Five9 Reports 13% Revenue Growth and Net Income Improvement in Q1 2025

Five9, Inc. reported a significant increase in its financial performance for the first quarter of 2025, with total revenue reaching $279.7 million, a 13% increase from $247.0 million in the same period last year. The company achieved a net income of $0.6 million, compared to a net loss of $7.1 million in the first quarter of 2024. This improvement in profitability was attributed to a growing customer base and enhanced sales and marketing efforts, particularly among larger clients. The gross profit margin also improved, rising to 55% from 54% year-over-year.

In terms of operational metrics, Five9 reported having over 3,000 customers as of March 31, 2025, with no single customer accounting for more than 10% of total revenue. The company’s Annual Dollar-Based Retention Rate decreased slightly to 107% from 109% year-over-year, reflecting challenges in retaining revenue from existing customers amid macroeconomic pressures. The company continues to invest in its Intelligent CX Platform, which integrates AI capabilities to enhance customer interactions across various channels.

Five9's balance sheet showed total assets of $2.09 billion as of March 31, 2025, up from $2.05 billion at the end of 2024. Cash and cash equivalents increased to $370.3 million, while marketable investments rose to $671.4 million. The company’s total liabilities decreased slightly to $1.43 billion, with convertible senior notes accounting for a significant portion of this figure. The company has also been active in managing its debt, having repurchased approximately $313.1 million of its 2025 convertible senior notes in a transaction that resulted in a gain on early extinguishment of debt.

Strategically, Five9 has been focusing on enhancing its product offerings and expanding its market presence. The company completed the acquisition of Acqueon in August 2024, which is expected to bolster its AI-powered customer engagement capabilities. Additionally, Five9 announced a reduction in force plan in March 2025, aimed at prioritizing investments in key strategic areas, including artificial intelligence, and is expected to reduce its workforce by approximately 4%. The company anticipates incurring cash expenditures of $7 million to $9 million related to this restructuring.

Looking ahead, Five9 remains cautious about the macroeconomic environment, which includes challenges such as inflation and geopolitical tensions. The company expects these factors to continue impacting its revenue growth in the near term. However, it maintains a positive long-term outlook, driven by ongoing investments in technology and customer engagement solutions. The management is focused on leveraging its existing resources to navigate these challenges while pursuing growth opportunities in the cloud contact center market.