8×8 has increased its enterprise customer base through its acquisition of Fuze while achieving a milestone of 50 countries with sales operations.
Speaking on its Q4 earnings call, the CEO of 8×8 said the acquisition of Fuze has led to nearly 300 new customers, enhanced the company’s ‘XCaaS’ (Experience Communications as a Service) solution and provided cross-selling opportunities.
With a further 120 customers onboarded on top of these to its UC-CC business segment, 8×8 now has a total of 1,320 enterprise customers.
Dave Sipes, CEO at 8×8, said: Enterprise adoption of our integrated XCaaS platform continues to expand with XCaaS ARR growth accelerating to more than 35% year-over-year, not including Fuze.
“XCaaS now accounts for approximately 35% of combined 8×8 Fuze ARR, and given the Fuze enterprise base, we see an opportunity to grow this materially over the next several years.
“We have been excited by the response we are seeing from fee customers and partners, and strengthened European presence is just some examples of the additive impact of the Fuze acquisition across the business.
“Customer retention among the Fuze space has been strong, and revenue of $24 million was above our expectations for the quarter.
“We moved swiftly after the transaction closed to integrate the two organizations and streamline the combined cost structure.”
The acquisition of Fuze cost approximately $250m split between cash and shares, based on Fuze’s share price at the time the deal closed in January.
In terms of global expansion, Sipes referred to its recent entry into Indonesia and Thailand, on top of its contact centre becoming available in the Philippines and China earlier this fiscal year.
He told analysts that 8×8’s UCaaS solution is now available in 50 countries with full cloud, public switch telephone network support, increasing from 41 territories a year ago and covering more than 85% of the world’s GDP.
8×8’s international business for CPaaS comes predominantly from the UK and APAC countries, notably Singapore, Indonesia, and Thailand, Sipes shared.
Sipes also spoke about market trends: “One of the biggest trends we see is, customers are looking to integrate Teams users with their Enterprise Communication platforms.
“They are doing it fundamentally through direct routing and Operator Connect solutions.
“We have been recognized in the channel as having the best direct routing solution in the market.
“We continue to hone that offering as we look at the other solutions in the market [such as] Operator Connect, which tends to be carriers or national service providers, who are usually less global, less feature-rich and siloed in that they’re only servicing the Teams users in the enterprise.
“Our offering brings functionality to those users as well as powering every employee in the organization, not just the Teams app, endpoint users but also frontline workers and contact centre users.
“It is a big trend as the Teams’ messaging application is prevalent with many of our customers. We have just scratched the surface [of possibilities] from powering that with a communication platform. It is a big initiative for a lot of our customers today.”
8×8 gained 6,500 users by providing BDO with a voice and contact centre for Microsoft Teams.
Other notable issues included the state of 8×8 normal deal cycles compared to its pre-COVID levels.
Sipes said that the deal cycle is now similar to what it would have been pre-COVID for customers moving from legacy to cloud-based systems over the previous 12 months, with an average rate of progression on those deals.
The Chief Financial Officer at 8×8, Sam Wilson, shared a number of the company’s earnings figures, including its total revenue for the quarter, which was $181.4 million, an increase of 25% year-over-year, and within its $180m to $182m guidance range.
For the first fiscal quarter of 2023, Wilson said it anticipates service revenue to be in the range of $177m to $180m, with a further $26m to $28m contributed by its revenue from Fuze. The total anticipated revenue is between $185m and $188m.
The Director of Commercial Sales at 8×8 spoke recently about the company’s ‘XCaaS’ solution at the UC Partner Summit.
The VP of EMEA Sales at 8×8 also attended the UC Partner Summit and discussed creating value with UCaaS and CCaaS.
