IDT Corporation reported Q2 FY2026 revenue of $320.5 million, up 5.8% from $303.3 million in the same quarter a year earlier. Gross profit rose to $121.3 million, a record for the company, and gross profit margin expanded to 37.8% from 36.5% in Q2 FY2025. Non‑GAAP earnings per share reached $1.00, beating the consensus estimate of $0.90–$0.91 and surpassing the prior‑year Non‑GAAP EPS of $0.84. GAAP EPS of $0.84 also exceeded the prior‑year figure of $0.80.
Growth was driven by the company’s high‑margin fintech and communications segments. Income from operations in National Retail Solutions grew 12%, BOSS Money & Fintech 32%, and net2phone 96%. Traditional Communications, while still a cash generator, saw a modest decline in adjusted EBITDA to $19 million, a drop from the $22 million reported a year earlier. The mix shift toward higher‑margin digital channels, accelerated by the new federal remittance tax, contributed to the strong performance in BOSS Money and net2phone.
Adjusted EBITDA for the quarter reached $38.0 million, up 18% YoY, and the adjusted EBITDA margin expanded to 11.9% from 10.8% in Q2 FY2025. The margin lift reflects both a favorable revenue mix and disciplined cost management, as the company continues to scale its platform‑driven model. The record gross profit margin of 37.8% underscores the company’s ability to convert sales into profit, a key driver of the earnings beat.
Management reaffirmed its confidence in the company’s cash‑generating capacity by increasing the annual dividend to $0.28 per share, a 17% hike, and announcing a $15 million share‑repurchase program that will cover 308,000 shares. CEO Shmuel Jonas said, “Because of our recent strong financial and operational performance, growth outlook, and balance sheet, we again repurchased stock in the second quarter and our Board has increased our annual dividend by 17% to $0.28 per year.”
Guidance for the full fiscal year was raised to an adjusted EBITDA range of $147 million to $149 million, up from the prior $141 million to $145 million. CFO Marcelo Fischer explained that the upgrade reflects “stronger‑than‑expected profitability at net2phone and BOSS Money and a slower‑than‑anticipated decline at Traditional Communications, while NRS remains on track with its original guidance of 20% to 25% adjusted EBITDA growth for the fiscal year.” The guidance increase signals management’s confidence that the momentum in high‑margin segments will continue.
CEO Shmuel Jonas noted that “advertising and data results were lower than expected as decreases in CPM rates pressured revenue,” highlighting a headwind in the National Retail Solutions segment. He also added that “the tax implementation has accelerated customer migration from the lower‑margin retail channel to the higher‑margin digital channel, and you will begin to see those positive impacts next quarter.” These comments illustrate the company’s awareness of current challenges while emphasizing the strategic shift toward higher‑margin digital services.
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