RingCentral Winning UCaaS 'Chess Match' with Mitel Partnership

RingCentral is riding high as its stock price soared on news of its strategic partnership with Mitel and positive third-quarter earnings.

RingCentral’s stock rallied 20% on Tuesday after announcing the Mitel partnership and its third-quarter earnings. It remained up nearly $50 a share on Wednesday.

J Arnold & Associates’ Jon Arnold

Jon Arnold is principal of J Arnold & Associates. He said the chess match to win the UCaaS space continues, with RingCentral yet again leading the way.

The new strategic partnership will provide Mitel’s global customer base with a migration path to RingCentral’s Message Video Phone (MVP). That’s RingCentral’s cloud phone system.

With this partnership, RingCentral becomes the exclusive UCaaS partner for Mitel.

RingCentral will pay Mitel $650 million to acquire intellectual property rights and patents covering network and call management, security and infrastructure. In turn, Mitel’s investor group led by affiliates of Searchlight will invest $200 million in equity in RingCentral.

Partnership Brings Together 2 ‘Leaders’

Vlad Shmunis is RingCentral’s founder, chairman and CEO.

“Mitel has an extensive network of thousands of channel partners servicing customers across the globe, who are largely incremental to our existing channel,” he said. “RingCentral will be the go-forward brand for all cloud technologies for Mitel customers. In summary, this new strategic partnership brings together two well-established leaders in business on-premises and cloud communications, respectively.”

For its third quarter, RingCentral reported $415 million in total revenue, a 37% year-over-year increase. That beat analysts’ expectations. Subscriptions revenue increased 38% year over year to $385 million.

RingCentral said it lost $147 million in the third quarter, compared with a loss of $21 million in the year-ago quarter.

For the fourth quarter of 2021, RingCentral expects revenues between $433.5 million and $434.5 million, indicating year-over-year growth of 30%.

Scroll through our slideshow above for a more in-depth look at the RingCentral-Mitel partnership.