What happened

Shares of RingCentral (RNG) tumbled 17.7% in May, according to data provided by S&P Global Market Intelligence, as the cloud-based workplace communication and collaboration platform looks to be having difficulty shedding the image that it's more than just a pandemic play.

So what

Much like Zoom Video Communications (ZM 0.95%), with which it partners (but is increasingly becoming a competitor to), RingCentral's business boomed during the COVID-19 outbreak as many employees were forced to work from home and use cloud-based video and teleconferencing technology.

Woman wearing headset while working on a laptop

Image source: Getty Images.

Now, with the economy reopening and many employers calling for their workers to return to the office, there's a sense that there won't be the same need for so-called unified communications-as-a-service vendors.

Yet RingCentral's first-quarter results, released in early May, showed that revenue rose 32% year over year to $352 million on a 34% increase in subscription revenue, while adjusted profits of $0.27 per share were 42% higher than the $0.19 last year. Both beat analyst expectations, the 14th consecutive quarter it beat the Street.

It also raised full-year guidance and now expects revenue between $1.5 billion and $1.51 billion, up from prior expectations of $1.475 billion to $1.49 billion, representing as much as 27% growth over the year-ago period.

Now what

RingCentral has forged partnerships with some of the biggest telecoms in the world, including Verizon, T-Mobile, and AT&T. And with large swaths of businesses still needing to upgrade their legacy telecom systems to cloud-based ones, it still sees large growth opportunities.

CEO Vlad Shmunis told CNBC's Jim Cramer recently that RingCentral's business was growing steadily before the pandemic and will still be growing after it.

The pandemic was more a bulge in its growth trajectory, and now as the world reverts to the mean, RingCentral's technology will continue enabling companies to connect their distributed workforces across any device anywhere in the world.

Zoom was obviously the high-profile winner during the pandemic, grabbing most of the headlines, but RingCentral prospered even as it flew under the radar. Its stock hit an all-time high of $449 per share in February, but has been falling steadily since and is now down 45% from those highs. 

That suggests opportunity in the disconnect between this software-as-a-service stock's price and its potential.