Form 8-K

8-K — Bandwidth Inc.

Accession: 0001514416-26-000080

Filed: 2026-10-29

Period: 2026-10-26

CIK: 0001514416

SIC: 7372 (SERVICES-PREPACKAGED SOFTWARE)

Item: Entry into a Material Definitive Agreement

Item: Results of Operations and Financial Condition

Item: Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant

Item: Financial Statements and Exhibits

Documents

8-K — band-20261026.htm (Primary)

EX-99.1 (q320268kexh991.htm)

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8-K

8-K (Primary)

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

___________________________________________________

FORM 8-K

___________________________________________________

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) October 26, 2026

___________________________________________________

BANDWIDTH INC.

(Exact name of registrant as specified in its charter)

___________________________________________________

Delaware 001-38285 56-2242657

(State or other jurisdiction

of incorporation)

(Commission

File Number)

(IRS Employer

Identification No.)

2230 Bandmate Way

Raleigh, NC 27607

(Address of principal executive offices) (Zip Code)

(800) 808-5150

Registrant’s telephone number, including area code

Not Applicable

(Former name or former address, if changed since last report)

___________________________________________________

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class Trading Symbol(s) Name of each exchange on which registered

Class A Common Stock, par value $0.001 per share BAND NASDAQ Global Select Market

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

☐

Item 1.01 Entry into a Material Definitive Agreement.

On October 26, 2026, Bandwidth Inc. (the “Company”) entered into a fourth amendment (the “Credit Agreement Amendment”) to that certain Credit Agreement (as amended by the Credit Agreement Amendment, the “Credit Agreement”) by and among the Company, as borrower, certain subsidiaries of the Company, as guarantors, the lenders from time to time party thereto, and Bank of America, N.A., as administrative agent, swingline lender and letters of credit issuer, with BofA Securities, Inc., as sole lead arranger and sole bookrunner. Effective as of October 26, 2026, the Credit Agreement was amended, with notable amendments including the following:

•increase the aggregate revolving credit commitments from $150.0 million to $200.0 million;

•extend the maturity date to October 26, 2031;

•delete the term “SOFR Adjustment” from the Credit Agreement and remove all references thereto from the Credit Agreement; and

•increase the basket in Section 7.02(e) of the Credit Agreement from the greater of (A) $5,000,000 and (B) 10% of TTM Consolidated EBITDA (as defined in the Credit Agreement) to the greater of (A) $10,000,000 and (B) 10% of TTM Consolidated EBITDA.

This summary of the Credit Agreement Amendment is qualified in its entirety by reference to the full text of the Credit Agreement Amendment, dated as of October 26, 2026, which will be filed as an exhibit to the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2026.

Item 2.02 Results of Operations and Financial Condition.

On October 29, 2026, the Company issued a press release reporting its financial results for the third quarter ended September 30, 2026. A copy of the press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.

The information furnished with this Item 2.02, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, except as expressly set forth by specific reference in such a filing.

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement.

The information set forth above under Item 1.01 is hereby incorporated by reference into this Item 2.03.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

Exhibit No. Description

99.1

Bandwidth Inc. press release, dated October 29, 2026

104 Cover Page Interactive File (the cover page tags are embedded within the Inline XBRL document)

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

BANDWIDTH INC.

Date: October 29, 2026 By: /s/ Daryl E. Raiford

Name: Daryl E. Raiford

Title: Chief Financial Officer

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Document

Bandwidth Announces Third Quarter 2026 Financial Results

Record revenue of $234 million, up 22% year-over-year, and Adjusted EBITDA of $35 million, up 43% year-over-year,

with Adjusted EBITDA margin of 22%

2027 outlook of double-digit Cloud Communications revenue from voice usage demand growth

October 29, 2026

Conference Call

Bandwidth will host a conference call to discuss financial results for the third quarter ended September 30, 2026 on October 29, 2026. Details can be found below and on the investor section of its website at https://investors.bandwidth.com where a replay will also be available shortly following the call.

Raleigh, N.C. - Bandwidth Inc. (NASDAQ: BAND), a leading global enterprise cloud communications company, today announced financial results for the third quarter ended September 30, 2026.

“We delivered another strong quarter, with record results in all key financial metrics, highlighting the value that we are bringing to enterprises that are increasingly entrusting us to power SI-driven communication workflows,” said David Morken, Bandwidth’s Co-Founder, Chief Executive Officer, and Chairman. “As SI agents begin to act on behalf of businesses and consumers, they will need to reach people by voice and text, with the reliability and trust those interactions demand. Bandwidth enables that connection, and we will continue to scale as SI generates more conversations between people and agents.”

Third Quarter 2026 Financial Highlights

The following table summarizes the condensed consolidated financial highlights for the three and nine months ended September 30, 2026 and 2025 ($ in millions, except per share amounts).

Conference Call Details

October 29, 2026

8:00 am ET

Domestic dial-in:

844-481-2707

International dial-in:

646-307-1963

Replay information

An audio replay of this conference call will be available through November 5, 2026 by dialing 855-669-9658 or

412-317-0088 for international callers, and entering passcode 4828018.

Investor Contact

Nils Erdmann

Bandwidth

919-410-7499

ir@bandwidth.com

Three months ended

September 30, Nine months ended

September 30,

2026 2025 2026 2025

Revenue $ 234 $ 192 $ 663 $ 546

Gross Margin 36 % 38 % 36 % 40 %

Non-GAAP Gross Margin (1)

61 % 58 % 60 % 58 %

Net income (loss) $ 5 $ (1) $ 12 $ (10)

Non-GAAP net income (1)

$ 20 $ 11 $ 46 $ 34

Net income (loss) per share, basic $ 0.16 $ (0.04) $ 0.37 $ (0.33)

Net income (loss) per share, diluted $ 0.13 $ (0.04) $ 0.00 $ (0.33)

Non-GAAP net income per Non-GAAP share (1)

$ 0.50 $ 0.36 $ 1.22 $ 1.10

Adjusted EBITDA (1)

$ 35 $ 24 $ 89 $ 68

Net cash provided by operating activities $ 38 $ 22 $ 75 $ 51

Free cash flow (1)

$ 33 $ 13 $ 56 $ 25

(1) Additional information regarding the Non-GAAP financial measures discussed in this release, including an explanation of these measures and how each is calculated, is included below under the heading “Non-GAAP Financial Measures.” A reconciliation of GAAP to Non-GAAP financial measures has also been provided in the financial tables included below.

“Our third quarter results demonstrate our continued focus and execution, with record revenue, Adjusted EBITDA, and free cash flow,” said Daryl Raiford, CFO of Bandwidth. “Our growth this quarter was driven by customers expanding their usage of our platform, and our sales team added four new $1 million-plus customer wins and expansions that will layer into our results over the next twelve months. The strength of our business model lets us lean into that momentum while expanding margins and generating strong cash flow.”

Third Quarter Customer Highlights

•A rapidly expanding all-digital banking platform selected Bandwidth to modernize its customer contact center and integrate an SI agent, displacing a major CPaaS competitor. The bank chose Bandwidth for our low-latency owned network, 5x-redundant toll-free solution with Maestro advanced routing and observability, and native Genesys integration, creating high-value enterprise voice traffic that grows as it scales SI-powered customer interactions.

•A fast-growing consumer privacy company expanded its relationship with Bandwidth, now relying on us for millions of phone numbers, and launched an SI-powered call screening service built on our software and voice infrastructure, with additional services planned on our WebRTC solution.

•A major enterprise network and communications provider serving businesses and state and local governments across the U.S. expanded a longstanding relationship spanning toll-free, 911, and other voice services by adopting our platform voice solution, creating a new source of recurring platform fees and incremental usage-based revenue.

•A specialized communications provider serving thousands of businesses and government agencies through its reseller and managed service provider network selected Bandwidth to expand its calling services internationally, relying on our network reaching 70 countries and our global routing capabilities to serve destinations its previous provider could not.

•Salesforce named Bandwidth its first certified international carrier to support the global rollout of its native Contact Center, extending Salesforce's CRM contact center capabilities to more than 25 countries across Europe, the U.K., Australia and New Zealand, with additional markets to follow. Enterprises can connect through a bring-your-own-carrier (“BYOC”) model with Maestro.

Financial Outlook

Bandwidth is providing guidance for the full year 2026 as follows (in millions, except per share amounts) based on current indications for its business, which are subject to change.

Full Year 2026 Guidance

Revenue

$905 - $910

Adjusted EBITDA

$124 - $125

Non-GAAP earnings per share (1)

$1.73 - $1.79

(1) Assumes weighted average diluted share count of approximately 38.7 million in full year 2026.

Bandwidth has not reconciled its full year 2026 guidance related to (i) Adjusted EBITDA to GAAP net income or loss, (ii) non-GAAP net earnings or loss to GAAP net earnings or loss or (iii) non-GAAP earnings or loss per share to GAAP earnings or loss per share, because stock-based compensation cannot be reasonably calculated or predicted at this time. Accordingly, a reconciliation is not available without unreasonable effort.

Upcoming Investor Conferences

•Needham Tech Week virtual investor meetings with management on November 18, 2026.

•Wells Fargo TMT Summit in Rancho Palos Verdes, CA. Fireside chat with David Morken, Chief Executive Officer on Tuesday, December 8, 2026 at 10:15 AM Pacific Time.

About Bandwidth Inc.

Bandwidth Inc. (NASDAQ: BAND) is a global cloud communications company that helps enterprises deliver exceptional experiences through voice calling, text messaging and emergency services. Our solutions and our Communications Cloud, covering ~70 countries and 90 percent of global GDP, are trusted by all the leaders in unified communications and cloud contact centers–including Amazon Web Services (AWS), Cisco, Google, Microsoft, RingCentral, Zoom, Genesys and Five9–as well as Global 2000 enterprises and SaaS builders like Docusign, Uber and Yosi Health. As a founder of the cloud communications revolution, we are the first and only global Communications Platform-as-a-Service (CPaaS) to offer a unique combination of composable APIs, super intelligence (“SI”) capabilities, owner-operated network and broad regulatory experience. Our award-winning support teams help businesses around the world transform their communications every day.

This press release includes forward-looking statements. All statements contained in this press release other than statements of historical facts, including, without limitation, future financial and business performance, the success of our product offerings and our platform, and the value proposition of our products, are forward-looking statements. The words “anticipate,” “assume,” “believe,” “continue,” “estimate,” “expect,” “intend,” “guide,” “may,” “will” and similar expressions and their negatives are intended to identify forward-looking statements. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy, short-term and long-term business operations and objectives and financial needs. These forward-looking statements are subject to a number of risks and uncertainties, including, without limitation, risks related to our rapid growth and ability to sustain our revenue growth rate, competition in the markets in which we operate, market growth, our ability to innovate and manage our growth, our ability to successfully leverage the use of SI in our business operations and in our service offerings, our ability to expand effectively into new markets, macroeconomic conditions both in the U.S. and globally, legal, reputational and financial risks which may result from ever-evolving cybersecurity threats, our ability to operate in compliance with applicable laws, as well as other risks and uncertainties set forth in the “Risk Factors” section of our latest Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”) and any subsequent reports that we file with the SEC. Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties and assumptions, we cannot guarantee future results, levels of activity, performance, achievements or events and circumstances reflected in the forward-looking statements will occur. We are under no obligation to update any of these forward-looking statements after the date of this press release to conform these statements to actual results or revised expectations, except as required by law. You should, therefore, not rely on these forward-looking statements as representing our views as of any date subsequent to the date of this press release.

Non-GAAP Financial Measures

To supplement our condensed consolidated financial statements, which are prepared and presented in accordance with generally accepted accounting principles in the United States, or GAAP, we provide investors with certain Non-GAAP financial measures and other business metrics, which we believe are helpful to our investors. We use these Non-GAAP financial measures and other business metrics for financial and operational decision-making purposes and as a means to evaluate period-to-period comparisons. We believe that these Non-GAAP financial measures and other business metrics provide useful information about our operating results, enhance the overall understanding of past financial performance and future prospects and allow for greater transparency with respect to metrics used by our management in its financial and operational decision-making.

The presentation of Non-GAAP financial information and other business metrics is not meant to be considered in isolation or as a substitute for the directly comparable financial measures prepared in accordance with GAAP. While our Non-GAAP financial measures and other business metrics are an important tool for financial and operational decision-making and for evaluating our own operating results over different periods of time, we urge investors to review the reconciliation of these financial measures to the comparable GAAP financial measures included below, and not to rely on any single financial measure to evaluate our business.

We define Non-GAAP gross profit as gross profit after adding back depreciation, amortization of acquired intangible assets related to acquisitions and stock-based compensation and related payroll taxes. We add back depreciation, amortization of acquired intangible assets related to acquisitions and stock-based compensation and related payroll taxes because we do not consider them indicative of our core operating performance. Their exclusion facilitates comparisons of our operating performance on a period-to-period basis. Therefore, we believe that showing gross margin, as adjusted to remove the impact of these expenses, is helpful to investors in assessing our gross profit and gross margin performance in a way that is similar to how management assesses our performance. We calculate Non-GAAP gross margin by dividing Non-GAAP gross profit by cloud communications revenue, which is revenue less pass-through messaging surcharge revenue.

We define Non-GAAP net income (loss) as net income or loss adjusted for certain items affecting period to period comparability. Non-GAAP net income (loss) excludes stock-based compensation and related payroll taxes, amortization of acquired intangible assets related to acquisitions, amortization of debt discount and issuance costs for convertible debt, acquisition related expenses, impairment charges of intangibles assets, net cost associated with early lease terminations and leases without economic benefit, (gain) loss on sale of business, net (gain) loss on extinguishment of debt, gain on business interruption insurance recoveries, non-recurring items not indicative of ongoing operations and other, and estimated tax impact of above adjustments, net of valuation allowances.

We define Adjusted EBITDA as net income or losses from continuing operations, adjusted to reflect the addition or elimination of certain statement of operations items including, but not limited to: income tax (benefit) provision, interest (income) expense, net, depreciation and amortization expense, acquisition related expenses, stock-based compensation and related payroll taxes, impairment of intangible assets, (gain) loss on sale of business, net cost associated with early lease terminations and leases without economic benefit, net (gain) loss on extinguishment of debt, gain on business interruption insurance recoveries, and non-recurring items not indicative of ongoing operations and other. We have presented Adjusted EBITDA and Adjusted EBITDA margin because they are key measures used by our management and board of directors to understand and evaluate our core operating performance and trends, generate future operating plans, and make strategic decisions regarding the allocation of capital. In particular, we believe that the exclusion of certain items in calculating Adjusted EBITDA and Adjusted EBITDA margin can produce a useful measure for period-to-period comparisons of our business. We calculate Adjusted EBITDA margin by dividing Adjusted EBITDA by cloud communications revenue, which is revenue less pass-through messaging surcharge revenue.

We define free cash flow as net cash provided by or used in operating activities less net cash used in the acquisition of property, plant and equipment and capitalized development costs for software for internal use. We believe free cash flow is a useful indicator of liquidity and provides information to management and investors about the amount of cash generated from our core operations that can be used for investing in our business. Free cash flow has certain limitations in that it does not represent the total increase or decrease in the cash balance for the period, it does not take into consideration investment in long-term securities, nor does it represent the residual cash flows available for discretionary expenditures. Therefore, it is important to evaluate free cash flow along with our condensed consolidated statements of cash flows.

We believe that these Non-GAAP financial measures provide useful information about our operating results, enhance the overall understanding of past financial performance and future prospects and allow for greater transparency with respect to metrics used by our management in its financial and operational decision-making. While a reconciliation of Non-GAAP guidance measures to corresponding GAAP measures is not available on a forward-looking basis as a result of the uncertainty regarding, and the potential variability of, many of these costs and expenses that we may incur in the future, we have provided a reconciliation of Non-GAAP financial measures and other business metrics to the nearest comparable GAAP measures in the accompanying financial statement tables included in this press release.

BANDWIDTH INC.

Condensed Consolidated Statements of Operations

(In thousands, except share and per share amounts)

(Unaudited)

Three months ended September 30, Nine months ended September 30,

2026 2025 2026 2025

Revenue $ 234,017 $ 191,895 $ 662,698 $ 546,149

Cost of revenue 149,217 118,097 421,441 329,175

Gross profit 84,800 73,798 241,257 216,974

Operating expenses

Research and development 36,495 33,008 112,304 95,389

Sales and marketing 25,567 24,702 75,554 75,976

General and administrative 20,943 18,096 60,778 56,052

Total operating expenses 83,005 75,806 248,636 227,417

Operating income (loss) 1,795 (2,008) (7,379) (10,443)

Other income (expense), net 1,549 (1,514) 12,913 (1,684)

Income (loss) before income taxes 3,344 (3,522) 5,534 (12,127)

Income tax benefit 1,903 2,281 6,218 2,215

Net income (loss) $ 5,247 $ (1,241) $ 11,752 $ (9,912)

Net income (loss) per share

Basic $ 0.16 $ (0.04) $ 0.37 $ (0.33)

Diluted $ 0.13 $ (0.04) $ 0.00 $ (0.33)

Numerator used to compute net income (loss) per share:

Basic $ 5,247 $ (1,241) $ 11,752 $ (9,912)

Diluted $ 5,022 $ (1,241) $ 4 $ (9,912)

Weighted average number of common shares outstanding:

Basic 32,235,811 30,278,516 32,017,803 29,721,404

Diluted 40,134,189 30,278,516 37,976,873 29,721,404

BANDWIDTH INC.

Condensed Consolidated Balance Sheets

(In thousands)

(Unaudited)

As of September 30, As of December 31,

2026 2025

Assets

Current assets:

Cash and cash equivalents $ 171,315 $ 102,788

Marketable securities 4,491 8,476

Accounts receivable, net of allowance 118,138 91,409

Deferred costs 4,530 4,830

Prepaid expenses and other current assets 15,596 11,557

Total current assets 314,070 219,060

Property, plant and equipment, net 160,518 174,251

Operating right-of-use asset, net 151,003 152,950

Intangible assets, net 114,070 138,742

Deferred costs, non-current 2,003 3,098

Other long-term assets 7,323 7,754

Goodwill 345,422 356,772

Total assets $ 1,094,409 $ 1,052,627

Liabilities and stockholders’ equity

Current liabilities:

Accounts payable $ 41,364 $ 42,600

Accrued expenses and other current liabilities 108,815 91,151

Current portion of deferred revenue 8,476 8,742

Operating lease liability, current 4,616 3,947

Current portion of convertible senior notes — 7,627

Total current liabilities 163,271 154,067

Other liabilities 1,703 555

Operating lease liability, net of current portion 217,964 221,019

Deferred revenue, net of current portion 2,602 4,972

Deferred tax liability 16,285 24,479

Convertible senior notes 310,584 247,562

Total liabilities 712,409 652,654

Stockholders’ equity:

Class A and Class B common stock 33 31

Treasury common stock (29,978) —

Additional paid-in capital 500,825 485,836

Accumulated deficit (72,574) (84,326)

Accumulated other comprehensive loss (16,306) (1,568)

Total stockholders’ equity 382,000 399,973

Total liabilities and stockholders’ equity $ 1,094,409 $ 1,052,627

BANDWIDTH INC.

Condensed Consolidated Statements of Cash Flows

(In thousands)

(Unaudited)

Nine months ended September 30,

2026 2025

Cash flows from operating activities

Net income (loss) $ 11,752 $ (9,912)

Adjustments to reconcile net income (loss) to net cash provided by operating activities

Depreciation and amortization 52,613 39,658

Non-cash reduction to the right-of-use asset 2,553 2,472

Amortization of debt discount and issuance costs 1,198 1,054

Stock-based compensation 39,089 38,448

Deferred taxes and other (7,290) (1,056)

Net gain on extinguishment of debt (13,246) (1,082)

Changes in operating assets and liabilities:

Accounts receivable, net of allowance (27,067) (5,930)

Prepaid expenses and other assets (2,456) (4,767)

Accounts payable 104 5,630

Accrued expenses and other liabilities 20,989 (12,692)

Operating right-of-use liability (2,994) (946)

Net cash provided by operating activities 75,245 50,877

Cash flows from investing activities

Purchase of property, plant and equipment (12,417) (17,188)

Capitalized software development costs (6,690) (8,218)

Purchase of marketable securities (7,409) (12,680)

Proceeds from sales and maturities of marketable securities 11,415 7,672

Proceeds from sale of business — 361

Net cash used in investing activities (15,101) (30,053)

Cash flows from financing activities

Borrowings on line of credit 148,700 28,500

Repayments on line of credit (148,700) (28,500)

Proceeds from issuance of convertible senior notes 316,250 —

Net cash paid for debt extinguishment (236,084) (26,144)

Purchase of capped call (21,821) —

Repurchase of Class A common stock (29,978) —

Payment of debt issuance costs (12,937) (25)

Value of equity awards withheld for tax liabilities and other (5,403) (2,907)

Net cash provided by (used in) financing activities 10,027 (29,076)

Effect of exchange rate changes on cash, cash equivalents and restricted cash (1,645) (284)

Net increase (decrease) in cash, cash equivalents, and restricted cash 68,526 (8,536)

Cash, cash equivalents, and restricted cash, beginning of period 103,160 82,234

Cash, cash equivalents, and restricted cash, end of period $ 171,686 $ 73,698

BANDWIDTH INC.

Reconciliation of Non-GAAP Financial Measures

(In thousands, except share and per share amounts)

(Unaudited)

Non-GAAP Gross Profit and Non-GAAP Gross Margin

Three months ended September 30, Nine months ended September 30,

2026 2025 2026 2025

Gross Profit $ 84,800 $ 73,798 $ 241,257 $ 216,974

Gross Profit Margin % 36 % 38 % 36 % 40 %

Depreciation 5,934 5,299 17,882 15,137

Amortization of acquired intangible assets 5,007 2,100 15,141 6,039

Stock-based compensation and related payroll taxes 343 542 1,329 1,597

Non-GAAP Gross Profit $ 96,084 $ 81,739 $ 275,609 $ 239,747

Non-GAAP Gross Margin % (1)

61 % 58 % 60 % 58 %

________________________

(1) Calculated by dividing Non-GAAP gross profit by cloud communications revenue of $158 million and $460 million for the three and nine months ended September 30, 2026, respectively, and $142 million and $411 million for the three and nine months ended September 30, 2025, respectively.

BANDWIDTH INC.

Reconciliation of Non-GAAP Financial Measures

(In thousands, except share and per share amounts)

(Unaudited)

Non-GAAP Net Income

Three months ended September 30, Nine months ended September 30,

2026 2025 2026 2025

Net income (loss) $ 5,247 $ (1,241) $ 11,752 $ (9,912)

Stock-based compensation and related payroll taxes 14,559 12,328 42,934 38,448

Amortization of acquired intangibles 7,531 4,633 22,721 13,485

Amortization of debt discount and issuance costs for convertible debt 541 278 998 854

Net gain on extinguishment of debt (800) — (13,246) (1,082)

Non-recurring items not indicative of ongoing operations and other (1)

15 1,185 (1,119) 2,002

Estimated tax effects of adjustments (2)

(7,209) (5,721) (18,081) (9,373)

Non-GAAP net income $ 19,884 $ 11,462 $ 45,959 $ 34,422

Interest expense on Convertible Notes (3)

13 238 348 726

Numerator used to compute Non-GAAP diluted net income per share $ 19,897 $ 11,700 $ 46,307 $ 35,148

Net income (loss) per share

Basic $ 0.16 $ (0.04) $ 0.37 $ (0.33)

Diluted $ 0.13 $ (0.04) $ 0.00 $ (0.33)

Non-GAAP net income per Non-GAAP share

Basic $ 0.62 $ 0.38 $ 1.44 $ 1.16

Diluted $ 0.50 $ 0.36 $ 1.22 $ 1.10

Weighted average number of shares outstanding

Basic 32,235,811 30,278,516 32,017,803 29,721,404

Diluted 40,134,189 30,278,516 37,976,873 29,721,404

Non-GAAP basic shares 32,235,811 30,278,516 32,017,803 29,721,404

Convertible debt conversion 4,433,843 1,478,379 2,368,515 1,537,847

Stock options issued and outstanding 16,363 17,324 34,650 20,247

Nonvested RSUs outstanding 3,448,172 510,590 3,555,905 811,839

Non-GAAP diluted shares 40,134,189 32,284,809 37,976,873 32,091,337

________________________

(1) Non-recurring items not indicative of ongoing operations and other include (i) $(0.3) million and $(1.7) million of foreign exchange gains primarily related to balance sheet revaluations during the three and nine months ended September 30, 2026, respectively, (ii) $0.2 million of losses on prepaid contract and related implementation costs during the three and nine months ended September 30, 2026, (iii) $0.1 million and $0.4 million of losses on disposals of property, plant and equipment during the three and nine months ended September 30, 2026, respectively, (iv) $1.2 million of foreign exchange losses primarily related to balance sheet revaluations during three and nine months ended September 30, 2025, (v) less than $0.1 million and $0.2 million of losses on disposals of property, plant and equipment during the three and nine months ended September 30, 2025, respectively, (vi) $0.1 million of losses on sale of business during the nine months ended September 30, 2025, and (vii) $0.5 million of nonrecurring litigation expense during the nine months ended September 30, 2025.

(2) The estimated tax-effect of adjustments is determined by recalculating the tax provision on a Non-GAAP basis. The Non-GAAP effective income tax rate was 20.5% and 17.2% for the nine months ended September 30, 2026 and 2025, respectively. We analyze the Non-GAAP valuation allowance position on a quarterly basis. As of September 30, 2026, we have no valuation allowance against our deferred tax assets for Non-GAAP purposes.

(3) Non-GAAP net income is increased for interest expense as part of the calculation for diluted Non-GAAP earnings per share.

BANDWIDTH INC.

Reconciliation of Non-GAAP Financial Measures

(In thousands, except share and per share amounts)

(Unaudited)

Adjusted EBITDA

Three months ended September 30, Nine months ended September 30,

2026 2025 2026 2025

Net income (loss) $ 5,247 $ (1,241) $ 11,752 $ (9,912)

Income tax benefit (1,903) (2,281) (6,218) (2,215)

Interest expense, net 180 498 1,820 1,533

Depreciation 9,968 9,208 29,892 26,173

Amortization 7,531 4,633 22,721 13,485

Stock-based compensation and related payroll taxes 14,559 12,328 42,934 38,448

Net gain on extinguishment of debt (800) — (13,246) (1,082)

Non-recurring items not indicative of ongoing operations and other (1)

15 1,185 (1,119) 2,002

Adjusted EBITDA $ 34,797 $ 24,330 $ 88,536 $ 68,432

________________________

Free Cash Flow

Three months ended September 30, Nine months ended September 30,

2026 2025 2026 2025

Net cash provided by operating activities $ 37,705 $ 22,239 $ 75,245 $ 50,877

Net cash used in investing in capital assets (1)

(4,724) (9,104) (19,107) (25,406)

Free cash flow $ 32,981 $ 13,135 $ 56,138 $ 25,471

________________________

(1) Represents the acquisition cost of property, plant and equipment and capitalized development costs for software for internal use.

Stock-Based Compensation Expense

Bandwidth recognized total stock-based compensation expense as follows:

Three months ended September 30, Nine months ended September 30,

2026 2025 2026 2025

Cost of revenue $ 319 $ 542 $ 1,208 $ 1,597

Research and development 5,634 5,622 17,045 16,703

Sales and marketing 1,770 1,799 5,233 5,940

General and administrative 5,769 4,365 15,603 14,208

Total $ 13,492 $ 12,328 $ 39,089 $ 38,448

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