Bandwidth Inc.

Hello, ladies and gentlemen. Thank you all for standing by. My name is Mork and I will be your conference operator for today. At this time, I would like to welcome everyone to the by the way, second quarter 2026 earnings call. All lines have been placed only to prevent any background noises. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw a question, please press star and number one again. Thank you. And I would now like to turn the call over to Niels Erdmann, Senior Vice President, Investor Relations. Please go ahead.

Thank you, Operator. Good morning and welcome to Bandwidth's second quarter 2026 earnings conference call. I'm joined today by David Morken, Chief Executive Officer, and Daryl Raiford, Chief Financial Officer. We will begin with prepared remarks and then open up the call for Q&A. During this call, we will make forward-looking statements, including statements related to our future financial performance, expectations regarding the growth of our business, our outlook for the third quarter and full year 2026, and other indications of future opportunities. These forward-looking statements are subject to certain risks, uncertainties and assumptions, and actual results may differ materially. These forward-looking statements represent our beliefs and assumptions only as of today. and we undertake no obligation to revise or update any statements to reflect changes that occur after this call. Further information on factors and other risks that could cause actual results to differ materially from these forward-looking statements is included in our reports filed with the SEC, including our most recent Form 10-K and our forthcoming Form 10-Q and in our second quarter earnings press release and earnings presentation that were issued this morning. During the call, we refer to certain metrics including non-GAAP financial measures, Definitions of these non-gap metrics and other operating metrics, as well as reconciliations with the most comparable historical gap measures, are available in our earnings press release and our earnings presentation, both of which can be found on the investor relations page of our website at investors.bandwidth.com. With that, I will now turn the discussion over to David.

Thank you, and welcome everyone. We are pleased to report outstanding second quarter results with revenue and profitability exceeding expectations. Based upon our performance, we are raising our full-year financial outlook. AI is changing how enterprises buy communications infrastructure, shifting the decision toward providers that can support mission-critical AI interactions. AI and AI voice agents are driving customers to highly value our services that provide trust, compliance, and global performance. This is creating numerous strategic opportunities for bandwidth. We're capitalizing on this shift to secure larger customer wins across a wide range of AI native companies, global 2000 enterprises, hyperscalers, and software platforms. and we're innovating to strengthen our competitive position, growing faster and creating durable long-term shareholder value. In the second quarter, these themes yielded revenue growth of 22%, EBITDA growth of 27% and five new million dollar plus customer wins and expansions. Additionally, we strengthened our balance sheet with a convertible notes offering in June. This offering reduces our financing costs. retires the large bulk of our 2028 maturity and reinforces our capacity to invest profitably in AI voice infrastructure. Daryl will walk through the details shortly. I'd like to thank our customers for trusting bandwidth with their most important customer interactions. I'd also like to thank our bandmates whose passion for innovation and serving customers continues to set us apart and I thank God for the opportunity to serve alongside such an exceptional team. A year ago, AI came up in only a fraction of our customer conversations. Today, it leads nearly every time. Whether we're talking with AI native startups, global enterprises or hyperscalers, they're increasingly reaching the same conclusion. AI is only as good as the communications platform it runs on. That means customer buying decisions are now driven by a partner's ability to consistently deliver the trusted, compliant, high performance communications foundation that production AI demands. We're seeing that shift play out across every category of our business. A great example is one of the fastest growing AI native voice agent developers, which we signed in the second quarter. As the company scaled, they quickly outgrew the provider they used to initially build their business. To serve larger enterprises, they needed the higher quality voice infrastructure, global reach, regulatory compliance, and higher control, observability, and auditability that bandwidth provides. This win demonstrates something we're seeing across this space. Many AI-native companies began with speed and experimentation. As they mature into enterprise platforms, we see them needing high-performing trusted communications infrastructure that can support production workloads around the world. That's exactly where bandwidth is uniquely positioned and where our business model creates more value. As agentic voice adds more legs to every interaction, each of those legs becomes a new source of usage on our platform. Sentiment analysis, transcription, translation, and orchestration between systems. We're also making it easier for these next generation AI companies to build on our platform. In June, we introduced Bandwidth Build, enabling authenticated AI agents to autonomously provision and launch communication services on our network. We're already seeing early signups generating real traffic. As AI voice agents proliferate, we're ensuring bandwidth is easy to discover, authenticate with, integrate, and deploy. Every major frontier AI lab is racing toward the same conclusion, that the primary way people will engage with AI is through speaking and listening. This is a conclusion being heard by our customers around the world. They require the same carrier-grade, regulated global voice network we've spent two decades building. And it's why we're already integrating leading voice agents into Maestro, so our customers can deploy them faster and with more control over their voice AI tech stack. And there are elements of that voice AI tech stack infrastructure which belong closer to the end user in our global network in order to perform faster, better, and more cost-effectively. We're seeing those same AI-driven requirements translate into larger opportunities with global 2000 enterprises as they modernize customer engagement for the next generation of AI-enabled experiences. That trend continued in the second quarter with five new $1 million-plus customer wins and expansions, 100% of which included maestro or AI services. A great example is a growing healthcare system operating dozens of hospitals and 400 clinics across five states in the Midwest. This million-dollar-plus opportunity came through one of our channel partners, as the customer needed to modernize their complex legacy environment for the cloud. They selected Bandwidth's Communications Cloud and Maestro orchestration platform for our native WebEx calling integration, automated migration capabilities that reduce porting times from weeks to days, and centralized operational control. This modernization with bandwidth creates a foundation for the customer's planned cloud contact center adoption and future AI-enabled communications. Another new million-dollar-plus customer is a leading European appliance care and warranty provider that selected bandwidth to modernize its customer engagement platform. Operating across multiple European markets left the customer with a fragmented communications environment. across different incumbent carriers and regulatory requirements in each country. The customer simplified that complexity by consolidating onto a single trusted communications partner. Bandwidth's Global Communications Cloud, combined with our native Genesys Cloud BYOC integration, enables the customer to improve performance, simplify operations, and increase control across its European communications environment. As the customer expands its use of AI within Genesys Cloud, it will do so on our trusted carrier-grade infrastructure required to deliver those experiences at scale. In addition to these new logos, here are $3 million-plus examples of existing customers deepening their strategic partnerships with bandwidth. A global electronic brokerage serving investors in more than 200 countries expanded a multi-year messaging relationship into global voice, replacing regional carriers across its highly regulated markets with one global partner in bandwidth. And one of our longest-standing hyperscaler partners significantly expanded our role supporting a key digital service internationally, which is continued proof that as these partners scale their AI and cloud platforms, they scale on bandwidth. We also saw this pattern in messaging, with a million-dollar-plus existing customer expansion by one of the largest text messaging platforms in the US, serving approximately 2,500 brands. This customer had been managing traffic across six different vendors. As their business scaled, they needed more capacity, better deliverability, and stronger digital campaign management. Consolidating with bandwidth, they've moved over 95% of their messaging volume onto our platform. We now support their business across all key channels and expect to add RCS as they evaluate a 2027 launch. This is a strong example of how our messaging business continues to win when customers need scale, deliverability, and operational discipline, not just volume. We announced in March that Salesforce selected Bandwidth as its exclusive critical infrastructure partner for voice and messaging within AgentForce Contact Center. Salesforce has publicly discussed customer momentum following the March launch, including wins across both mid-sized organizations and growing interest from large enterprises. We're encouraged by what we're seeing and pleased to have already begun supporting the opportunities Salesforce is bringing to market. Thank you so much for joining us today. were embedded in Salesforce's governed workflows today with the control, observability, and integration depth their platform requires. Over the last 18 months, we have been accelerating innovation behind the opportunities we believe will create the greatest value proposition for our customers. That decision reflects our confidence that we've just begun one of the most significant technology shifts in history. We are already seeing these investments pay off. The upgrades to our owned and operated network have contributed to the gross margin and adjusted EBITDA expansion we reported this quarter, giving us confidence that continued investment is self-reinforcing. Our innovation investments are broadening our portfolio in four key areas. First, we're extending our global communications cloud's network footprint, regulatory coverage, and capacity. into additional strategic markets where our global 2000 customers are growing. This positions us to support our customers wherever they choose to do business. Second, we're expanding Maestro and have launched Bandwidth Build to give enterprises even more integration choices and flexibility in how they deploy, orchestrate, and manage AI-powered communications across their technology environments. Third, We're continuing to broaden our trust portfolio with capabilities that help enterprises improve answer rates, strengthen customer trust, mitigate fraud, and protect their brands at a time when trust and security have never been more important. We're also protecting new IP in this area with a patent awarded for AI VoiceBot authentication this quarter, which reinforces the defensibility of the platform we're building. and finally, we're investing in our global infrastructure at the edge and data center level to power even more secure, compliant, high performance AI driven communications. In total, investments like these examples with rapid returns are designed to widen our competitive moat, increase the value we deliver to customers and strengthen our ability to create durable growth and shareholder value. As we progress into the second half of 2026, our momentum is strong. We see voice AI adoption driving enterprise modernization and larger platform wins, and we expect those wins to translate into stronger owner economics, growing software services attachment and continued expansion of profitability and cash generation. The examples we shared today span AI-native startups, global 2000 enterprises, messaging and software platforms, and hyperscalers, different customers, different verticals, different use cases. Yet they're all increasingly making the same strategic decision to standardize on bandwidth. We've spent years building the owned infrastructure, orchestration software, and consumption pricing model needed for this moment. As AI reshapes enterprise communications, we believe our innovations position us to be the mission-critical foundation of AI-driven communications, creating more value for our customers and for our shareholders. Now, I'll turn it over to Daryl to walk through the financial details of the quarter.