AudioCodes (AUDC) Stock Forecast & Price Target

AudioCodes Ltd has demonstrated robust financial performance, as highlighted by a 10.9% year-over-year growth in service revenue, which now constitutes 56% of total revenue, indicating a successful transition to a subscription-based model. The company finished the quarter with $62.4 million in cash and equivalents, a notable increase from $48 million in the prior quarter, and generated $15.3 million in cash from operating activities, reflecting operational efficiency. Furthermore, the significant increase in live annual recurring revenue (ARR) to $65 million, alongside a forecasted 30% growth for the upcoming fiscal year, underscores AudioCodes's promising growth trajectory within the competitive converged voice over IP market.

AudioCodes Ltd reported revenue of $61.5 million, reflecting a year-over-year decline of 3.2% and falling short of the consensus estimate of $61.9 million. Although the company achieved a non-GAAP EPS of $0.37, this strong performance was primarily due to an outsized tax benefit rather than operational growth, raising concerns about the sustainability of such earnings. Additionally, despite a record backlog driven by strong subscription bookings, the overall revenue decrease suggests potential challenges in market demand and sales execution moving forward.