Five9 Beats Q3 Estimates as AI Revenue Jumps 91%, but Trims EPS Outlook and Shares Slide After Level AI Deal

FIVN reported third-quarter 2026 results on Nov. 5 that topped consensus: revenue of $323.3 million, up 13% from a year earlier, against a consensus of $319.0 million, and non-GAAP earnings per share of $0.82 versus $0.80 expected. Subscription revenue grew 16%.

AI was the standout. AI revenue grew 91% year over year to about $45 million, or 17% of subscription revenue, up from 10% a year earlier, and the company now expects full-year AI revenue growth of at least 75%, up from at least 60%.

The guidance was mixed. The full-year revenue midpoint rose to $1.272 billion, about $6 million above the prior outlook, but full-year non-GAAP EPS guidance of $3.17 to $3.21 sits about $0.07 below the prior guidance. Fourth-quarter guidance of $328 million to $334 million in revenue and $0.88 to $0.92 in EPS landed close to analyst estimates. Adjusted gross margin slipped to 61.7% from 62.8%.

Five9 also agreed to acquire Level AI for $325 million in cash, expected to close in the fourth quarter. Per the earnings call summary, Level AI has about $20 million in annual recurring revenue growing about 50%, a price of roughly 11 times forward ARR, and the company's guidance excludes the deal. Shares fell 17.6% to $28.12 in the Nov. 6 session.

What to watch: integration of Level AI, whether AI revenue keeps growing near its current pace, and whether margins improve in the fourth quarter as management expects.