Five9's Fourth Quarter Performance Sparks Market Enthusiasm

Author: Dylan Bailey Updated: 02-20-2025 04:57 PM

Five9 Shares Rally After Q4 Report

Five9, Inc. reported its fourth-quarter results recently, marking a significant milestone in its financial journey. This report has caught the attention of investors and market analysts alike, demonstrating the company's strong performance and promising outlook.

Quarterly Financial Highlights

In the recent earnings release, Five9 disclosed quarterly earnings of 79 cents per share, surpassing the analyst consensus estimate of 70 cents. The revenue for the quarter totaled $278.66 million, exceeding expectations, as analysts had estimated approximately $267.81 million. It's worth noting that this figure reflects substantial growth compared to $239.06 million generated in the same quarter the previous year.

Improved Gross Margins

The company reported an adjusted gross margin of 63.5% for the fourth quarter, indicating improvement over the 61.3% recorded in the same quarter of the prior year. This upward trajectory highlights Five9's commitment to enhancing its operational efficiency and overall profitability.

Leadership Changes Announced

In addition to its financial results, Five9 also announced a significant change in its executive team. Chief Financial Officer Barry Zwarenstein is set to retire, with Bryan Lee stepping in as Interim CFO. This leadership transition is critical as the company navigates its future growth strategy.

CEO's Remarks on Growth

CEO Mike Burkland expressed enthusiasm regarding the results, stating, "We are very pleased to report strong year-end results, with 2024 annual revenue exceeding $1 billion. Fourth-quarter revenue growth accelerated to 17%, driven by our subscription revenue growing 19%. We reached an all-time record adjusted EBITDA margin of 23%, helping drive our highest ever quarterly operating cash flow of $50 million." Such comments underline the confidence the management team has in the company's direction and the potential for continued expansion.

Future Outlook

Looking ahead, Five9 anticipates first-quarter revenue to fall between $271.5 million and $272.5 million, slightly above the $272.44 million estimate. Additionally, adjusted earnings per share are projected to be between 47 cents and 49 cents, compared to the analyst estimate of 48 cents. Overall, this outlook reinforces the belief in Five9's capacity for sustained growth.

Stock Performance Following Earnings

After the announcement, Five9 shares experienced an impressive boost, climbing by 8.78% after hours, reaching a price of $45.35. This increase reflects the positive reception of the quarterly results within the investment community.

Frequently Asked Questions

What were Five9's earnings per share for the fourth quarter?

Five9 reported earnings of 79 cents per share for the fourth quarter.

How did Five9's revenue in Q4 compare to last year?

Revenue for the fourth quarter was $278.66 million, an increase from $239.06 million in the same quarter last year.

Who is the new Interim CFO of Five9?

Bryan Lee has been appointed as the Interim CFO following the retirement of Barry Zwarenstein.

What is Five9's outlook for its first-quarter revenue?

Five9 expects first-quarter revenue to range from $271.5 million to $272.5 million.

How did the market react to Five9's earnings report?

After the earnings report, Five9's shares rose by 8.78%, signifying positive investor sentiment.

About The Author

My name is Dylan Bailey, and I am 28 years old. I am an author and an expert on the stock market who specializes in publicly traded companies. Early fascination with the stock market inspired me to seek a finance degree and then delve deeply into the world of stocks. I have developed over the years my abilities to spot investment prospects, assess business performance, and analyze market trends.

My books and articles try to help regular investors understand the nuances of the stock market. Anyone can, in my opinion, make wise investment choices and succeed financially if they have the correct information and resources. In my writing, I combine in-depth research with practical insights and advice that can be put into action. This is done with the intention of assisting readers in navigating the constantly shifting landscape of publicly traded companies.

In addition to writing, I also host webinars and workshops, where I give presentations and share my knowledge with a wider audience. I also write for top financial journals and show up as a guest analyst on financial news shows. I like to travel, spend time with my family, and keep active by playing different sports when I'm not buried in market research.

My goal is to enable people to choose wisely and consciously in their investments, so taking charge of their financial futures. By my work, I hope to create a community of informed and self-assured investors prepared to take advantage of the chances presented by the stock market.

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