RingCentral's revised 2026 targets pair higher revenue and non-GAAP free cash flow forecasts with a mixed GAAP margin outlook, following a quarter in which sales increased 5.9%.
The company now expects $620 million to $630 million in full-year non-GAAP free cash flow, up from $615 million to $625 million. Its revenue forecast rose to $2.650 billion to $2.657 billion from $2.635 billion to $2.646 billion. RingCentral set the subscription-revenue target at $2.563 billion to $2.569 billion, compared with $2.550 billion to $2.561 billion before.
RingCentral also raised its fiscal 2026 non-GAAP operating-margin outlook to 24.0% to 24.2% from 23.6% to 24.0%, and its non-GAAP diluted earnings-per-share forecast to $5.07 to $5.12 from $4.96 to $5.10. Its GAAP operating-margin range changed unevenly: the lower end rose to 9.2% from 9.0%, while the upper end fell to 9.6% from 9.7%.
Revenue for the quarter ended Sept. 30 was $676.043 million, 5.9% above $638.655 million in the year-earlier quarter. Subscription revenue was $652.944 million, compared with $615.821 million. Non-GAAP free cash flow increased 21% to $157 million, or 23.2% of revenue, against 20.3% a year earlier. Net cash provided by operating activities rose 18.8% to $180 million.
Non-GAAP diluted earnings per share were $1.33, versus $1.13 a year earlier. GAAP diluted earnings per share were $6.50, including the effect of a valuation-allowance release. Excluding that effect, diluted earnings per share were $0.28, 47.4% higher than a year earlier.
Chief Financial Officer Vaibhav Agarwal said RingCentral made progress on growth and profitability, including stronger operating and free-cash-flow margins. RingCentral announced the results Oct. 22 and said it reached its $1 billion gross-debt target ahead of schedule while returning capital to shareholders.
The company declared a $0.125-per-share dividend, payable Nov. 20 to shareholders of record Nov. 6.
