It has been about a month since the last earnings report for Bandwidth (BAND Quick QuoteBAND - Free Report) . Shares have added about 7.1% in that time frame, outperforming the S&P 500.

Will the recent positive trend continue leading up to its next earnings release, or is Bandwidth due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.

Bandwidth Q2 Earnings Beat Estimates on Healthy Revenue Growth

Bandwidth reported impressive second-quarter 2025 results, with both the top and bottom lines surpassing the respective Zacks Consensus Estimate.

The strong performance was backed by enterprises increasingly relying on Bandwidth’s platform for cloud-based communications. To drive growth, the company plans to focus on winning large enterprises and become the leading global CPaaS (Communications Platform as a Service) platform for scaling digital engagement. A strong focus on strengthening profitability and expanding cash flow generation is a positive factor.

BAND’s Quarter Details

On a GAAP basis, net loss during the quarter was $4.9 million or a loss of 16 cents per share compared with a net loss of $5 million or a loss of 17 cents per share in the prior-year quarter. The marginally narrower loss was attributable to top-line growth.
 
Excluding non-recurring items, non-GAAP net income during the reported quarter was $12.1 million or 38 cents per share compared with $9 million or 29 cents per share in the prior-year quarter. The bottom line beat the Zacks Consensus Estimate of 32 cents.

Quarterly revenues improved to $180 million from $174 million in the prior-year quarter. The growth was driven by high demand for digital engagement and strong contributions from messaging services across various use cases, including healthcare, IT services, fintech and civic engagement. The top line exceeded the consensus estimate of $179 million.  Bandwidth’s Maestro and AI Bridge, which allows for the seamless integration of preferred voice agents, are gaining popularity.

BAND’s Operating Details

Non-GAAP gross margin during the quarter was 58%, up from 56% a year ago. Favorable product mix and operational efficiency propelled the gross margin. Adjusted EBITDA was $22 million, well above the guidance and up from $19 million in the prior-year period.

Cash Flow & Liquidity for BAND

In the June quarter, net cash from operating activities was $31.7 million compared with a cash generation of $24.4 million in the prior year. Cash and cash equivalents as of June 30, 2025, were $60.1 million, with convertible senior notes of $247 million.

BAND’s Guidance

Backed by strong momentum, Bandwidth expects continued growth, with a focus on strategic investments and strengthening its capital structure. Revenues for 2025 are anticipated to be in the band of $745-760 million, indicating 9-11% year-over-year growth. Management forecasts adjusted EBITDA in the range of $86-$91 million.

For the third quarter, revenues are expected to be between $189 million and $191 million. Adjusted EBITDA is anticipated to be in the band of $19 million-$21 million.

How Have Estimates Been Moving Since Then?

It turns out, estimates revision have trended downward during the past month.

The consensus estimate has shifted -20% due to these changes.

VGM Scores

Currently, Bandwidth has a strong Growth Score of A, though it is lagging a lot on the Momentum Score front with a D. However, the stock has a score of A on the value side, putting it in the top 20% for value investors.

Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.

Outlook

Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Interestingly, Bandwidth has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.