AudioCodes NASDAQ: AUDC reported second-quarter 2026 revenue of $63 million, up 3.1% from $61.1 million a year earlier, as growth in managed services and voice artificial intelligence offerings supported its results. The company raised its full-year revenue outlook while reiterating its non-GAAP earnings-per-share guidance.
Services revenue increased 6.2% year over year to $34.6 million and represented 54.9% of total quarterly revenue. Revenue distribution by region was 50% from North America, 33% from Europe, the Middle East and Africa, 14% from Asia-Pacific, and 3% from Central and Latin America.
Chief Financial Officer Niran Baruch said AudioCodes generated $6.1 million in operating cash flow during the quarter and ended June with $64.2 million in cash equivalents, short-term bank deposits, marketable securities and long-term financial investments.
Profitability Improved From Prior Year
On a GAAP basis, gross margin rose to 65.7% from 64.1% in the second quarter of 2025. Operating income increased to $3.2 million, or 5.1% of revenue, from $2.6 million, or 4.3% of revenue, a year earlier. Net income was $0.5 million, or $0.02 per diluted share, compared with $0.3 million, or $0.01 per diluted share, in the prior-year period.
Non-GAAP gross margin was 65.8%, compared with 64.5% a year earlier. Non-GAAP operating income was $4.6 million, or 7.4% of revenue, versus $4.4 million, or 7.2% of revenue, in the year-ago quarter. Non-GAAP net income was $3.9 million, or $0.15 per diluted share, compared with $4.1 million, or $0.14 per diluted share, in the second quarter of 2025.
AudioCodes’ days sales outstanding stood at 107 days as of June 30.
Outlook Raised; Capital Returns Announced
Baruch said the company now expects 2026 revenue of $251 million to $256 million, raising the lower end of its previous $247 million to $255 million range. AudioCodes maintained its forecast for non-GAAP diluted earnings per share of $0.60 to $0.75 for the year.
In May, AudioCodes received Israeli court approval to purchase up to $25 million of additional ordinary shares or declare a dividend from that amount. The authorization remains valid through Nov. 12, 2026. During the second quarter, the company repurchased 950,000 ordinary shares for approximately $8.9 million.
The company also declared a cash dividend of $0.20 per share, totaling approximately $4.8 million. The dividend is scheduled to be paid Sept. 3 to shareholders of record as of Aug. 19.
Managed Services and VoiceAI Drive Growth Strategy
President and Chief Executive Officer Shabtai Adlersberg said the company’s Live managed-services business and VoiceAI operations generated a combined annual recurring revenue exit rate of $84 million at the end of the second quarter, up 20% from a year earlier. He said annual recurring revenue has doubled over the past three years.
AudioCodes’ backlog reached nearly $90 million, up 23% from $73 million a year earlier. Adlersberg said the expanding Live managed-services backlog is expected to convert into revenue in coming quarters.
Enterprise customers represented more than 90% of quarterly revenue, according to Adlersberg. The company’s Microsoft Teams Phone business grew 5% year over year during the quarter and 5.6% during the first half. AudioCodes exited 2025 with more than $160 million in Microsoft Teams revenue and is targeting roughly $170 million by the end of 2026, he said.
New Microsoft Teams-related opportunities increased 14% year over year, while total contract value associated with Teams activity rose 73% to more than $20 million in the quarter. Adlersberg also said a previously won opportunity valued at more than $10 million had entered production and is expected to add several million dollars of product revenue annually over the next three years.
- A major state university with more than 50 campuses placed follow-on orders totaling more than $1 million for Live Pro Teams managed services, professional services, phones and video conferencing systems.
- A European global logistics customer renewed Teams Live services and expanded its use of Voca technology globally to replace traditional toll-free numbers.
VoiceAI Revenue Increased More Than 50%
Adlersberg said VoiceAI revenue grew more than 50% year over year in the second quarter and nearly 100% in the first half. The company said it remains on track for 40% to 50% VoiceAI growth for the full year and is targeting $50 million in VoiceAI revenue by the end of 2028.
AudioCodes’ VoiceAI Connect and Live Hub operations recorded what Adlersberg described as a record quarter, driven largely by capacity expansions among existing customers. A U.S. tier-one healthcare provider more than doubled its existing VoiceAI capability during the quarter, while a North American retail conglomerate selected VoiceAI Connect for virtual-agent experiences at its primary business unit.
The company said sales cycles for certain new VoiceAI opportunities have shortened to about six months from a historical range of 12 to 24 months. Adlersberg said this trend reflects growing maturity in the conversational AI market and increasing enterprise adoption of virtual-agent and agent-assist technology.
AudioCodes also highlighted momentum for its Voca CIC contact-center platform, including a selection by a leading Asian bank to replace a legacy provider. Microsoft named AudioCodes as the only third-party solution in its June announcement of Teams Phone Agent, according to Adlersberg. Voca CIC subsequently became the first solution listed in Microsoft’s Teams Phone Agent certification program, he said.
In its Meeting Insights Cloud Edition business, AudioCodes reported monthly recurring revenue growth of nearly 150% and active-user growth of 50% from a year earlier. The company plans to expand sales activity beyond the two or three countries that have been its primary markets for the product.
About AudioCodes (NASDAQ:AUDC)
AudioCodes Ltd is a global provider of advanced voice networking and media processing solutions for enterprises and service providers. The company designs and manufactures a comprehensive portfolio of products, including session border controllers (SBCs), media gateways, IP phones, management and monitoring software, and cloud-based communications microservices. Its offerings support a wide range of unified communications (UC) and contact center deployments, enabling secure, high-quality voice connectivity across on-premises, hybrid and cloud environments.
Founded in 1993 and headquartered in Rosh Ha'Ayin, Israel, AudioCodes serves customers in North America, Europe, Asia-Pacific and Latin America.
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