& cplSiteName &

Broadsoft Boosts Revenues 20% in Q2

Sarah Thomas

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-à-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
Light Reading’s Upskill U is a FREE, interactive, online educational resource that delivers must-have education on themes that relate to the overall business transformation taking place in the communications industry.
Friday, October 21, 1:00PM EDT
Security: Evolving the Data Center
Rasool Kareem Irfan, Head, Telecom & Infrastructure Security Practice, Tata Communications Transformation Services Ltd (TCTS)
Wednesday, October 26, 1:00PM EDT
Security: Tackling DDoS
Gary Sockrider, Principal Security Technologist, Arbor Networks
Friday, October 28, 1:00PM EDT
Security: The Plusses and Minuses of Open Source Software
Nick Feamster, Acting Director, Center for Information Technology Policy, Princeton University
Wednesday, November 16, 1:00PM EST
SDN 101
in association with:
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 Custom TV
Next-Generation Technology Beyond DOCSIS 3.1

10|20|16   |     |   (0) comments

At SCTE 2016, Huawei's Liu Jianhua speaks with Alan Breznick for an exclusive interview.
LRTV Custom TV
Hybrid Video Solutions to Change TV, Change Future

10|20|16   |     |   (0) comments

At SCTE 2016, Huawei's Ian Locke speaks with Alan Breznick for an exclusive interview.
LRTV Custom TV
Huawei Future-Oriented Giga Coax Network

10|20|16   |     |   (0) comments

At SCTE 2016, Huawei's Allen Wang speaks with Alan Breznick for an exclusive interview.
LRTV Custom TV
Huawei at SCTE 2016

10|20|16   |     |   (0) comments

Join Alan Breznick of Light Reading and take a sneak peek at the Huawei booth at SCTE 2016.
LRTV Custom TV
Assuring Network Quality in a Rapidly Changing Environment

10|20|16   |     |   (0) comments

As the rate of change and complexity increases in agile networks, the importance of introducing DevOps methodologies for integrating active test and assurance solutions throughout the full service lifecycle becomes critical to ensure that customers are experiencing the service quality they demand. The industry landscape is changing, and software-based test and ...
Telecom Innovators Video Showcase
A10 Networks on Service Providers' Industry Needs

10|20|16   |     |   (0) comments

Light Reading's Steve Saunders hears how A10 enables service providers to accelerate, secure and optimize their application delivery to drive down costs, enhance service availability, and better respond to customer requirements, so they can improve customer satisfaction, monetize their network, and grow revenues.
LRTV Custom TV
New NFV Use Cases for Cable TV

10|19|16   |     |   (0) comments

A large number of NFV use cases are focused on the enterprise domain, looking at virtualization of customer-premises equipment (CPE). To date, there has been little focus on the use cases and business case for virtualization of the video content delivery networks required to deliver unicast and streaming video to consumers. Amdocs commissioned Analysys Mason to ...
Women in Comms Introduction Videos
Meet the Future Workforce: New Faces, Expectations & Motivations

10|19|16   |   5:33   |   (1) comment

Millennials and their younger peers, Gen Z, expect more out of their network and more out of their work. Intel's Lynn Comp shares how the industry can prepare for this new generation of workers.
LRTV Custom TV
ZTE Global Services User Congress 2016 Highlights

10|19|16   |     |   (0) comments

ZTE held its 2nd Global Service User Conference in Dusseldorf on October 13-14. Representatives from network operators, leading industry analysts and ZTE senior expertsattended the event, exploring the best practice in managed services and the vision to transform network operations into the operations center of the future (OpCF) in the software-defined networking ...
LRTV Custom TV
Cliff Grossner on Cloud & Network Synergy From Carrier Service

10|18|16   |     |   (0) comments

Local carriers offer the collaborated cloud and network service that benefits from their understanding of the regulations operating in different vertical markets.
In this interview, Cliff Grossner from IHS Technology talks about how this advanced service can support business agility and flexibility.
LRTV Custom TV
VeEX's Plan for DOCSIS Deployment

10|17|16   |     |   (0) comments

Join VeEX's CEO Cyrille Morelle and Light Reading's Alan Breznick as they discuss VeEX's new products at SCTE 2016 at Philadelphia.
LRTV Custom TV
Smith Micro's Carrier-Grade WiFi Component

10|17|16   |     |   (0) comments

Join Carol Wilson of Light Reading as she interviews the CTO of Smith Micro, Dave Sperling.
Upcoming Live Events
November 3, 2016, The Montcalm Marble Arch, London
November 30, 2016, The Westin Times Square, New York City
December 1, 2016, The Westin Times Square, New York, NY
December 6-8, 2016, The Westin Excelsior, Rome
May 16-17, 2017, Austin Convention Center, Austin, TX
All Upcoming Live Events
Hot Topics
Amazon Unlimited, Alexa, AI & How to Cut Off Google at Its Knees
Brian Santo, Senior editor, Test & Measurement / Components, Light Reading, 10/14/2016
US Issues Total Flight Ban on Samsung Note 7
Dan Jones, Mobile Editor, 10/15/2016
Oh Snap! Qualcomm Unveils X50, Its First 5G Modem
Dan Jones, Mobile Editor, 10/17/2016
Verizon Wants More Data on Yahoo Breach
Alan Breznick, Cable/Video Practice Leader, Light Reading, 10/20/2016
Amazon Exploring Future as an ISP – Report
Mari Silbey, Senior Editor, Cable/Video, 10/19/2016
Like Us on Facebook
Twitter Feed
BETWEEN THE CEOs - Executive Interviews
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.
There's no question that, come 2020, 5G technology will turn the world's conception of what mobile networking is on its head. Within the world of 5G development, Dr. ...
Animals with Phones
Live Digital Audio

A vital part of increasing the number of women in comms is transforming the ways companies can support and empower women. While progressive company policies that support both men and women in achieving work-life balance are a step in the right direction, creating a company culture that supports those policies can at times be more challenging.

During this show, we'll talk to Lynn Comp, Senior Director of Industry and Sales Enabling (ISE) in the Network Platforms Group at Intel, about why those challenges exist and how companies can overcome them. She'll provide insight into how Intel has worked to create a culture that supports work-life balance, and provide steps and guidance for other companies wishing to do the same. We will also leave plenty of time to get your questions answered live on the air.