Consensus Cloud Solutions (CCSI)·Q4 2025 Earnings Summary

Consensus Cloud Beats on EPS as Corporate Growth Accelerates

February 10, 2026 · by Fintool AI Agent

Consensus Cloud Solutions (CCSI) reported Q4 2025 results that beat analyst expectations on both revenue and earnings, driven by accelerating growth in its higher-value Corporate segment. The company achieved its strongest Corporate growth rate since Q4 2022 while maintaining robust EBITDA margins above 50%.

Did Consensus Cloud Beat Earnings?

Yes — CCSI beat on both revenue and EPS.

*Values retrieved from S&P Global

This marks the third consecutive quarter of consolidated revenue growth for CCSI. Adjusted EBITDA margin came in at 51.9%, ahead of internal expectations and well above the 51.0% delivered in Q4 2024.

How Did the Stock React?

CCSI shares closed at $22.68 on February 9, down 4.2% heading into the earnings release.* After-hours trading showed the stock up to $23.13, suggesting an initial positive reaction to the beat.

*Values retrieved from S&P Global

The stock has traded in a range of $17.84 to $30.08 over the past 52 weeks, currently sitting near the middle of that range.* Management's focus on deleveraging and capital return may attract value-oriented investors given the stock's current valuation.

*Values retrieved from S&P Global

What Changed From Last Quarter?

Corporate Acceleration is the Story. The Corporate segment posted its highest year-over-year growth rate since Q4 2022, at +7.3% YoY. Key drivers include:

• Account Growth: Corporate accounts increased 11.3% YoY to ~65,000
• Revenue Retention: Expanded to 101.3%, up 80 bps YoY
• Usage Growth: Usage per business day has grown double digits for 5 consecutive quarters
• Mix Shift: Corporate now represents 64% of total revenue, up from 49% in Q4 2021 — projected to reach 68% in 2026

SoHo Stabilizing. The consumer-focused SoHo segment declined 11.1% YoY to $30.3M, but this was ahead of management's expectations. The company has repositioned SoHo as a "Strategic Cash Engine" rather than a growth driver, and Q4 turnaround initiatives are showing results with sign-up metrics improving into Q1 2026.

What Did Management Guide?

FY2026 Guidance:

Q1 2026 Guidance:

The FY2026 guidance implies ~2% revenue growth at midpoint, with Corporate expected to grow ~9% while SoHo declines ~10%. Consensus estimates for FY2026 revenue of $352.6M and EPS of $5.62 sit comfortably within management's guided ranges.*

*Values retrieved from S&P Global

Capital Allocation Update

Management continued aggressive debt paydown while returning capital to shareholders:

Debt Reduction:

• Cumulative: $243M retired since spin
• Fully retired 6% Notes due October 2026 at par
• No substantial maturities until 2028; refinancing likely in 2027

Current Capital Structure:

• Total Debt: $562M (6.5% Notes: $348M, Delayed Draw Term Loan: $150M, Revolver: $64M)
• Net Leverage: 2.6x (Total Debt/EBITDA: 3.0x target achieved)
• Cash: $75M

Equity Repurchases:

• Q4 2025: 344K shares / $8M
• FY2025: 1M shares / $23M
• Cumulative: ~2.2M shares / $57M (~10% of shares outstanding at spin)

Free Cash Flow: Record $106M for FY2025, up 20% vs FY2024 on flat revenues.

Healthcare & Government Momentum

Several growth vectors emerged from the quarter:

1. VA Contract Success: Exceeded $5M target in 2025, now projecting ~$9M contribution in 2026 — representing significant growth from a single account
2. FedRAMP Pipeline: Strong demand driven by federal mandates requiring FedRAMP High-certified solutions; non-government contractors supporting claims processing and fraud prevention are also mandated buyers
3. Clarity AI Product: Expected multi-million dollar revenue contribution in 2026, focused on referral management and prior authorization workflows to meet CMS 72-hour turnaround requirements
4. State/Local/Education (SLED): Growing significantly faster than commercial segment, becoming a second major growth pillar

Full Year 2025 Results

While revenue was essentially flat, the mix shift toward higher-value Corporate customers and disciplined capital management drove meaningful EPS and free cash flow improvement. Since the spin 4+ years ago, Consensus has generated over $800M of Adjusted EBITDA and ~$375M of free cash flow after investing ~$150M in the business.

Executive Changes Announced

Alongside earnings, CCSI announced a CFO transition:

• James Malone, CFO, will retire this year — staying on as CFO through Q1 2026, then transitioning to special advisor through year-end
• Adam Varon, SVP of Finance (14 years with the business), appointed as new CFO effective April 1, 2026
• Karel Krulich, SVP of Accounting (~4 years tenure), promoted to Chief Accounting Officer effective April 1, 2026

CEO Scott Turicchi noted this is CCSI's earliest investor call and 10-K filing in company history, a testament to Malone building out the finance team. Both successors were developed internally.

Q&A Highlights

On Healthcare Demand Environment (BTIG Analyst Question):

Management addressed concerns about the Big Beautiful Bill Act and potential Medicaid cuts: "What we're seeing right now is hospitals have figured it out... They went into a little bit of a halt mode and just monitoring what was happening and figuring that out with their budgets. Obviously... focusing more on OpEx than CapEx, managing their cash. So they're interested in moving into services like ours."

On AI/Clarity Product Strategy (Freedom Capital Question):

CRO Johnny Hecker explained the go-to-market focus: "What we have filtered out for ourselves... is really in that first, really on the indexing, on document classification... On the one hand, you can manage that administrative burden... On the other hand, the acceleration of processing those referrals faster really drives top line for them. So you have a double benefit."

One customer describes it as "the race to yes" — whoever responds to a referral first gets the patient.

On Capital Allocation Philosophy:

CEO Scott Turicchi explained the buyback rationale: "The spot free cash flow of $106 against our equity is about 25% free cash flow yield, whereas when we retire debt, we're retiring at either under 6% or at most at 6.5%." The company targets reducing debt to ~$500M over time while prioritizing buybacks given the yield differential.

On Three-Year Outlook:

When asked about corporate revenue mix in three years, management projected: "If we're at almost two-thirds, one-third today in favor of Corporate, you're probably gonna be around 75, 25 within the three-year time frame."

On Gross Margins:

Management confirmed: "On a non-GAAP basis, pretty stable margins right around 80%, and there's no reason to believe those will not continue."

Key Risks and Concerns

• SoHo Decline: While stabilizing, the consumer segment continues to shrink, requiring Corporate to accelerate further to drive consolidated growth
• ARPA Pressure: Corporate ARPA declined 4.3% YoY to $290.40, offset by account growth
• Debt Load: While deleveraging is progressing, $562M in debt remains with the 6.5% Notes callable in October 2026
• Fax Secular Decline: The core fax market continues to face long-term headwinds, requiring successful diversification into workflow solutions
• CFO Transition: While internal promotions suggest continuity, any leadership change introduces execution risk during a pivotal growth period

Bottom Line

Consensus Cloud delivered a solid quarter with beats on both revenue and EPS, driven by the strongest Corporate growth in two years. The mix shift toward enterprise customers continues, revenue retention is expanding, and management is executing well on capital allocation. FY2026 guidance is achievable if Corporate momentum continues and SoHo stabilization holds. The 3.0x leverage target has been achieved, opening the door for more aggressive capital returns.

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Analysis generated by Fintool AI Agent on February 10, 2026. Data from company filings and S&P Global.