Business Description
Five9, Inc., together with its subsidiaries, provides cloud software for contact centers in the United States and internationally. The company offers virtual contact center cloud platform that delivers a suite of applications, which enables the breadth of contact center-related customer service, sales, and marketing functions. Its solution enables its clients to manage these customer interactions across various channels, including voice, video, chat, email, website, social media, click-to-call, callback, and mobile channels, as well as through APIs; and provides natural language processing and automatic speech recognition solutions. The company serves customers in various industries comprising banking and financial services, business process outsourcers, consumer, healthcare, technology, and education. Five9, Inc. was incorporated in 2001 and is headquartered in San Ramon, California.
Business History
Generated: Jun 5, 2026 1:11pmPrice Overview
Last updated: Jun 5, 2026 1:08pm (21d ago)Price History (1 Year)
Revenue & Net Income Trend
| Period | Revenue | Net Income | Net Margin | YoY/QoQ |
|---|
Key Metrics
EPS (Diluted): 0.51
Total Equity: $785.82M
Shares: 87,037,000
Total Debt: $799.01M
Cash: $232.08M
EBITDA: $163.89M
Total Debt: $799.01M
Cash: $232.08M
Revenue: $1.15B
Revenue: $1.15B
Revenue: $1.15B
Total Equity: $785.82M
Tax Rate: 12.3%
Equity: $785.82M
Total Debt: $799.01M
Cash: $232.08M
Current Liabilities: $213.01M
Long-Term Debt: $777.61M
Total Debt: $799.01M
Total Equity: $785.82M
Shares: 87,037,000
Shares: 87,037,000
CapEx: -$24.96M
Shares: 87,037,000
Stock Price: $22.77
Net Income: $39.42M
Industry Benchmarks
Advanced Analysis Forensic deep-dive · three lenses
Five9 is a scaling contact-center SaaS franchise: revenue compounded from $610M (2021) to $1.15B (2025), gross margin is stable in the low-50s, and the business just crossed into GAAP profitability (OpM +2.8%, NI $39M) with FCF stepping up materially to $201M on $1.15B revenue (~17.5% FCF margin). Liquid cash of $697M (44% of market cap) and $201M FCF mean the business is comfortably self-funding; the 'net debt' is essentially convertible-related and not a survival concern given the cash pile.
The quality blemish is per-share discipline. Diluted shares went 67.5M → 87.0M, a ~6.6% CAGR, with a notable jump from 74.5M to 87.0M in the latest year — that single-year ~17% step-up is larger than SBC alone would explain and warrants checking for convert/acquisition issuance. SBC runs ~12.9% of revenue and buybacks recover only ~6% of it, so the operating improvement is being partially harvested by shareholders, not fully. Earnings quality signals are mixed-to-okay: accruals are negative (cash > earnings, a good sign), Beneish M -2.72 is clean, but the Altman Z of 1.79 is a quirk of an asset-light SaaS with converts rather than genuine distress.
Insider tape shows a coordinated 6/4/2026 sell cluster across multiple officers — not catastrophic in dollar terms (~$1.4M that day) and likely RSU-vest related, but 56 sells vs 1 token buy over 12 months reflects zero conviction buying from management.
Verify before trusting this (5)
- What drove the 74.5M → 87.0M diluted share jump in 2025 — convert conversion, settlement of capped call, or stock-funded acquisition?
- Convertible note maturity schedule, conversion price, and whether capped calls are in place to limit economic dilution.
- Customer concentration and net revenue retention — is the >$1B run-rate broad-based or carried by a few large enterprise wins?
- AI/Genius platform attach economics — is the AI revenue mix actually accretive to gross margin or diluting it?
- Whether the 6/4/2026 insider sales were 10b5-1 scheduled or discretionary.
Market cap of ~$1.58B against ~$200M of real FCF puts FIVN at roughly 8x FCF — optically cheap for a SaaS compounder growing revenue in the mid-teens with sticky contact-center ARR. The e2e synthesis tags it 'Reasonable Premium' (i.e. some upside but not screaming) which aligns: a steady-compounder narrative at 8x FCF and finally GAAP-positive earnings looks like a setup the market is mildly underpricing relative to peers like NICE/Genesys economics.
The catch — and why I won't call this Undervalued — is shareholder treatment. SBC at ~13% of revenue and a 17% one-year share-count jump means the per-share FCF is leaking ~6-7%/yr to dilution. Deserved value has to be marked down for that: effective FCF yield to existing holders is closer to 6x adjusted than 8x headline. Earnings-quality is 'Adequate/Mixed,' so no extra credit there. Net: price ~$20.66 sits below a deserved value I'd peg around $24-26 on a dilution-adjusted DCF — a real but not fat margin of safety.
The bear case (no moat vs Genesys/NICE, post-Zoom-deal de-rate is permanent, contact center commoditizes with AI) is genuinely in the price at 8x FCF; that's why it's cheap-ish. But nothing here screams 'must own at any price' — it's a fair-to-modestly-cheap setup, not a fat pitch.
Verify before trusting this (4)
- Forward SBC guidance and any commitment to slow share growth / buybacks beyond token level
- Net retention rate trend — if NRR is slipping below 105%, the compounder thesis weakens and deserved value drops
- Management's FY guidance on revenue growth and FCF — is mid-teens sustainable or decelerating
- Any one-time items inside the $200M FCF (working capital, deferred revenue benefit)
FIVN sits in a quiet sentiment zone. The market regime is neutral with VIX modestly elevated, and at a 1.45 beta this name would normally amplify any tape move, but there is no decisive tape to amplify right now. Crucially, FIVN carries almost no live narrative pressure: the steady-compounder archetype has minimal intensity and low cult coefficient, so the stock is not being pushed by belief in either direction. It trades on prints, not on story. The bear overhang from the busted 2021 Zoom deal still lingers as a ceiling on multiple, but it is old news, not active selling pressure. Higher-for-longer rates at 4.47% are a mild headwind for enterprise SaaS sentiment broadly, and FIVN's high beta means any risk-off lurch would hit it harder than defensives. Offsetting that, the May 1 earnings beat plus a 200M buyback delivered a 29% pop, analyst consensus is Buy with a 23 target (about 21% above spot), and momentum reads strong_positive. But target revisions this month are zero - tone is stale, not freshly bullish. Net: balanced pressure with a slight positive tilt from the recent print fading into a directionless macro backdrop.
Verify before trusting this (4)
- Whether any sell-side raises targets in the weeks after the Q1 beat - silence here would confirm stale tone
- VIX behavior and 10y yield direction; a break to risk-off would hit FIVN's 1.45 beta disproportionately
- Any AI-agent product announcement from FIVN or peers (NICE, Genesys) that could revive or further bury the narrative
- Next earnings print - with no story bid, the stock lives and dies on NDR and subscription growth
Deep Analysis
Pre-flight intelligence scans the company first, then routes to the right analytical methods.
Income Statement (Annual)
Last updated: Jun 1, 2026 4:35pm (25d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Revenue | $609.6M | $778.8M | $910.5M | $1.0B | $1.1B |
| Cost of Revenue | $271.1M | $367.5M | $432.7M | $477.5M | $521.1M |
| Gross Profit | $338.5M | $411.3M | $477.8M | $564.4M | $628.0M |
| Operating Expenses | $394.7M | $498.9M | $576.4M | $615.7M | $595.4M |
| Operating Income | -$56.3M | -$87.6M | -$98.6M | -$51.3M | $32.6M |
| Net Income | -$53.0M | -$94.7M | -$81.8M | -$12.8M | $39.4M |
| EBITDA | -$8.8M | -$38.1M | -$23.3M | $55.0M | $163.9M |
| EPS | $-0.79 | $-1.35 | $-1.13 | $-0.17 | $0.51 |
| EPS (Diluted) | — | — | — | — | — |
Balance Sheet (Annual)
Last updated: Jun 2, 2026 3:07pm (24d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Cash & Equivalents | $90.9M | $180.5M | $143.2M | $362.5M | $232.1M |
| Total Current Assets | $617.2M | $778.7M | $924.1M | $1.2B | $871.0M |
| Total Assets | $1.2B | $1.2B | $1.5B | $2.1B | $1.8B |
| Current Liabilities | $157.6M | $150.8M | $167.2M | $641.7M | $213.0M |
| Long-Term Debt | $768.6M | $738.4M | $742.1M | $731.9M | $777.6M |
| Total Liabilities | $981.8M | $934.5M | $956.5M | $1.4B | $1.0B |
| Total Equity | $211.1M | $310.0M | $538.1M | $622.2M | $785.8M |
| Retained Earnings | -$228.4M | -$323.1M | -$404.9M | -$417.6M | -$378.2M |
Cash Flow (Annual)
Last updated: Jun 1, 2026 4:35pm (25d ago)| Metric | 2021 | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|---|
| Operating Cash Flow | $29.0M | $88.9M | $128.8M | $143.2M | $226.2M |
| Capital Expenditure | -$42.2M | -$56.2M | -$31.2M | -$64.6M | -$25.0M |
| Free Cash Flow | -$13.2M | $32.7M | $97.6M | $78.6M | $201.2M |
| Acquisitions (net) | $0 | -$2.0M | $0 | $0 | $0 |
| Debt Repayment | — | — | — | — | — |
| Dividends Paid | — | — | — | — | — |
| Stock Buybacks | $0 | $0 | $0 | $0 | -$50.0M |
| Net Change in Cash | -$129.0M | $89.6M | -$37.3M | $219.3M | -$130.1M |
Analyst Estimates (Annual)
Last updated: Jun 5, 2026 1:08pm (21d ago)| Metric | 2027 | 2028 | 2029 | 2030 |
|---|---|---|---|---|
| Revenue |
$1.4B $1.4B – $1.4B
|
$1.5B $1.5B – $1.5B
|
$1.6B $1.6B – $1.7B
|
$1.8B $1.8B – $1.8B
|
| EBITDA |
$432.9M $429.8M – $439.2M
|
$472.8M $472.1M – $473.4M
|
$512.5M $508.6M – $519.2M
|
$554.0M $549.7M – $561.2M
|
| Net Income |
$342.9M $312.4M – $373.4M
|
$374.4M $369.4M – $379.4M
|
$268.9M $266.3M – $273.5M
|
$275.9M $273.2M – $280.6M
|
| EPS | — | — | — | — |
Growth Trends (YoY %)
Last updated: Jun 1, 2026 4:35pm (25d ago)| Metric | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Revenue Growth | +27.8% | +16.9% | +14.4% | +10.3% |
| Gross Profit Growth | +21.5% | +16.2% | +18.1% | +11.3% |
| Operating Income Growth | -55.7% | -12.6% | +48.0% | +163.6% |
| Net Income Growth | -78.6% | +13.6% | +84.4% | +408.1% |
| EBITDA Growth | -332.0% | +38.9% | +336.3% | +198.2% |
Insider Trading (Recent)
Last updated: Jun 5, 2026 1:13pm (21d ago)All SEC Form 4 codes
- P Purchase
- Open-market or private purchase of shares.
- S Sale
- Open-market or private sale of shares.
- A Award / grant
- Grant or award of securities (RSUs, options, etc.) under Rule 16b-3.
- D Return to issuer
- Securities disposed back to the company under Rule 16b-3.
- F In-kind (tax)
- Shares withheld or delivered to pay the option-exercise price or tax — not an open-market sale.
- I Discretionary
- Discretionary transaction under an employee plan — Rule 16b-3(f).
- M Option exercise
- Exercise or conversion of a derivative (option/RSU) into shares — exempt.
- C Conversion
- Conversion of a derivative security into the underlying shares.
- E Short expiration
- Expiration of a short derivative position.
- H Long expiration
- Expiration or cancellation of a long derivative position with value received.
- O OTM exercise
- Exercise of an out-of-the-money derivative.
- X ITM exercise
- Exercise of an in-the-money or at-the-money derivative.
- G Gift
- Bona fide gift of securities.
- L Small acquisition
- Small acquisition under Rule 16a-6.
- W Inheritance
- Acquisition or disposition by will or the laws of descent.
- Z Voting trust
- Deposit into or withdrawal from a voting trust.
- J Other
- Other acquisition or disposition (explained in a Form 4 footnote).
- K Equity swap
- Transaction in an equity swap or similar instrument.
- U Tender / buyout
- Disposition via tender of shares in a change-of-control transaction.
Compensation-plan codes (A, D, F, M) are routine and rarely directional. Open-market P (buy) and S (sale) carry the most signal.
| Date | Insider | Type | Shares | Price | Value |
|---|---|---|---|---|---|
| 2026-06-04 | Meriweather Tiffany N. | S-Sale | 9,526.00 | $24.81 | $236,340 |
| 2026-06-04 | Kozanian Panos | S-Sale | 5,869.00 | $24.81 | $145,610 |
| 2026-06-04 | Tuckness Matthew E. | S-Sale | 8,645.00 | $24.81 | $214,482 |
| 2026-06-04 | Mansharamani Leena | S-Sale | 2,556.00 | $24.81 | $63,414 |
| 2026-06-04 | Lee Bryan M | S-Sale | 4,794.00 | $24.16 | $115,823 |
| 2026-06-04 | Lee Bryan M | S-Sale | 6,107.00 | $25.13 | $153,469 |
| 2026-06-04 | Lee Bryan M | S-Sale | 1,406.00 | $25.69 | $36,120 |
| 2026-06-04 | Lee Bryan M | S-Sale | 4,313.00 | $24.81 | $107,006 |
| 2026-06-05 | Lee Bryan M | S-Sale | 1,511.00 | $24.25 | $36,642 |
| 2026-06-04 | Dignan Andy | S-Sale | 2,400.00 | $24.15 | $57,960 |
| 2026-06-04 | Dignan Andy | S-Sale | 2,700.00 | $25.07 | $67,689 |
| 2026-06-04 | Dignan Andy | S-Sale | 545.00 | $25.68 | $13,996 |
| 2026-06-04 | Dignan Andy | S-Sale | 2,558.00 | $24.81 | $63,464 |
| 2026-06-05 | Dignan Andy | S-Sale | 3,073.00 | $24.25 | $74,520 |
| 2026-05-20 | Gupta Sagar | A-Award | 8,972.00 | $0.00 | $0 |
| 2026-05-20 | Walker Maria C | A-Award | 8,972.00 | $0.00 | $0 |
| 2026-05-20 | MARINER JONATHAN D | A-Award | 8,972.00 | $0.00 | $0 |
| 2026-05-20 | Iskow Julie | A-Award | 8,972.00 | $0.00 | $0 |
| 2026-05-20 | Burdiek Michael J | A-Award | 8,972.00 | $0.00 | $0 |
| 2026-05-20 | Barsamian Sue | A-Award | 8,972.00 | $0.00 | $0 |
Narrative Economics
market-narrative step).
Delvantic AI Findings
Looking at the raw trajectory first: revenue went $252M→$264M→$279M→$283M→$286M→$300M→$305M over eight quarters — that's a clean accelerating ramp, not deceleration. The "decelerating" tag in revenue confidence looks wrong on sequential reading; YoY growth held at ~10-13% across quarters with Q1'26 at $305M vs Q1'25 $280M = 9.2%. Net income inflected sharply: -$12.8M → -$4.5M → $11.6M → $0.6M → $1.2M → $18M → $19.7M → $18.4M. The $200M FCF on $1.15B revenue (17.5% FCF margin) is real, and it's the second derivative that matters — 2024 op income was -$51M, 2025 was +$32M. That's an $84M swing on $110M of incremental revenue, implying ~75% incremental operating margin. Either this is genuine operating leverage finally showing up after years of S&M overspend, or it's compensation-mix engineering (SBC shifted, hiring frozen). Without SBC disclosed in this file, I can't tell — and that's the single most important missing number.
The synthesis "Reasonable Premium" verdict and the Market Forces "Headwinds/financial engineering for exit" verdict directly contradict each other, and the file gives me no clean way to reconcile them. I lean closer to the synthesis: at $1.58B market cap minus $232M cash = ~$1.35B EV on $201M FCF, that's a 6.7x EV/FCF and ~15% FCF yield on a business growing low-double-digits. That is not a "prove it" valuation, that's a distressed-multiple valuation for a profitable SaaS. The S&P median software EV/FCF is 25-35x. Either the market is right that 2025 FCF is non-recurring (pull-forward, SBC games, working capital), or this is genuinely mispriced by 50%+. The 30% drawdown from $29.71 plus the cluster of June 4, 2026 insider sales (ten transactions same day — looks like 10b5-1 scheduled or post-vest auto-sell, not conviction selling; sizes are small, 1k-10k shares each) is consistent with broad SaaS de-rating, not Five9-specific deterioration.
The contrarian case the models underweight: Five9 competes against Genesys, NICE CXone, Amazon Connect, and increasingly Microsoft Dynamics with Copilot. Contact-center-as-a-service is the SaaS vertical most exposed to AI displacement of seats — every agent replaced by an LLM is a seat Five9 doesn't bill. The 17.5% FCF margin could be the peak before AI deflation hits per-seat pricing in 2026-2027. That's a credible reason the multiple stays compressed even if numbers look cheap. The bull rebuttal is that Five9 monetizes AI agents too (their Genius AI platform), but pricing power on AI minutes is unproven and likely commoditized. The narrative model's "forgotten SaaS" framing is right — this is a stock where you need either a strategic bid (Zoom 2.0) or three more quarters of margin expansion to re-rate.
I dissent mildly from "Reasonable Premium" — at 6.7x EV/FCF with FCF growing 40%+ and revenue accelerating sequentially, this looks closer to undervalued than fairly valued, assuming the FCF is real. The Market Forces verdict overreads the insider activity (small, clustered, likely programmatic) and underweights the operating inflection. The biggest unknowns: SBC as % of revenue (not disclosed here), NRR/churn trajectory (not disclosed), and whether Q1'26's $305M reflects seasonality or sustained reacceleration. If SBC is running >15% of revenue, the FCF number is half as impressive and "Reasonable Premium" is right. If SBC is normalizing toward 10%, this is a $28-32 stock. I'd start a position here with the explicit plan to add on the Q2'26 print if revenue clears $310M and FCF margin holds above 15%, and cut if either slips.
GPT Critique
In analyzing Five9, Inc., several elements of the data catch my attention. The company's revenue trajectory from $252.1M in Q2 2024 to $305.3M in Q1 2026 reflects a consistent upward trend, highlighting a robust revenue growth of about 20% over the period. This aligns with a compound annual growth rate (CAGR) of approximately 12.3%, which is respectable given the current market context for SaaS companies. Notably, Five9 achieved positive net income in 2025 after years of losses, with a net income margin improving to 6% from negative figures in 2024. This shift indicates a significant turnaround in operational efficiency. The free cash flow (FCF) of $201.2M in 2025 on $1.15B revenue, translating to a 17.5% FCF margin, is a strong indicator of the company's cash-generating capabilities, although the sustainability of this margin is a point of scrutiny, especially with potential impacts from AI-driven market changes.
Opus argues that the revenue trajectory shows a clean acceleration, countering the "decelerating" label in revenue confidence. I concur with this assessment, as the sequential revenue growth supports a narrative of acceleration rather than deceleration. However, I diverge from Opus's conclusion that the valuation at 6.7x EV/FCF is distressed. While the EV/FCF multiple indeed appears low compared to typical SaaS medians, this discrepancy might reflect market skepticism about the durability of Five9's recent financial performance. Opus's argument that the significant insider selling is likely programmatic rather than indicative of insider pessimism is plausible, yet the timing and volume of these sales cannot be entirely dismissed as inconsequential, as they could signal underlying concerns about future growth prospects or strategic shifts.
Where Opus describes Five9's valuation as undervalued if FCF is sustainable, I view this with some caution. The rapid FCF growth and operating income improvement might mask underlying issues such as potential over-reliance on cost-cutting measures, like reduced stock-based compensation (SBC), which could be unsustainable in the long term. Without detailed SBC figures, it's challenging to assess the true quality of the FCF. Moreover, the competitive landscape, with formidable rivals like Genesys and NICE, poses a credible threat to Five9's market position, especially if AI advancements erode traditional revenue streams faster than new AI-driven opportunities are monetized.
A careful skeptic might argue that both Opus and I overlook broader macroeconomic headwinds and sector-specific risks that could dampen Five9's growth and profitability. These include potential disruptions from economic downturns, changes in enterprise software spending, and the rapid pace of technological change in the contact-center space. A skeptic would also point out that the lack of comprehensive insights into customer retention rates or churn could skew the optimism about revenue sustainability.