& cplSiteName &

Broadsoft Boosts Revenues 20% in Q2

Sarah Thomas
8/5/2014
50%
50%

Unified communications (UC) vendor Broadsoft managed to boost its second-quarter revenues by almost 20% year-over-year, as one analyst says it continues to win "more than its fair share" of the deals with service providers against big names like Cisco.

BroadSoft Inc. earned $1.7 million in the second quarter on revenues of $52.5 million, an increase of 19% compared to $44.0 million in the second quarter of 2013 and its highest quarterly result ever.

Jefferies & Co. Inc. Equity Analyst George Notter points out in a research note that the positive earnings, which beat analyst estimates of $49.4 million, come as Broadsoft has found its sweet spot between big names like Cisco Systems Inc. (Nasdaq: CSCO) targeting the high-end carrier channel and competitive over-the-top (OTT) players such as 8x8 Inc. (Nasdaq: EGHT) and RingCentral Inc. focused on very small businesses. (See BroadSoft Becomes Telecom Italia Partner and Business Market Rediscovers Its Voice.)

"One of the main barriers to the further development of the SIP Trunking and Hosted markets is the incumbent telecom operators themselves," Notter writes in the note. "Naturally, they're hesitant to proactively push these offerings as it effectively reduces their monthly service revenue by 15% to 70% vis-ŗ-vis TDM (ISDN) lines running into enterprise PBXs."


Want to know more about the future of voice communications? Check out our dedicated rich communications channel here on Light Reading.


Notter adds that the emergence of competitive offerings is driving these incumbent operators to embrace SIP trunking and hosted UC, which is good news for Broadsoft. The UC vendor is actually playing in a number of technologies that are critical to service providers today as they work to keep their voice services front-and-center amongst OTT competition and create new revenue-generating services with WebRTC, voice-over-LTE and UC. (See VoLTE: So Close You Can Hear It.)

Notter says that the transition to VoIP and UC-based services for real-time communications has only reached 10% to 15% of enterprises and consumers. Coupled with the fact that VoLTE is just now being deployed across the globe, Broadsoft is well positioned going forward as well. (See Sprint Taps BroadSoft for VoLTE Transition and D2 & BroadSoft Test VoLTE.)

The company's CEO, Michael Tessler, said on the earnings call that VoLTE rollouts have been slow, but Broadsoft is involved with a number of business VoLTE projects in Europe that will play out over the next two years.

"Take a small business today that would have a fixed infrastructure, high speed broadband router, switching, etc., serving 25 employees," Tessler said, according to a Seeking Alpha transcript. "What we're starting to work with and we're starting to see the operators looking to plan is offers that would be completely wireless."

The vendor is not, however, betting solely on the service provider market. It also announced on Tuesday that it has acquired hospitality software provider SDD, one of several acquisitions in the past few years and further evidence that Broadsoft is looking to bolster its offerings for particular verticals to diversify its business. (See Euronews: BroadSoft Buys in Germany, BroadSoft Buys Into British Cloud and BroadSoft Acquires Adaption Technologies.)

Buoyed by the strong earnings, Broadsoft's share price was up 3.65% to $24.96 in Tuesday morning trading.

— Sarah Reedy, Senior Editor, Light Reading

(1)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
Educational Resources
sponsor supplied content
Educational Resources Archive
From The Founder
Light Reading today starts a new voyage as part of a larger Enterprise.
Flash Poll
Live Streaming Video
Charting the CSP's Future
Six different communications service providers join to debate their visions of the future CSP, following a landmark presentation from AT&T on its massive virtualization efforts and a look back on where the telecom industry has been and where it's going from two industry veterans.
LRTV Interviews
Cox Clears $2B in Business Revenue

12|8|16   |     |   (0) comments


Cox's Jeff Breaux discusses how the third-largest US MSO will reach the $2 billion revenue mark this year and plans to hit $3 billion by 2021
LRTV Interviews
Can Cable Climb Upmarket?

12|7|16   |     |   (0) comments


Carol Wilson and Alan Breznick assess cable's prospects for winning more enterprises in a landscape rocked by corporate M&A activity.
Women in Comms Introduction Videos
TalkTalk Exec: Find Your North Star at Work

12|7|16   |   3:38   |   (1) comment


Women need to find their purpose, a professional North Star, and create a personal board for themselves, according to Alex Tempest, director of partners at TalkTalk Business.
LRTV Interviews
Verizon: Beware Unknown Unknowns

12|7|16   |   04:58   |   (0) comments


Chris Novak, director of the Verizon Enterprise Solutions Risk Team, explains that enterprises who don't conduct a thorough audit of their assets often leave some things unprotected because they don't know they exist. Many times these unprotected assets are part of corporate M&A activity but left unshielded they can become a hacker's playground, he tells Light ...
LRTV Interviews
ETSI's CTO Talks NFV, 5G & NGP

12|5|16   |   09:45   |   (0) comments


Adrian Scrase, CTO at standards body ETSI, talks about the various initiatives and specifications developments related to NFV, 5G and NGP (next-generation protocols) that will underpin next-gen networks.
Women in Comms Introduction Videos
Korn Ferry Consultant: How to Find, Cultivate & Be the Best Talent

11|30|16   |   4:10   |   (2) comments


Erin Callaghan, a managing consultant for Korn Ferry Futurestep, shares strategies for companies to improve how they recruit and for women to ensure they don't get lost in the pipeline.
LRTV Custom TV
We Can Make the World More Sustainable

11|29|16   |     |   (0) comments


GeSI is a global e-Sustainability Initiative organization bringing together 40 big multinational companies around the world. According to GeSI's report, information and communication technology can make the world more sustainable. Luis Neves, chairman of GeSI, shared with us his opinion at Ultra-broadband Forum (UBBF2016).
LRTV Custom TV
Finding a New Way to Engage Customers & Drive Revenue

11|29|16   |     |   (0) comments


Mobile revenues are declining. Digicel, a player in the Caribbean telecommunications/entertainment space, has found a new way to engage customers and drive revenue. John Quinn, CTO of Digicel, shared with us its story at Ultra-broadband Forum (UBBF2016)
LRTV Custom TV
Do You Really Need Gigabit Infrastructure?

11|29|16   |     |   (0) comments


Altibox is the biggest fiber-to-the-home (FTTH) player and the largest provider of video and TV in Norway. They started out with zero customers in 2002. Now they have close to half a million households and companies attached to their FTTH business. Nils Arne, CEO of Altibox shared with us their story and insight on 5G at Ultra-broadband Forum (UBBF2016).
LRTV Custom TV
BTís Openreach Strategy & Its Updates in 2016

11|29|16   |     |   (0) comments


A lot of developments at Openreach this year in terms of strategy and planned investments. Peter Bell, CIO of Openreach BT, shared with us the updates of Openreach at Ultra-broadband Forum (UBBF2016).
LRTV Custom TV
ITU: The Broadband Is Our Future

11|29|16   |     |   (0) comments


At Ultra-broadband Forum, Houlin Zhao, Secretary General of ITU, discussed how important it is for countries, companies and everybody to be working together to help to build the broadband and digital economies (UBBF2016).
LRTV Custom TV
Tackling 5G in Dallas

11|28|16   |     |   (0) comments


Here are our highlights of the 5G North America show in Dallas, Texas with Light Reading's Dan Jones.
Upcoming Live Events
May 16-17, 2017, Austin Convention Center, Austin, TX
All Upcoming Live Events
Infographics
Hot Topics
Cable Nodes Becoming a Choke Point
Brian Santo, Senior editor, Test & Measurement / Components, Light Reading, 12/5/2016
WiCipedia: After-School Coding, Salary Probing & Pro-Parenthood Companies
Eryn Leavens, Special Features & Copy Editor, 12/2/2016
Consolidated Snaps Up Fairpoint for $1.5B
Iain Morris, News Editor, 12/5/2016
Like Us on Facebook
Twitter Feed
BETWEEN THE CEOs - Executive Interviews
Eyal Waldman, CEO of Mellanox Technologies, speaks to Steve Saunders, CEO of Light Reading, for an exclusive interview about the 100 GB cable challenge, cybersecurity and much more.
Join us for an in-depth interview between Steve Saunders of Light Reading and Alexis Black Bjorlin of Intel as they discuss the release of the company's Silicon Photonics platform, its performance, long-term prospects, customer expectations and much more.
Animals with Phones
A Mobile Safari Click Here
Literally.
Latest Comment
Live Digital Audio

Even when there's a strong pipeline of female talent in the comms industry, it tends to leak all the way to the top. McKinsey & Company says women experience pipeline leakage at three primary points: being unable to enter, being stuck in the middle or being locked out of the top. Each pipeline pain point presents its own challenges, but also opportunities to stop the leak. Wireless operator Sprint is making a conscious effort to improve its own pipeline from new recruits to the C-suite, and it wants the rest of the industry to do the same. In this Women in Comms radio show, WiC Board Member and Sprint Vice President of Enterprise Sales Nelly Pitocco will give us her take on the industry's pipeline challenges. Pitocco, who joined Sprint in May and has spent 20 years in the comms industry, will also offer solutions, share how Sprint is tackling the challenge within its own organization and take your questions live on air.