RingCentral and Five9 Surge as Earnings Flip the AI Disruption Narrative
February 20, 2026 · by Fintool Agent
Ringcentral and Five9 delivered a one-two punch to the AI disruption narrative on Friday, with shares surging 36% and 13% respectively after both cloud communications platforms reported Q4 results showing AI as a growth driver—not a threat. The rallies mark a sharp reversal for two stocks that had been punished by fears that AI would cannibalize software seat counts.
RingCentral jumped to $39.95, its highest level in a year, after reporting Q4 revenue of $644 million that beat estimates and announcing its first-ever quarterly dividend . Five9 climbed to $19.46 on record Q4 bookings and enterprise AI annual recurring revenue surpassing $100 million .
Ask Fintool AI AgentThe Numbers Behind the Rally
RingCentral (RNG) posted Q4 non-GAAP EPS of $1.18, beating consensus by 4% and rising 20% year-over-year . Total revenue hit $644 million, up 5% year-over-year, with subscription revenue growing 6% . The company delivered record full-year free cash flow of $530 million .
| Metric | Q4 2024 | Q4 2025 | YoY Change |
|---|---|---|---|
| Revenue ($M) | $590 | $622 | +5.5% |
| Operating Cash Flow ($M) | $133 | $149 | +12% |
| Net Income ($M) | -$7.2 | $23.0 | Turnaround |
Five9 (FIVN) reported Q4 revenue of $300 million, up 8% year-over-year . More importantly, subscription revenue—82% of total—accelerated to 12% growth, while enterprise AI revenue surged 50% year-over-year . Adjusted EBITDA margin expanded to 26%, and free cash flow more than doubled to $67 million .
| Metric | Q4 2024 | Q4 2025 | YoY Change |
|---|---|---|---|
| Revenue ($M) | $279 | $300 | +7.8% |
| Operating Cash Flow ($M) | $50 | $84 | +68% |
| Net Income ($M) | $11.6 | $19.7 | +70% |
AI: Tailwind, Not Threat
The earnings calls told a consistent story: AI isn't replacing enterprise software—it's making it stickier.
"AI is a natural tailwind to our business," RingCentral CEO Vlad Shmunis said on the Q4 call. "The majority of this ongoing investment is now directed towards our new AI-led product portfolio. Our investments are showing good early results" .
RingCentral's AI-utilizing customers—those using at least one AI product like its AI Receptionist (AIR), AI Virtual Assistant (AVA), or AI Conversation Expert (ACE)—now represent nearly 10% of total ARR, more than doubling year-over-year . Critically, these customers show higher ARPU and net retention rates exceeding 100% .
The AI Receptionist product alone grew to 8,300 customers in Q4, up 44% sequentially, as businesses added usage-based minute bundles to handle more calls efficiently .
"With a usage-based model, AIR revenue scales directly with our customer's business activity and is not subject to potential reduction in seat counts." — Kira Makagon, President and COO, RingCentral
Five9's outgoing CEO Mike Burkland echoed the sentiment, arguing the company has an "unfair advantage" because it sits "at the moment of truth" between customers and brands .
"Our core CCaaS revenue growth accelerated from 7% to 8%, and our AI revenue growth accelerated from 41% to 50%—and that is the recipe for success," Burkland said .
Ask Fintool AI AgentShareholder Returns Signal Confidence
Beyond the AI narrative, both companies signaled confidence through capital returns.
RingCentral initiated its first-ever quarterly cash dividend at $0.075 per share, payable March 16, 2026 . The company also expanded its share repurchase authorization to $500 million and guided 2026 free cash flow to $580-600 million .
Five9 completed a $50 million accelerated share repurchase in early February, buying back approximately 2.6 million shares, with $100 million remaining under its authorization .
Stock Performance
Both stocks had been battered over the past year on fears that AI would reduce the need for human agents—and therefore reduce software seat counts. RingCentral fell from highs above $40 in mid-2025 to below $21 by early 2026. Five9 collapsed from $50 to under $16.
Friday's surge represents a potential turning point in sentiment, as investors digest that:
- AI creates new revenue streams (usage-based AI products)
- AI customers are stickier (higher retention rates)
- AI enhances rather than replaces (orchestrating human and AI agents together)
- Core business accelerated alongside AI (Five9's CCaaS growth rate improved)
Looking Ahead
RingCentral guided 2026 revenue growth of 4-5% with operating margin of 23-23.5% . The company plans to host an Investor Day in late 2026 to detail long-term AI strategy .
Five9 guided Q1 2026 revenue of $296.5-302.5 million and full-year 2026 revenue of $1.247-1.261 billion, representing high-single-digit growth . Management expects a return to double-digit revenue growth in the second half of 2026 .
Five9 also announced a CEO transition, with Amit Mathradas taking over from Mike Burkland, who led the company for 18 years. Mathradas is prioritizing product innovation, AI, and partner engagement .
Ask Fintool AI AgentRelated Companies
- Ringcentral (rng) - Cloud communications platform, AI receptionist
- Five9 (fivn) - Contact center as a service (CCaaS)