A provider of cloud-based business phone and communications services, RingCentral's products include RingEX, RingCentral Contact Center, RingCX, and RingCentral Events, all woven together with AI tools for customer service and virtual assistants. Founded in 1999 by Vlad Shmunis and Vlad Vendrow, the company began life as RingZero, a desktop communications software maker that shipped millions of copies before being bought by Motorola. In its early days, the founder's mother served as the company's controller.
Q2 FY2026 revenue rose 6% to $657.0M and ARR reached $2.76B as AI-led upsell continued
RingCentral grew to $2.76B, up from $2.59B a year earlier. rose 6% to $657.0M in Q2 FY2026 and held at 72%, with more than doubling to $100.3M for the half on a $15.0M partner-agreement gain and lower . The business is profitable and generating cash, but $879.1M of term-loan debt now sits against $116.6M of cash.
Key takeaways
reached $2.76B as of June 30, 2026, up from $2.59B a year earlier, with net monthly subscription dollar retention above 99%, driven by new customers and AI product upsell.
Total grew 6% to $657.0M, with subscriptions up 6% to $633.6M from new customer acquisition and upsell of AI-led products.
more than doubled to $100.3M for H1 FY2026, aided by a $15.0M net gain from an amended partner agreement and a reduction in as a percentage of .
Section summaries
Management's Discussion and Analysis
Q2 FY2026 revenue rose 6% to $657M, net income reached $39.1M, and ARR grew to $2.76B driven by new customers and AI product upsell.
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Total grew 6% to $657.0M, with subscriptions revenue up 6% to $633.6M, driven by new customer acquisition and upsell of AI-led products.
Total improved to 72% from 71% a year earlier as subscription gross margin held at 75% and other cost of revenues decreased on personnel cost reductions.
was $320.8M for H1 FY2026; the company repurchased $175.0M of shares, repaid $132.2M of debt, and initiated a quarterly cash .
The company drew a $650M delayed-draw to repay $609.1M notes due March 2026, leaving at $1,159.4M and cash at $116.6M as of Q1, with the Term Loan now hedged by a pay-fixed swap through February 2028.
What changed
Q2 2026 growth of 6% compares with 4.6% in Q2 2025 and 4.8% in FY2025, reversing the slowdown flagged in prior quarters.
rose 84.2% to $1,159.4M by Q1 2026 from $629.6M at FY2025 year-end after the $650M draw, settling the flagged $609.1M March 2026 note maturity.
Cash and equivalents fell to $116.6M by Q1 2026, down 24.5% from $154.4M, continuing the decline from $132.6M at FY2025 year-end against the now-larger debt load.
moved from $2.67B at FY2025 year-end and $2.71B in Q1 2026 to $2.76B this quarter, extending the climb from the $2.49B base a year earlier.
of $100.3M for H1 2026 follows the $50.0M Q1 figure and the $37.0M Q2 2025 quarter, with the half-year result more than doubling the year-ago pace on the partner gain and lower stock compensation.
What to watch
Q3 FY2026 growth rate to see if the 6% pace holds or resumes the prior slowdown as subscription upsells moderate.
trajectory after the $1,159.4M level and cash balance against the $879.1M and $250M .
Total movement from the $2.76B Q2 base and AI-led product contribution beyond the ~$100M recorded in 2025.
FY2026 R&D spend of approximately $250M for agentic voice AI and its effect on as the investment ramps.
Total improved to 72% from 71%, as subscription gross margin held at 75% and other cost of revenues decreased due to personnel cost reductions.
more than doubled to $100.3M for H1 FY2026, aided by a $15.0M net gain from an amended partner agreement and a reduction in as a percentage of .
reached $2.76B as of June 30, 2026, up from $2.59B a year earlier, with remaining above 99%.
was $320.8M for H1 FY2026; capital allocation included $175.0M in share repurchases, $132.2M in debt repayment, and the initiation of a quarterly cash .
The company expects to continue investing in AI innovation and operational efficiencies, while monitoring macroeconomic factors that could impact customer buying behavior and demand.
Quantitative and Qualitative Disclosures About Market Risk
Foreign-currency and floating-rate debt are the primary market risks; a 10% FX move is not material, and an interest-rate swap hedges the Term Loan.
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Most sales are in U.S. dollars, but international billings in GBP, EUR, CAD, and AUD expose to currency fluctuations.
Operating expenses are mainly in local currencies of foreign subsidiaries, so consolidated results are subject to FX translation risk.
A hypothetical 10% change in foreign exchange rates would not have materially impacted the condensed consolidated financial statements in the periods reported.
Cash equivalents are in short-term money-market funds; a 10% rate move would not materially affect interest income.
The $879.1M Term Loan carries floating rates, hedged by a pay-fixed interest-rate swap at 3.79% plus a 2–3% margin, effective through February 2028.
The $250M 2030 Senior Notes carry a fixed rate, so there is no economic interest-rate exposure on the debt, though fair value moves with rates.
Information with respect to this item may be found in Note 9, Commitments and Contingencies, in the accompanying notes to the Condensed Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q under “Legal Matters”, which is incorporated…
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Information with respect to this item may be found in Note 9, Commitments and Contingencies, in the accompanying notes to the Condensed Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q under “Legal Matters”, which is incorporated herein by reference.
Key risks center on AI execution, competitive pressure, reliance on partners, and macroeconomic headwinds that could impair growth and profitability.
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Failure to develop or integrate AI products like RingCX and agentic AI features on time could make existing offerings obsolete and harm competitive standing.
Intense competition from larger rivals (e.g., Microsoft, Zoom) and partners who also sell competing services may force price cuts or loss of market share.
A substantial portion of depends on channel partners and global service providers with no long-term contracts; shifting to a resale/wholesale model adds execution risk.
Customer turnover, down-selling, and macroeconomic pressures—including tariffs and inflation—could increase and acquisition costs, especially among SMBs.
Reliance on third parties such as NICE for contact center solutions and Bandwidth.com for SMS creates vulnerability if those relationships change or fail.
Servicing $879.1M in term loan debt and $250M in senior notes requires significant cash; restrictive covenants and refinancing risk could constrain operations.