AltiGen Communications Q3 2026 Earnings Report

AltiGen Communications EPS Results

• Actual EPS: $0.01
• Consensus EPS: N/A
• Beat/Miss: N/A
• One Year Ago EPS: N/A

AltiGen Communications Revenue Results

• Actual Revenue: N/A
• Expected Revenue: N/A
• Beat/Miss: N/A
• YoY Revenue Growth: N/A

AltiGen Communications Announcement Details

• Quarter: Q3 2026
• Date: 8/11/2026
• Time: After Market Closes
• Conference Call Date: Tuesday, August 11, 2026
• Conference Call Time: 4:00PM ET

AltiGen Communications (OTCMKTS:ATGN), Inc. is a provider of voice-over-IP (VoIP) telephony and unified communications solutions designed primarily for small and medium-sized businesses. The company offers a range of IP-based PBX systems, contact center applications and unified messaging products that enable organizations to streamline inbound and outbound voice traffic, automate call routing and integrate voice mail, e-mail and conferencing functions into a single platform.

Founded in the mid-1990s and headquartered in California, AltiGen develops both hardware appliances and software modules that support analog, digital and SIP-based telephony endpoints. Its core product line includes the IP-PBX series, which combines auto-attendant, call handling and voicemail, as well as add-on contact center suites for call monitoring, reporting and agent management. The company also offers software-based clients for desktop and mobile users, enabling remote extensions and unified messaging services.

AltiGen sells its solutions through a network of direct and channel partners, serving customers in North America, Europe and parts of Asia. Its target markets include professional services, healthcare, retail and manufacturing sectors where cost-effective, scalable communications systems are in demand. AltiGen’s deployment options span on-premise, virtualized and cloud-ready environments, allowing organizations to choose configurations that align with their IT strategies.

Guided by a management team with deep experience in telecommunications and network technologies, AltiGen maintains a product roadmap focused on enhancing mobility, analytics and interoperability with third-party business applications. The company continues to evolve its offering to address emerging trends in unified communications, contact center automation and remote workforce enablement.

AltiGen Communications Q3 2026 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Newly contracted cloud revenue exceeded legacy customer churn in the quarter, which management described as a critical inflection point and evidence that the transition may be shifting toward sustainable growth.
• Positive Sentiment: Altigen signed the largest cloud customer in its history and reported growing traction for CoreEngage and CoreInteract among larger enterprise customers, which could support higher contract values and expansion potential.
• Positive Sentiment: Fiserv approved Altigen’s AI IVR enhancements for general availability and authorized QA testing for CoreInsights; the companies are also increasing joint sales activity, including exposure to approximately 4,000 banking executives.
• Negative Sentiment: Third-quarter revenue fell to $3.0 million from $3.5 million year over year, while cloud services revenue declined 18%, gross margin dropped to 58% from 63%, and adjusted EBITDA decreased to $423,000 from $645,000.
• Neutral Sentiment: Management highlighted infrastructure investments—including CoreManage, SOC 2 certification, a multi-provider AI Studio, and a geo-redundant carrier environment—that are intended to improve scalability and reduce costs, but several benefits remain dependent on execution and completion.

Presentation

[Operator]

Please note this conference is being recorded. I will now turn the conference over to your host, Cori, our AI agent. You may begin.

[Company Representative at Altigen Technologies]

Good afternoon and welcome to the Altigen Technologies Fiscal Third Quarter 2026 earnings call. My name is Cori and I am Altigen's AI-developed communications agent, built on the same Core Interact AI platform that powers Altigen's customer engagement solutions. I am a fitting demonstration of what we're building. Before we get started, let me cover a few housekeeping items. This call is being recorded and will be available for replay on the investor relations section of Altigen's website at altigen.com. A copy of today's prepared remarks will be made available following the conclusion of this call. This replay will be available one hour after this call's completion and remain in effect for 90 days. At this time, I'd like to read Altigen's Safe Harbor statement. Certain statements made during this call may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.

[Company Representative at Altigen Technologies]

These statements include, but are not limited to, statements regarding Altigen's business strategy, expected financial performance, product roadmap, customer pipeline, and market opportunities. Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied. These risks include, but are not limited to, dependence on a limited number of customers and partners, rapid technological change in the communications and AI markets, competition from companies with significantly greater resources, Altigen's ability to develop, market, and deliver new and enhanced products and services, the company's reliance on third-party vendors and platform partners, and general economic conditions. Altigen cautions that these factors are not exhaustive. Additional risks and uncertainties are described in Altigen's most recent filings with the OTCQB, including its annual report on Form 10-K for the fiscal year ended September 30, 2025.

[Company Representative at Altigen Technologies]

In addition, during today's call, we will also be referring to certain non-GAAP financial measures such as adjusted EBITDA. These non-GAAP measures are not superior to or a replacement for the comparable GAAP measures, but we believe these measures help gain a more complete understanding of our results. Listeners are cautioned not to place undue reliance on these forward-looking statements, which speak only as of today's date. Altigen undertakes no obligation to update any forward-looking statements to reflect new information, future events, or otherwise. Thank you. Joining us today is Jerry Fleming, Chief Executive Officer, Joe Hamblin, President and Chief Operating Officer, and Gary Stone, Chief Financial Officer. With that, I'll turn the call over to Jerry.

[Jerry Fleming, CEO at Altigen Technologies]

Thank you, Cori, and good afternoon, everyone. Thanks for joining us for today's call. Earlier today, Altigen reported third quarter fiscal 2026 revenue of $3 million, our ninth consecutive profitable quarter, which demonstrates the financial discipline we've maintained while transforming our business. Today, I'll discuss our strategic direction, our expanding solutions portfolio, and business growth opportunities. Joe will follow with a business and operational update. Then Gary will come on with a detailed review of our financial results. Let me begin with the quarter's most important development. Newly contracted cloud revenue exceeded the cloud revenue lost through our legacy customer churn. This is a critical inflection point for Altigen. During the company's transformation initiatives, churn from our legacy business outpaced revenue gains from our new cloud solutions. That equation is now beginning to change.

[Jerry Fleming, CEO at Altigen Technologies]

We believe most of the legacy churn is behind us, positioning Altigen to move from managing a revenue transition to generating sustainable revenue growth. Our new solutions are gaining traction. Our average revenue per customer continues to grow, and our revenue mix is increasingly shifting toward larger strategic opportunities. In short, our transformation efforts are now beginning to yield results. The key strategic element of our business transformation has been our focus on building all new cloud-native AI-powered customer engagement solutions. These solutions, which target mid-sized enterprise organizations, combine AI-first customer service, AI-enabled contact center, and AI-driven customer analytics into an integrated customer engagement suite. Core Interact is our AI-first virtual agent customer service platform. As the enterprise digital front door, Core Interact engages customers 24 hours a day across voice and digital channels, resolving the majority of issues without ever needing to engage a live agent.

[Jerry Fleming, CEO at Altigen Technologies]

Our objective is not to simply create a better chatbot. It's to provide a first contact resolution solution for our customers, any customer, any communications channel, any time of day. In some circumstances, human assistance is inevitable. In these instances, Core Interact seamlessly transfers the customer, along with the full context of the conversation, to Core Engage, our Microsoft Teams-based contact center solution. Core Engage picks up where Core Interact leaves off, allowing live agents to efficiently and cost-effectively manage voice and digital customer interactions within their familiar Microsoft Teams environment, resulting in higher employee productivity, increased leverage of an organization's investment in Microsoft technologies, and lower operating costs. The third and final component to Altigen's new customer engagement suite is Core Insights, which analyzes customer interaction and transactional data to create a complete 360-degree view of the customer.

[Jerry Fleming, CEO at Altigen Technologies]

Core Insights further applies AI to identify trends, detect issues, and recommend actions, turning customer interactions into intelligence executives can use to make better-informed decisions to improve business outcomes. Together, these solutions create a complete customer engagement platform powered by AI, with Core Interact utilizing AI to resolve customer issues, Core Engage empowering live agents with AI customer assistance, and Core Insights transforming every customer interaction into actionable business intelligence. The new platform, designed for mid-market and enterprise organizations, enables us to secure customers that have larger contract values, longer retention periods, and significantly greater expansion potential than our historical small business customer base. These dynamics are changing the economics of Altigen's business, resulting in a stronger cloud business model, improved operating leverage, and more sustainable long-term growth. AI is also creating opportunities for Altigen's consulting services division, ACS.

[Jerry Fleming, CEO at Altigen Technologies]

Mid-size and enterprise organizations are increasingly evaluating AI to automate processes, improve customer engagement, and reduce costs, but they often lack the in-house expertise or internal resources to deploy a successful AI project. Altigen Consulting Services assists those customers in identifying AI projects having the highest ROI potential, then designs, deploys, and manages the AI solution for that customer. Many of these AI projects are done in conjunction with our customer engagement solutions, enabling Altigen to deliver real-world AI solutions that most of our competitors are simply not equipped to provide. Today, Altigen is fundamentally different from the company we were several years ago. We have moved beyond our legacy identity as a communications technology provider. We are building an integrated AI-powered customer engagement company that helps organizations serve customers more effectively, automate complex transactions, unlock customer intelligence, and operate more efficiently.

[Jerry Fleming, CEO at Altigen Technologies]

We've also remained consistently profitable while investing in that future, which we see as very bright. With that, I'll turn the call over to Joe for his business and operational update. Joe?

[Joe Hamblin, President and COO at Altigen Technologies]

All right. Thank you, Jerry. Good afternoon, everyone. I'd like to provide an update on the progress we're making across the business, from our consulting services organization and the investments we've made to strengthen our operational foundation, to the traction that we're seeing across the cloud platform and existing customer base, along with our strategic partnerships. Taken together, I believe these areas demonstrate how the investments we've made over the last two years are beginning to position Altigen for our next phase of growth. Let me begin with our consulting business. Altigen Consulting Services continues to be an important part and stable part of our business. During the quarter, we completed our annual consulting planning process with the Connecticut Department of Transportation, establishing our scope of work for the upcoming year.

[Joe Hamblin, President and COO at Altigen Technologies]

This continues a long-standing relationship and reflects the confidence CTDOT places in our team to deliver and support the mission-critical solutions we have. We also successfully completed our first major development project for one of our newest regulated industry customers. The solution was delivered on time, on budget, and has now transitioned into an ongoing support relationship. These engagements demonstrate the strength of our consulting model, maintaining and expanding long-term strategic relationships while applying our development expertise to win new customers. More importantly, they demonstrate our ability to design, build, deploy, and support enterprise-grade solutions that solve real business problems. Our focus now is to replicate that success with additional enterprise and public sector customers. Over the last two years, we've invested heavily in strengthening Altigen's operational foundation.

[Joe Hamblin, President and COO at Altigen Technologies]

Many of these investments are not immediately visible in our financial results, but they are essential to building a company that can scale efficiently as we grow. During the quarter, we completed and launched CoreManage, our next-generation customer management portal, replacing our legacy portal. The customer migrations are now underway. Our SOC 2 certification continues through the audit monitoring process. Once complete, we will remove an important barrier we encounter with customers operating in highly regulated industries, particularly financial services and healthcare. We are also developing Core Interact AI Studio, which will allow us to integrate solutions from multiple AI providers through a common architecture. Rather than tying Altigen to a single AI technology or provider, we are building an environment that gives us the flexibility to adopt new AI capabilities as the market continues to evolve.

[Joe Hamblin, President and COO at Altigen Technologies]

On the infrastructure side, we are deploying a new geo-redundant SBC environment that will allow us to leverage multiple tier 1 and tier 2 carriers. Beyond improving resiliency and giving us greater carrier flexibility, we expect this initiative to reduce our operating costs by approximately $10,000 a month once we are fully implemented. None of these projects generate headlines individually. Collectively, however, they create an operational and technology foundation we need to scale the business while continuing to deliver the level of customer experience our clients expect. We are beginning to see the benefit of these investments in our cloud business, where CoreEngage continues to gain momentum. We are adding new customers on a consistent basis, but what is particularly encouraging is the size and the complexity of the opportunities we are now winning. During the quarter, we signed the largest cloud customer in Altigen's history.

[Joe Hamblin, President and COO at Altigen Technologies]

This is an important milestone for us, not simply because of the size of the engagement, but because it demonstrates our ability to compete and win large enterprise opportunities. The profile of the new customers is changing. We are increasingly engaging with larger organizations that have more complex requirements, deeper Microsoft Teams environments, and the need to integrate communications, customer engagement, and AI capabilities. Simply put, the platform is gaining traction. We also continue to see meaningful opportunity with our existing customer base. Our MaxCloud/MaxCS customers represent a well-established install base with long-standing Altigen relationships. As we continue to transition customers from our legacy premise solutions to our cloud platforms, we have the opportunity to expand recurring revenue while strengthening those relationships. Importantly, the opportunity extends beyond cloud migrations.

[Joe Hamblin, President and COO at Altigen Technologies]

Our existing customer base also provides a natural path to introduce CoreInteract and our AI Studio capabilities, creating additional opportunities to expand the value we deliver to those customers over time. We believe our install base represents an important and efficient source of organic growth as we continue to expand our cloud and AI portfolio. I would like to also spend a moment discussing Fiserv. We continue to believe this represents one of the most strategic opportunities for Altigen. During the quarter, Fiserv approved our AI IVR enhancements for general availability. We also received approval to begin QA testing for our new analytics platform, CoreInsights. Both solutions provide opportunities to drive incremental revenue across our existing Fiserv customer relationships. These approvals are significant because of the rigorous certification process required within the Fiserv ecosystem.

[Joe Hamblin, President and COO at Altigen Technologies]

We also now participate in regular sales engagement sessions with the Fiserv team, reflecting a much closer go-to-market relationship than we've had historically. Next week, we're participating in the Fiserv Customer Forum, expected to reach approximately 4,000 banking executives. Again, another example of how we are strengthening our go-to-market partnership. This represents one of the largest targeted marketing opportunities we've had within the financial services market, and our sales organization is working closely with Fiserv to capitalize on that opportunity. As we move into the fourth quarter, our priorities remain straightforward: continue growing recurring revenue, expand customer adoption of CoreEngage and CoreInteract, leverage our Fiserv relationship, and continue investing in AI-powered solutions that solve meaningful customer problems. For the past two years, we've been focused on building the company we want Altigen to become.

[Joe Hamblin, President and COO at Altigen Technologies]

We've modernized our infrastructure, strengthened our operational discipline, improved our delivery capabilities, and positioned ourselves to compete for larger enterprise opportunities. While we still have a great deal of work ahead, the progress we're seeing provides encouraging evidence that these investments are beginning to translate into increased customer adoption, a growing recurring revenue opportunity, and a stronger competitive position. We're encouraged by the progress we're making and excited about the opportunities ahead. With that, I'll turn the call over to Gary to discuss the financial results and outlook. Gary?

[Gary Stone, CFO at Altigen Technologies]

Yes, thank you, Joe. For our 2026 fiscal third quarter, which is April to June, we reported total revenue of $3 million, with GAAP net income of $15,000, or zero cents per share, and non-GAAP net income of $190,000, or one cent per share. That compares to the prior year's quarter revenue of $3.5 million, with GAAP net income of $110,000 and also zero cents per share, and non-GAAP net income of $350,000 or a penny per share. Total cloud services for the third quarter was approximately $1.4 million, down 18% from the $1.7 million last year. Our services and other revenue was approximately $1.5 million, down 8% from the $1.7 million last year. Gross margin was 58%, down from 63% last year, impacted by lower revenue and increased professional service costs associated with new project work requiring additional upfront resources.

[Gary Stone, CFO at Altigen Technologies]

GAAP operating expenses for the quarter totaled $1.7 million, reflecting an 18% decrease from the $2.1 million in the same period last year, and the main reason why we've been able to remain profitable. Looking at our liquidity, we closed out the quarter with $3.4 million in cash and cash equivalents, up from $2.75 million last September 30th, 2025. Working capital was $3.2 million compared to $2.9 million reported at the end of September. Our EBITDA, adjusted for legal, severance, and other one-time costs, was $423,000 compared to $645,000 in the prior year. Now I'll turn the call back over to Jerry for our concluding remarks. Jerry?

[Jerry Fleming, CEO at Altigen Technologies]

Thank you, Gary. Our top priority now is execution. With our legacy business declines largely behind us, we are focused on deploying the business we've contracted, expanding within our enterprise customer base, converting our pipeline into recurring revenue, and building Altigen into a larger, stronger, and increasingly valuable company. We're confident in our direction, we're encouraged by our progress, and we're excited about the opportunity ahead. With that, I'll now turn the call back to the operator.

[Operator]

Thank you. At this time, we will be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Once again, that is star one to ask a question. One moment please while we poll for questions. As a reminder, if you would like to ask a question, please press star one. We have reached the end of the question and answer session, and I will now turn the call over to management for closing remarks.

[Jerry Fleming, CEO at Altigen Technologies]

All right. Thank you, operator, and thanks again, everyone, for joining us today. We look forward to updating you on our fiscal year-end call later this year. Thanks again.

[Operator]

This concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation.

Participants

Analysts

• Company Representative at Altigen Technologies
• Jerry Fleming, CEO at Altigen Technologies
• Joe Hamblin, President and COO at Altigen Technologies
• Gary Stone, CFO at Altigen Technologies