8x8 Inc. (NASDAQ:EGHT) Q3 2015 Earnings Conference Call - Final Transcript
Jan 22, 2015 • 04:30 pm ET
Good afternoon, ladies and gentlemen, and welcome to the 8x8 Third Quarter Fiscal 2015 Earnings Conference Call. At this time all participants are in a listen-only mode. Later we will conduct a question-and-answer session and instructions will follow at that time. (Operator Instructions) As a reminder this conference call is being recorded.
I would now like to turn the conference over to your host, Ms. Joan Citelli, Director of Corporate Communications.
Thank you, and welcome everyone to our call. Today, I am joined by 8x8's Chief Executive Officer, Vik Verma; and our Chief Financial Officer, Mary Ellen Genovese to discuss our results for 8x8's third fiscal quarter of 2015 ended December 31, 2014. If you have not yet seen today's financial results the press release is available on the Investors tab of 8x8's website at www.8x8.com. Following our comments there will be an opportunity for questions. (Forward-Looking Cautionary Statements)
And with that I'll turn the call over to Vik Verma, Chief Executive Officer of 8x8.
Thank you Joan and welcome everyone to 8x8's third quarter of fiscal 2015 earnings call. This was another strong quarter for 8x8 and I believe we bolstered our industry leadership position in several key areas, notably our expanding presence in the mid-market, our talent and our technology.
As you can see from our fiscal 2015 third quarter results the momentum we generated in the first half of our fiscal year continued with strong 26% year-over-year growth in total revenue to a record $41.4 million and 27% year-over-year growth in service revenue to a record $37.8 million.
Driving this growth is the continued mid-market adoption of our cloud telephony, contact center and Unified Communications Services we saw during the quarter. New monthly recurring revenue sold by mid-market and channel sales teams increased 42% year-over-year and represented 44% of new monthly recurring revenue sold in the quarter. Revenue from mid-market customers now represents 42% of total service revenue compared with 38% for the same period a year ago.
Our non-GAAP net income results for the third quarter of fiscal 2015 were equally strong at $4.1 million or 10% of revenue compared with $2.5 million or 8% revenue for the same period last year. This is the 19th consecutive quarter in which 8X8 has generated non-GAAP net income alongside increasing revenue and we remain committed to profitable growth and strong cash flow.
Since our last earnings call 8X8 has made significant progress in a number of key areas. First, I am pleased to announce that we've rounded out our senior management team with the strategic hiring of two executives following the appointment last October of Mary Ellen Genovese as Chief Financial Officer. In November we brought on board Enzo Signore as Chief Marketing Officer and earlier this month we named Puneet Arora as Senior Vice President of Global Sales.
Enzo brings over 20 years of marketing product management sales and business development experience to 8x8 with industry leading communication and technology vendors such as Avaya, JDSU and Cisco. Puneet