Highlights

  • Second quarter revenue rose 6% to $657.0 million, and GAAP diluted earnings per share climbed to $0.45 from $0.14.
  • Six-month net cash from operations reached $370.5 million, and non-GAAP free cash flow was $320.8 million.
  • RingCentral repaid its $609.1 million 2026 convertible notes with a $600.0 million term loan and cash on hand.
  • The board approved a $0.125 quarterly dividend, about 67% above the prior $0.075 payment, after the company's first-ever dividend.

RingCentral (NYSE:RNG) shares were trading near their 52-week high at USD 82.77 on October 21, 2026, up 1.41%. The cloud communications company started its first quarterly dividend, retired its 2026 convertible notes, amended its Avaya partnership, and filed its second quarter 2026 report on July 23 with higher revenue and profit.

Based in Belmont, California, RingCentral was incorporated in California in 1999 and reincorporated in Delaware in 2013. It describes itself as a global leader in AI-powered customer engagement, with a portfolio spanning Unified Communications as a Service, Contact Center as a Service, AI solutions, Video and Events. Products include RingEX, RingCX and the AI Receptionist. Subscriptions account for more than 90% of revenue, and the vast majority of revenue comes from the United States and Canada. Its fiscal year ends December 31.

Profit Gains in the Second Quarter

Revenue for the quarter ended June 30, 2026 was $657.0 million, up 6% from $620.4 million. Subscriptions revenue rose 6% to $633.6 million, which the company tied to new customers and upsell, including AI-led products, while other revenue rose 8% to $23.4 million. Annualized Exit Monthly Recurring Subscriptions reached $2.76 billion, versus $2.59 billion a year earlier, and the net monthly subscription dollar retention rate remained above 99%.

Gross margin was 72% against 71%. Income from operations rose to $50.3 million from $37.0 million. Net income was $39.1 million, or $0.45 per diluted share, versus $13.2 million, or $0.14. Other income included a $15 million gain tied to an amended Avaya Cloud Office arrangement, under which customers move to a RingCentral-branded offering. Interest expense rose to $18.7 million from $16.5 million, and sales and marketing expense grew 4% to $274.9 million.

Stock-based compensation fell to about 8.7% of revenue from 10.2%. For the six months, revenue was $1.30 billion, up 6%, net income was $69.7 million versus $2.9 million, and diluted EPS was $0.80 versus $0.03.

Debt Repayment and Capital Returns

Operating cash flow for the six months was $370.5 million, up from $317.1 million. After $49.6 million of capital expenditures, non-GAAP free cash flow was $320.8 million, compared with $274.6 million.

In the first half, RingCentral repaid in full the remaining $609.1 million of its 2026 Convertible Notes using $600.0 million of term loan borrowings and $9.1 million of cash. It also repurchased $100.0 million of principal on its 8.50% senior notes due 2030 for $105.0 million, leaving $250.0 million outstanding. Term loan principal stood at $879.1 million, the revolver was undrawn, and the company reported $305.0 million of revolver availability and $50.0 million of delayed draw capacity.

Cash and cash equivalents were $111.5 million, including $8.4 million of restricted cash. The company repurchased 4.8 million Class A shares for $175.0 million, with about $325.8 million left under repurchase authorizations. The board started its first quarterly dividend in February, paid $0.075 per share on June 11, and in July approved $0.125 per share payable August 20. Remaining performance obligations were about $2.7 billion.

Outlook and Risks

The 10-Q does not provide numerical guidance. Management said it plans to invest more than $250 million in research and development in 2026, continue to monetize its AI-led products, expand margins and free cash flow, and pay a quarterly dividend going forward, subject to market conditions and board approval. It also said a reversal of valuation allowances in certain jurisdictions is reasonably possible, which would produce an income tax benefit in the period it occurs.

The company cautioned that inflation, interest rates, tariffs, geopolitical conflict and currency swings could affect customer buying and lead to lower upsell or higher downsell. It believes operating cash flow and existing liquidity will meet needs for at least the next 12 months. These are company statements, not forecasts.