Core Viewpoint - Halper Sadeh LLC is investigating potential breaches of fiduciary duties by certain officers and directors of Five9, Inc., encouraging shareholders to contact the firm to discuss their rights and possible corporate governance reforms [1]. Group 1: Shareholder Rights and Legal Actions - Shareholders of Five9, Inc. may seek corporate governance reforms, return of funds, court-approved financial incentives, or other benefits [1]. - The firm operates on a contingent fee basis, meaning shareholders would not incur out-of-pocket legal fees [1]. Group 2: Importance of Shareholder Involvement - Shareholder participation is crucial for improving company policies, practices, and oversight, which can enhance overall shareholder value [1]. - Halper Sadeh LLC has a history of representing investors globally who have experienced securities fraud and corporate misconduct, recovering millions for defrauded investors [1].

NEW YORK, Feb. 25, 2026 /PRNewswire/ -- Kuehn Law, PLLC, a shareholder litigation law firm, is investigating whether certain officers and directors of Five9, Inc. (NASDAQ: FIVN) breached their fiduciary duties to shareholders. According to a federal securities lawsuit, Insiders at Five9 caused the company to misrepresent or fail to disclose that: (i) Five9's net new business was not "strong irrespective of the macro" and was, in fact, hampered by macroeconomic issues such as constrained and scrutinized cust ...

Wall Street’s outlook for Five9 (FIVN) reflects a wide spectrum of sentiment, but at the bullish end, some analysts see major upside potential ahead. Among the latest forecasts, the Street-high price target set by Northland Capital Markets sits at about $47, markedly above the current trading range and signaling significant optimism about the cloud contact-center software provider’s growth prospects. This estimate reflects 164.9% upside from yesterday's closing price. Northland Capital has rated the stock ...

Core Insights - The article emphasizes the importance of identifying underappreciated companies that can provide value to investors through a contrarian investment philosophy [1]. Group 1: Author's Background - The author has 20 years of experience in foreign policy research and over 25 years in investment analysis, focusing on deep-discount value plays [1]. - The author began analyzing securities during college and has contributed to various reputable publications, including Forbes and Seeking Alpha [1]. Group 2: Investment Philosophy - The investment approach is centered around finding micro-cap stocks that are undervalued and have the potential to return value to investors [1]. - The author is influenced by the contrarian investment philosophy of David Dreman, which focuses on value investing rather than momentum [1].

If you are new to this company, I'd like you to go back and read my in-depth write-ups on Hemisphere Energy Corporation ( HMENF ) here and here . In these articles IFluidsdoc is an international oil industry veteran with 40 years of experience having worked on six continents and in over twenty countries around the world. He is an expert in the upstream oilpatch and an energy sector specialist. He is the leader of the investing group The Daily Drilling Report where he provides investment analysis for the oil ...

Group 1 - Five9 Incorporated (NASDAQ:FIVN) is identified as one of the small-cap software infrastructure stocks with significant upside potential, with a current upside of more than 59% despite a price target reduction from $30 to $26 by Morgan Stanley [1][3] - Barclays analyst Raimo Lenschow also reduced his target price on Five9 from $29 to $25 while maintaining an Overweight rating, indicating an upside potential of over 53% based on steady macro and IT spending [4] - The company operates as a contact center as a service (CCaaS) provider, offering a cloud-based CX platform that includes applications for customer service, sales, and marketing, featuring services like virtual assistance and AI insights [5] Group 2 - Application SaaS companies, including Five9, have shown weaker returns in 2025 compared to the broader software segment, although AI-related risks may be less severe than expected, leading to a more favorable outlook for the segment [3] - The software sector is currently out of favor, with depressed valuations and limited signs of increased software spending, prompting analysts to be cautious and selective in their outlook [4]

Core Insights - Five9, Inc. (FIVN) reported fourth-quarter 2025 earnings of 80 cents per share, exceeding the Zacks Consensus Estimate by 1.3% and showing a 1.3% increase from the previous year's 79 cents [1][9] - The company's fourth-quarter revenues rose 8% year over year to $300.3 million, also surpassing the Zacks Consensus Estimate by 0.9%, driven by a 12% increase in subscription revenues due to strong Enterprise AI traction [2][9] Financial Performance - FIVN's adjusted non-GAAP gross profit for Q4 was $189.47 million, up from $176.85 million in the same quarter last year, with a gross margin of 63.1%, down 40 basis points year over year [3] - Non-GAAP operating income increased to $61.62 million from $49.52 million year over year, resulting in a non-GAAP operating margin of 20.5%, up from 17.8% [4] - General & administrative expenses on a non-GAAP basis rose to $18.2 million, accounting for 6.1% of revenues, down from 6.4% in the previous year [4] - Research & development expenditures decreased to $26.2 million, representing 8.7% of revenues, down from 11.5% [5] - Non-GAAP sales & marketing costs increased to $67.7 million, maintaining 22.6% of revenues, consistent with the prior year [5] Balance Sheet & Cash Flow - At the end of the quarter, FIVN had cash and cash equivalents of $696.92 million, up from $676.2 million in the previous quarter [6] - The company generated an operating cash flow of $83.6 million and reported a free cash flow of $67.3 million, with a free cash flow margin of 22% [6] Guidance - For 2026, Five9 expects revenues to be between $1.247 billion and $1.261 billion, with the Zacks Consensus Estimate at $1.26 billion, indicating a year-over-year growth of 9.6% [7] - GAAP net income per share is projected to be between 86 cents and 95 cents, while non-GAAP net income per share is expected to range from $3.15 to $3.21, with the Zacks Consensus Estimate at $3.19, reflecting an 8.3% year-over-year growth [8] - For Q1 of fiscal 2026, revenues are forecasted to be between $296.5 million and $302.5 million, with the Zacks Consensus Estimate at $299.3 million, indicating a 7% year-over-year growth [10] - GAAP net income per share for Q1 is projected to be between 10 cents and 17 cents, while non-GAAP net income per share is expected to be between 66 cents and 70 cents, with the Zacks Consensus Estimate at 67 cents, indicating an 8.1% year-over-year growth [11]

Core Insights - Five9 reported a strong fourth-quarter performance with total revenue of $300 million, reflecting an 8% year-over-year increase, and subscription revenue grew 12% year-over-year, indicating an acceleration in growth trends [1][3][6] - The company experienced a leadership transition with Amit Mathradas taking over as CEO on February 2, focusing on product innovation, AI, and operational execution [2][4] - Enterprise AI bookings more than doubled year-over-year, contributing to a backlog and pushing annual run-rate revenue for enterprise AI past $100 million [1][5] Financial Performance - For fiscal year 2025, Five9 achieved total revenue of $1.15 billion, up 10% year-over-year, with subscription revenue growth of 13% [14] - The adjusted EBITDA margin for Q4 was 26%, an increase of approximately 260 basis points year-over-year, and free cash flow reached $67 million, representing 22% of revenue [7][8] - Five9 provided guidance for 2026 with a revenue midpoint of $1.254 billion and a non-GAAP EPS midpoint of $3.18, alongside expectations for at least a 24% adjusted EBITDA margin [15][16] Growth Drivers - The company identified two primary growth engines: enterprise AI and core CCaaS, with enterprise AI revenue growth accelerating to 50% year-over-year in Q4 [9][5] - Five9's partner strategy is significant, with over 80% of business being partner-influenced, and the number of certified partners doubled in 2025 [7] - The company is focusing on verticals such as financial services, healthcare, and retail, which reflect the complexity and regulatory demands of enterprise deployments [13] Strategic Initiatives - Five9 is positioning itself as an end-to-end customer experience platform leveraging conversational data and orchestration as a competitive advantage [5][10] - The company completed a $50 million accelerated share repurchase on February 2, buying back approximately 2.6 million shares [17] - Five9 plans to host an Investor Day in late 2026 to provide further details on strategic priorities and long-term financial outlook [16]

Financial Performance - Five9's revenue for the years ended December 31, 2025, 2024, and 2023 was $1,149.1 million, $1,041.9 million, and $910.5 million, respectively, representing year-over-year growth of 10% and 14%[25]. - The company recorded net income (losses) of $39.4 million, $(12.8) million, and $(81.8) million for the years ended December 31, 2025, 2024, and 2023[25]. - As of December 31, 2025, Five9's total assets were $1,790.1 million, down from $2,051.2 million in 2024 and up from $1,494.6 million in 2023[25]. - The company incurred net losses of $39.4 million, $(12.8) million, and $(81.8) million for the years ended December 31, 2025, 2024, and 2023, with an accumulated deficit of $378.2 million as of December 31, 2025[98]. - Revenue for the years ended December 31, 2025, 2024, and 2023 was $1,149.1 million, $1,041.9 million, and $910.5 million, representing year-over-year growth of 10% and 14% respectively[99]. Customer Base and Retention - Five9 has over 3,000 customers, leveraging its AI-powered CX platform to improve customer experiences across various channels[16]. - As of December 31, 2025, the company has a diverse customer base of over 3,000 organizations, with no single customer accounting for more than 10% of revenues in 2025, 2024, or 2023[33]. - The Annual Dollar-Based Retention Rate was 105% as of December 31, 2025, enhancing the company's ability to forecast financial performance[25]. - In 2025, 51% of total revenues were generated in the second half of the year, attributed to increased activities in retail, healthcare, and education[53]. - Retaining existing customers is critical, as subscription terminations or reductions could significantly harm revenues and gross margins[110]. Business Model and Operations - The company operates a SaaS business model, generating subscription revenue primarily based on the number of licenses and usage-based telephony revenue[24]. - The company’s sales model includes both direct sales through field and telesales teams and indirect sales through a network of technology solution distributors and resellers[38]. - The company’s cloud platform is designed to be highly reliable, secure, and scalable, with operational control over critical elements of its voice infrastructure[41]. - The company continues to expand its international operations, which introduces significant macroeconomic risks[101]. - The company plans to invest in enhancing its solution through AI capabilities and expanding its partner ecosystem to drive future growth[100]. Research and Development - The company has invested significantly in research and development, with a core center in California and additional engineers in Australia, Portugal, and India, to enhance its Intelligent CX Platform[40]. - Research and development expenses totaled $152.3 million, $166.2 million, and $156.6 million for the years ended December 31, 2025, 2024, and 2023, respectively[144]. - The company emphasizes advancements in AI, particularly through its Genius AI suite, which enhances customer experience and operational efficiency[19]. - The development of AI-powered features is a key focus, but there are risks associated with achieving sufficient accuracy and market acceptance[134]. Employee Engagement and Diversity - The company employs 2,910 full-time employees as of December 31, 2025, with 43% in cost of revenue functions and 25% in research and development[54]. - The company’s employee engagement score was 72% in 2025, exceeding the Culture Amp benchmark by three percentage points, indicating strong team effectiveness and growth opportunities[63]. - Women represented 32% of the company's worldwide employees and racial and ethnic minorities represented 36% of U.S. employees as of December 31, 2025[66]. - The company emphasizes a total rewards system that includes competitive cash compensation and a holistic package addressing employee needs, such as healthcare benefits and retirement plans[70]. Regulatory and Compliance Risks - The company faces regulatory challenges, including compliance with the Telecommunications Act and various federal and state regulations that could impact operations[78]. - The company must adhere to numerous regulations, including the Telephone Consumer Protection Act and the California Consumer Privacy Act, which could affect operational costs and competitive positioning[80][81]. - The company is subject to international regulations, such as the GDPR in the EU, which imposes strict requirements on data processing and can result in significant fines for non-compliance[82]. - The company has implemented a layered information governance program to ensure compliance with evolving regulatory frameworks and protect customer data[83]. - Compliance with new robocall prevention regulations, including the STIR/SHAKEN framework, poses significant business risks and may affect customer relationships[210]. Market Competition and Challenges - The company faces intense competition from both large legacy technology vendors and smaller service providers, which could harm its operating results[124]. - Competitors are increasingly integrating AI technologies into their offerings, potentially leading to pricing pressures and reduced market share for the company[125]. - The company faces challenges in managing growth effectively, which could lead to operational difficulties and impact business performance[102]. - The company acknowledges risks related to adverse economic conditions, including inflation and high interest rates, which may impact revenue growth and customer retention[90]. Intellectual Property and Technology Risks - The company has approximately $747.5 million in principal outstanding under convertible senior notes issued in March 2024, maturing on March 15, 2029[176]. - The company may incur additional liabilities for taxes, fees, or surcharges if state and local taxing authorities challenge its tax positions[207]. - The company relies on third-party licensed software, including AI solutions, and any inability to maintain these licenses could harm its business[196]. - The company is subject to third-party intellectual property infringement claims, which could result in substantial damages and legal costs[191]. Future Outlook and Strategic Initiatives - The company plans to expand its international presence, particularly in India, with significant operations in the Philippines and Portugal[154]. - The company is increasing sales, marketing, and support personnel in the U.K. and the European Union, along with enlarging data centers in the U.K. and Amsterdam[159]. - The company plans to invest in acquiring government customers, which requires compliance with FedRAMP, a process that is costly and time-consuming[108]. - The company is increasing its network of technology solution distributors and resellers, but failure to manage these relationships effectively could harm revenues[118].

Financial Data and Key Metrics Changes - The company reported total revenue of $300 million for Q4, representing an 8% year-over-year growth [21] - Subscription revenue grew by 12% year-over-year in Q4, now making up 82% of total revenue, up from 79% a year ago [22] - Adjusted EBITDA margin increased to 26%, while free cash flow more than doubled year-over-year to a margin of 22% [10][24] - For the full year 2025, total revenue was $1.15 billion, growing 10% year-over-year, with subscription revenue growing 13% [25] Business Line Data and Key Metrics Changes - Enterprise AI revenue growth accelerated to 50% year-over-year, contributing significantly to the overall subscription revenue [21][22] - Core CCaaS subscription revenue growth accelerated to 8% year-over-year [22] - The company achieved a record in enterprise AI bookings, which more than doubled year-over-year [9][16] Market Data and Key Metrics Changes - The market for traditional CCaaS is expected to grow at a 9% CAGR, while the GenAI customer service market is projected to grow at a 34% CAGR through 2029, reaching a combined annual spend of $48 billion [11] - The company is well-positioned to capitalize on these growth drivers, leveraging its data advantage in conversational data [11][12] Company Strategy and Development Direction - The company aims to lead in AI-powered customer experience (CX) by enhancing its platform capabilities and expanding its partnerships, particularly with Google Cloud [14][15] - The focus is on creating a unified CX platform that addresses both agentic and traditional human needs, driving efficiency and elevating customer experiences [8][10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's positioning for continued success in 2026 and beyond, driven by strong demand for AI solutions [10] - The CEO emphasized the importance of operational excellence and the potential for significant growth in the AI-driven CX market [9][10] Other Important Information - The company completed a $50 million accelerated share repurchase on February 2, buying back approximately 2.6 million shares, reflecting strong cash generation [29] - The company plans to host an Investor Day in late 2026 to provide additional details on strategic priorities and long-term financial outlook [29] Q&A Session Summary Question: Breakdown of AI revenue growth - Management indicated that AI revenue growth is driven by both new logo acquisition and penetration into the existing customer base, with both segments growing significantly [33][34] Question: Product strategy and potential changes - The new CEO highlighted the opportunity for transformation within the CX space, focusing on increasing the total addressable market (TAM) through AI and traditional CCaaS [40] Question: Contact center industry outlook - Management discussed the ongoing shift to cloud solutions and the significant AI opportunity, emphasizing the company's end-to-end platform advantage [46][48] Question: Sector performance and customer pain points - The company noted strong adoption in healthcare and retail sectors, with customers focusing on improving their data strategies to enhance AI capabilities [54][89] Question: AI revenue composition - The company clarified that the $100 million in AI revenue is primarily consumption-based, with significant traction in AI agents and agent assist solutions [67][75]