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MARKHAM, ONTARIO, May 8, 2025 – Sangoma Technologies Corporation (TSX: STC; Nasdaq: SANG) (“Sangoma” or the “Company”), a trusted leader offering businesses a choice of on-premises, cloud or hybrid Communications as a Service solutions, today announced its financial results for the third quarter and unaudited interim consolidated financial statements for the three- and nine-month periods ended March 31, 2025.

“This quarter reflects our continued focus and disciplined execution of strategic priorities, highlighted by the completion of a major transformation phase. With this foundation now solid, Sangoma has the financial strength, operational structure and capabilities needed to fully embrace its next chapter — a multifaceted growth journey,” said Charles Salameh, Chief Executive Officer. “We generated robust free cash flow and exceeded our capital allocation target ahead of schedule, while revenue from core and on-premises platforms increased for the second consecutive quarter. These results demonstrate the durability of our business model, the traction of our go-to-market strategy and our ability to gain market share as competitors exit. With this solid foundation, Sangoma is well positioned to accelerate growth and increase profitability.”

Fiscal Third Quarter 2025 Highlights:

  • Total revenue of $58.1 million, down $1.0 million or 2% from fiscal second quarter 2025, primarily due to a decline in non-core products, while revenue from core platform products and services increased sequentially for the second consecutive quarter.
  • Revenue from on-premises solutions and telephone product lines increased quarter over quarter, reflecting the effectiveness of targeted go-to-market campaigns and strategic market share gains following competitors’ exits from the on-premises market.
  • Gross margin of $40.0 million, or 69% of total revenue.
  • Operating expenses1 of $40.6 million, approximately 5% lower than in the same quarter of the prior year.
  • Adjusted EBITDA2 of $9.8 million, representing 17% of total revenue.
  • Enterprise resource planning (ERP) expenses of $0.4 million during the quarter, bringing third-quarter adjusted EBITDA2 to $10.2 million excluding this investment.
  • Quarterly churn rate remains an industry leader at less than 1%.
  • Net loss increased slightly to $1.4 million ($0.04 diluted loss per share), compared with $1.3 million ($0.04 diluted loss per share) in fiscal third quarter 2024.
  • Net cash from operating activities of $10.6 million in the third quarter and $34.7 million for the first three quarters of fiscal 2025, an improvement of 7% compared with the same three quarters of the prior year.
  • Net cash from operating activities as a percentage of third-quarter adjusted EBITDA2 reached 109%, exceeding 100% for the fifth consecutive quarter.
  • Free cash flow2 of $8.4 million in the third quarter ($0.25 per diluted share) and $28.2 million for the first three quarters of fiscal 2025.
  • Fully repaid the Company’s Term Loan 1, reducing total debt to approximately $53 million at quarter-end, exceeding the previously announced fiscal 2025 debt reduction target of $55–60 million well ahead of schedule.
  • Cash at the end of fiscal third quarter 2025 was $17.3 million, reflecting strong quarterly growth in operating cash flow, primarily due to efficiency initiatives and effective working capital management.
  • More than 155,000 shares were repurchased for cancellation under the ongoing normal course issuer bid launched on March 27, 2025.

Outlook for fiscal year 2025

Sangoma reaffirms and refines its revenue outlook from 235 – 240 million $ to 235 – 238 million $ and confirms its adjusted EBITDA2 outlook of 40 – 42 million $, or approximately 17 % of revenue, in light of the results for the first three quarters of fiscal year 2025.

Conference call Sangoma will hold a conference call on Thursday, May 8, 2025 at 17 h30 (ET) to discuss these results. The call access number is 1‑833‑752‑3740 (International +1‑647‑846‑8617). Participants are asked to dial in 5 minutes before the scheduled start time and ask to join the Sangoma Technologies call.

1 Operating expenses include sales and marketing, research and development, general and administrative expenses, and amortization of intangible assets. 2 Adjusted EBITDA and free cash flow are non-IFRS financial measures used by the Company to monitor its performance. Please see the section titled «Non-IFRS Measures and Reconciliation of Non-IFRS Measures» in this press release for how we define «Adjusted EBITDA» and «Free Cash Flow». 3 The information in this section is forward-looking. Please see the section titled «Cautionary Statement Regarding Forward-Looking Information» in this press release.

About Sangoma Technologies Corporation Sangoma (TSX: STC; Nasdaq: SANG) is a leading provider of enterprise communications platforms, offering solutions that include its UCaaS, CCaaS, CPaaS and trunking technologies. Its enterprise-grade communications suite is developed in-house and available for cloud, hybrid or on-premises deployments. In addition, Sangoma offers managed connectivity, networking and security services. A trusted partner for more than 40 years, Sangoma has more than 2.7 million UC seats across a diverse customer base of more than 100,000 customers. Sangoma has been recognized in the Gartner UCaaS Magic Quadrant for nine consecutive years. As a developer and primary sponsor of the Asterisk and FreePBX open source projects, Sangoma is committed to driving continuous innovation in communications technology. For more information, visit www.sangoma.com.

Cautionary Statement Regarding Forward-Looking Statements This press release contains forward-looking statements, including statements concerning the future success of our business, development strategies and future opportunities.

Forward-looking statements are provided to present management’s current expectations and plans regarding the future, and readers are cautioned that such statements may not be appropriate for other purposes. Forward-looking statements include, but are not limited to, statements relating to revenue and adjusted EBITDA forecasts, statements relating to expected future production and cash flows, and other statements that are not historical facts. When used in this document, words such as “could,” “plan,” “estimate,” “expect,” “will,” “intend,” “may,” “potential,” “should,” and similar expressions indicate forward-looking statements.

Although Sangoma believes that its expectations reflected in these forward-looking statements are reasonable, these statements involve risks and uncertainties, and no assurance can be given that actual results will conform to them. Forward-looking statements are based on management’s opinions and estimates as of the date the statements are made and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ from those projected in the forward-looking statements.

Readers are cautioned not to place undue reliance on forward-looking statements, as there can be no assurance that the plans, intentions or expectations on which they are based will be realized. By their nature, forward-looking statements involve numerous assumptions, known and unknown risks, both general and specific, that contribute to the possibility that the forecasts, projections and other events contemplated by the forward-looking statements will not occur. Although Sangoma believes that the expectations represented by these forward-looking statements are reasonable, there can be no assurance that they will prove correct, as they are inherently subject to business, economic and competitive uncertainties. Some of the risks and other factors that could cause results to differ from those expressed in the forward-looking statements contained herein include, but are not limited to, risks and uncertainties related to fluctuations in exchange rates between the Canadian dollar and other currencies (particularly the U.S. dollar), technological changes, changes in the economic climate, changes in macroeconomic conditions, including (i) inflationary pressures and potential recessionary conditions, as well as actions taken by central banks and regulators around the world to reduce, limit and address these pressures and conditions, including any increases in interest rates, and (ii) the effects of adverse developments in financial institutions, including bank failures, that affect general sentiment regarding the stability and liquidity of banks, and the resulting impact on the stability of global financial markets in general, risks related to any pandemic or epidemic, our ability to identify and effectively remediate material weaknesses and significant deficiencies in our internal controls, our current level of indebtedness and our ability to incur additional short- and long-term indebtedness; changes in the regulatory environment, the imposition of tariffs, the declining importance of the PSTN (as defined in our MD&A), goodwill amortization and new competitive pressures, political unrest, geopolitical instability and tensions, or terrorist attacks, and changes associated with trade policies and global economic sanctions, including, but not limited to, in connection with (x) the ongoing conflict in Ukraine (the “Russo-Ukrainian War”) and (y) any impact, effect, damage, destruction and/or bodily injury directly or indirectly related to ongoing hostilities in the Middle East, and technological changes affecting the development of our products and the implementation of our business needs, including with respect to automation and the use of artificial intelligence (“AI”), and the other risk factors described in our latest annual information form for the fiscal year ended June 30, 2024.

Our forecasts are based on the Company’s assessment of numerous important assumptions, including:

  • The Company’s ability to manage current supply chain constraints, including our ability to secure electronic components and parts, manufacturers’ ability to deliver planned quantities of finished products, no further material increases in electronic component costs, and no material shipping delays or cost increases
  • Successful execution of the Company’s go-to-market strategy
  • Revenue trends the Company has experienced in 2025 to date, the trends we expect going forward in 2025, the impact of our go-to-market strategy transformation and the impact of global economic headwinds
  • The ongoing effects of recent macroeconomic pressures such as inflation, interest rates, recessions, invasions or declarations of war, political landscape uncertainties, government spending constraints, and the continued threat of tariffs and reciprocal trade measures
  • Continued growth in the overall UCaaS and broader cloud communications markets
  • Demand and subscriber growth for our Services and continued expected demand for our Products
  • The impact of global exchange rate fluctuations on demand for the Company’s products and services
  • The ability of the Company’s customers to continue their business operations without a material impact on their product and service requirements
  • Revenue forecasts from the Company’s internal sales team and channel partners will meet current expectations, based on certain management assumptions, including continued demand for the Company’s products and services, no material delays in receiving products from its contract manufacturers, and no further increases in manufacturing, labor or shipping costs
  • That the Company can attract and retain the employees needed to maintain current momentum

Non-IFRS Measures and Reconciliation of Non-IFRS Measures

This press release contains references to non-IFRS measures. These measures are used by management to evaluate the Company’s performance and have no meaning prescribed by IFRS and therefore cannot be compared with similar measures presented by other issuers. Instead, these measures are provided as supplemental information to complement IFRS measures by offering a deeper understanding of our operating results from management’s perspective, without being considered in isolation or as a substitute for analyzing our financial information reported under IFRS. These non-IFRS measures are used to provide investors with alternative measures of our operating performance and liquidity and thereby highlight trends in our business that might otherwise not be apparent when relying solely on IFRS measures. We also believe that financial analysts, investors and other interested parties frequently use non-IFRS measures to compare issuers. Management also uses non-IFRS measures to facilitate comparisons of operating performance from one period to another, the preparation of annual operating budgets and forecasts, and the determination of executive compensation components. The non-IFRS measures mentioned in this press release include “Adjusted EBITDA” and “Free Cash Flow”.

“Adjusted EBITDA” means earnings before taxes, interest (net), share-based compensation, depreciation (including right-of-use assets), amortization, business restructuring and integration costs, goodwill impairment and change in the fair value of the payable consideration.

The IFRS measure most directly comparable to Adjusted EBITDA presented in our financial statements is net loss.

The following table reconciles Adjusted EBITDA to net loss for the periods indicated:

“Free Cash Flow” means cash provided by operating activities less cash used to purchase property and equipment and capitalized development costs.

The IFRS measure most directly comparable to Free Cash Flow presented in our financial statements is net cash provided by operating activities.

The following table reconciles Free Cash Flow to net cash provided by operating activities for the periods indicated: