Summary (from the latest annual and quarterly report)
- Total equity : 577 million USD
- Market Cap is 3.4 billion USD ( the last price of the stock is 14.03 USD)
- Vonage Holdings Corp. provides cloud communications services for businesses and consumers. It operates through two segments, Business and Consumer.
- Total stockholders' equity has increased from 567 million USD in 2019 to 577 million in 2020
- The company has 48 million USD in cash on account
- Total equity – cash on account = 577 million USD – 48 million USD = 529 million USD
- In Sep. 2020 long-term debt was 527 million USD, short – term debt was 33 million USD. (In 2019 total debt was 570 million USD)
- The company's revenue has increased in 2019 to 1.18 billion USD from 1.04 billion in 2018
- Net loss in 2019 was 19.5 million USD, Net income in 2018 was 35.7 million USD
Opinion about the company
Fundamentally it is a good company and in the future we can expect its growth (Total debt is 560 million USD, the company has 48 million USD in cash on account, ROE is negative: around -4%).
Vonage Holdings Corp is a publicly held business cloud communications provider. Headquartered in Holmdel Township, New Jersey, the company was founded in 2001 as a provider of residential telecommunications services based on voice over Internet Protocol (VoIP).
Through a series of acquisitions beginning in 2013, Vonage, previously a consumer-focused service provider, has expanded its presence in the business-to-business marketplace. Vonage's offering includes unified communications, contact center applications, and communications APIs.
Vonage has quite big total debt of $526 million but the company mainly used debt to fund its acquisitions. Vonage is trading at a market cap of $3.4 billion and a forward P/E of around 60x earnings which is a much cheaper valuation than Twilio's market cap of $48.1 billion.
Revenue in Q3 2020 was $316.6 million which is 4.8% higher than the $302 million in revenue in Q3 2019. The revenue gains this quarter are being driven primarily by Vonage's VCP business which grew by 13.2% year over year. The VCP business is the company's next-generation business consisting of Unified Communications, Contact Centers, and APIs.
Particularly good news is that the company's API revenues grew by 35%. A subset of these APIs classified as high value grew at an even faster rate of 143%. The growth of the company's API business was driven by its strength in the programmable video. This strength allowed the company to win major engagements such as Domino's (DPZ) contract for unified communication solutions.
Service revenues from the company's Unified Communications and Contact Center business grew a respectable 7%. Growth in this segment was primarily driven by customers with Annual Recurring Revenue greater than $12,000 which is good news as it shows the company's ability to win Mid-market to Enterprise level customers.
Going forward, the company plans to increase investments in artificial intelligence, high-value API leadership, advancements in mobility, omnichannel capabilities, and expanding its addressable market while tailoring its go-to-market initiatives to reach and win more customers.
Standalone subsidiaries and acquisitions :
- In 2013, Vonage Holdings acquired Vocalocity, a software as a service (SaaS) provider of cloud-based communications services, for $130 million
- In 2014, Vonage Holdings acquired Telesphere, a unified communications as a service (UCaaS) provider to large companies, for $114 million
- In 2015, Vonage Holdings acquired iCore Networks, also a UCSaaS provider to large companies, for $92 million
- In 2015, Vonage Holdings acquired SimpleSignal, another UCSaaS service provider to small and medium-sized businesses, for $25 million
- In 2016, Vonage Holdings acquired Nexmo, the 2nd largest CPaaS company, for $250 million
- Vonage Holdings acquired TokBox, a WebRTC programmable video provider, for $35 million
- In 2018, Vonage Holdings acquired NewVoiceMedia, a Contact Center as a Service (CCaaS) provider, for $350 million
- Vonage Holdings acquired Over.ai and gUnify for an undisclosed amount (around $50 million)
Total = 1.046 billion USD