Ooma (OOMA +1.01%) reported second quarter 2026 earnings on August 26, 2025, reporting revenue of $66.4 million, up 3.5% year over year, a record non-GAAP net income of $6.5 million, up 59% year over year, and an adjusted EBITDA margin rising to 11%. Management highlighted strengthening business user metrics, Airdial’s accelerated bookings, expanded partner ecosystem, and updated full-year non-GAAP net income guidance to $24.5 million to $25 million for FY2026, raising previous expectations.
Airdial bookings drive Ooma business revenue and partner expansion
Product and other revenue grew 15% year over year in Q2 FY2026, attributed largely to increased Airdial installations, while the company now partners with nearly 35 Airdial resellers, up sequentially. Airdial landed its largest customer to date, a national U.S. retailer deploying to over 3,000 locations.
"I'm pleased to report that Airdial ramped well in Q2. We more than doubled new bookings year over year and secured our largest customer win to date with a large national retailer. Started the rollout with this retailer and anticipate serving over 3,000 locations. We also closed several other significantly sized customers who placed initial orders. As is our goal every quarter, we expanded the number of partners who will resell Airdial, and signed three new partner resellers in the quarter. We believe two of these new partners have experience selling competitive solutions and will be able to ramp relatively quickly with Airdial. In total, we are now approaching 35 Airdial partner resellers."
-- Eric Stang, CEO
With bookings more than doubling year over year and rapid channel expansion in Q2 FY2026, Airdial is contributing to the growth of Ooma’s annual recurring revenue and business user additions.
Ooma reaches record profitability through operational leverage
Adjusted EBITDA rose 27% year over year to $7.2 million, with non-GAAP net income driven by improving operating leverage, R&D efficiency, and a disciplined cost structure. The company’s gross margin remained stable year over year at 62%, Sales and marketing expenses were $18 million or 27% of total revenue, up 2% year over year, while research and development expenses were $11.5 million or 17% of total revenue, down 6% year over year.
"Q2 non-GAAP net income was $6.5 million, above our guidance range of $5.6 million to $5.9 million, and grew 59% year over year, primarily driven by our improving operating leverage. Q2 non-GAAP net income this year also included a small amount of tax benefit due to the recent changes in U.S. tax law."
-- Shig Hamamatsu, CFO
This margin expansion and stronger bottom-line output indicate Ooma's ability to balance growth investments with profitable scalability, underpinning an attractive long-term financial profile for investors.
Business solutions segment outpaces residential as key revenue driver
Business subscription and services revenue represented 62% of total subscription revenue, up from 60% in the previous quarter, and grew 66% year over year, while residential subscription revenue declined by 2% year over year. Blended average revenue per user (ARPU) climbed 4% year over year to $15.68, propelled by the increased mix of business users and higher-tier Ooma Office Pro and Pro Plus services adoption, with 61% of new Office users opting for premium tiers.
"Business subscription and services revenue grew 66% year over year in Q2 driven by user growth and ARPU growth. On the residential side, subscription and services revenue was down 2% year over year. For the second quarter, total subscription and services revenue was $61.1 million or 92% of total revenue as compared to $59.6 million or 93% of total revenue in the prior year quarter."
-- Shig Hamamatsu, CFO
The business segment grew rapidly, driven by higher customer value and increased premium service adoption, reflecting a shift toward business customers.
Looking Ahead
Management guided non-GAAP revenue for Q3 FY2026 to $67.2 million to $67.9 million and full-year non-GAAP revenue to $267 million to $270 million for FY2026, with non-GAAP net income for FY2026 now expected at $24.5 million to $25 million, raising prior guidance. Adjusted EBITDA for FY2026 is forecast at $28.5 million to $29 million, and non-GAAP diluted EPS at $0.87 to $0.89 for FY2026, with business subscription and services revenue projected to grow 5% to 6% for FY2026 on a non-GAAP basis, while residential declines 1% to 2%. Management’s strategic priorities remain capitalizing on Airdial expansion, enhancing Ooma Office for higher ARPU, and scaling wholesale platform 2,600 Hertz, and further cost efficiency gains anticipated through the second half of FY2026.
