RingCentral Lifts Guidance Again as AI Revenue Share Hits 13%
RingCentral's revenue growth accelerated to 5.9% in the second quarter, its fastest pace in a year, as the company raised its full-year outlook for the second straight quarter.
RingCentral (RNG) reported second-quarter revenue growth of 5.9% to $657 million, the strongest year-over-year rate in the trailing four quarters. The cloud communications provider had posted 5% growth in each of the prior three quarters — the first quarter of 2026, the fourth quarter of 2025 and the third quarter of 2025 — making the acceleration a break from a run of flat growth rates.
The reacceleration came alongside broader margin gains. Non-GAAP operating margin expanded to 23.4%, up 90 basis points from a year earlier and continuing a steady climb from 22.8% in the third quarter of 2025 to 22.9% in the first quarter of 2026. GAAP operating margin rose to 7.7% from 6.0% a year ago, though it slipped from the first quarter's record 7.8%. Adjusted EBITDA margin reached 26.9% of revenue, up from 26.0% a year earlier.
GAAP earnings per share more than tripled to $0.45 from $0.14 a year earlier, extending a run of improvement that included $0.26 in the fourth quarter of 2025 and $0.35 in the first quarter of 2026. Free cash flow grew 24.8% year-over-year to $180 million, accelerating from 8.0% growth in the first quarter and following 32% growth for full-year 2025.
Artificial-intelligence products accounted for 13% of annual recurring revenue in the second quarter, up from just over 10% in the first quarter and roughly 10% in the fourth quarter of 2025. AI-product penetration doubled year-over-year in each of the past three quarters.
RingCentral raised its full-year 2026 guidance across revenue, margins, earnings and free cash flow for the second consecutive quarter. The company now guides to total revenue of $2.635 billion to $2.646 billion and free cash flow of $615 million to $625 million, building on a similar raise issued in the first quarter. Third-quarter revenue guidance of $664 million to $670 million implies continued sequential growth from the second quarter's $657 million, extending a sequential climb from $639 million in the third quarter of 2025 through $644 million in both the fourth quarter of 2025 and first quarter of 2026.
RingCentral raised its quarterly dividend roughly 67% to $0.125 a share from $0.075, the first increase since the dividend was initiated in the fourth quarter of 2025. The company also repurchased $94 million of stock in the second quarter, or 2.2 million shares, following $81 million in the first quarter, leaving $326 million remaining under its buyback authorization, down from $418 million at the end of the first quarter.
Cash and cash equivalents fell to $111.5 million at quarter-end from $132.6 million at the end of 2025 and $117 million at the end of the first quarter, reflecting the buyback spending alongside a $600 million debt issuance used to refinance the March 2026 repayment of convertible notes. Long-term debt rose to $1.074 billion at June 30 from $629.6 million at year-end 2025, following the first-quarter repayment of $609 million in convertible notes and the new debt issuance in the six months ended June 2026.