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IDT Stock Gains Post Q3 Earnings as Growth Segments Boost Profit
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Shares of IDT Corporation (IDT - Free Report) have gained 1.2% since the company reported results for the quarter ended April 30, 2026, outperforming the S&P 500 Index, which declined 2.6% over the same period. Over the past month, IDT shares advanced 7.5%, against a 0.8% decline for the broader market.
IDT’s Earnings Snapshot
IDT delivered higher revenues and earnings in the third quarter of fiscal 2026, driven by continued growth in its higher-margin businesses. Revenues increased 4.5% year over year to $315.7 million, while gross profit rose 9.4% to a record $122.5 million. Gross margin expanded 170 basis points to 38.8% from 37.1%. Income from operations climbed 12% to $29.8 million, and GAAP earnings per share (EPS) improved to $0.87 from $0.86 a year earlier. Non-GAAP EPS increased 4.4% to $0.94 from $0.90. Adjusted EBITDA grew 13% to $37.5 million.
Segment performance was led by National Retail Solutions (NRS), where revenue rose 22% and operating income increased 33%; the Fintech segment, where revenue grew 17% and operating income advanced 29%; and net2phone, which posted 11% revenue growth and a 76% increase in operating income. Traditional Communications revenue declined 1%, although adjusted EBITDA edged up 1%.
IDT’s Segment Growth Drives Profit Expansion
Management attributed the quarter’s performance to the expanding contribution of NRS, Fintech and net2phone, which collectively accounted for 34% of consolidated revenue, up from 30% a year ago. These businesses generated 67% of consolidated gross profit compared with 61% in the prior-year period. Combined adjusted EBITDA from the three growth segments increased 27% year over year to $20.5 million.
At NRS, recurring revenue increased 22% to $36 million, supported by a 31% increase in Merchant Services and Other revenue and a 17% rise in SaaS Fees. Active POS terminals reached 39,300, up 10.4%, while payment processing accounts increased 14.5% to 29,200. Revenue climbed 22% to $38 million and adjusted EBITDA rose 25% to $9.8 million.
The Fintech segment benefited from strong BOSS Money performance. Total segment revenue increased 17% to $45 million, while gross profit rose 25% to $28.3 million. BOSS Money transactions increased 15% to 6.9 million, and digital channel transactions rose 20%. Digital channel revenue jumped 27% to $31 million. Digital channel send volume jumped 40%, reflecting growth in both transaction activity and average remittance amounts. Adjusted EBITDA increased 30% to $6.6 million.
At net2phone, subscription revenue grew 12% to $24 million as seats served increased 6.3% to 441,000. The business benefited from growth in higher-value CCaaS seats, helping operating income rise 76% to $2.4 million and adjusted EBITDA increase 30% to $4.1 million.
NRS reported a Rule of 40 score of 50, reflecting a balance between growth and profitability. Monthly average recurring revenue per terminal increased 10% to $307. Management noted that payment processing accounts surpassed 29,000, and recurring revenue growth continued to be driven by merchant services and software fees.
IDT ended the quarter with $251.4 million in cash, cash equivalents and current debt and equity securities, excluding restricted cash, and had no outstanding debt. During the quarter, IDT repurchased approximately 84,000 Class B shares for $4 million.
IDT’s Management Commentary
Chief executive officer Shmuel Jonas said that growth continued to be fueled by IDT’s higher-margin businesses alongside steady cash generation from Traditional Communications. Jonas highlighted market-share gains at BOSS Money following implementation of a federal remittance tax and pointed to growing traction for net2phone’s AI offerings, which management expects to become accretive growth drivers in fiscal 2027. Management also emphasized broader adoption of AI and machine-learning tools across operations, including customer service, pricing, marketing and product development.
IDT’s Guidance Raised
Reflecting strong results through the first nine months of fiscal 2026 and visibility into the fiscal fourth quarter, IDT raised its full-year consolidated adjusted EBITDA guidance to a range of $150 million to $152 million from its previous outlook of $147 million to $149 million. At the midpoint, the revised forecast implies 15% growth over fiscal 2025 adjusted EBITDA of $131.7 million.
IDT’s Other Developments
Following the quarter’s close, IDT acquired an 80% controlling stake in OnCore Digital, a digital media brokerage. Management said the acquisition will allow NRS to integrate OnCore’s advertising technology, demand relationships and publisher network with its existing screen network and first-party transaction data. During the earnings call, management described the deal as a small tuck-in acquisition valued at roughly $6 million, excluding earn-outs, and said it is expected to enhance monetization of NRS advertising assets.
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IDT Stock Gains Post Q3 Earnings as Growth Segments Boost Profit
Shares of IDT Corporation (IDT - Free Report) have gained 1.2% since the company reported results for the quarter ended April 30, 2026, outperforming the S&P 500 Index, which declined 2.6% over the same period. Over the past month, IDT shares advanced 7.5%, against a 0.8% decline for the broader market.
IDT’s Earnings Snapshot
IDT delivered higher revenues and earnings in the third quarter of fiscal 2026, driven by continued growth in its higher-margin businesses. Revenues increased 4.5% year over year to $315.7 million, while gross profit rose 9.4% to a record $122.5 million. Gross margin expanded 170 basis points to 38.8% from 37.1%. Income from operations climbed 12% to $29.8 million, and GAAP earnings per share (EPS) improved to $0.87 from $0.86 a year earlier. Non-GAAP EPS increased 4.4% to $0.94 from $0.90. Adjusted EBITDA grew 13% to $37.5 million.
Segment performance was led by National Retail Solutions (NRS), where revenue rose 22% and operating income increased 33%; the Fintech segment, where revenue grew 17% and operating income advanced 29%; and net2phone, which posted 11% revenue growth and a 76% increase in operating income. Traditional Communications revenue declined 1%, although adjusted EBITDA edged up 1%.
IDT’s Segment Growth Drives Profit Expansion
Management attributed the quarter’s performance to the expanding contribution of NRS, Fintech and net2phone, which collectively accounted for 34% of consolidated revenue, up from 30% a year ago. These businesses generated 67% of consolidated gross profit compared with 61% in the prior-year period. Combined adjusted EBITDA from the three growth segments increased 27% year over year to $20.5 million.
At NRS, recurring revenue increased 22% to $36 million, supported by a 31% increase in Merchant Services and Other revenue and a 17% rise in SaaS Fees. Active POS terminals reached 39,300, up 10.4%, while payment processing accounts increased 14.5% to 29,200. Revenue climbed 22% to $38 million and adjusted EBITDA rose 25% to $9.8 million.
The Fintech segment benefited from strong BOSS Money performance. Total segment revenue increased 17% to $45 million, while gross profit rose 25% to $28.3 million. BOSS Money transactions increased 15% to 6.9 million, and digital channel transactions rose 20%. Digital channel revenue jumped 27% to $31 million. Digital channel send volume jumped 40%, reflecting growth in both transaction activity and average remittance amounts. Adjusted EBITDA increased 30% to $6.6 million.
At net2phone, subscription revenue grew 12% to $24 million as seats served increased 6.3% to 441,000. The business benefited from growth in higher-value CCaaS seats, helping operating income rise 76% to $2.4 million and adjusted EBITDA increase 30% to $4.1 million.
IDT Corporation Price, Consensus and EPS Surprise
IDT Corporation price-consensus-eps-surprise-chart | IDT Corporation Quote
IDT’s Other Key Business Metrics
NRS reported a Rule of 40 score of 50, reflecting a balance between growth and profitability. Monthly average recurring revenue per terminal increased 10% to $307. Management noted that payment processing accounts surpassed 29,000, and recurring revenue growth continued to be driven by merchant services and software fees.
IDT ended the quarter with $251.4 million in cash, cash equivalents and current debt and equity securities, excluding restricted cash, and had no outstanding debt. During the quarter, IDT repurchased approximately 84,000 Class B shares for $4 million.
IDT’s Management Commentary
Chief executive officer Shmuel Jonas said that growth continued to be fueled by IDT’s higher-margin businesses alongside steady cash generation from Traditional Communications. Jonas highlighted market-share gains at BOSS Money following implementation of a federal remittance tax and pointed to growing traction for net2phone’s AI offerings, which management expects to become accretive growth drivers in fiscal 2027. Management also emphasized broader adoption of AI and machine-learning tools across operations, including customer service, pricing, marketing and product development.
IDT’s Guidance Raised
Reflecting strong results through the first nine months of fiscal 2026 and visibility into the fiscal fourth quarter, IDT raised its full-year consolidated adjusted EBITDA guidance to a range of $150 million to $152 million from its previous outlook of $147 million to $149 million. At the midpoint, the revised forecast implies 15% growth over fiscal 2025 adjusted EBITDA of $131.7 million.
IDT’s Other Developments
Following the quarter’s close, IDT acquired an 80% controlling stake in OnCore Digital, a digital media brokerage. Management said the acquisition will allow NRS to integrate OnCore’s advertising technology, demand relationships and publisher network with its existing screen network and first-party transaction data. During the earnings call, management described the deal as a small tuck-in acquisition valued at roughly $6 million, excluding earn-outs, and said it is expected to enhance monetization of NRS advertising assets.