Consensus Cloud Solutions Q1 Earnings Call Highlights

07 May 2026, 19:42 by Scott Moore · The Cerbat Gem

Consensus Cloud Solutions (NASDAQ:CCSI) reported first-quarter 2026 results that management said marked a continued shift toward faster-growing corporate revenue, while maintaining profitability and strong free cash flow.

Management highlights corporate momentum and improving consolidated growth

CEO Scott Turicchi said the company entered 2026 with “momentum” and delivered results that exceeded internal expectations in both corporate and SOHO channels. Turicchi noted consolidated revenue grew 1.5% year over year versus Q1 2025, and said it was the second consecutive quarter of year-over-year growth across four metrics: revenue, adjusted EBITDA, non-GAAP EPS, and free cash flow.

The quarter’s performance was driven by an 8.2% revenue increase in the corporate channel, which Turicchi attributed to “record usage as well as a continuation of customer acquisition across our continuum.” He described it as the company’s highest corporate growth rate since Q4 2022.

Turicchi also said SOHO outperformed the company’s forecast due to improved customer acquisition and a “significant improvement” in the year-over-year decline rate compared to Q4 2025.

Corporate channel posts record revenue, retention rises above 102%

CRO and EVP of Operations Johnny Hecker framed 2025 as a “foundational year” and said the company’s realignment toward “high-value, high-durability corporate revenue” is accelerating, particularly as customers continue migrating to cloud-based workflows. Hecker said the company intensified go-to-market execution to focus on “intent-driven customer acquisition,” and pointed to strong engagement from industry conferences during the quarter.

Hecker said the corporate channel delivered record revenue of $58.7 million in Q1, up 8.2% year over year from $54.3 million in Q1 2025, and up 3.4% sequentially from a record Q4. He described the corporate customer base as approximately 65,000 customers, up roughly 7% year over year, and said the company has maintained that level since Q3 2025 while “high-grading” toward larger enterprise accounts.

Hecker also reported that net revenue retention (NRR) exceeded 102% in the quarter, improving by 76 basis points from Q4 2025 and reaching the highest level since the company exceeded 100% in Q4 2024. He said the lift reflected customers “adding more volume and adopting our solutions more broadly,” driven by increased utilization among larger enterprise clients and the integration of eFax into clinical workflows via electronic health record (EHR) vendor platforms.

In the public sector, Hecker said the company’s FedRAMP High-certified ECFax solution continues to gain traction, adding that management is confident it can “meet or exceed the $9 million VA contribution to 2026 revenue” projected on the prior quarter’s call as the engagement scales.

Product and platform initiatives focus on workflow and AI monetization

Hecker said the company “soft launched a rearchitected eFax platform” for corporate and SOHO e-commerce offerings, which he described as a workflow and AI monetization framework designed to reduce friction in the customer journey and support broader deployment of “eFax Clarity AI capabilities.” He characterized the evolution as moving from a “transport layer” to an “intelligence layer,” aimed at automating manual processes in healthcare and routing data extracted from unstructured documents into EHRs and back-office systems.

Hecker said the company expects the platform improvements to support higher deal conversion rates and contribute to its “path to delivering sustained double-digit growth” in the corporate channel.

SOHO managed as a cash engine; decline moderates

Hecker reiterated that the company manages SOHO as a “strategic cash engine,” prioritizing yield and contribution margin over subscriber longevity to fund corporate expansion. SOHO revenue was $29.7 million, representing a 9.5% year-over-year decline. Hecker said that was an improvement from the 11.1% decline in Q4 2025 and was in line with the decline rate seen in Q3 2025.

Financial results, capital return, and guidance

CFO Adam Varon, appearing on his first earnings call with the company, reviewed quarterly results and reiterated full-year guidance. Varon said consolidated revenue was $88.5 million, up $1.3 million, or 1.5%, from Q1 2025 and up 1.6% sequentially.

Adjusted EBITDA totaled $47.9 million versus $47.3 million a year earlier, producing a 54.1% margin. Varon said the margin was driven by revenue flow-through and partially offset by marketing and personnel-related expenses.

Adjusted net income was $28.9 million, up 7.3% year over year, which Varon said was aided by favorable net interest expense on lower debt balances. Adjusted EPS was $1.52, up $0.15, or 10.9%, driven by operating performance and a lower share count from repurchases. The company’s Q1 non-GAAP tax rate was 20.5%, and the share count was approximately 19 million.

Free cash flow was $38.5 million, which Varon said was up 14% year over year, and cash ended the quarter at $92.3 million. Capital expenditures were $7.4 million.

On capital allocation, Varon said the company repurchased 600,000 shares for approximately $17 million in Q1. In total, it has used $72 million to repurchase 2.7 million shares under a $100 million authorization, leaving $28 million available.

Total debt was approximately $560 million, consisting of $348 million of 6.5% high-yield notes, $148 million of delayed draw term loan, and $64 million on the revolver. Varon said net debt to EBITDA was 2.5x and total debt to EBITDA was 3.0x, flat with Q4 2025.

Turicchi said the company has no substantial maturities until late 2028 and is monitoring bank and debt markets for a potential refinancing opportunity before late 2027. He also said management expects free cash flow to “approximate the record level of 2025” and indicated the company expects to remain a stock buyer, citing a free cash flow yield “approximately three times” its debt costs.

For guidance, Varon reaffirmed full-year 2026 targets:

Revenue: $350 million to $364 million (midpoint $357 million)
Adjusted EBITDA: $182 million to $193 million (midpoint $187.5 million)
Adjusted EPS: $5.55 to $5.95 (midpoint $5.75)
Full-year tax rate: 19.7% to 21.7% (midpoint 20.7%), with ~19 million shares

For Q2 2026, the company guided to:

Revenue: $87.9 million to $91.9 million (midpoint $89.9 million)
Adjusted EBITDA: $46.4 million to $49.6 million (midpoint $48.0 million)
Adjusted EPS: $1.43 to $1.53 (midpoint $1.48)

In response to a question about why full-year guidance was not raised following the Q1 beat, Turicchi said the company adjusts guidance only when it is “highly confident” it will exceed one or more metrics, adding that it is “too early in the year” to make changes. He also cautioned that Q1 margins benefited from slower-than-budgeted hiring and said he expects hiring to pick up through the year, primarily in go-to-market, product, and engineering roles. Turicchi said he does not expect 54% EBITDA margins to repeat as staffing ramps, and that some hires are intended to support 2027 rather than contribute revenue immediately.

In closing remarks, Turicchi said the company expects to release Q2 results in “the first, probably 10 days of August,” and management expects to file its Q1 10-Q later the same day.

About Consensus Cloud Solutions (NASDAQ:CCSI)

Consensus Cloud Solutions (NASDAQ: CCSI) is a provider of cloud consulting and managed services focused on helping organizations accelerate digital transformation. The company specializes in designing, deploying and supporting cloud architectures that leverage leading public and private cloud platforms, including infrastructure as a service (IaaS), platform as a service (PaaS) and software as a service (SaaS) environments. Its end-to-end approach encompasses strategy, implementation and ongoing optimization to align technology investments with business objectives.

The firm’s core offerings include cloud migration and deployment, application modernization, data analytics and cybersecurity solutions.