Vonage (NASDAQ: VG) reported Q1 EPS of $0.05, $0.04 better than the analyst estimate of $0.01. Revenue for the quarter came in at $297.46 million versus the consensus estimate of $279.46 million.

First Quarter 2020 Highlights:

• Consolidated Revenues of $297 million (including $14 million of USF revenues)
• Business Segment Revenues of $210 million (including $4 million of USF revenues)
• Service Revenues of $196 million, a 23% Increase
• API Platform Revenues Increased 44%
• Applications Service Revenues Increased 10%
• Net Loss of $4 Million and Adjusted EBITDA of $39 million

“We had a strong first quarter, highlighting the power of our programmable platform strategy,” said Alan Masarek, Chief Executive Officer. “In today’s environment, Vonage’s cloud-based communications services are ever more critical to support the world’s new-normal, requiring remotely-delivered services and remote work environments.”

“Vonage is prepared to navigate these uncertain times given the mission-critical nature of our offerings. While we expect some short-term financial impacts from COVID-19, this is a defining moment for Vonage. We believe COVID will accelerate the digital transformation of the global economy, and Vonage is well-positioned to aid in that transition.”

Masarek continued, “I'm proud of our team’s response to the crisis, and I want to thank our employees for their commitment during these unprecedented times. Our business continuity plans were enacted virtually overnight, and our own technology seamlessly enabled more than 2,400 Vonage remote offices across the globe, keeping Vonage’s business functioning smoothly so our employees could focus on helping our customers.”

GUIDANCE:

Vonage sees Q2 2020 revenue of $295-298 million, versus the consensus of $292.63 million.

Vonage sees FY2020 revenue of $1.18-1.205 billion, versus the consensus of $1.18 billion.

The Company is updating its 2020 guidance to reflect the estimated impact of the COVID-19 crisis based on information available today. The Company is seeing positive catalysts as evidenced by surging video API usage and lower Applications churn. However, in the short term, these positive catalysts are being offset by elevated levels of payment deferrals and credits, some install delays, and demand declines in hospitality- and travel-related sectors. While some customers are accelerating their move to the cloud for business continuity, others are putting that decision on hold to focus on their business operations.

For the second quarter of 2020, Vonage expects the following:

• Consolidated Revenues in the range of $295 million to $298 million
• Total Business Segment Revenues in the range of $213 million to $216 million (which includes approximately $4 million of USF revenues)
• Total Consumer Revenues in the $82 million area (which includes approximately $8 million of USF revenues)
• Consolidated Adjusted EBITDA in the $36 million area.

For the full year 2020, Vonage now expects the following, (based on constant currency as of May 2020):

• Consolidated revenues in the range of $1.180 billion to $1.205 billion
• Total Business Segment Revenues in the range of $855 million to $880 million (which includes approximately $17 million of USF revenues)
• Total Consumer Segment Revenues in the $325 million area (which includes approximately $34 million of USF revenues)
• Consolidated Adjusted EBITDA of between $150 to $155 million
• Capex in the $60 million area

For earnings history and earnings-related data on Vonage (VG) click here.