Five9 (NASDAQ:FIVN – Get Free Report) released its quarterly earnings results on Thursday. The software maker reported $0.82 EPS for the quarter, topping analysts’ consensus estimates of $0.80 by $0.02, FiscalAI reports. The firm had revenue of $323.30 million during the quarter, compared to analysts’ expectations of $319.04 million. Five9 had a net margin of 4.94% and a return on equity of 12.92%. The firm’s revenue for the quarter was up 13.1% compared to the same quarter last year. During the same period in the previous year, the company earned $0.78 EPS.
Here are the key takeaways from Five9’s conference call:
- Five9 reported Q3 revenue of $323 million, up 13% year over year, with subscription revenue up 16%. AI revenue grew 91% to about $45 million, and the company raised its 2026 AI revenue growth outlook to at least 75% from at least 60%.
- Customer expansion and backlog conversion supported a subscription dollar-based retention rate of 109%, up from 107% in the prior quarter. Management expects full-year adjusted EBITDA margin of at least 24% and cash flow of approximately $175 million.
- Five9 agreed to acquire Level AI for $325 million in cash, adding standalone AI products and a second route to customers that are not yet ready to move contact centers to the cloud. Level AI had approximately $20 million in ARR as of October 31 and was growing about 50% year over year; Five9 expects the deal to accelerate its AI roadmap.
- The Level AI deal is expected to dilute adjusted EBITDA margin by about one percentage point in 2027, though management aims to bring its EBITDA dollars to break-even in roughly six months and expects margin accretion in 2028. The acquisition’s revenue and operating contribution are excluded from Five9’s 2026 guidance.
- Five9 lowered its 2026 non-GAAP EPS midpoint by $0.07 to $3.19, citing the timing of planned organizational changes and a higher diluted share count. It still expects sequential adjusted EBITDA margin expansion in Q4, but said the organizational changes will shift into early 2027.
Five9 Stock Down 17.6%
NASDAQ FIVN traded down $6.02 during trading on Friday, reaching $28.12. 6,549,861 shares of the company’s stock traded hands, compared to its average volume of 1,557,405. Five9 has a 12-month low of $13.29 and a 12-month high of $40.00. The company has a debt-to-equity ratio of 0.94, a current ratio of 4.15 and a quick ratio of 4.15. The firm has a market cap of $2.15 billion, a price-to-earnings ratio of 41.97 and a beta of 1.56. The company’s 50 day simple moving average is $34.54 and its two-hundred day simple moving average is $24.49.
Analysts Set New Price Targets
FIVN has been the topic of a number of analyst reports. Piper Sandler upped their target price on Five9 from $24.00 to $30.00 and gave the company a “neutral” rating in a research note on Friday, August 7th. FBN Securities began coverage on shares of Five9 in a research report on Wednesday, September 16th. They issued an “outperform” rating and a $40.00 price objective for the company. Cantor Fitzgerald raised their target price on shares of Five9 from $34.00 to $40.00 and gave the stock an “overweight” rating in a research report on Monday, September 21st. Truist Financial decreased their price target on shares of Five9 from $40.00 to $35.00 and set a “buy” rating for the company in a research note on Friday. Finally, Wall Street Zen lowered Five9 from a “strong-buy” rating to a “buy” rating in a report on Saturday, August 8th. Twelve analysts have rated the stock with a Buy rating and nine have assigned a Hold rating to the stock. According to MarketBeat, the company has an average rating of “Moderate Buy” and an average price target of $33.94.
Get Our Latest Research Report on Five9
More Five9 News
Here are the key news stories impacting Five9 this week:
- Positive Sentiment: Five9 reported Q3 adjusted EPS of $0.82 versus the $0.80 consensus and revenue of $323.3 million versus $319.0 million. Revenue rose 13% year over year, with subscription growth of 16%. Five9 Q3 results
- Positive Sentiment: Management’s FY 2026 adjusted EPS guidance of $3.17–$3.21 is above the cited $2.92 consensus. The company also highlighted 91% growth in AI revenue, supporting its opportunity to expand AI-powered customer service products. Q3 earnings call highlights
- Neutral Sentiment: Five9 agreed to acquire Level AI for $325 million in cash, adding tools for automating customer interactions and analyzing customer conversations. The deal could strengthen its AI platform, though its eventual financial contribution is uncertain. Level AI acquisition announcement
- Negative Sentiment: Gross margins narrowed year over year: GAAP gross margin was 53.4%, versus 55.0% a year earlier. Q4 EPS guidance of $0.88–$0.92 straddles the $0.90 consensus, while revenue guidance is broadly in line with expectations—limiting evidence of a near-term forecast beat. Q3 estimates and margins
- Negative Sentiment: Analyst responses were mixed but included a downgrade from Evercore to “in-line” with a $24 target and lower targets from Wells Fargo ($28), Truist ($35), and Barclays ($38). These cautious revisions may add pressure despite several firms retaining positive ratings. Wells Fargo analyst rating
Insider Buying and Selling at Five9
In other news, CFO Bryan Lee sold 1,310 shares of the stock in a transaction that occurred on Tuesday, September 8th. The shares were sold at an average price of $32.60, for a total transaction of $42,706.00. Following the transaction, the chief financial officer directly owned 289,333 shares in the company, valued at approximately $9,432,255.80. This trade represents a 0.45% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, President Andy Dignan sold 6,986 shares of the stock in a transaction that occurred on Thursday, September 17th. The shares were sold at an average price of $35.00, for a total transaction of $244,510.00. Following the transaction, the president owned 237,614 shares in the company, valued at approximately $8,316,490. This represents a 2.86% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold a total of 83,831 shares of company stock worth $2,821,366 over the last quarter. 1.20% of the stock is currently owned by company insiders.
Five9 Company Profile
Five9, Inc is a cloud-based software company that provides customer experience and contact center solutions. Its platform enables organizations to manage customer interactions across voice, chat, email, social media and other digital channels without relying on traditional on-premises contact center infrastructure.
The company’s Intelligent CX Platform includes tools for inbound and outbound communications, digital engagement, workforce optimization, workflow automation, analytics and reporting.
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