Ribbon Communications (NASDAQ: RBBN) reported Q1 EPS of $0.01, $0.02 better than the analyst estimate of ($0.01). Revenue for the quarter came in at $158 million versus the consensus estimate of $122.78 million.

"We are pleased with our first quarter sales results. In the face of very difficult global conditions for our customers and employees arising from the COVID-19 pandemic, we achieved organic revenue growth of eight percent compared with the first quarter of last year, driven by strong demand for our communications software as our customers responded to increased traffic on their networks," said Bruce McClelland, President and Chief Executive Officer of Ribbon Communications. "We saw an increase in session software deployments to facilitate remote work and Ribbon's multi-year investments in fully virtualized software and cloud products allowed us to rapidly deploy solutions for our Service Provider and Enterprise customers."

Mr. McClelland added, "During March we successfully completed the merger with ECI. Although the ongoing pandemic has impacted demand in certain regions and created supply chain challenges for our Packet Optical Network products, we are excited about the opportunities this merger provides, with an impressive breadth of products to serve our combined global customer base."

"First quarter 2020 sales benefited from a 62 percent increase in our software product revenue as well as growth in sales of our Enterprise solutions compared with first quarter of last year. Ribbon's standalone Non-GAAP gross margin grew 6 percentage points, overall Non-GAAP Adjusted EBITDA grew $13 million to $10 million, and operating cash flow doubled to $40 million over last year's first quarter," said Daryl E. Raiford, Chief Financial Officer of Ribbon Communications. "These results demonstrate solid execution of our ongoing strategic priorities. While the global pandemic has impacted near term visibility, particularly for our recently acquired ECI business, we continue to be focused on serving our customers, caring for our employees and building shareholder value."

Business Outlook

Visibility into Ribbon's organic business remains solid as Service Provider and Enterprise customers continue to respond to increased demand. The Company's recent merger makes its previous guidance provided on a standalone basis no longer applicable and, therefore, the Company is withdrawing such guidance. Ribbon remains optimistic about the long-term prospects of the industry and the criticality of the Company's solutions. However, the Company expects the COVID-19 global pandemic to continue to impact the near-term performance of its recently acquired ECI business. Accordingly, Ribbon is not providing guidance at this time.

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