973) 528-0011 The conference call will also be simultaneously webcast. Investors are invited to listen to the call live via webcast at the AudioCodes investor website at http://www.audiocodes.com/investors-lobby. About AudioCodes AudioCodes Ltd. (NASDAQ: AUDC)(TASE: AUDC) is a global leader in unified communications voice, contact center and conversational AI services and solutions for enterprises, enabling them to improve their customer experience (CX) and employee experience (EX) through enhanced communications and collaboration. Powered by AI, AudioCodes offers a comprehensive range of products, applications and SaaS services that provide seamless interoperability with the world's leading unified communications as a service (UCaaS) and contact center as a service (CCaaS) platforms, including Microsoft Teams, Webex, Zoom, Genesys and many others. Enterprises across the world, including 65 Fortune 100 companies, leverage AudioCodes expertise to enhance their productivity, collaboration, business process automation & intelligence, compliance and customer interaction. AudioCodes' global reach is achieved via its expert sales and support teams and its worldwide community of certified resellers, integrators and service providers. For more information on AudioCodes, visit http://www.audiocodes.com. Follow AudioCodes' social media channels: AudioCodes invites you to join our online community and follow us on: AudioCodes Voice Blog, LinkedIn, Twitter, Facebook, and YouTube. Statements concerning AudioCodes' business outlook or future economic performance; product introductions and plans and objectives related thereto; and statements concerning assumptions made or expectations as to any future events, conditions, performance or other matters, are "forward-looking statements'' as that term is defined under U.S. Federal securities laws. Forward-looking statements are subject to various risks, uncertainties and other factors that could cause actual results to differ materially from those stated in such statements. These risks, uncertainties and factors include, but are not limited to: the effect of global economic conditions in general and conditions in AudioCodes' industry and target markets in particular; shifts in supply and demand; market acceptance of new products and the demand for existing products; the impact of competitive products and pricing on AudioCodes' and its customers' products and markets; timely product and technology development, upgrades and the ability to manage changes in market conditions as needed; possible need for additional financing; the ability to satisfy covenants in the Company's loan agreements; possible disruptions from acquisitions; the ability of AudioCodes to successfully integrate the products and operations of acquired companies into AudioCodes' business; possible adverse impact of the COVID-19 pandemic on our business and results of operations; the effects of the current terrorist attacks by Hamas in Israel, and the war and hostilities between Israel and Hamas, and Israel and Hezbollah as well as the possibility that this could develop into a broader regional conflict involving Israel with other parties, may affect our operations and may limit our ability to produce and sell our solutions; any disruption in our operations by the obligations of our personnel to perform military service as a result of current or future military actions involving Israel; and other factors detailed in AudioCodes' filings with the U.S. Securities and Exchange Commission. AudioCodes assumes no obligation to update the information in this release. ©2025 AudioCodes Ltd. All rights reserved. AudioCodes, AC, HD VoIP, HD VoIP Sounds Better, IPmedia, Mediant, MediaPack, What's Inside Matters, OSN, SmartTAP, User Management Pack, VMAS, VoIPerfect, VoIPerfectHD, Your Gateway To VoIP, 3GX, VocaNom, AudioCodes One Voice, AudioCodes Meeting Insights, AudioCodes Room Experience are trademarks or registered trademarks of AudioCodes Limited. All other products or trademarks are property of their respective owners. Product specifications are subject to change without notice. Summary financial data follows AUDIOCODES LTD. AND ITS SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS U.S. dollars in thousands June 30, December 31, 2025 2024 (Unaudited) (Unaudited) ASSETS CURRENT ASSETS: Cash and cash equivalents $ 62,619 $58,749 Short-term bank deposits 228 210 Short-term marketable securities 16,365 3,426 Trade receivables, net 58,567 56,016 Other receivables and prepaid expenses 17,456 13,012 Inventories 26,390 31,463 Total current assets 181,625 162,876 LONG-TERM ASSETS: Long-term Trade receivables $ 16,338 $ 15,753 Long-term marketable securities 12,725 28,518 Long-term financial investments 3,341 3,008 Deferred tax assets 9,340 9,838 Operating lease right-of-use assets 30,702 32,534 Severance pay funds 19,105 18,004 Total long-term assets 91,551 107,655 PROPERTY AND EQUIPMENT, NET 28,873 27,321 GOODWILL, INTANGIBLE ASSETS AND OTHER, NET 37,783 38,049 Total assets $ 339,832 $ 335,901 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Trade payables 7,538 7,543 Other payables and accrued expenses 26,737 25,823 Deferred revenues 43,480 38,438 Short-term operating lease liabilities 6,194 5,954 Total current liabilities 83,949 77,758 LONG-TERM LIABILITIES: Accrued severance pay $ 17,564 $ 16,387 Deferred revenues and other liabilities 19,187 19,434 Long-term operating lease liabilities 31,057 30,508 Total long-term liabilities 67,808 66,329 Total shareholders' equity 188,075 191,814 Total liabilities and shareholders' equity $ 339,832 $ 335,901 AUDIOCODES LTD. AND ITS SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS U.S. dollars in thousands, except per share data Six months ended Three months ended June 30, June 30, 2025 2024 2025 2024 (Unaudited) (Unaudited) Revenues: Products $ 56,290 $ 56,897 $ 28,515 $ 28,347 Services 65,162 63,482 32,563 31,956 Total Revenues 121,452 120,379 61,078 60,303 Cost of revenues: Products 21,936 22,743 10,919 10,918 Services 21,258 19,494 11,035 9,910 Total Cost of revenues 43,194 42,237 21,954 20,828 Gross profit 78,258 78,142 39,124 39,475 Operating expenses: Research and development, net 25,899 27,114 12,873 13,181 Selling and marketing 38,376 34,820 19,815 17,453 General and administrative 7,738 7,991 3,836 3,905 Total operating expenses 72,013 69,925 36,524 34,539 Operating income 6,245 8,217 2,600 4,936 Financial income (expenses), net 522 419 (1,194) 396 Income before taxes on income 6,767 8,636 1,406 5,332 Taxes on income, net (2,445) (2,779) (1,100) (1,558) Net income $ 4,322 $ 5,857 $ 306 $ 3,774 Basic net earnings per share $ 0.15 $ 0.19 $ 0.01 $ 0.12 Diluted net earnings per share $ 0.15 $ 0.19 $ 0.01 $ 0.12 Weighted average number of shares used incomputing basic net earnings per share (in thousands) 29,202 30,337 28,877 30,341 Weighted average number of shares used in computing diluted net earnings per share (in thousands) 29,699 30,764 29,353 30,735 AUDIOCODES LTD. AND ITS SUBSIDIARIES RECONCILIATION OF GAAP NET INCOME TO NON-GAAP NET INCOME U.S. dollars in thousands, except per share data Six months ended Three months ended June 30, June 30, 2025 2024 2025 2024 (Unaudited) (Unaudited) GAAP net income $ 4,322 $ 5,857 $ 306 $ 3,774 GAAP net earnings per share $ 0.15 $ 0.19 $ 0.01 $ 0.12 Cost of revenues: Share-based compensation (1) 225 175 130 96 Amortization expenses (2) 244 244 122 122 Lease expenses (5) - 304 - - 469 723 252 218 Research and development, net: Share-based compensation (1) 729 1,171 380 579 Lease expenses (5) - 342 - - 729 1,513 380 579 Selling and marketing: Share-based compensation (1) 1,221 1,472 652 749 Amortization expenses (2) 22 22 11 11 Lease expenses (5) - 38 - - 1,243 1,532 663 760 General and administrative: Share-based compensation (1) 1,101 1,434 526 692 Lease expenses (5) - 76 - - 1,101 1,510 526 692 Financial expenses (income): Exchange rate differences (3) 918 )809( 1,953 (445) Income taxes: Taxes on income, net (4) - 422 - (49) Non-GAAP net income $ 8,782 $ 10,748 $ 4,080 $ 5,529 Non-GAAP diluted net earnings per share $ 0.29 $ 0.34 $ 0.14 $ 0.18 Weighted average number of shares used in computing Non-GAAP diluted net earnings per share (in thousands) 30,422 31,561 30,120 31,552 (1) Share-based compensation expenses related to options and restricted share units granted to employees and others. (2) Amortization expenses related to intangible assets. (3) Financial income (expenses) related to exchange rate differences in connection with revaluation of assets and liabilities in non-dollar denominated currencies. (4) Tax impact which relates to our non-GAAP adjustments. (5) In Q1 2024, non-cash lease expense which is required to be recorded during the quarter even though this is a free rent period under the lease for the Company's new headquarters. Note: Non-GAAP measures should be considered in addition to, and not as a substitute for, the results prepared in accordance with GAAP. The Company believes that non-GAAP information is useful because it can enhance the understanding of its ongoing economic performance and therefore uses internally this non-GAAP information to evaluate and manage its operations. The Company has chosen to provide this information to investors to enable them to perform comparisons of operating results in a manner similar to how the Company analyzes its operating results and because many comparable companies report this type of information. AUDIOCODES LTD. AND ITS SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS U.S. dollars in thousands Six months ended Three months ended June 30, June 30, 2025 2024 2025 2024 (Unaudited) (Unaudited) Cash flows from operating activities: Net income $ 4,322 $ 5,857 $ 306 $ 3,774 Adjustments required to reconcile net income to net cash provided by operating activities: Depreciation and amortization 1,913 1,784 959 1,261 Amortization of marketable securities premiums and accretion of discounts, net 197 615 93 301 Decrease (increase) in accrued severance pay, net 76 (479) (57) (369) Share-based compensation expenses 3,276 4,252 1,688 2,116 Decrease (increase) in deferred tax assets, net 307 64 (312) 850 Cash financial loss (income), net 22 154 (31) 69 Decrease in operating lease right-of-use assets 2,199 3,557 1,453 1,168 Increase (decrease) in operating lease liabilities 422 (3,435) 1,965 (1,324) Decrease (increase) in trade receivables, net (3,136) (3,767) (3,922) (6,083) Decrease (increase) in other receivables and prepaid expenses (4,444) 235 (6,827) (305) Decrease in inventories 4,976 5,947 2,121 2,689 Increase (decrease) in trade payables 87 (2,454) 1,376 (2,220) Increase (decrease) in other payables and accrued expenses 6,750 (1,605) 9,345 127 Increase (decrease) in deferred revenues 4,215 1,365 (432) (4,945) Net cash provided by (used in) operating activities 21,182 12,090 7,725 (2,891) Cash flows from investing activities: Proceeds from short-term deposits (18) 6 (19) 2 Proceeds from financial investment 178 47 65 26 Proceeds from redemption of marketable securities 3,200 3,450 - 2,950 Purchase of financial investments (442) - - - Purchase of property and equipment (3,259) (15,263) (1,785) (8,478) Net cash used in investing activities (341) (11,760) (1,739) (5,500) AUDIOCODES LTD. AND ITS SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS U.S. dollars in thousands Six months ended Three months ended June 30, June 30, 2025 2024 2025 2024 (Unaudited) (Unaudited) Cash flows from financing activities: Purchase of treasury shares (11,818) (4,754) (6,610) (1,170) Cash dividends paid to shareholders (5,326) (5,453) - - Proceeds from issuance of shares upon exercise of options 173 180 110 - Net cash used in financing activities (16,971) (10,027) (6,500) (1,170) Net increase (decrease) in cash, cash equivalents, and restricted cash 3,870 (9,697) (514) (9,561) Cash, cash equivalents and restricted cash at beginning of period 58,749 30,546 63,133 30,410 Cash, cash equivalents and restricted cash at end of period $ 62,619 $ 20,849 $ 62,619 $ 20,849 Company Contacts Niran Baruch, Chief Financial Officer AudioCodes Tel: +972-3-976-4000[email protected] Roger L. Chuchen, VP, Investor Relations AudioCodes Tel: 732-764-2552 [email protected] Logo: https://mma.prnewswire.com/media/2391462/audiocodes_Logo.jpg SOURCE AudioCodes WANT YOUR COMPANY'S NEWS FEATURED ON PRNEWSWIRE.COM? 440k+ Newsrooms & Influencers 9k+ Digital Media Outlets 270k+ Journalists Opted In

AudioCodes Reports Second Quarter 2025 Results and Declares Semi-Annual Dividend of 20 cent per share

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