Ooma Finalizes $23.2 Million Acquisition of Phone.com in Strategic Push for SMB Market

SUNNYVALE, CA – December 29, 2025 – Ooma, Inc., a prominent smart communications platform, has officially closed its acquisition of Phone.com, a significant provider of cloud-based communication services for small and medium-sized businesses (SMBs). The all-cash transaction, valued at approximately $23.2 million, marks a major consolidation move in the Unified Communications as a Service (UCaaS) sector, significantly expanding Ooma’s footprint and capabilities.

The deal unites two companies with a shared focus on the SMB market, a segment that continues to rapidly adopt flexible and cost-effective cloud communication solutions. By integrating Phone.com, Ooma not only absorbs a direct competitor but also gains a substantial new customer base and a proprietary technology platform, positioning itself for more aggressive growth and market penetration.

Analyzing the Financial Framework

The financial architecture of the acquisition is designed to deliver immediate scale and future profitability for Ooma. The $23.2 million cash payment, subject to customary working capital adjustments, brings a business with a strong revenue stream under the Ooma umbrella. Based on current run rates, Phone.com is projected to generate between $22 million and $23 million in annual revenue.

More critically for investors, the acquired entity is expected to contribute between $1.0 million and $1.5 million in annual adjusted EBITDA. Ooma's leadership has stated that the acquisition is anticipated to be accretive to its own Adjusted EBITDA and non-GAAP earnings per share, with this positive financial impact beginning as early as December 26, 2025. The term 'accretive' indicates that the deal is expected to increase Ooma's earnings per share, a key metric of shareholder value.

The press release places a strong emphasis on non-GAAP financial measures, particularly Adjusted EBITDA. This metric, which excludes items like stock-based compensation, amortization of intangible assets, and certain litigation costs, is presented as a clearer view of core operating performance. By using this measure, Ooma aims to provide investors with a more direct understanding of the annualized financial impact of Phone.com's business, separate from the complexities of GAAP accounting and one-time acquisition-related expenses. The company notes that forecasting a direct reconciliation to GAAP net income is unfeasible due to high variability, urging investors to consider both GAAP and non-GAAP measures together for a complete financial picture.

A Strategic Play for SMB Market Leadership

Beyond the immediate financial injection, this acquisition is a calculated strategic maneuver. Both Ooma, with its flagship Ooma Office solution, and Phone.com have built their reputations on providing affordable and reliable UCaaS solutions—spanning voice, video, and messaging—to small and medium-sized organizations that require enterprise-grade features without the corresponding complexity or cost.

The purchase brings Phone.com's approximately 36,000 customers and 87,000 users into the Ooma ecosystem. This significant expansion of its customer base provides Ooma with enhanced scale, a critical factor for competing effectively in the crowded cloud communications market. Headquartered in Newark, New Jersey, Phone.com has developed its own proprietary UCaaS platform to serve its North American clients, an asset that could either be integrated into Ooma's technology stack or leveraged to serve a specific segment of the newly combined user base.

This move can be seen as a defensive and offensive strategy. Offensively, it strengthens Ooma's market share and revenue base. Defensively, it removes a key competitor that targeted the same customer profile. As businesses continue to abandon traditional landlines for more versatile and integrated cloud systems, a larger, more scaled provider like the newly expanded Ooma is better positioned to capture this ongoing migration.

The Path to Integration and Synergy

With the deal now closed, the next critical phase is integration. Ooma's management faces the task of merging company cultures, aligning technology roadmaps, and, most importantly, retaining the customers and employees from Phone.com. The success of the acquisition will largely depend on how smoothly this process unfolds.

The forward-looking statements included in the announcement acknowledge these inherent risks. The company cautions that achieving the expected benefits and synergies is not guaranteed and depends heavily on the successful integration of the acquired company. Key challenges will include harmonizing the two distinct UCaaS platforms and ensuring a seamless experience for Phone.com's 36,000 customers to prevent churn.

However, the potential for synergies—a term used in the release to describe the added value created by combining the two entities—is substantial. Opportunities likely exist in streamlining back-office operations, consolidating marketing efforts, and cross-selling Ooma's broader product suite to the newly acquired customer base. For instance, Phone.com customers may be introduced to other Ooma solutions like Ooma AirDial, which is designed to replace aging copper phone lines. The transaction's financial advising was handled exclusively by Telegraph Hill Advisors for Phone.com, ensuring the deal was structured to meet the objectives of the selling party.

Profiling the Unified Communications Players

Ooma, traded on the NYSE under the symbol OOMA, has established itself as a versatile communications provider since its founding in 2003. Its portfolio extends beyond the Ooma Office SMB solution to include Ooma AirDial for businesses, Ooma 2600Hz for platform-level services, and the Ooma Telo for residential consumers. With over 2 million users, the company has cultivated a reputation for value and ease of implementation.

Phone.com, while smaller and privately held before the acquisition, has been a focused and agile competitor in the SMB space. Its success in building a proprietary platform and attracting a loyal customer base made it an attractive target. By acquiring this focused expertise and technology, Ooma not only expands its reach but also enriches its own institutional knowledge of the SMB market's specific needs.

This acquisition represents a clear commitment by Ooma to double down on its core business market. As the communications landscape continues its shift to the cloud, this strategic purchase fortifies Ooma’s position, providing it with greater scale and resources to innovate and compete for the long term.