Core Insights - RADCOM Ltd. has signed a multi-year agreement with 1GLOBAL to deploy RADCOM ACE, an AI-powered assurance solution aimed at optimizing network operations and enhancing customer experiences across Europe, North America, and Asia, supporting over 43 million connections [1][2]. Company Overview - RADCOM is a leading provider of advanced, intelligent assurance solutions with integrated AI Operations (AIOps) capabilities, focusing on improving customer experiences through its flagship platform, RADCOM ACE [4][5]. - 1GLOBAL is a technology-driven global mobile communications provider, serving over 43 million devices globally and generating over US$100 million in revenue for the full year 2024, positioning itself as a profitable business with significant cash flows [7][8]. Partnership Details - The partnership with RADCOM will enable 1GLOBAL to enhance its service quality and customer experiences through next-generation, AI-driven assurance, leveraging RADCOM's cloud-native platform for faster and more flexible network monitoring [2][3]. - RADCOM ACE will provide 1GLOBAL with a comprehensive, scalable, and flexible assurance solution that adapts to network growth and rising traffic demands, incorporating advanced capabilities such as AI-driven anomaly detection and deep analysis of voice and data traffic [3][4]. Technological Advancements - RADCOM ACE features patented load-balancing technology and is designed to maximize efficiency by processing only the most relevant data, significantly reducing data volumes while maintaining full visibility [2][3]. - The solution supports full IP Multimedia Subsystem (IMS)/Voice over Long-Term Evolution (VoLTE) and 4G/5G data monitoring, ensuring precise troubleshooting across all required protocols [3].

Core Insights - RADCOM Ltd. announced the appointment of Hod Cohen as Chief Financial Officer, effective January 11, 2026, succeeding Hadar Rahav, who will remain in an advisory role through Q1 2026 [1][3] Company Overview - RADCOM is a leading provider of cloud-native service assurance solutions, focusing on advanced, intelligent assurance solutions with integrated AI Operations (AIOps) capabilities [4][5] - The company's flagship platform, RADCOM ACE, utilizes AI-driven analytics and generative AI to enhance customer experiences and offers end-to-end network observability, particularly in 5G [4][5] Leadership Transition - Hod Cohen brings two decades of financial leadership experience, having previously served as Head of the Global Business Finance Group at Amdocs Limited, where he contributed to strategic planning and M&A execution [2][3] - The CEO, Benny Eppstein, emphasized that Cohen's financial expertise will be crucial for advancing RADCOM's growth plans and building long-term shareholder value [3] Strategic Focus - The appointment of Cohen reflects RADCOM's commitment to winning new customers and strategically expanding its business [3] - The company aims to enhance financial performance and support its next phase of expansion through effective leadership and strategic execution [3]

Core Insights - RADCOM Ltd. has launched its High-Capacity User Analytics solution, enabling telecom operators to process network traffic at up to 400 Gbps on a single server, significantly reducing costs while providing real-time customer insights [1][2]. Technology and Performance - The solution utilizes NVIDIA BlueField-3 DPU to enhance performance by offloading intensive network functions from the CPU, allowing for real-time visibility into increasing data flows [2]. - Field trials indicate that operational costs can be reduced by up to 75% compared to traditional network probes, with savings attributed to licensing, data processing, storage, and energy costs [2]. Applications and Benefits - The solution supports various network and business applications, enabling closed-loop automation and advanced AI-driven analytics for personalized service and improved quality [3]. - It allows operators to capture 100% of traffic with minimal effort and investment, leading to significant storage reductions and enhanced network monitoring capabilities [5][6]. Company Overview - RADCOM specializes in 5G-ready cloud-native network intelligence solutions, offering a suite that includes network visibility, service assurance, and network insights [4].

Core Insights - RADCOM Ltd. will release its financial results for the third quarter ended September 30, 2025, on November 12, 2025, before the market opens [1] - A conference call and live webinar will be hosted by RADCOM's CEO Benny Eppstein and CFO Hadar Rahav on the same day at 8:00 AM Eastern Time to discuss the financial results [2] Company Overview - RADCOM is a leading provider of advanced intelligent assurance solutions with integrated AI Operations (AIOps) capabilities [3] - The company's flagship platform, RADCOM ACE, utilizes AI-driven analytics and generative AI to enhance customer experiences [3] - RADCOM's solutions are designed to be open, vendor-neutral, and cloud-agnostic, focusing on next-generation network automation and efficiency [3] - The company aims to empower telecom operators by providing a complete, real-time view of mobile and fixed networks, ensuring exceptional service quality and enhancing user experiences [3]

Core Insights - Radcom's stock surged by 5.9% to $14.62, contrasting with a 0.4% loss over the past four weeks, indicating strong investor interest and trading volume [1][2] Company Performance - In Q2 2025, Radcom reported total revenues of $17.7 million, a 19.3% year-over-year increase, driven by strong momentum in key accounts and the adoption of AI-powered network assurance solutions [4] - The company anticipates full-year revenue growth of 15%–18%, projecting a midpoint revenue of $71.1 million [4] - The upcoming quarterly earnings are expected to be $0.22 per share, reflecting a year-over-year decline of 4.4%, with revenues projected at $17.9 million, a 13.2% increase from the previous year [5] Market Position and Strategy - Radcom's growth is supported by strong relationships with Tier 1 customers like AT&T and Rakuten, and collaborations with technology leaders such as NVIDIA and ServiceNow [3] - The company's focus on Agentic AI innovation and real-time network visibility aligns with industry trends, as telecom operators seek to optimize performance and enhance customer experience [2][3] Industry Context - Radcom operates within the Zacks Computer - Networking industry, where it holds a Zacks Rank of 2 (Buy), indicating positive market sentiment [6] - In comparison, NetScout Systems, another player in the same industry, has a Zacks Rank of 3 (Hold) and reported a 0.3% increase in its stock price [6][7]

Industry Overview - The Zacks Computer - Networking industry is poised for growth driven by advancements in cloud computing, network security, big data, and next-gen connectivity, particularly due to the increasing applications of AI technology [1] - The demand for AI workloads and hyperscale data centers is leading to significant investments in high-speed interconnects, optical networking, and Ethernet switches, with companies aiming to leverage the multi-billion-dollar AI infrastructure opportunity [1] - The rapid deployment of 5G technology is enhancing the Internet of Things (IoT), Advanced Driver Assistance Systems, AR/VR devices, and 5G smartphones, thereby increasing the need for robust networking infrastructure [1] Trends Influencing the Industry - The Wi-Fi 7 upgrade cycle is expected to stimulate demand for innovative networking products, benefiting major players like Cisco Systems, Extreme Networks, and RADCOM [2] - The industry is experiencing heightened uncertainty due to global macroeconomic conditions and volatile supply-chain dynamics, with some telecom operators reducing or delaying capital expenditures [2][7] - The growing popularity of smart home products and IoT devices is driving innovation in networking technologies, including network virtualization and Software-Defined Networking [4] Performance Metrics - The Zacks Computer - Networking industry has outperformed the S&P 500 Composite and the broader Zacks Computer and Technology sector, gaining 31.3% over the past year compared to the sector's 18.3% and the S&P 500's 13.9% [11] - The industry is currently trading at a forward 12-month price-to-earnings (P/E) ratio of 20.27X, which is lower than the S&P 500's 22.52X and the sector's 27.18X [14] Company Highlights - **Extreme Networks**: The company reported a 20% year-over-year revenue growth in the last quarter, driven by strong demand for its AI-driven cloud networking solutions. Its SaaS annual recurring revenues rose 24.4% year-over-year to $207.6 million [18][19] - **Cisco Systems**: Cisco is enhancing its AI capabilities across its security and collaboration platforms, with notable developments including the launch of AI-driven solutions and partnerships with NVIDIA to create AI-ready data center networks [23][24] - **RADCOM**: The company focuses on cloud-native, automated service assurance for 5G networks and aims for a revenue growth target of 15%-18% for the full year, translating to a midpoint projection of $71.1 million [28][31]

Core Insights - RADCOM Ltd. reported second-quarter 2025 non-GAAP earnings per share (EPS) of 25 cents, exceeding the Zacks Consensus Estimate by 13.6% and improving from 20 cents in the prior-year quarter [1][10] - Total revenues reached $17.7 million, reflecting a 19.3% year-over-year increase, driven by strong momentum in key accounts and the adoption of AI-powered network assurance solutions [2][10] - The company reaffirmed its full-year revenue growth target of 15%–18%, translating to a midpoint projection of $71.1 million [7][10] Financial Performance - Non-GAAP gross margin was reported at 76.2%, an increase from 75% in the year-ago quarter [3] - Non-GAAP operating income reached a record $3.4 million, representing 19.5% of quarterly revenues, compared to $2.3 million or 15.4% of revenues in the previous-year quarter [4] - Non-GAAP gross R&D expenses rose 10.7% year over year to $4.5 million, while sales and marketing expenses increased 13.5% year over year to $4.3 million [5] Cash Flow and Liquidity - As of June 30, 2025, the company had $101.6 million in cash, cash equivalents, and short-term bank deposits, with no debt [6] - The company exited the second quarter with a cash flow of $2.6 million [6] Strategic Focus - RADCOM is focused on prudent expense management while making targeted strategic investments to drive growth and sustain its competitive edge [4] - The company is enhancing global sales and partnerships to support its next growth phase with advanced solutions powered by accelerated computing and Agentic AI [2]

Company Performance - Radcom (RDCM) reported quarterly earnings of $0.25 per share, exceeding the Zacks Consensus Estimate of $0.22 per share, and showing an increase from $0.20 per share a year ago, representing an earnings surprise of +13.64% [1] - The company achieved revenues of $17.66 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 3.87%, and up from $14.8 million year-over-year [2] - Over the last four quarters, Radcom has consistently surpassed consensus EPS and revenue estimates [2] Stock Performance - Radcom shares have increased approximately 10.4% since the beginning of the year, outperforming the S&P 500's gain of 9.6% [3] - The current consensus EPS estimate for the upcoming quarter is $0.22 on revenues of $18.1 million, and for the current fiscal year, it is $0.91 on revenues of $70.3 million [7] Industry Outlook - The Computer - Networking industry, to which Radcom belongs, is currently ranked in the top 32% of over 250 Zacks industries, indicating a favorable outlook [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Radcom's stock performance [5][6]

Financial Data and Key Metrics Changes - In Q2 2025, revenue increased by 19.3% year over year, reaching a record of $17,700,000, supported by demand for the Intelligent Service Assurance platform [6][10][24] - Operating income rose by more than 50% compared to Q2 last year, with non-GAAP operating margin expanding to nearly 20% of revenue [10][24] - Non-GAAP net income was $4,200,000, or $0.25 per diluted share, compared to $3,100,000, or $0.20 per diluted share last year [29] - The company ended Q2 with over $100,000,000 in cash, the highest in its history, and remains debt-free [10][29] Business Line Data and Key Metrics Changes - The company reported solid profitability and cash generation, with positive cash flow of $2,600,000 during the quarter [10][29] - Non-GAAP gross margin for Q2 2025 was 76.2%, reflecting effective expense management while investing in growth [24] Market Data and Key Metrics Changes - The telecom industry is experiencing transformation driven by the convergence of 5G and AI, with significant challenges for operators due to data volume growth and IoT adoption [17][18] - In Q1 alone, operators added 145,000,000 new 5G subscriptions globally, bringing the total to 2,400,000,000 [19] Company Strategy and Development Direction - The company is focused on becoming a key vendor in the intelligent, agentic AI-powered ecosystem, addressing operators' pain points and future market drivers [9][11] - Strategic partnerships, including collaboration with NVIDIA, are expected to drive incremental value and expand the addressable market [12][21] - The company aims to deliver advanced service assurance frameworks to support operators' AI-driven customer-centric vision [11][21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving full-year revenue growth guidance of 15% to 18%, supported by healthy customer engagement and market shifts towards intelligent, automated assurance [21][22] - The company is actively engaged in field trials with Tier 1 operators in key markets such as North America, Japan, and EMEA [13][19] Other Important Information - The company did not receive a grant from the Israel Innovation Authority this quarter, compared to $180,000 received in the same quarter last year, but anticipates securing grants in Q3 and Q4 [27] - Non-GAAP operating income for Q2 was $3,400,000, representing 19.5% of quarterly revenues, an increase of $1,200,000 from the previous year [28] Q&A Session Summary Question: How is the partnership with service management system vendors like ServiceNow and AWS going? - The partnership is progressing well, with co-development and interconnecting platforms already in place [34] Question: How should we think about the capital allocation with $100,000,000 in cash? - The company is considering potential M&A as a priority and is progressing with a few candidates [35] Question: What percentage of the pipeline is coming from existing customer expansion versus new logo wins? - Approximately two-thirds of growth is expected from existing customers and one-third from new customers [39] Question: What percentage of current revenue is coming from 5G versus legacy network revenue? - A significant portion of LTE networks is still operational, and while 5G is growing, it will take time for full transformation [40] Question: Any updates on the RFP process for new Tier 1 opportunities? - The company is participating in several RFPs globally and expects decisions on a few within the next half of the year [41] Question: Is there an opportunity in the direct-to-device satellite space? - There are active opportunities, but clarity on capital allocation from certain customers is still pending [43] Question: Any changes in the competitive environment relative to peers? - The competitive landscape remains stable, with competitors shifting focus while the company continues to invest in innovation [44]

Financial Performance - RADCOM achieved a new quarterly revenue record of $17.7 million, representing a 19.3% year-over-year increase[15, 38, 42] - The company's non-GAAP operating margin was 19.5%, reflecting improved profitability[15, 38] - RADCOM ended Q2 2025 with a record-high cash and bank deposits of $101.6 million and generated $2.6 million in positive cash flow[15, 47] - The company reaffirms its full-year 2025 revenue guidance, projecting year-over-year growth of 15% to 18%, with a midpoint of $71.1 million[32, 51] - Q2 2025 GAAP diluted EPS was $0.15, while the non-GAAP diluted EPS was $0.25[38] Strategic Focus - RADCOM is continuing its investment in R&D, particularly in agentic AI (agent-to-agent and multi-model workflows)[17] - The company is involved in several Proof of Concepts (POCs) in the lab for its high-capacity user plane analytics and is engaged in field trials with Tier 1 operators[17] - RADCOM is focused on key markets, including North America, Japan, and EMEA[17] Market Trends - Telecom industry trends indicate that 84% of telco executives agree that AI agents will reinvent how their organizations are building and operating their digital infrastructures[25] - A 6% growth in the mobile core market is projected through to 2029, with operators adding 145 million new 5G subscriptions globally in Q1, bringing the total to 2.4 billion[26]