CCSI

Image source: The Motley Fool. Thursday, Aug. 6, 2026 at 5:00 p.m. ET Chief Executive Officer - Scott Turicchi Vice President of Finance - Kip Killpack CRO and Executive Vice President of Operations - Johnny Hecker Chief Financial Officer - Adam Varon Operator: Good day, ladies and gentlemen, and welcome to Consensus Q2 2026 Earnings Call. My name is Paul, and I will be the operator assisting you today. [Operator Instructions] On this call from Consensus will be Scott Turicchi, CEO; Kip Killpack, Vice President of Finance; Johnny Hecker, CRO and Executive Vice President of Operations; and Adam Varon, CFO. I will now turn the call over to Kip Killpack, Vice President of Finance at Consensus. Thank you. You may begin. Kip Killpack: Good afternoon, and welcome to the Consensus investor call to discuss our Q2 2026 financial results, other key information and our Q3 2026 quarterly guidance. Joining me today are Scott Turicchi, CEO; Johnny Hecker, CRO and EVP, Operations; and Adam Varon, CFO. The earnings call will begin with Scott providing opening remarks. Johnny will give an update on operational progress since our Q1 2026 investor call, then Adam will provide Q2 2026 financial results and our Q3 2026 guidance range. After we finish our prepared remarks, we will conduct a Q&A session. At that time, the operator will instruct you on the procedures for asking a question. Before we begin our prepared remarks, allow me to direct you to our forward-looking statements and risk factors on Slide 2 of our investor presentation. As you know, this call and the webcast will include forward-looking statements. Such statements may involve risks and uncertainties that would cause actual results to differ materially from the anticipated results. Some of these risks and uncertainties include, but are not limited to, the risk factors that we have disclosed in our regulatory filings, including our annual 10-K and quarterly 10-Q SEC filings. Now let me turn the call over to Scott for his opening remarks. R. Turicchi: Thank you, Kip. We had excellent financial results in Q2, continuing our acceleration of total revenue growth with meaningful contributions from each channel of revenue. In addition, this was the third consecutive quarter that we had year-over-year growth in the following key financial metrics: consolidated revenue, adjusted EBITDA, adjusted non-GAAP EPS and free cash flow. Our revenue growth was driven by the continuing improvement in our corporate channel, which reinforces both the necessity and value proposition of our solutions. We exceeded our revenue objective with corporate revenue posting a 9.3% growth over Q2 2025 ahead of our forecast. This success was driven by record strong usage, increased revenue retention, new customer acquisition and contribution from our advanced products. In addition, eFax Protect had record sign-ups, which is a continuing trend each quarter. In addition, at the VA, we continue to see more facilities come online, generating a record level of usage. All of these factors contributed to the stellar year-over-year growth for our corporate channel. SoHo revenue was also ahead of our expectations and had the slowest rate of decline since we began the shift of our marketing dollars to corporate in late 2023. We continue to be judicious in adding to our cost structure, producing an adjusted EBITDA margin of 52.9% in Q2, comfortably within our range of 50% to 55%. Johnny will provide more detail in his portion of the presentation regarding the operational results for Q2. Free cash flow was $25.5 million in the quarter, up approximately 25% from Q2 2025 due to excellent management of our receivables and lower interest expense than a year ago. We continue to expect our free cash flow in 2026 to approximate the $106 million of free cash flow in 2025. In addition, we were able to repurchase approximately $9.6 million of our stock during the quarter or approximately 300,000 shares. Before turning the call over to Johnny, I want to share 2 strategic developments during the quarter. The first is the formation of our new Healthcare Strategy and Solutions group headed by Steve Tolle and the second is the tuck-in acquisition of doc.health. The Healthcare Strategy and Solutions group will own the health care product portfolio, go-to-market efforts and strategy primarily for our non-fax solutions. This group will build on the foundation we have built in health care through our eFax product. By way of example, when our fax customers receive referrals, prior authorizations, orders or record requests via fax, they are receiving data in an unstructured format. And as a result, they need someone to process the document and enter the information into the EHR. We can seamlessly fill that gap with our variety of technologies and solutions. We have discussed our vision for Harmony before and how pieces of it are already in production. This group will be responsible for unifying our health care portfolio of solutions. The inbound image in the prior example will be transformed into structured data, which will be routed to the right people so they can act. These solutions will target specific segments and use cases in the health care ecosystem. This will allow our existing eFax customers to expand into higher-value services and for new clients to come to us for the intelligence rather than merely the transport. The Healthcare Strategy and Solutions group will be led by Steve Tolle, as I mentioned, and he will have the role of Chief Healthcare Solutions Officer. He's a 35-year health care technology executive, who delivered the industry's first AI-based radiology product at IBM Watson Health. He also founded iConnect Network Services at Merge Healthcare before its acquisition by IBM, and he's held senior roles at Allscripts, OptumInsight and Pfizer Health Solutions. His domain is interoperability and AI applied to clinical workflow, which is precisely what this group is tasked to do. We will continue to hire into this business unit and its related areas over the balance of the year and into 2027 as we look for meaningful contributions from this group to our non-fax revenue in 2028 and beyond. doc.health is a workflow platform developed by a practicing medical professional. It handles the clinically adjacent work that surrounds patient care but doesn't live cleanly inside an electronic health record, such as referral management, care coordination, patient follow-up and the administrative tasks that fall between visits. doc.health fits perfectly into our vision for the Harmony platform. Adam will provide more financial details regarding the transaction, but I'm excited to welcome the 14 employees of doc.health that have joined Consensus as well as its customer base and pipeline and key technologies. I'll now turn the call over to Johnny, who will provide more operational details. Johnny Hecker: Thank you, Scott, and hello, everyone. As Scott mentioned, we are pleased to see continued progress across the business with consolidated revenue growing 4.1% year-over-year to $91.4 million. Over the last few quarters, I have talked extensively about the structural shift in our business toward high-value corporate revenue. In Q2, we saw this established pattern solidify. I want to emphasize the strength of secure cloud fax in this context. It is the primary driver of total dollar growth, which we expect to continue into the future. The migration to the cloud in regulated industries, especially in health care and the public sector, has only just begun. We're vigorously riding that wave by replacing legacy on-premise servers across these verticals. Our volume growth is coming from 3 distinct reliable pillars. We're winning new customers, our existing customers' traffic is growing and we're capturing larger shares of wallet within those established accounts. Fax is what is driving our top line and the demand for it remains robust. Our Q2 results reflect the power of that core engine delivering another quarter of record performance. The corporate channel achieved a major milestone, crossing the $60 million mark for the very first time to deliver a record $60.5 million in total revenue for the quarter. That represents a 9.3% year-over-year increase and a solid 3% sequential increase from Q1, setting a new high watermark for this channel. With Q2 coming in at 9.3% corporate growth, we're consistently operating in the high single digits, well on our path to reaching double digits. This record growth is supported by an expanding market presence ending the quarter with approximately 67,000 corporate customers, which is a 9.4% increase year-over-year. Another key metric that truly demonstrates the health and durability of our corporate business is our net revenue retention rate. I am very pleased to share that our NRR continued its upward climb this quarter by more than 1%, reaching 103.1%, up from 102% in Q1. This is the ultimate validation of our strategy. It proves that once we land these enterprise accounts, we're successfully expanding our footprint, capturing more volume and embedding ourselves deeper into their daily operations. To secure and grow those enterprise accounts, we're continuing to invest purposefully in our health care solutions strategy. As Scott mentioned in his opening remarks, this investment involves building out a dedicated group of subject matter experts. Their specific mandate is to build laser-focused solutions that create tangible value for our health care customers at the intelligence and workflow layer. Last quarter, I spoke quite a bit about the importance of workflow. I'm excited to report that we made great progress on that front in Q2, executing a strategic buy versus build decision through a small asset acquisition, whereby we acquired excellent caliber technology and talent. It brings an appealing customer base and strong partnerships that will directly benefit our go-to-market motions and accelerate our road map for flexible health care provider workflows. The decision fits perfectly into our broader product strategy. The new eFax platform we continue to deploy provides excellent entry-level workflow capabilities right out of the box. By integrating these newly acquired advanced capabilities upmarket, we're building an ecosystem where we can provide AI-powered workflow layer seamlessly along the entire customer continuum from a small independent clinic all the way up to a major health system or payer. This strategy is the natural evolution of our platform, supporting our deep vertical focus by making our core fax products stickier and more deeply embedded in clinical workflows. This continuous product evolution brings me to our SoHo channel and how it converges with our corporate SMB business. We countered the overlap of SoHo and corporate with a very high-performing upgrade program in the past. We launched a new corporate e-commerce offering, eFax Protect, in mid-2023, which has been a meaningful service and a highly relevant revenue contributor. As this captures that SMB demand so efficiently, it has allowed us to scale back our legacy upgrade program and reallocate those valuable resources upmarket to focus on our enterprise accounts. Now we're taking the next step. With the general availability launch of our new eFax platform in Q2, we are offering a dedicated business plan effectively replacing eFax Protect for new customers. It provides an even smoother upgrade path and a much better self-service experience for our customers. I am happy to report a successful rollout resulting in a seamless transition on the new customer acquisition side. We're not stopping there. In Q3, we're releasing enhanced mobile capabilities alongside an optional frictionless migration path from the legacy platform to the new eFax. We're already seeing strong early signs of adoption of these new features, particularly around the self-service flexibility the new platform provides. As we continue to deploy additional features, we expect the platform to grow steadily. Of course, a superior product experience is only half the equation. We also have to drive the right volume to the top of the funnel. On that front, I am pleased to report that our adoption to the new advertising and search environment continues to yield tangible results. Our ongoing search and AI search optimization efforts are driving improved higher-quality traffic directly into our customer acquisition channels. Looking at the financial performance of the SoHo channel, revenue for Q2 was $30.9 million. The year-over-year decline narrowed to 4.7% this quarter, so we view the specific level of improvement as an exceptional result that may not recur at this rate in future periods, particularly compared to the 9.5% decline reported in Q1. I want to be extremely clear about how we are managing this channel. As I've mentioned in the past, metrics in SoHo have been deprioritized. We're managing the strategy strictly for cash optimization and contribution margin, not for absolute subscriber volume or ARPA. Because of this disciplined yield-first approach, we fully expect to see volatility in net adds, ARPA and total revenue in the SoHo channel in the coming months. We will not chase low-margin volume simply to manage our subscriber count. We will accept subscriber volatility in SoHo as long as the channel continues to generate the highly efficient free cash flow required to fund our corporate growth initiatives. Before I hand it over to Adam to walk through the detailed financials, I want to touch briefly on our public sector business because it serves as a massive proof point for our overall upmarket strategy. The Department of Veterans Affairs remains the absolute highlight here, serving as a true lighthouse customer for us and testament to our entrenched position in the federal space. In late Q1, the VA issued a policy that mandates ECFax powered by eFax as the secure fax solution within the VA. It is doing exactly what we believed it would do. It is driving a highly qualified lead pipeline across the public sector and adjacent organizations such as government contractors and suppliers alike. This rare policy mandate solidifies our standing in the public sector and boost our credibility alongside our FedRAMP Class D, formerly FedRAMP High certification. In Q1, we discussed the VA's contribution to our 2026 performance. Based on our current execution and deployment pace, we are highly confident that the VA revenue contribution should be north of $9 million in 2026. This engagement demonstrates our capability to scale rapidly within complex, highly secure environments, and it serves as a powerful door opener for further public sector wins. When you look at the business in totality, the pieces are working together exactly as designed. In summary, Q2 was a quarter of highly focused execution. We're expanding our most valuable enterprise relationships, evolving our product to solve real health care workflow problems and actively optimizing our SoHo cash engine to fuel that growth. I want to thank our entire team for their hard work and discipline this quarter as well as our customers and partners for their continued trust and collaboration. And now I will hand the call over to Adam to walk through the financials in detail. Adam? Adam Varon: Thank you, Johnny, and good afternoon, everyone. Today, I will discuss our Q2 2026 results as well as guidance for Q3 2026 and full year 2026. We expect to file our 10-Q later today. Moving to Corporate results. During the second quarter of 2026, our Corporate business achieved a major milestone breaking the $60 million mark with record-breaking revenue of $60.5 million, representing a 9.3% increase of $5.2 million compared to the previous year. This performance continues our accelerating momentum when compared to 8.2% year-over-year revenue growth last quarter. This 9.3% year-over-year expansion represents the strongest year-over-year growth rate our Corporate business has realized since Q4 2022 and continues the corporate momentum to double-digit growth. Our record Q2 2026 Corporate revenue delivered a trailing 12-month net retention rate of 103.1%. This reflects a sequential and year-over-year increase of approximately 110 basis points. Our Corporate customer base of approximately 67,000 was up 9.4% over the prior comparable period, with corporate ARPA increasing year-over-year by approximately 1% to $305. Moving to SoHo. As mentioned previously and to be very clear, we manage our SoHo revenue channel as a strategic cash engine to fund our accelerating corporate business growth. Q2 2026 SoHo revenue of $30.9 million decreased by $1.5 million or 4.7% over the prior year, slowing from the Q1 2026 decline of 9.5%. We expect SoHo year-over-year revenues to decline in the range of 5% to 7% in each of the next 2 quarters. Moving to consolidated results. As Scott stated, this is the third consecutive quarter that we have demonstrated year-over-year growth in all 4 of our key financial metrics being revenue, adjusted EBITDA, adjusted non-GAAP EPS and free cash flow. Consolidated revenue of $91.4 million represents an increase of $3.6 million or 4.1% over Q2 2025 and a $2.9 million or 3.3% increase sequentially. Additionally, this represents the fifth consecutive quarter of year-over-year consolidated revenue growth and the highest consolidated revenue growth since Q4 of 2022. Q2 2026 adjusted EBITDA of $48.3 million increased $0.2 million or 0.5% year-over-year from $48.1 million in Q2 2025, delivering a solid 52.9% EBITDA margin and firmly within our target adjusted EBITDA margin range of 50% to 55%. Adjusted net income of $28.7 million is an increase of $0.2 million or 0.7% over the prior year. Adjusted EPS of $1.49 is favorable to the prior year by 2.1% or $0.03, driven by the items mentioned and a lower share count from equity repurchases. The Q2 2026 non-GAAP tax rate and share count were 20.3% and 90.2 million shares, respectively. Moving on to capital allocation. Our free cash flow of $25.5 million was driven by Q2 2026 performance, which fueled a $5.1 million or 25% year-over-year increase. We expect full year free cash flow to be in line with 2025 free cash flows at $106 million. We ended Q2 2026 with approximately $99 million in cash, an increase of $6.6 million when compared to Q1 of 2026. Q2 2026 CapEx of $7.8 million was in line with prior year-end expectations. With regard to equity repurchases, I am pleased to announce that our Board of Directors has authorized an amendment in our equity repurchase plan to approve an increase in the total authorization to $200 million. In Q2 2026, we bought 300,000 shares for approximately $9.6 million. Program to date, we have utilized approximately $82 million to repurchase 3 million shares, leaving approximately $118 million available under our amended $200 million Board authorized equity repurchase plan. Our Q2 2026 total debt balance stands at approximately $558 million with $348 million of 6.5% high-yield notes, $146 million in our term loan and $64 million on our revolver. Our net debt-to-EBITDA ratio for Q2 2026 was 2.45x, and we held our total debt-to-EBITDA ratio steady sequentially just below 3x at 2.97x. Moving to guidance. We are reaffirming our full year 2026 outlook as follows: Revenue, we anticipate between $350 million and $364 million, representing a $357 million midpoint. Adjusted EBITDA is expected to range from $182 million to $193 million with a midpoint of $187.5 million. Our adjusted EPS guidance remains between $5.55 and $5.95 or $5.75 at the midpoint. We estimate our full year income tax rate will be between 19.7% and 21.7% with 20.7% at the midpoint with an approximate 19.2 million share count. Albeit immaterial, we have incorporated our recent doc.health acquisition into our full year guidance with the following impact: revenues approximately $1 million; EBITDA, negative $0.6 million; EPS, negative $0.02. Based on our first half 2026 performance, Q3 2026 guidance range and acquisition impact, we expect full year revenues to be between the midpoint and high end of the range. Full year adjusted EBITDA and adjusted EPS are expected to track slightly above the midpoint of guidance. Moving to Q3 2026 guidance. Revenues between $89.2 million and $93.2 million with $91.2 million at the midpoint, adjusted EBITDA between $45 million and $48 million with $46.5 million at the midpoint; adjusted EPS of $1.34 to $1.44 with $1.39 at the midpoint. We estimate our Q3 2026 income tax rate between 19.7% and 21.7% with 20.7% at the midpoint and an approximate share count of 19.2 million shares. This concludes my formal remarks. I'd like to turn the call back to the operator for Q&A. Operator: [Operator Instructions] And the first question today is coming from David Larsen from BTIG. Jenny Shen: This is Jenny Shen on for Dave. Congrats on the quarter. First, I just wanted to ask about the demand environment, hospital spending. This is one of the first quarters where we've really heard some of the hospitals start to express some of their volume challenges that they're going through. Have your conversations with hospitals changed at all? And are the way that you're pitching your products changing? For example, are you emphasizing the ROI aspect of it more? And along those lines, just the quarter looks very good with the top and bottom line beats. What was your decision to reaffirm the full year guide without raising it? Is that just added conservatism given the environment? R. Turicchi: Johnny, do you want to take the first one on the market? Johnny Hecker: Yes. Thanks for the question. I think it's a very good pointed question, and you're basically almost answering it yourself in the way you asked it. So we're experiencing similar things that hospitals are a little bit -- they're slowing down. They're more diligent in their vendor selection. They're particularly focused on EHR integration and buying services through existing vendors. And we can say that we're lucky to be integrated in many EHR vendors. We have very strong partners in the space. So we can basically balance that out a little bit. But the direct communication is exactly as you have described, it's a little bit slower. They're a little bit more reluctant, and we're doing exactly what you said is we're emphasizing ROI with the solutions that we sell and that we position in these hospitals. So yes, very good question, and I think we're positioned really well to balance these kind of ups and downs as we've experienced them throughout the past few years in the health care sector. R. Turicchi: And still getting important wins for us. Johnny Hecker: Yes, absolutely. R. Turicchi: And then I'll take the second one, Jenny. We've reiterated this before, our philosophy on guidance, and I think Adam did a good job of giving you where we think we'll sit within the range. When we come out with the range at the beginning of the year, it is not our practice to -- even if we have beats in a quarter or 2 quarters to raise the ranges. But as Adam noted, based on the first 2 quarters, we think clearly we'll be above the midpoint of the revenues, in fact, between the midpoint and the high end. And we believe we will outperform the midpoint somewhat on both EBITDA and EPS, but neither one of those are sufficient enough to cause us to actually change the range. Operator: [Operator Instructions] And the next question is coming from Ian Zaffino from Oppenheimer. Isaac Sellhausen: This is Isaac Sellhausen on for Ian. My question is just on the VA ECFax. You talked about the contribution for this year. Maybe any additional color you can provide on how many sites that includes and kind of runway for growth going forward? And then in addition to that, maybe highlight your expectations around adoption from other public sector customers and potential conversations with customers there. Johnny Hecker: Yes. Thanks. Really good questions. So on the VA sites, that's not a number that we publicly announce or publish. So I can give you roughly an estimate of where we think we are on the rollout. We're probably, I would say, somewhere between 65%, 75%, maybe 80% through the rollout within the VA. But that mandate that I indicated or that I spoke about in the -- on the call, I think it's opening up other opportunities for us in the broader VA ecosystem. So there's a lot of vendors that are providing services, government contractors that are processing data for the VA. And they are -- we're in active conversations with the first contractors there to get on to ECFax and use the same platform as the VA and as the VA is mandating internally. So the other thing about the sites, maybe to comment why we're not publishing that. On the one hand, signing the VA, we're excited about talking -- about us talking about this. And secondly, it's not really the perfect indicator for the volume. It gives you a little bit of a direction, but there's no direct correlation between -- really between sites and volume. We've learned over the past couple of years that the volume differs from site to site, depending on what they do at those sites, how well they're integrated in the community, how many veterans they can actually serve on-site versus off-site, all those kind of things. So they're not direct correlative to the volume. On the other question that you asked with other public sector opportunities, that is going well. We're expanding that team. We're building out that go-to-market motion. We're seeing more engagement with government contractors as well as with government agencies. And obviously, that mandate, the policy mandate from the VA is giving us increased credibility and some tailwind in that respect. But the VA is just such a large customer that the other wins that we're -- that we can actually put on the board in that space are not contributing at the rate that you would really see in that revenue yet. But we're -- that's a matter of time. I think if you look at the VA time line, it took us years to actually close that deal and implement it. While we don't think it's going to take that long with other larger agencies, the government still operates at the pace that it does. So we expect the next couple of years to see more on that front. I don't know if you want to add anything. R. Turicchi: Well, no, we have a question by e-mail that sort of dovetails with this. One, it was about the federal state local deal pipeline, which I think you in part addressed. And I think it's correlative because the question was what will it take to get corporate growth over 10%, obviously 9% and change. So it's knocking on the door. Part of it, I think, is this opportunity in the public sector over the next several quarters. I would also add that the continuation, particularly the usage trends we've seen in the core base and then outside of the public sector, as I mentioned in response to the previous question, we have some meaningful wins that may take them some time to ramp. But as we look into '27, all of those factors together, assuming there's no change in -- major change in the economy or things like that in terms of how the bases behave would be the elements that would push us into double-digit growth, at least as we see it right now. Johnny Hecker: I mean, obviously, as we're growing, it gets harder and harder, right? Yes, absolute number gets just bigger all the time. But I think we're -- like I said in the call, I think we're on that path. And as Scott stated, it's multiple things. And yes, the public sector plays a big role in getting us across that line. R. Turicchi: And then we had 2 other questions by -- well, I don't know the live question, any follow-ups? Operator: There were no other questions from the lines at this time, Scott. Please go ahead. R. Turicchi: Okay. Then we have 2 others that come by e-mail. One is what is our thoughts on capital deployment in the back half of the year given the strong free cash flow generation. Glad you asked that question. Obviously, as Adam noted, we have been more aggressive purchasers of stock in the first half of the year than probably any 6-month period since we -- 5 years since we spun. We continue to view the stock as very attractive. We look at it on a free cash flow yield basis. We've given you sort of our estimate of the free cash flow for the year. So at the current stock price, the yield is like 16%, 17%. So I would anticipate, subject to volume limitations and just there's not a lot of activity in our stock that, that continues to be very attractive for us. We have looked at buying some of the 6.5% in the open market. There's really no volume to speak of. So I don't think, as has been the case the last several quarters, we'll be able to retire any of the 6.5s at better than par. As a note, they do become callable in October of this year at 101.625%. We don't find that attractive in terms of the call price. October 15, 2027, though they are callable at par. So I think that given that, the 2 uses in the near term of our cash would be equity subject to price and availability. And then we do have the option, particularly with our U.S. cash, which is an important distinction, to pay down some of the revolver. And while that's not extraordinarily attractive, there is a 2% to 2.5% arbitrage between what we earn on the money markets on that cash versus the cost of the debt, which is a SOFR-based loan. So basically, we can make that differential. So I think those are the 2 ways you'll see us deploy the cash through the balance of the year. And then the final question by e-mail, there was a note, we didn't discuss it that we, on a GAAP basis, booked a $5.3 million gain on an investment in the quarter. You may recall that over the last probably 2.5, 3 years, we've talked about investments we've made in one of our partner companies. It's an AI company that is one of the third parties we use in conjunction with Clarity. They had a priced round during the second quarter. So that triggered a valuation. Up until that point, there were no discernible valuation points. So we kept it on the books at our invested cost. We have a $10.5 million cash investment in the business, but it's valued close to $16 million, hence the $5.3 million gain. I would note, one, that is noncash. So that is an accounting gain. And two, you will see some additional disclosure in our Q that just highlights primarily what we already say in our K, which is, hey, these kind of investments are inherently risky. So there could be future valuation changes up or down based on either the company's performance and what future capital raises and what price it raises that. Go back to live questions. Operator: Okay. We did have another question coming in from Isaac from Oppenheimer. Isaac Sellhausen: Just one quick follow-up. Just on the EBITDA margin in the quarter. I think you had previously talked about some hiring across the organization. Maybe you could just provide an update on where the company stands on that. And then I guess the guidance implies margins are towards the lower end of your guys target for the back half. So yes, just any clarification as far as hiring there. R. Turicchi: Yes, 2 things. So you're correct. You may remember in the Q1 earnings call, I noted we had extraordinarily large margins, and I was disappointed in that because the hiring was slow relative to the way we budgeted. Now through a combination of organic hiring and the doc.health acquisition, we started to catch up in Q2. So we sit right now at about 550 employees versus sub-520 when we entered the year. So there's been a growth of 32 employees roughly from the beginning of the year until now. So yes, you're starting to see the comp expense ramp in Q2. Obviously, that will carry through in Q3 and Q4. The other thing I would note, and it's something we're looking at changing for next year, but we account for our accounting fees and professional fees as incurred. And so because of the -- we're a year-end company, the bulk of those fees occur in Q3 and Q4. So on a sequential basis from Q2 to Q3 of this year, we will have an additional $1.3 million of costs that will be expensed in the quarter, primarily relating to the audit. Those fees will repeat again in Q4. So if you look historically at our margin profile, and you'll see Q1 and Q2 have superior margins to 3 and 4 in almost all instances because of that. Now as I say, we're working with our Chief Accounting Officer to estimate those fees in '27 and spread them ratably over the 4 quarters, so you don't have that influencing the margins. So those are the 2 things that are the takeaways in terms of the hiring is catching up. That's a good thing as it relates to the future because the people we're hiring are primarily in the go-to-market product health care solutions group. So these are all people that directly or indirectly are revenue generators in the future, they're not G&A. But then we do have this anomaly of the way we've accounted for our year-end audit, which is heavy in 3 and 4. Operator: And there are no other questions from the lines at this time. I'd now like to hand the call back to Scott Turicchi for closing remarks. R. Turicchi: Great. Well, we appreciate you joining us for our Q2 update. I'd like to note before we sign off that we will be virtually at the Opco Conference on August 12. There are still some slots available. So if you're interested in a follow-up one-on-one, you can reach out to Oppenheimer and be happy to schedule some time for a meeting. The next time that we will be talking will be in early November to report on the Q3 results and maybe have a little insight into 2027. Thank you. Operator: This does conclude today's conference. You may disconnect at this time, and have a wonderful day. Thank you for your participation. 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Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Achieved record corporate revenue of $60.5 million, driven by a structural shift toward high-value enterprise accounts and robust demand for secure cloud fax in regulated verticals. Launched the Healthcare Strategy and Solutions group to unify the product portfolio and transition from simple data transport to high-value, AI-powered structured data processing. Acquired doc.health to integrate clinically adjacent workflow capabilities, accelerating the roadmap for managing referrals and care coordination outside of traditional EHRs. Managed the SoHo channel strictly for cash optimization and contribution margin, intentionally deprioritizing subscriber volume to fund corporate growth initiatives. Reported a record net revenue retention rate of 103.1%, validating the strategy of expanding the footprint within established enterprise accounts. Benefited from a Department of Veterans Affairs policy mandate that established eFax as the secure solution, creating a significant lead pipeline across the public sector. Anticipates full-year 2026 revenue to track between the midpoint and high end of the $350 million to $364 million range. Expects the Department of Veterans Affairs revenue contribution to exceed $9 million in 2026 based on current deployment pace. Projects SoHo revenue to continue declining in the 5% to 7% range over the next two quarters as marketing spend remains focused on corporate channels. Targets double-digit corporate growth in 2027 and beyond, contingent on public sector expansion and the ramp-up of new healthcare solution hires. Assumes a slight compression in H2 margins due to the timing of professional audit fees and the full-period impact of 32 new strategic hires. Recorded a $5.3 million non-cash GAAP gain on an investment in an AI partner company following a recent priced valuation round. Authorized an increase in the equity repurchase plan to $200 million, with $118 million remaining for future opportunistic buybacks. Noted that while hospital spending has slowed, the company's deep EHR integration and ROI-focused pitching help mitigate sector-wide reluctance. Identified a 2% to 2.5% interest rate arbitrage opportunity between cash holdings and revolver debt as a secondary capital allocation priority. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management confirmed hospitals are becoming more diligent and slower in vendor selection, requiring a stronger emphasis on ROI and EHR integration. Consensus leverages existing EHR partnerships to maintain stability despite broader hospital volume challenges. The VA rollout is estimated to be 65% to 80% complete, with the internal mandate driving interest from government contractors. While the VA is a 'lighthouse' customer, other public sector wins are expected to take years to contribute meaningfully to revenue due to government procurement cycles. Margins in Q3 and Q4 are expected to be lower than H1 due to the seasonal concentration of audit and professional fees. The company has added approximately 32 employees since the start of the year, primarily in revenue-generating go-to-market and healthcare solution roles.

Interested in Consensus Cloud Solutions, Inc.? Here are five stocks we like better. Q2 performance improved: Revenue rose 4.1% year over year to $91.4 million, while adjusted EPS increased 2.1% to $1.49 and free cash flow climbed 25% to $25.5 million. Corporate-channel revenue reached a record $60.5 million, offsetting a 4.7% decline in the lower-margin SoHo channel. Healthcare expansion is a key long-term strategy: Consensus launched a Healthcare Strategy and Solutions Group and acquired workflow platform doc.health. Management expects these non-fax healthcare offerings to contribute meaningfully beginning in 2028 and beyond. Guidance was reaffirmed: Full-year 2026 revenue remains projected at $350 million–$364 million, adjusted EBITDA at $182 million–$193 million and adjusted EPS at $5.55–$5.95. The company also expanded its share-repurchase authorization to $200 million and expects VA-related revenue to exceed $9 million this year. Consensus Cloud Solutions (NASDAQ:CCSI) reported second-quarter 2026 results marked by accelerating corporate revenue growth, higher free cash flow and continued investment in healthcare-focused products and sales capabilities. Consolidated revenue increased 4.1% year over year to $91.4 million, while adjusted EBITDA rose 0.5% to $48.3 million. The company said this was its third consecutive quarter of year-over-year growth in consolidated revenue, adjusted EBITDA, adjusted non-GAAP earnings per share and free cash flow. → 3 Drone Stocks That Should Soar After the Summer Slump Adjusted EBITDA margin was 52.9%, within the company’s stated target range of 50% to 55%. Adjusted net income increased 0.7% to $28.7 million, and adjusted EPS rose 2.1% to $1.49, aided in part by a lower share count from repurchases. The corporate channel generated a record $60.5 million in quarterly revenue, up 9.3% from the prior-year period and 3% sequentially. CEO Scott Turicchi said growth was supported by strong usage, revenue retention, new customer additions and advanced-product contributions. → Meta’s Earnings Drop Shows Wall Street Wants More Than Ad Growth Chief Revenue Officer and Executive Vice President of Operations Johnny Hecker said secure cloud fax remains the company’s principal source of dollar growth, particularly as regulated industries such as healthcare and the public sector migrate away from legacy on-premise fax servers. Corporate customers totaled about 67,000 at quarter-end, an increase of 9.4% year over year. Corporate average revenue per account rose about 1% to $305, while trailing-12-month net revenue retention increased to 103.1%, up from 102% in the first quarter. → Jersey Mike's Serves Fresh Gains After IPO Stumble “We’re winning new customers, our existing customers’ traffic is growing, and we’re capturing larger shares of wallet within those established accounts,” Hecker said. The company’s SoHo channel, which it manages primarily for cash generation and contribution margin, produced $30.9 million of revenue, down 4.7% year over year. The decline improved from a 9.5% decrease in the first quarter. However, management said it expects SoHo revenue to decline between 5% and 7% year over year in each of the next two quarters and does not intend to pursue lower-margin volume simply to support subscriber metrics. Consensus formed a Healthcare Strategy and Solutions Group, led by newly appointed Chief Healthcare Solutions Officer Steve Tolle. The group will oversee the company’s healthcare product portfolio, go-to-market efforts and strategy for primarily non-fax solutions. Turicchi said the unit will focus on converting unstructured healthcare documents, such as faxed referrals, authorizations, orders and record requests, into structured data that can be routed through clinical workflows. The initiative is intended to help existing eFax customers expand into higher-value services while drawing new clients seeking workflow intelligence rather than document transport alone. The company also completed a tuck-in acquisition of doc.health, a workflow platform used for clinically adjacent functions including referral management, care coordination, patient follow-up and administrative tasks between visits. Consensus added 14 doc.health employees, along with its customer base, pipeline and technology. Management said it expects to continue hiring in the healthcare unit and related functions through the remainder of 2026 and into 2027, with the group expected to make meaningful contributions to non-fax revenue beginning in 2028 and beyond. During the question-and-answer session, Hecker said hospitals have become more deliberate in vendor selection and are placing greater emphasis on electronic health record integrations and return on investment. He said Consensus is emphasizing ROI in customer discussions and benefits from integrations with multiple EHR providers and partnerships in the sector. Consensus said the Department of Veterans Affairs remains a major public-sector customer. The VA issued a policy in late first quarter requiring ECFax, powered by eFax, as its secure fax solution. Hecker said the rollout was approximately 65% to 80% complete, though he noted that site count does not directly correlate with volume because usage varies by location. The company expects VA revenue to exceed $9 million in 2026. Management said the policy is also generating opportunities with government contractors, suppliers and other agencies, though larger public-sector implementations may take time to develop and scale. Turicchi said continuing usage growth among existing customers, public-sector expansion and recently secured customer wins could support corporate revenue growth moving into double digits, assuming no major change in economic conditions. Free cash flow increased approximately 25% year over year to $25.5 million, helped by receivables management and lower interest expense. Consensus ended the quarter with about $99 million in cash, up $6.6 million from the first quarter, and maintained its expectation for roughly $106 million in full-year free cash flow. The company repurchased about 300,000 shares for approximately $9.6 million during the quarter. Its board expanded the overall share-repurchase authorization to $200 million. Through the program, Consensus has spent about $82 million to buy 3 million shares, leaving approximately $118 million available. Total debt was approximately $558 million at quarter-end, including $348 million of 6.5% high-yield notes, $146 million in term-loan borrowings and $64 million on its revolver. Net debt to EBITDA was 2.45 times. Full-year 2026 revenue guidance was reaffirmed at $350 million to $364 million. Full-year adjusted EBITDA guidance remained $182 million to $193 million. Full-year adjusted EPS guidance remained $5.55 to $5.95. Third-quarter revenue guidance is $89.2 million to $93.2 million. Third-quarter adjusted EBITDA guidance is $45 million to $48 million, with adjusted EPS expected between $1.34 and $1.44. Management said it expects full-year revenue to fall between the midpoint and high end of its outlook, while adjusted EBITDA and adjusted EPS should track slightly above their respective midpoints. The doc.health acquisition is expected to contribute about $1 million of full-year revenue, reduce EBITDA by about $0.6 million and lower EPS by approximately $0.02. Consensus Cloud Solutions (NASDAQ: CCSI) is a provider of cloud consulting and managed services focused on helping organizations accelerate digital transformation. The company specializes in designing, deploying and supporting cloud architectures that leverage leading public and private cloud platforms, including infrastructure as a service (IaaS), platform as a service (PaaS) and software as a service (SaaS) environments. Its end-to-end approach encompasses strategy, implementation and ongoing optimization to align technology investments with business objectives. The firm’s core offerings include cloud migration and deployment, application modernization, data analytics and cybersecurity solutions. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Consensus Cloud Solutions Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

LOS ANGELES, August 06, 2026--(BUSINESS WIRE)--Consensus Cloud Solutions, Inc. (NASDAQ: CCSI) today reported financial results for the second quarter of 2026. "Our Q2 achievements sustained the momentum of the past few quarters. Our corporate channel exceeded 9% revenue growth which has not occurred since Q4 2022. We also saw a meaningful improvement in the SoHo channel ahead of our expectations. More importantly, we were able to accelerate our hiring in Q2, which will be important for achieving our future revenue growth objectives. In addition, we were able to repurchase approximately 300,000 shares of our common stock during the quarter at what we believe are attractive prices," said Scott Turicchi, CEO of Consensus. SECOND QUARTER UNAUDITED 2026 HIGHLIGHTS Q2 2026 quarterly revenues increased by $3.6 million or by 4.1% to $91.4 million compared to $87.7 million for Q2 2025. This increase was primarily due to an increase of $5.2 million or 9.3% in our Corporate business, partially offset by a decrease of $1.5 million or 4.7% in our small office/home office ("SoHo") business relating to our strategic initiative. Net income (1) increased by $6.6 million or 31.7% to $27.4 million in Q2 2026 compared to $20.8 million for Q2 2025. The increase was primarily due to an unrealized gain on our investments during the current quarter and an increase in revenues, partially offset by an increase in our personnel related costs. Q2 2026 net income margin (1) was 30.0% compared to 23.7% for Q2 2025. Earnings per diluted share (1) increased to $1.43, or by 33.6% in Q2 2026 compared to $1.07 for Q2 2025. The increase was primarily due to the items discussed above, as well as a lower weighted average share count as a result of share repurchases. Adjusted EBITDA (3,4) for Q2 2026 of $48.3 million remained consistent compared to Q2 2025 of $48.1 million. Adjusted EBITDA margin (3) was 52.9% and 54.8% in Q2 2026 and Q2 2025, respectively, which were both within our target Adjusted EBITDA margin (3) range of 50% - 55%. Adjusted net income (1,2) in Q2 2026 remained consistent at $28.7 million compared to $28.4 million in Q2 2025. Adjusted earnings per diluted share (1,2) for the quarter increased to $1.49 in Q2 2026 compared to $1.46 in Q2 2025, primarily due to the items discussed above, as well as a lower weighted average share count as a result of share repurchases. Net cash provided by operating activities in Q2 2026 increased to $33.3 million from $28.3 million in Q2 2025. Free cash flow (5) in Q2 2026 increased to $25.5 million from $20.3 million in Q2 2025. The increase in net cash provided by operating activities and Free cash flow (5) was primarily attributable to an increase in income after excluding noncash items in Q2 2026 compared to Q2 2025. Key financial results from operations for Q2 2026 versus Q2 2025 are set forth in the following table. Reconciliations of GAAP measures to comparable non-GAAP financial measures accompany this press release. Notes: CAPITAL ALLOCATION STRATEGIC INITIATIVES Including the cash outlays for strategic capital allocation initiatives detailed below, Consensus ended the quarter with $98.9 million in cash and cash equivalents. The following table consists of our material capital allocation strategic initiatives (in thousands): Notes: FY 2026 GUIDANCE (i) The following table presents ranges for the Company’s 2026 guidance (in millions, except per share amounts): Q3 2026 GUIDANCE (i) The following table presents ranges for the Company’s Q3 2026 guidance (in millions, except per share amounts): Notes: About Consensus Cloud Solutions Consensus Cloud Solutions, Inc. (NASDAQ: CCSI) is a global leader in digital cloud fax technology. With over 25 years of success with eFax® at its core, the Company has evolved to be a trusted provider of interoperability solutions, leveraging artificial intelligence and secure data exchange to transform digital information, automate critical workflows, and maximize operational efficiencies. Consensus offers select services with independently audited compliance controls and enterprise grade security, making it a preferred partner for heavily regulated industries including healthcare, the public sector, financial services, insurance, real estate, and manufacturing. For more information about Consensus, visit consensus.com. "Safe Harbor" Statement Under the Private Securities Litigation Reform Act of 1995: Certain statements in this press release are "forward-looking statements" within the meaning of The Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management’s current expectations or beliefs and are subject to numerous assumptions, risks and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. These factors and uncertainties include, among other items: the Company’s ability to grow fax revenues, profitability and cash flows; the Company’s ability to identify, close and successfully transition acquisitions; subscriber growth and retention; variability of the Company’s revenue based on changing conditions in particular industries and the economy generally; protection of the Company’s proprietary technology or infringement by the Company of intellectual property of others; the risk of adverse changes in the U.S. or international regulatory environments, including but not limited to the imposition or increase of taxes or regulatory-related fees; general economic and political conditions, including political tensions and war (such as the ongoing conflict in Ukraine and the Middle East); the impact of new or additional tariffs or other trade restrictions, and the impacts of a U.S. federal government shutdown; and the numerous other factors set forth in Consensus’ filings with the Securities and Exchange Commission ("SEC"). For a more detailed description of the risk factors and uncertainties affecting Consensus, refer to the 2025 Annual Report on Form 10-K filed by Consensus on February 13, 2026, and the other reports filed by Consensus from time-to-time with the SEC, each of which is available at www.sec.gov. The forward-looking statements provided in this press release are subject to change. Although management’s expectations may change after the date of this press release, the Company undertakes no obligation to revise or update these statements. About non-GAAP Financial Measures To supplement our condensed consolidated financial statements, which are prepared and presented in accordance with GAAP, we use the following non-GAAP financial measures: Adjusted net income, Adjusted earnings per diluted share, Adjusted EBITDA, Adjusted EBITDA margin and Free cash flow. The presentation of this non-GAAP financial information is not intended to be considered in isolation from, or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. We use these non-GAAP financial measures for financial and operational decision-making and as a means to evaluate period-to-period comparisons. Our management believes that these non-GAAP financial measures provide meaningful supplemental information regarding our performance and liquidity by excluding certain expenses and expenditures that may not be indicative of our recurring core business operating results. We believe that both management and investors benefit from referring to these non-GAAP financial measures in assessing our performance and when planning, forecasting, and analyzing future periods. These non-GAAP financial measures also facilitate management’s internal comparisons to our historical performance and liquidity. We believe these non-GAAP financial measures are useful to investors both because (1) they allow for greater transparency with respect to key metrics used by management in its financial and operational decision-making and (2) they are used by our institutional investors and the analyst community to help them analyze the health of our business. For more information on these non-GAAP financial measures, please see the appropriate GAAP to non-GAAP reconciliation tables included within the attached Exhibit to this Release. Adjusted net income as calculated above represents net income and the items used to reconcile GAAP to non-GAAP financial measures, including (a) share-based compensation; (b) intercompany related foreign exchange (gain) loss; (c) amortization of acquired intangibles; (d) intra-entity transfers; (e) debt extinguishment loss; (f) unrealized gain on investments; (g) other benefits or costs related to non-routine and other matters; and (h) income tax impact. Adjusted net income and weighted average diluted shares are then used to calculate Adjusted earnings per diluted share. The Company discloses these measures as a supplemental non-GAAP financial performance measure, as it believes it is a useful metric by which to compare the performance of its business from period to period. The Company also understands that measures are broadly used by analysts, rating agencies and investors in assessing our performance. Accordingly, the Company believes that the presentation of these measures provides useful information to investors. Adjusted net income and Adjusted earnings per diluted share are not calculated in accordance with, or presented as an alternative to, net income or earnings per diluted share, and may be different from similarly or identically named non-GAAP measures used by other companies. In addition, these measures are not based on any comprehensive set of accounting rules or principles. These non-GAAP measures have limitations in that they do not reflect all of the amounts associated with the Company’s results of operations determined in accordance with GAAP. Non-GAAP Financial Measures To supplement its unaudited condensed consolidated financial statements, the Company uses the following non-GAAP financial measures: Adjusted net income, Adjusted earnings per diluted share, Adjusted EBITDA, Adjusted EBITDA margin and Free cash flow (collectively the "non-GAAP financial measures"). The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with U.S. GAAP. The Company uses these non-GAAP financial measures for financial and operational decision making and as a means to evaluate period-to-period comparisons. The Company believes that they provide useful information about core operating results, enhance the overall understanding of past financial performance and future prospects, and allow for greater transparency with respect to key metrics used by management in its financial and operational decision making. The Company’s non-GAAP financial measures are adjusted for the following items: (a) Share-based compensation. The Company excludes share-based compensation because it is non-cash in nature and because the Company believes that the non-GAAP financial measures excluding this item provides meaningful supplemental information regarding the operational performance of the business. In addition, excluding this item from the non-GAAP measures facilitates comparisons to historical operating results and comparisons to peers, many of which similarly exclude this item. (b) Foreign exchange (gain) loss. The Company excludes intercompany related gains or losses associated with foreign exchange. The Company believes that the non-GAAP financial measures excluding this item provide meaningful supplemental information regarding the operational performance of the business. In addition, excluding this item from the non-GAAP measures facilitates comparisons to historical operating results and comparisons to peers, many of which similarly exclude this item. (c) Amortization of acquired intangibles. The Company excludes amortization of patents and acquired intangible assets because it is non-cash in nature and because the Company believes that the non-GAAP financial measures excluding this item provide meaningful supplemental information regarding the operational performance of the business. In addition, excluding this item from the non-GAAP measures facilitates comparisons to historical operating results and comparisons to peers, many of which similarly exclude this item. (d) Intra-entity transfers. The Company excludes certain effects of intra-entity transfers to the extent the related tax asset or liability in the financial statement is not recovered or settled, respectively, during the year. During December 2019, the Company entered into an intra-entity asset transfer that resulted in the recording of a tax benefit and related tax asset representing tax deductible amounts to be realized in future years which is expected to be recovered over a period of up to 20 years. The Company believes that excluding the cumulative future unrealized benefit of the assets transferred in 2019 and amortization of the tax asset in the subsequent years in the non-GAAP financial measures, thereby presenting the tax benefit in the non-GAAP measures in the year of realization, provides meaningful supplemental information regarding operational performance and facilitates comparisons to historical operating results. (e) Debt extinguishment loss. The Company excludes certain gains or losses associated with the retirement of our debt. The Company believes that the non-GAAP financial measures excluding this item provide meaningful supplemental information regarding the operational performance of the business. In addition, excluding this item from the non-GAAP measures facilitates comparisons to historical operating results and comparisons to peers, many of which similarly exclude this item. (f) Unrealized gain on investments. The Company excludes gains or losses associated with changes in the fair value of its investments. The Company believes that excluding this item provides meaningful supplemental information regarding the operational performance of the business. In addition, excluding this item from the non-GAAP measures facilitates comparisons to historical operating results and comparisons to peers, many of which similarly exclude this item. (g) Other. The Company excludes certain benefits or costs related to non-routine and other matters. The Company believes that the non-GAAP financial measures excluding this item provide meaningful supplemental information regarding the operational performance of the business. In addition, excluding this item from the non-GAAP measures facilitates comparisons to historical operating results. Adjusted EBITDA as calculated above represents earnings before interest expense, interest income, other (income) expense, net, income tax expense, depreciation and amortization and the items used to reconcile GAAP to non-GAAP financial measures, including share-based compensation and other benefits or costs related to non-routine and other matters. The Company discloses Adjusted EBITDA as a supplemental non-GAAP financial performance measure, as it believes it is a useful metric by which to compare the performance of its business from period to period. The Company also understands that measures similar to Adjusted EBITDA are broadly used by analysts, rating agencies and investors in assessing our performance. Accordingly, the Company believes that the presentation of Adjusted EBITDA provides useful information to investors. Adjusted EBITDA is not calculated in accordance with, or presented as an alternative to, net income, and may be different from similarly or identically named non-GAAP measures used by other companies. In addition, Adjusted EBITDA is not based on any comprehensive set of accounting rules or principles. This Adjusted non-GAAP measure has limitations in that it does not reflect all of the amounts associated with the Company’s results of operations determined in accordance with GAAP. Net cash provided by operating activities in Q2 2026 increased to $33.3 million from $28.3 million in Q2 2025. Free cash flow in Q2 2026 increased to $25.5 million from $20.3 million in Q2 2025. The increase in net cash provided by operating activities and Free cash flow was primarily attributable to an increase in income after excluding noncash items in Q2 2026 compared to Q2 2025. The term Free cash flow is defined as net cash provided by operating activities, less purchases of property and equipment. The Company discloses Free cash flow as a supplemental non-GAAP financial performance measure, as it believes it is a useful metric by which to compare the performance of its business from period to period. The Company also understands that this non-GAAP measure is broadly used by analysts, rating agencies and investors in assessing the Company’s performance. Accordingly, the Company believes that the presentation of this non-GAAP financial measure provides useful information to investors. Free cash flow is not calculated in accordance with, or presented as an alternative to, net cash provided by operating activities, and may be different from non-GAAP measures with similar or even identical names used by other companies. In addition, Free cash flow is not based on any comprehensive set of accounting rules or principles. This non-GAAP measure has limitations in that it does not reflect all of the amounts associated with the Company’s results of operations determined in accordance with GAAP. Key Performance Metrics (Unaudited) The following table sets forth certain key performance metrics for Consensus for the three months ended June 30, 2026 and 2025 (in thousands, except for percentages and Average Revenue per Customer Account): View source version on businesswire.com: https://www.businesswire.com/news/home/20260806114093/en/ Contacts Laura HinsonConsensus Cloud Solutions, [email protected]

Consensus Cloud Solutions, Inc. (CCSI) came out with quarterly earnings of $1.49 per share, in line with the Zacks Consensus Estimate . This compares to earnings of $1.46 per share a year ago. These figures are adjusted for non-recurring items. A quarter ago, it was expected that this company would post earnings of $1.4 per share when it actually produced earnings of $1.52, delivering a surprise of +8.57%. Over the last four quarters, the company has surpassed consensus EPS estimates three times. Consensus Cloud Solutions, which belongs to the Zacks Internet - Software industry, posted revenues of $91.36 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 1.52%. This compares to year-ago revenues of $87.72 million. The company has topped consensus revenue estimates three times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Consensus Cloud Solutions shares have added about 74.9% since the beginning of the year versus the S&P 500's gain of 12.8%. While Consensus Cloud Solutions has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Consensus Cloud Solutions was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $1.47 on $89.35 million in revenues for the coming quarter and $5.80 on $356.75 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Internet - Software is currently in the top 44% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. A2Z Cust2Mate Solutions Corp. (AZ), another stock in the same industry, has yet to report results for the quarter ended June 2026. The results are expected to be released on August 12. This company is expected to post quarterly loss of $0.16 per share in its upcoming report, which represents a year-over-year change of +48.4%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. A2Z Cust2Mate Solutions Corp.'s revenues are expected to be $3.4 million, up 193.1% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Consensus Cloud Solutions, Inc. (CCSI) : Free Stock Analysis Report A2Z Cust2Mate Solutions Corp. (AZ) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

F5 Networks (FFIV) came out with quarterly earnings of $4.73 per share, beating the Zacks Consensus Estimate of $3.98 per share. This compares to earnings of $4.16 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +18.84%. A quarter ago, it was expected that this computer networking company would post earnings of $3.47 per share when it actually produced earnings of $3.9, delivering a surprise of +12.39%. Over the last four quarters, the company has surpassed consensus EPS estimates four times. F5, which belongs to the Zacks Internet - Software industry, posted revenues of $865.08 million for the quarter ended June 2026, surpassing the Zacks Consensus Estimate by 3.96%. This compares to year-ago revenues of $780.37 million. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. F5 shares have added about 53.7% since the beginning of the year versus the S&P 500's gain of 8.3%. While F5 has outperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for F5 was mixed. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $4.12 on $854.33 million in revenues for the coming quarter and $16.45 on $3.32 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Internet - Software is currently in the bottom 40% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Another stock from the same industry, Consensus Cloud Solutions, Inc. (CCSI), has yet to report results for the quarter ended June 2026. The results are expected to be released on August 6. This company is expected to post quarterly earnings of $1.49 per share in its upcoming report, which represents a year-over-year change of +2.1%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Consensus Cloud Solutions, Inc.'s revenues are expected to be $90 million, up 2.6% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report F5, Inc. (FFIV) : Free Stock Analysis Report Consensus Cloud Solutions, Inc. (CCSI) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Investors in Consensus Cloud Solutions, Inc. (NASDAQ:CCSI) had a good week, as its shares rose 6.3% to close at US$29.33 following the release of its quarterly results. Consensus Cloud Solutions reported US$88m in revenue, roughly in line with analyst forecasts, although statutory earnings per share (EPS) of US$1.30 beat expectations, being 9.6% higher than what the analysts expected. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We've gathered the most recent statutory forecasts to see whether the analysts have changed their earnings models, following these results. Trump has pledged to "unleash" American oil and gas and these 15 US stocks have developments that are poised to benefit. Following last week's earnings report, Consensus Cloud Solutions' five analysts are forecasting 2026 revenues to be US$355.9m, approximately in line with the last 12 months. Statutory earnings per share are predicted to accumulate 5.4% to US$5.05. Before this earnings report, the analysts had been forecasting revenues of US$355.6m and earnings per share (EPS) of US$4.87 in 2026. So the consensus seems to have become somewhat more optimistic on Consensus Cloud Solutions' earnings potential following these results. View our latest analysis for Consensus Cloud Solutions The consensus price target was unchanged at US$34.40, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. There are some variant perceptions on Consensus Cloud Solutions, with the most bullish analyst valuing it at US$42.00 and the most bearish at US$20.00 per share. Note the wide gap in analyst price targets? This implies to us that there is a fairly broad range of possible scenarios for the underlying business. One way to get more context on these forecasts is to look at how they compare to both past performance, and how other companies in the same industry are performing. It's pretty clear that there is an expectation that Consensus Cloud Solutions' revenue growth will slow down substantially, with revenues to the end of 2026 expected to display 1.9% growth on an annualised basis. This is compared to a historical growth rate of 7.2% over the past five years. Compare this against other companies (with analyst forecasts) in the industry, which are in aggregate expected to see revenue growth of 17% annually. Factoring in the forecast slowdown in growth, it seems obvious that Consensus Cloud Solutions is also expected to grow slower than other industry participants. The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Consensus Cloud Solutions' earnings potential next year. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. The consensus price target held steady at US$34.40, with the latest estimates not enough to have an impact on their price targets. With that in mind, we wouldn't be too quick to come to a conclusion on Consensus Cloud Solutions. Long-term earnings power is much more important than next year's profits. We have forecasts for Consensus Cloud Solutions going out to 2028, and you can see them free on our platform here. Even so, be aware that Consensus Cloud Solutions is showing 1 warning sign in our investment analysis , you should know about... Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com. This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Interested in Consensus Cloud Solutions, Inc.? Here are five stocks we like better. Corporate growth accelerating: Corporate revenue hit a record $58.7 million, up 8.2% year‑over‑year, with net revenue retention above 102% as the company “high‑grades” its customer base toward larger enterprise accounts. Strong profitability and cash generation: Q1 adjusted EBITDA was $47.9 million (54.1% margin), adjusted EPS was $1.52 (up 10.9%), and free cash flow was $38.5 million (up 14%), while the company repurchased $17 million of stock and sits with roughly $92 million cash and net debt/EBITDA of 2.5x. Guidance reaffirmed with cautious hiring headwinds: Management reaffirmed full‑year 2026 targets (revenue $350–364M, adjusted EBITDA $182–193M, adjusted EPS $5.55–5.95) but warned margins may compress as hiring ramps to support growth and 2027 initiatives. Consensus Cloud Solutions (NASDAQ:CCSI) reported first-quarter 2026 results that management said marked a continued shift toward faster-growing corporate revenue, while maintaining profitability and strong free cash flow. CEO Scott Turicchi said the company entered 2026 with “momentum” and delivered results that exceeded internal expectations in both corporate and SOHO channels. Turicchi noted consolidated revenue grew 1.5% year over year versus Q1 2025, and said it was the second consecutive quarter of year-over-year growth across four metrics: revenue, adjusted EBITDA, non-GAAP EPS, and free cash flow. → Berkshire Hathaway’s Record Cash Hoard: Why and What's Next? The quarter’s performance was driven by an 8.2% revenue increase in the corporate channel, which Turicchi attributed to “record usage as well as a continuation of customer acquisition across our continuum.” He described it as the company’s highest corporate growth rate since Q4 2022. Turicchi also said SOHO outperformed the company’s forecast due to improved customer acquisition and a “significant improvement” in the year-over-year decline rate compared to Q4 2025. → Insider Sales: Top AST SpaceMobile Insider Cuts Postion Over 30% CRO and EVP of Operations Johnny Hecker framed 2025 as a “foundational year” and said the company’s realignment toward “high-value, high-durability corporate revenue” is accelerating, particularly as customers continue migrating to cloud-based workflows. Hecker said the company intensified go-to-market execution to focus on “intent-driven customer acquisition,” and pointed to strong engagement from industry conferences during the quarter. Hecker said the corporate channel delivered record revenue of $58.7 million in Q1, up 8.2% year over year from $54.3 million in Q1 2025, and up 3.4% sequentially from a record Q4. He described the corporate customer base as approximately 65,000 customers, up roughly 7% year over year, and said the company has maintained that level since Q3 2025 while “high-grading” toward larger enterprise accounts. → Years in the Making, AMD’s Upside Movement Has Just Begun Hecker also reported that net revenue retention (NRR) exceeded 102% in the quarter, improving by 76 basis points from Q4 2025 and reaching the highest level since the company exceeded 100% in Q4 2024. He said the lift reflected customers “adding more volume and adopting our solutions more broadly,” driven by increased utilization among larger enterprise clients and the integration of eFax into clinical workflows via electronic health record (EHR) vendor platforms. In the public sector, Hecker said the company’s FedRAMP High-certified ECFax solution continues to gain traction, adding that management is confident it can “meet or exceed the $9 million VA contribution to 2026 revenue” projected on the prior quarter’s call as the engagement scales. Hecker said the company “soft launched a rearchitected eFax platform” for corporate and SOHO e-commerce offerings, which he described as a workflow and AI monetization framework designed to reduce friction in the customer journey and support broader deployment of “eFax Clarity AI capabilities.” He characterized the evolution as moving from a “transport layer” to an “intelligence layer,” aimed at automating manual processes in healthcare and routing data extracted from unstructured documents into EHRs and back-office systems. Hecker said the company expects the platform improvements to support higher deal conversion rates and contribute to its “path to delivering sustained double-digit growth” in the corporate channel. Hecker reiterated that the company manages SOHO as a “strategic cash engine,” prioritizing yield and contribution margin over subscriber longevity to fund corporate expansion. SOHO revenue was $29.7 million, representing a 9.5% year-over-year decline. Hecker said that was an improvement from the 11.1% decline in Q4 2025 and was in line with the decline rate seen in Q3 2025. CFO Adam Varon, appearing on his first earnings call with the company, reviewed quarterly results and reiterated full-year guidance. Varon said consolidated revenue was $88.5 million, up $1.3 million, or 1.5%, from Q1 2025 and up 1.6% sequentially. Adjusted EBITDA totaled $47.9 million versus $47.3 million a year earlier, producing a 54.1% margin. Varon said the margin was driven by revenue flow-through and partially offset by marketing and personnel-related expenses. Adjusted net income was $28.9 million, up 7.3% year over year, which Varon said was aided by favorable net interest expense on lower debt balances. Adjusted EPS was $1.52, up $0.15, or 10.9%, driven by operating performance and a lower share count from repurchases. The company’s Q1 non-GAAP tax rate was 20.5%, and the share count was approximately 19 million. Free cash flow was $38.5 million, which Varon said was up 14% year over year, and cash ended the quarter at $92.3 million. Capital expenditures were $7.4 million. On capital allocation, Varon said the company repurchased 600,000 shares for approximately $17 million in Q1. In total, it has used $72 million to repurchase 2.7 million shares under a $100 million authorization, leaving $28 million available. Total debt was approximately $560 million, consisting of $348 million of 6.5% high-yield notes, $148 million of delayed draw term loan, and $64 million on the revolver. Varon said net debt to EBITDA was 2.5x and total debt to EBITDA was 3.0x, flat with Q4 2025. Turicchi said the company has no substantial maturities until late 2028 and is monitoring bank and debt markets for a potential refinancing opportunity before late 2027. He also said management expects free cash flow to “approximate the record level of 2025” and indicated the company expects to remain a stock buyer, citing a free cash flow yield “approximately three times” its debt costs. For guidance, Varon reaffirmed full-year 2026 targets: Revenue: $350 million to $364 million (midpoint $357 million) Adjusted EBITDA: $182 million to $193 million (midpoint $187.5 million) Adjusted EPS: $5.55 to $5.95 (midpoint $5.75) Full-year tax rate: 19.7% to 21.7% (midpoint 20.7%), with ~19 million shares For Q2 2026, the company guided to: Revenue: $87.9 million to $91.9 million (midpoint $89.9 million) Adjusted EBITDA: $46.4 million to $49.6 million (midpoint $48.0 million) Adjusted EPS: $1.43 to $1.53 (midpoint $1.48) In response to a question about why full-year guidance was not raised following the Q1 beat, Turicchi said the company adjusts guidance only when it is “highly confident” it will exceed one or more metrics, adding that it is “too early in the year” to make changes. He also cautioned that Q1 margins benefited from slower-than-budgeted hiring and said he expects hiring to pick up through the year, primarily in go-to-market, product, and engineering roles. Turicchi said he does not expect 54% EBITDA margins to repeat as staffing ramps, and that some hires are intended to support 2027 rather than contribute revenue immediately. In closing remarks, Turicchi said the company expects to release Q2 results in “the first, probably 10 days of August,” and management expects to file its Q1 10-Q later the same day. Consensus Cloud Solutions (NASDAQ: CCSI) is a provider of cloud consulting and managed services focused on helping organizations accelerate digital transformation. The company specializes in designing, deploying and supporting cloud architectures that leverage leading public and private cloud platforms, including infrastructure as a service (IaaS), platform as a service (PaaS) and software as a service (SaaS) environments. Its end-to-end approach encompasses strategy, implementation and ongoing optimization to align technology investments with business objectives. The firm’s core offerings include cloud migration and deployment, application modernization, data analytics and cybersecurity solutions. The article "Consensus Cloud Solutions Q1 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for May 2026.

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Corporate channel growth accelerated to 8.2%, the highest rate since late 2022, driven by record usage and sustained customer acquisition. Management attributes the Corporate momentum to a 'barbell strategy' that prioritizes high-grading the portfolio toward larger, high-durability enterprise accounts. Net Revenue Retention (NRR) reached 102%, a 76 basis point sequential improvement, indicating that existing clients are integrating the platform deeper into their clinical workflows. The SoHo channel is being managed as a 'Strategic Cash Engine' focused on yield and contribution margin rather than subscriber longevity to fund Corporate expansion. Operational performance in Healthcare is shifting from a discretionary tech update to a mandatory upgrade as clients face severe staffing constraints and margin pressure. The eFax brand serves as a strategic entry point and 'magnet' for cloud migration, effectively leading conversations around broader digital transformation. Management expects adjusted EBITDA margins to track toward the 50% to 55% midpoint for the remainder of the year as they close the Q1 hiring gap. The soft launch of a rearchitected eFax platform is designed to serve as a new workflow and AI monetization framework, enabling future layering of Clarity AI capabilities. The company is monitoring debt markets for opportunistic refinancing before late 2027, though no substantial maturities occur until late 2028. Guidance for 2026 revenue remains at a $357 million midpoint, with management maintaining a 'philosophical principle' of only raising ranges when highly confident in exceeding them. The VA engagement is projected to contribute $9 million to 2026 revenue as the integration continues to scale into daily operations. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Q1 EBITDA margins of 54.1% were partially inflated by a hiring lag in go-to-market and engineering roles relative to budget expectations. The company utilized $17 million to repurchase 600,000 shares in Q1, citing a free cash flow yield approximately 3x that of their debt costs. FedRAMP high certification for the ECFax solution is cited as a critical differentiator for gaining traction within the public sector. Management explicitly noted they are 'not managing SoHo for subscriber longevity,' accepting a 9.5% revenue decline in that segment to prioritize cash flow. CEO Scott Turicchi explained that the decision was based on a philosophical principle of not raising guidance only one quarter into the year. He noted that while Q1 results were strong, the company intends to increase spending on hiring in Q2 and beyond to set up for 2027 growth. The Q1 margin outperformance was driven by timing of expenses, and management expects these costs to normalize as they fill roles in go-to-market and engineering.

Image source: The Motley Fool. Thursday, May 7, 2026 at 5 p.m. ET Chief Executive Officer — Scott Turicchi Chief Financial Officer — Adam Varon Chief Revenue Officer and EVP Operations — Johnny Hecker Vice President of Finance — Kip Kilpak Need a quote from a Motley Fool analyst? Email [email protected] Operator: Good day, ladies and gentlemen, and welcome to the Consensus Cloud Solutions, Inc. Q1 2026 Earnings Call. My name is Paul, and I will be the operator assisting you today. At this time, all participants are in a listen-only mode. If anyone should require operator assistance during the conference, please press the appropriate key on your telephone keypad. On this call from Consensus Cloud Solutions, Inc. will be Scott Turicchi, Adam Varon, Johnny Hecker, and Kip Kilpak. I will now turn the call over to Kip Kilpak, Vice President of Finance at Consensus Cloud Solutions, Inc. You may begin. Kip Kilpak: Good afternoon, and welcome to the Consensus Cloud Solutions, Inc. investor call to discuss our Q1 2026 financial results, other key information, and our Q2 2026 quarterly guidance. Joining me today are Scott Turicchi, CEO, Johnny Hecker, CRO and EVP Operations, and Adam Varon, CFO. The earnings call will begin with Scott providing opening remarks, Johnny will give an update on operational progress since our Q4 2024 investor call, then Adam will provide Q1 2026 financial results and our Q2 2026 guidance range. After we finish our prepared remarks, we will conduct a Q&A session. At that time, the operator will instruct you on the procedures for asking a question. Before we begin our prepared remarks, allow me to direct you to our forward-looking statements and risk factors on Slide 2 of our investor presentation. As you know, this call and the webcast will include forward-looking statements. Such statements may involve risks and uncertainties that could cause actual results to differ materially from the anticipated results. Some of those risks and uncertainties include, but are not limited to, the risk factors that we have disclosed in our regulatory filings, including our annual 10-Ks and quarterly 10-Q SEC filings. Now let me turn the call over to Scott for his opening remarks. Scott Turicchi: Thank you, Kip. I would also like to welcome Adam on his first earnings call as our Chief Financial Officer. I am very proud of the momentum that our team carried into 2026 and the results that we posted to begin the fiscal year. As I stated last quarter, the next phase of Consensus Cloud Solutions, Inc. has begun. While we did post three consecutive quarters last year of revenue growth, it was minimal. However, in Q1 2026, we exceeded our expectations in both our corporate and SOHO channels of revenue and had 1.5% consolidated revenue growth compared to 2025. In fact, this is now the second consecutive quarter that we have demonstrated year-over-year growth in all four of our key financial metrics: revenue, adjusted EBITDA, non-GAAP EPS, and free cash flow. Before turning the call over to Johnny, who will provide you with more detail regarding the quarter, I would like to note a few items. Our Q1 financial results were driven by 8.2% revenue growth in our corporate channel driven by record usage as well as a continuation of customer acquisition across our continuum. This is the highest growth rate for our corporate channel since 2022. The SOHO channel also beat our forecast as we saw improvement in customer acquisition during the quarter and had a significant improvement in the year-over-year rate of decline experienced in Q4 2025. Our adjusted EBITDA margins remain consistent with 2025 and above the midpoint of our range of 50% to 55%. This is due in part to the timing of hiring relative to our budget expectations. We plan to close the hiring gap throughout the year and would expect our adjusted EBITDA margins to track more to the midpoint of our range for the remainder of the year. We started the year with strong Q1 free cash flow of $38.5 million, which allowed us to repurchase 600 thousand shares of our stock during the quarter while maintaining cash balances such that we can fully borrow under our credit facility and term loan. We do not have any substantial maturities on our debt until late 2028. However, we are monitoring both the bank and debt markets to see if an opportunistic refinancing can be achieved before late 2027. We expect free cash flow to approximate the record level of 2025 and look to continue to be buyers of our stock given the free cash flow yield on our stock is approximately three times that of our debt costs. I will now turn the call over to Johnny. Thank you, Scott, and hello, everyone. Johnny Hecker: Last year, I described 2025 as our foundational year, a period of deliberate realignment to favor high-value, high-durability corporate revenue. Today, I want to share how that transformation is accelerating in a way that confirms the core of our platform thesis. In times of uncertainty and a tight macroeconomic environment, particularly within healthcare, we are actively intensifying our go-to-market execution, focusing relentlessly on intent-driven customer acquisition to increase deal volume. I am pleased that we are seeing this strategy come to fruition. In Q1, our teams participated in several of the most important industry conferences in our sector, and the results validated this targeted approach. The record lead volume and intensity of interest we captured at these events confirmed that the ongoing migration to the cloud represents a structural opportunity for Consensus Cloud Solutions, Inc. Our eFax brand has proven to be a highly effective magnet in this space, as the strategic entry point that allows us to lead the conversation around digital transformation. For these organizations, migrating to our platform is no longer a discretionary tech stack update; it has become a mandatory operational upgrade. Our Q1 results substantiate once more that our center of gravity has shifted. The corporate channel delivered record revenue this quarter, generating $58.7 million. I am excited to report an 8.2% year-over-year growth rate over the $54.3 million of corporate revenue in 2025, a significant acceleration from the 7.3% we reported last quarter. This sustained increase in our momentum is the primary takeaway here, as it demonstrates the compounding strength of our strategy and keeps us firmly on the path towards double-digit corporate growth. While we also saw a solid 3.4% sequential increase coming out of a record fourth quarter, it is the consistent year-over-year expansion that validates our thesis. Trajectory is driven by the continued execution of our barbell strategy reflected in our corporate base of approximately 65 thousand customers, which has grown roughly 7% year over year. While we have maintained this level since 2025 as we prioritize high-grading our portfolio towards larger enterprise accounts, the annual growth proves the scalability of our acquisition power. More importantly, that upmarket momentum is directly feeding our expansion economics. Our net revenue retention rate exceeded 102% this quarter, a 76-basis-point improvement over 2025, and the highest NRR rate since we reached the target of 100% in 2024. It proves our customers are finding more value in our solutions. They are adding more volume and adopting our solutions more broadly as they integrate deeply into our ecosystem. This lift results from a powerful utilization tailwind as our largest enterprise clients route more uninterrupted data flows through our network with ever-increasing volumes that consistently exceed our internal targets. As evidenced by our native integration into major EHR vendor platforms, eFax has developed into an operational dependency within the clinical workflow. This shift underscores our move to an embedded infrastructure layer. We are seeing a similar trend in the public sector where our FedRAMP High-certified eFax solution continues to gain traction. Our Q1 results give us confidence that we can meet or exceed the $9 million VA contribution to 2026 revenue we projected last quarter as that engagement continues to scale and integrate into their daily operations. Capturing volume is the foundation. The next phase of our growth is about value extraction—moving from being a transport layer to being an intelligence layer. With that in mind, last month, we soft launched the eFax platform for our corporate and SOHO e-commerce offerings. This launch brings the identity of our recent brand refresh directly into the product experience and serves as our new workflow and AI monetization framework. It is an infrastructure upgrade specifically engineered to remove friction from the customer journey and provide a seamless on-ramp for our advanced technologies. As part of a continuous deployment, this architecture will eventually enable our clients to layer on eFax Clarity AI capabilities at scale, moving at the pace of their own digital transformation. In our last call, I emphasized that we are no longer just selling a connection; we are tackling a labor problem. This product evolution is how we deliver on that promise. Our customers, particularly in healthcare, are facing severe staffing constraints and margin pressure. They can no longer afford to have high-value staff performing manual data entry. By combining our platform with Clarity, we are extracting actionable data from unstructured documents and routing it directly into EHRs and back-office systems. These automated workflows give our customers time back, reduce manual errors, and accelerate their revenue cycles. While last month’s launch is just the beginning, we expect this infrastructure to improve deal conversion rates and serve as a lever on our path to delivering sustained double-digit growth in our corporate channel. We are prioritizing these workflow and solution propositions because they resonate deeply with our prospects, helping us capture new market share while simultaneously locking in our existing base for the long term. Moving to SOHO, as we have consistently stated, we manage that channel as a strategic cash engine. We are not managing SOHO for subscriber longevity. Our priority remains yield, efficiency, and maximizing the contribution margin that funds our high-growth corporate business. SOHO revenue for the quarter was $29.7 million, representing a managed 9.5% year-over-year decline. I am happy to report that this is a significant improvement over the minus 11.1% we experienced last quarter, in line with the rate of decline we experienced in 2025. In summary, Q1 has proven that our go-to-market strategy is functioning exactly as intended. Our SOHO business is providing disciplined cash flow, while our corporate channel is delivering record results with growth accelerating past 8%. None of this is possible without the dedication of our global team who executed exceptionally well and with high energy this quarter. I also want to thank our partners and customers for their continued trust and collaboration as we capture these high-stakes operational opportunities together. With that, I will hand the call over to Adam to provide the financial details. Adam? Adam Varon: Thank you, Johnny, and good afternoon, everyone. We will discuss our Q1 2026 results, guidance for 2026, as well as guidance for Q2 2026. We expect to file our 10-Q later today. Moving to corporate results. During Q1 2026, our corporate business achieved record-breaking revenue of $58.7 million, representing an 8.2% increase, or $4.4 million, compared to the previous year. This performance indicates our accelerating momentum when compared to the 7.3% revenue growth last quarter. Notably, this 8.2% year-over-year expansion also represents the strongest year-over-year growth rate our corporate business has realized since Q4 2022. With our record corporate revenue in Q1 2026, we achieved a trailing twelve-month net revenue retention rate of 102%. This reflects a sequential rise of 76 basis points and an approximate 100-basis-point gain compared to the same period last year. Our corporate customer base of approximately 65 thousand customers was up 7% over the prior comparable period. Propelled by higher volumes, specifically within the upper tier of our customer continuum, corporate ARPA for Q1 2026 rose sequentially approximately 3% to $306 and was roughly flat year over year. Moving to SOHO results. As Johnny mentioned, we continue to manage the SOHO channel as a strategic cash engine, focusing on customer acquisition yield and contribution margin to generate cash flow that funds our accelerating corporate business growth. SOHO Q1 2026 revenue of $29.7 million decreased $3.1 million, or 9.5%, over the prior year, slowing from the Q4 2025 decline of 11.1%. Moving to consolidated results. As Scott stated, this is the second consecutive quarter that we have demonstrated year-over-year growth in all four of our key financial metrics: revenue, adjusted EBITDA, non-GAAP EPS, and free cash flow. Consolidated revenue of $88.5 million represents an increase of $1.3 million, or 1.5%, over Q1 2025, and a $1.4 million, or 1.6%, increase sequentially. Additionally, this represents the fourth consecutive quarter of year-over-year consolidated revenue growth. Adjusted EBITDA of $47.9 million versus $47.3 million in Q1 2025 delivered a consistent year-over-year EBITDA margin of 54.1%, driven by revenue flow-through partially offset by marketing spend and personnel-related expenses. Adjusted net income of $28.9 million is an increase of $2 million, or 7.3%, over the prior year, primarily driven by the items mentioned, plus favorable net interest expense on lower debt balances. Adjusted EPS of $1.52 is favorable to the prior year by 10.9%, or $0.15, driven by the items mentioned above and a lower share count from equity repurchases. The Q1 2026 non-GAAP tax rate and share count were 20.5% and approximately 19 million shares, respectively. Moving on to capital allocation. Free cash flow was a robust $38.5 million driven by Q1 2026 performance, which fueled a 14%, or $4.7 million, year-over-year increase. We ended Q1 2026 with $92.3 million in cash, an increase of $17.6 million when compared to Q4 2025. Q1 2026 CapEx of $7.4 million was in line with the prior year and expectations. On the equity repurchases program to date, we have utilized $72 million to repurchase 2.7 million shares, leaving $28 million available under our $100 million board equity repurchase plan. This includes our successful Q1 2026 activity where we bought back 600 thousand shares for approximately $17 million. Our Q1 2026 total debt balance stands at approximately $560 million, comprised of the following components: $348 million of 6.5% high-yield notes, $148 million of delayed draw term loan, and $64 million on our revolver. Our net debt to EBITDA ratio for Q1 2026 was 2.5x, and we held our total debt to EBITDA ratio steady at the Q4 2025 level of 3.0x. Moving to 2026 guidance. We are reaffirming our full-year 2026 outlook as follows. For revenue, we anticipate between $350 million and $364 million, representing a $357 million midpoint. Adjusted EBITDA is expected to range from $182 million to $193 million, with a midpoint of $187.5 million. Our adjusted EPS guidance remains between $5.55 and $5.95, or $5.75 at the midpoint. Finally, we estimate our full-year income tax rate will be between 19.7% and 21.7%, with 20.7% at the midpoint, with approximately 19 million shares. Moving to Q2 2026 quarterly guidance. We are issuing the following guidance for the quarter. Total revenue is projected to be in the range of $87.9 million to $91.9 million, representing a midpoint of $89.9 million. Adjusted EBITDA is expected to fall between $46.4 million and $49.6 million, with $48.0 million at the midpoint. Adjusted EPS is anticipated to range from $1.43 to $1.53, or $1.48 at the midpoint. For Q2 2026, our estimated income tax rate is 19.7% to 21.7%, with 20.7% at the midpoint, with an expected share count of approximately 19 million. That concludes our formal comments. Now I would like to turn the call over to the operator for Q&A. Thank you. Operator: Thank you. We will now be conducting a question-and-answer session. In the interest of time, we ask that you please limit yourself to one question. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove yourself from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. One moment please while we poll for questions. The first question today is coming from David Larsen from BTIG. David, your line is live. Analyst: Hi, this is Jenny Shen on for Dave. Thanks for taking my question, and congrats on the quarter. Just looking at the reaffirmed full-year 2026 guide, was that not raised mainly due to conservatism, and what do you expect revenue and earnings growth cadence to be for the rest of the year? Thanks. Scott Turicchi: So, you know, we set up the range of guidance just a quarter ago, and obviously there is a width on it on both revenues, EBITDA, and adjusted EPS. Certainly, if you look at the first quarter results, where we have had the most positive movement from the mean would be in the adjusted non-GAAP EPS. So right now, we see even if you migrate towards the upper end of the range, that still being sufficient. We only change our range of guidance, whether it is for all the metrics or a single metric, when we are highly confident we will be exceeding one or more of them. So it is too early in the year to do that, so it is neither conservatism; it is really more a philosophical principle on which we construct our guidance on an annual basis. I think you get a sense in terms of the second question, though, given that we do give quarterly guidance, which you see in Q2. The one thing I would note and caution people on, as I said in my opening remarks, is one of the benefits that flowed through in the first quarter was not only more revenue, which is clearly a good thing, and I would say most of that revenue relative to our expectations went to the bottom line, but we did not hire as much in Q1 as we had budgeted. And I do anticipate that will pick up, as it already has in the early stages of Q2, throughout the end of the year. And in fact, I want it to pick up. So while we had 54% EBITDA margins in Q1, I do not expect that to repeat, and I do not want it to repeat, because I want to see us fill out the hiring that we have, which is primarily in the go-to-market operations, which is Johnny’s area, and in the product area and the engineering, which is Jeff Sullivan, our CTO. So if we are successful in our hiring, a lot of those people will not be immediately contributing revenue within the calendar year. They are really more setting up for 2027. So that is the basis on which we constructed our reforecast for the balance of the year. It also played into account Q2 guidance. And then we will take a much deeper dive as we hit the midway point once we report Q2 results for the back half of the year. Analyst: Perfect. Thank you. Operator: Thank you. There are no other questions from the lines at this time. I will now hand the call back to Scott Turicchi for closing remarks. Scott Turicchi: Okay. Alright. I was just checking to see if there are any questions that came by email, but give us a second, Paul. Okay. Alright. Well, we know it is a crowded day for reporting, so we appreciate those that have been able to listen live. And if not, hopefully, you will listen to the rebroadcast of it. It will be available on our website. Look for some releases at some various conferences that we are likely to be at over the coming weeks. Obviously, if you do have questions, you know how to reach either myself or Adam or Laura, and we would be happy to address those, also set up one-on-ones even outside of any formal conference. And then without any further news, we would be planning to release Q2 results sometime in the first, probably ten days of August. Look for that press release as we get closer to that actual release date. And then, as Adam mentioned, we are looking to file the 10-Q for Q1 this evening, so it should be available, if not tonight, by tomorrow morning. Thank you. Operator: Thank you. This does conclude today’s conference. You may disconnect your lines at this time, and have a wonderful day. Thank you for your participation. Before you buy stock in Consensus Cloud Solutions, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Consensus Cloud Solutions wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $476,034!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,274,109!* Now, it’s worth noting Stock Advisor’s total average return is 974% — a market-crushing outperformance compared to 206% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors. See the 10 stocks » *Stock Advisor returns as of May 8, 2026. This article is a transcript of this conference call produced for The Motley Fool. While we strive for our Foolish Best, there may be errors, omissions, or inaccuracies in this transcript. As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. Consensus Cloud (CCSI) Q1 2026 Earnings Transcript was originally published by The Motley Fool