Why RingCentral Stock Is Up Today
Key Points
RingCentral's voice and agentic AI technology is making it easier for businesses to communicate with customers.
The cloud pioneer is generating bountiful free cash flow.
- 10 stocks we like better than RingCentral ›
Shares of RingCentral (NYSE:RNG) rose 5% on Friday after the communications software provider raised its full-year free cash flow forecast.
Image source: Getty Images.
Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a "Double Down" signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same "Total Conviction" signal is flashing for a company 1/100th the size of Nvidia. Continue »
AI-fueled growth
RingCentral's revenue grew 5.9% year over year to $676 million in the third quarter.
During a conference call with analysts, CEO Vlad Shmunis said artificial intelligence (AI) represents an even larger opportunity for RingCentral than the shift from traditional communication systems to the cloud.
"We are leading this next transformation with agentic voice AI, making customer interactions more efficient, intelligent, and actionable," Shmunis said.
Customers using at least one AI product now account for about 15% of RingCentral's total annual recurring revenue, or over $400 million. These sales are also growing rapidly, with AI-based ARR doubling compared to the prior-year period.
Rising cash profits
Better still, the communications specialist is becoming more profitable as it scales its business. Adjusted operating margin increased by 1.9 percentage points to 24.7%.
All told, RingCentral's adjusted earnings jumped 18% to $1.33 per share, while its free cash flow rose 21% to $157 million.
For the full year, RingCentral expects revenue of more than $2.65 billion, earnings per share of $5.07 to $5.12, and free cash flow of roughly $625 million.
This strong cash generation is enabling RingCentral to pay down debt and return capital to shareholders via dividends and stock buybacks.
"These results underscore the strength of our financial model and our focus on driving profitable growth and long-term shareholder value," chief financial officer Vaibhav Agarwal said.
Should you buy stock in RingCentral right now?
Before you buy stock in RingCentral, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and RingCentral wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $361,596!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $1,303,935!*
Now, it’s worth noting Stock Advisor’s total average return is 910% — a market-crushing outperformance compared to 211% for the S&P 500. Don't miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.
See the 10 stocks »
*Stock Advisor returns as of October 23, 2026.
Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
Recommended Articles
