Insider Report November 2025

Curated Enterprise Communications News and Insights from November 2025

Featured

This Economy Brought to You By the Letter K: There’s a lot of concern that we are on the cusp of a bubble pop. Maybe. Markets are cyclical and are known to overreact. Yes, the S&P 500 has done very well this year, and Nvidia has very rapidly become the first $5T company. Those are all cause for alarm. 

While stocks are high, it’s nonsensical to suggest they are overvalued. Stocks trade freely every day on the open market at current market rates. Markets can be fickle, and they continuously reassess prices. Michels doesn’t see a dot-com bubble comparison, but a correction may be inevitable based on this talk about bubbles. Price-to-earnings ratios are much lower than the dot-com pop, and instead of hope and startups, we are dealing with some of the largest and best-run tech companies.

The bigger problem is that the rising tech stocks have been masking a “K-shaped economy.” For the first time, Fed Chair Powell said aloud that the US labor market may be entering a new kind of slowdown, potentially as a result of AI. He then described a “bifurcated economy” (aka “K-shaped”) where higher-income workers benefit from AI-driven productivity while lower earners struggle with rising costs. This is validated by several sources, including Chipotle and McDonald’s reporting declines in lower-income customers. 

Meta grew revenue 23% last year with 20% fewer people. Amazon announced that it’s restructuring (cutting) 30K corporate jobs, roughly 10% of its white-collar workforce, without an impact to revenue. Salesforce eliminated 4K support roles. Clara downsized 40%. Duolingo plans to replace contractors with AI. Target intends to cut 1,800 people. Paramount 1,000. Intel 24,000. Nestle 16,000. 

We are heading into uncharted waters. We know AI is causing some job loss, but we don’t know how big this story goes. We are seeing clear evidence that revenue and headcount are no longer correlated. Companies are growing revenue with fewer employees across sectors. The general expectation is that AI is going to get a lot better, and RIFs are going to get a lot worse, very soon. 

The New York Times revealed internal Amazon strategy documents to automate over half a million human roles within a decade. Its ultimate goal is to automate 75% of operations and avoid hiring over 600K new workers by 2033, primarily in factories and facilities. Amazon has rejected the Times’ assessment, but the documents viewed were confirmed as legitimate, though incomplete. 

This split economy is problematic on several fronts. Our new, more efficient companies are seeing wallets close. Even worse, these new bots are not contributing to Social Security or paying any kind of income taxes. The big economic risk ahead is less about the perceived AI bubble and more about the looming recession. 

General News

Cloud Reliability Takes a Hit: Global cloud infrastructure experienced a significant wave of disruptions in late October and November 2025, underscoring the internet’s profound reliance on a small number of centralized providers. Major incidents across Amazon Web Services (AWS), Microsoft Azure, and Cloudflare led to widespread service failures, affecting critical communication and business platforms worldwide.

Sequential Failures Across Major Platforms

• AWS Outage (Late October): A large-scale incident, primarily in the US-EAST-1 region, impacted core services like DynamoDB and EC2. Crucially, the cascading failure disrupted communication platforms like Amazon Connect and heavily affected companies relying on AWS infrastructure for their video and messaging services.
• Azure Outage (Late October/Early November): This disruption affected core Azure services, leading to issues with adjacent applications such as Microsoft Teams and other cloud-based corporate tools, showcasing the critical dependency of enterprise communications on a single cloud’s health.
• Cloudflare Outage (November 18): The most globally visible incident, caused by an internal configuration failure in its Bot Management system, crippled its global network. Because Cloudflare acts as a front-end shield for countless sites, its failure resulted in downtime for major services, including X (formerly Twitter) and the AI platform ChatGPT. The outage also caused knock-on effects for communication services like Zoom and RingCentral, which use various cloud layers for routing, security, and content delivery, subjecting their users to connection failures and service degradation.
• Many other vendors released patches. Microsoft identified and fixed 63 vulnerabilities – including two high-severity flaws. Zoom issued a set of high-severity vulnerability bulletins addressing significant risks. Reactive patching is better than no patching, but the new normal is flying very close to the sun. It’s dangerous for vendors to market security and safety, leaving customers unsure whether these bulletins reflect best practices or negligence. 

There was a time when cloud-delivered services were viewed as more secure than premises-based implementations, but such cloud claims are now nebulous. The frequency and global reach of large outages are increasing.

Zoom Euro Expansion: Zoom has announced plans to open a UK data center in the first half of 2026. This facility is designed to meet the country’s data residency requirements, opening doors for regulated sectors like the Public Sector, Healthcare, and Financial Services. Zoom opened its London Experience Center in June 2024. The center has since hosted over 5,500 guests.

Microsoft Ignite: Microsoft held its major annual gathering, Ignite, aimed at IT professionals. Teams no longer gets much attention at Ignite, as the event prioritizes Copilots and Azure. We have Teams-related coverage throughout this report. Microsoft has also pulled out of Enterprise Connect, so it’s unclear exactly where customers and analysts might hear a Teams keynote. Very few UC/CC analysts attend Ignite, and there’s very little outreach from Redmond. 

Microsoft FAX: Microsoft pulled the plug on the fax machine. The company’s latest Windows update quietly removes support for legacy fax modems. It’s easy to see the decision, but then again, was it causing any harm? Curious to have been a fly on that wall.

RIFs: Verizon initiated the largest RIF in its history, eliminating more than 13K positions, about 13%-15% of its workforce. Verizon expects to incur a pre-tax severance charge of approximately $1.6B-$1.8B in Q4. Verizon intends to reduce outsourced labor and external contractors. Additionally, Verizon is converting roughly 180 corporate-owned retail locations into franchised stores.

In the most recent quarter, the company reported a net loss of 7K postpaid phone connections, while competitors posted significant gains. Its new CEO, Dan Schulman, believes the cuts in labor will enable investments that will improve its customer value proposition.

HP plans to cut between 4,000 and 6,000 jobs globally by fiscal 2028 as it restructures around AI to automate work and reduce expenses. The company expects the ~10% global reduction to result in about US $1B in savings over three years. 

Private AWS: Amazon announced a deal worth up to $50B to build dedicated compute infrastructure for the US government. 

AI News

Shrugged Atlas: OpenAI officially launched ChatGPT Atlas, a new AI-powered web browser. Its launch demo showcased its agent mode, where the AI autonomously navigated retail sites and even purchased groceries. Atlas is designed to blend automation, memory, and AI assistance directly into everyday browsing, acting as a companion that lives alongside web activity. 

Google Chrome holds about 70%-71% of the browser market, so it will likely introduce similar capabilities. Google likely held back innovating on Chrome until the courts determined if it would be forced to sell off Chrome. Now that it has the all-clear, expect significant enhancements to Chrome soon, such as integrating Gemini and adding its own agent mode. 

Alphabet’s Month: Google’s shares have risen significantly this month, outperforming other big tech stocks, due to several key factors. First, the news that Warren Buffett’s Berkshire Hathaway bought a $4.3B stake sent shares up 3%, coupled with the company’s antitrust escape this past summer.

Beyond legal and investment news, confidence is growing in Google’s AI capabilities, especially with the release of the Gemini 3 model. Google’s strength is its existing vertically integrated position, possessing a top-notch large language model (LLM), a growing cloud business (Google Cloud), and its own AI chip (TPU) that it’s considering selling to firms like Meta, while Apple is in talks to license Gemini for Siri. OpenAI has been taunting Google for three years. Oops. Perhaps we should also mention things like dominant distribution channels, a dominant mobile OS, the dominant browser, Waymo, and so much more. Unlike competitors like OpenAI, Google is also financially strong and well-positioned to fund future AI investments.

Twilio Conversation Relay: Twilio’s ConversationRelay stood out as the central theme of the SIGNAL London conference this month. AI startups and CSPs can use ConversationRelay to manage the intricate loop of transcribing customer speech, processing it through LLMs, and synthesizing human-like responses via partners like ElevenLabs in less than half a second. 

Microsoft Agent 365: Agent 365 is a control plane that lets organizations govern the rapidly growing universe of AI agents their employees may rely on, including those built by other vendors. This reflects a larger shift in the market as enterprises experiment with AI agents for customer service, IT support and workflow automation and are now realizing they need centralized oversight, security and policy enforcement to keep the ecosystem manageable. Agent 365 is in limited preview and will be an add-on to existing Microsoft 365 subscriptions, with pricing still undisclosed.

Microsoft continued to refine its Copilot experience across Teams by unifying the interface in chats, channels and meetings and introducing a Teams Mode that lets users bring coworkers into a Copilot conversation while choosing what to reveal. Channel Agents gained the ability to generate status reports and workback plans directly inside a channel, reinforcing Microsoft’s push to make AI feel more native and more integrated across daily workflows rather than a standalone add-on.

Meetings and AV 

David Danto is the primary author of this section. 

AV Awards Americas: AV Magazine has announced the first-ever AV Awards Americas, expanding its long-running UK awards programs. The event will feature 22 categories honoring excellence in technology, projects, and individuals, judged by a panel of industry experts with a focus on fairness and integrity. Our David Danto is honored to be one of the inaugural event judges.

Teams Rooms Town Halls: Microsoft expanded Town Hall to work directly with Teams Rooms so hybrid all-hands can be run from a room system, with a presenter role on Windows and an attendee view on the front-of-room display. Teams Rooms on Android can join Town Halls and webinars as attendees – with front-of-room view controls supported. The update closes a practical gap for enterprises that stage large internal events from conference rooms rather than studios. This makes Microsoft’s story for in-room production more credible – and should reduce friction for IT and comms teams rolling out hybrid town halls.

Teams Meetings: Microsoft’s meeting and event updates at Ignite centered on making live sessions more guided, automated, and accessible. The new Facilitator Agent can read agendas shared in chat, track progress as the meeting unfolds, remind people who were mentioned but haven’t joined, and draft Word or Loop documents based on what was discussed. Recap tools now include reusable templates such as Speaker Summary and Executive Summary, and organizations can upload branded reactions to match corporate or event themes. Immersive events are now generally available with support for Meta Quest headsets, plus new accessibility options like text-to-speech and keyboard navigation. 

On the admin side, Copilot can help configure protected meetings, check call-quality metrics, and suggest fixes, and IT teams can now identify VDI-related meeting issues by location or user. Hardware announcements rounded things out, including MAXHUB’s XBar W70 Kit, Lenovo’s ThinkSmart Core plus Meeting Owl 4+ bundle, Logitech’s Express Install kits for quick huddle-room deployments, and Yealink’s LinkHub smart dock that connects room scheduling and workspace insights into Teams Places. 

Logitech Expands Teams Express Install: Logitech is extending its “Express Install” offering for Microsoft Teams Rooms by partnering with furniture and integration-specialist firms like Heckler, Salamander Designs, and Steelcase. The packages pair Logitech video hardware with mobile or tabletop furniture mounts and compatible displays. Logitech is positioning itself as a turnkey room-solution provider.

Logitech also (finally) released a statement on Microsoft MDEP, saying that it is working with Microsoft to “explore” implementing it on future products. So they admit there’s a chance they might support MDEP.

Acuity and QSC/QSYS Get Closer: The integration between QSC/Q-SYS and parent company Acuity has entered a new phase, evolving from a traditional acquisition into a true merger in motion. The once-clear boundaries between the brands are giving way to deeper operational and strategic alignment. This visible shift reflects a growing emphasis on collaboration, unified vision, and shared innovation as Acuity positions the combined group to operate as a single, cohesive organization. See additional details in Leadership Changes below.

QSC Also Fades Out of the Cinema Speaker Business: QSC has divested its Digital Cinema Speaker (DCS) product line to Moving iMage Technologies (MiT), effective October 31, 2025. The sale includes all DCS models – screen channel, subwoofer, surround, and replacement components – and transfers full responsibility for manufacturing, distribution, and service to MiT. QSC described the divestiture as a step to focus on its Q-SYS Full Stack AV platform while MiT expands its position in motion picture exhibition technology. The move reinforces QSC’s pivot toward integrated AV systems and leaves MiT to cultivate the specialized cinema audio segment.

Barco ClickShare Partner and Patent Update: Barco expanded its ClickShare Hub ecosystem with newly certified room-system bundles from Sennheiser, Jabra, Bose, Q-SYS, Biamp, Logitech, and Lenovo, giving buyers more validated options that combine audio, video, and compute components. Barco had said more partners were coming when it launched Hub, and this round of certifications makes that message more convincing. 

Later in the month, a Texas jury awarded Barco nearly $1M in its ClickShare patent case, finding that Yealink infringed several wireless-collaboration claims tied to meeting-room and BYOD functionality (shocking!). The ruling reinforces Barco’s long-standing position that its ClickShare IP can and will be enforced.

SCN’s Top 50 Integrators List: SCN published its annual top 50 AV integrators by revenue. AVI-SPL once again takes the top spot, with Diversified and Forte following in second and third. The newly merged Yorktel-Kinly lands at No. 6. The full list is available in the December issue of SCN, though seasoned readers won’t find many surprises.

Customer Experience

Five9 Genius: Five9 used its annual CX Summit (customer event) to unveil some new technologies. Five9 has been at CCaaS for a long time, and some vendors use that against Five9, implying they are not modern. That’s a lot harder now because of Genius Routing. The concept is simple, but the implementation is problematic. NiCE has it. Avaya/Afiniti chased it for years. Genesys announced plans to partner with Afiniti but then opted to build its own, to flat reviews. Five9 can now claim to offer the most modern approach to AI routing, connecting customers with agents based on several defined attributes. 

Other announcements include AQM for insights on agent performance and customer satisfaction; OneVUE, a unified reporting and analytics application offering self-service and customizable dashboards; and Adaptive Digital Engagement, a digital engagement solution that evolves as AI capabilities expand. 

Mitel CX 2.0: Mitel introduced Mitel CX 2.0, the next evolution of its customer experience (CX) platform, designed to offer a modern user experience in private cloud, hybrid, or on-premises deployments. Mitel CX 2.0 leverages GenAI virtual agents to enhance the productivity of contact center professionals. Key features include industry-tailored AI Virtual Agents, Voice AI Virtual Agents with seamless handoff of conversation transcripts to live agents, Agentic AI Workflows for task automation, and Low-Code/No-Code Workflow Design via the MCX Bot Builder and Workflow Studio. The platform is a core element of Mitel’s AI innovation strategy, integrating deeply with its Workflow Studio. Mitel CX is a suitable offer for new customers as well as existing Mitel and Unify CC customers. 

8x8 WEM for All: 8x8 Workforce Management (WFM) is now a standard, no-cost capability included in every 8x8 Contact Center package. This allows organizations to forecast, schedule, and staff across both voice and digital channels. The solution supports simple to advanced workforce requirements. 8x8 also announced enhancements to its AI-driven workflows that aim to improve speed and personalization. 

#TalkdeskAnalystSummit25: It was in Savannah, Georgia, that analysts learned all about Td CXA, or Customer Experience Automation. CXA is not just for Td CCaaS customers, as customers on legacy Avaya and Genesys systems were profiled. CXA separates AI and automation from core CCaaS features. Michels observes that several CCaaS providers are becoming CCaaS-agnostic. Verint attempted to coin its automation approach as Open CCaaS, but now Google, NiCE, and UJET (to name a few) see an opportunity. Michels likes CXA better than CX as it’s more specific and more CC centric, yet requires specialized AI and workflow skills. 

CCaaS hasn’t been forgotten at Talkdesk, despite no longer being on top of the talk track. Additional messages Td emphasized were data readiness, vertical savviness, and agility. 

UC and Messaging

Teams UC Updates: Microsoft refreshed core UC capabilities with a strong focus on external collaboration, compliance, and frontline uses. Teams now allows chatting with anyone via email, sharing files or Loop components in external chats without switching accounts, and viewing cross-tenant activity in one place, all supported by clearer trust indicators and an admin overview page for managing external settings. 

Teams Phone added support for third-party recording at the call-queue level. For frontline organizations, a new BYOD Onboarding Wizard simplifies secure setup on shared devices, while the Frontline Hub provides tools to pilot features and monitor usage. New devices include Yealink’s MP66W WiFi-based Teams device for mobile workers and Logitech’s new Zone headsets. 

Teams is the market-share leader in terms of the application, but Microsoft has barely penetrated its huge user base with PSTN services. It appears Microsoft is pulling away from Teams (no longer bundled, antitrust concerns, exiting Enterprise Connect, and missing lots of basic features). This will likely mean more growth for Teams PSTN partners (Direct Routing, Operator Connect, and Teams Phone Mobile). 

Teams Offering for High Security: NUSO and Intuity have partnered to deliver a managed Microsoft Teams calling solution built specifically for GCC High and DoD tenants, combining NUSO’s carrier infrastructure with Intuity’s government-focused Teams expertise. The service allows agencies and defense contractors to integrate secure voice directly into Teams without on-premises equipment, addressing long-standing compliance barriers. Officials position the offering as a way to streamline voice deployment in high-security environments. This move shows how vendors are racing to fill gaps in the government Teams ecosystem, and it suggests that secure voice for GCC High is finally becoming more accessible.

Zoom Phone: Zoom Phone surpassed 10M seats globally. 

Benchmark

Dmitry Netis (LI, email) of The Benchmark Company (now StoneX Group) provides Insider subscribers with financial insights quarterly. Dmitry leads M&A advisory and serves as a Managing Director and Co-Head of Technology Investment Banking at Benchmark. He has been immersed in enterprise communications for over 15 years as one of the first Wall Street research analysts covering this space, serving institutional and private equity clients. Benchmark offers capital markets, private placement, research, and M&A advisory services.

A customary macro recap: November brought a different sentiment to the stock market after all-time highs were reached in late October – intraday S&P 500 hit above 6,900 and Nasdaq surpassed 24,000. The Magnificent 7 (Mag7) stocks, whose combined weighting is above 40% of the Nasdaq index and 30% within the broader S&P 500 index, led the rally in October on the heels of strong 3Q earnings reports and optimism surrounding AI, quantum computing, and the lower interest rate environment. In November, the AI establishment was shaken up badly by the lack of economic data (due to the longest government shutdown in history), which significantly diminished the probability of an additional 25bps rate cut in December and continued worries of mounting inflation. Many economists now believe that an inflation rate target of 3% is the new 2% (a goal set by many central banks to maintain price stability). A change in the Fed’s narrative that has shifted from accommodative to restrictive policy is also weighing on investor sentiment. The new narrative has emerged in November as Wall Street is facing uncertainty post-shutdown, AI selloffs/profit-taking, a divided Fed, and liquidity influx.

Macro frothiness led to mixed earnings: Nvidia 3Q earnings exceeded expectations, and the company provided strong guidance for 4Q, but the stock failed to build momentum, dropping 10% since that report. Venture capitalist Peter Thiel’s hedge fund exited its entire position in Nvidia, and Softbank also offloaded its entire Nvidia stake. Jensen, who’s turned Nvidia into the first $5T company, went on a rampage campaign to silence the bears, but so far to no avail. Consumer bellwether Walmart beat expectations, with revenue rising 6% YoY and global e-commerce sales surging 27%. Solid comparable sales in the US and an increased membership base sent stock to an all-time high. Other consumer discretionary stocks were weak. Home Depot’s earnings missed, and the retailer lowered its full-year outlook. Factors like mild weather, consumer uncertainty, and a housing market downturn contributed to missed expectations. Target missed earnings guidance and warned about high prices, predicting a weak holiday season. Disney missed revenue estimates, calling out pressures in the linear TV business. The growing inflation is at least partially responsible for this weakening demand.

Japan bond-yield spike puts pressure on global trade. Japan’s 10-year government bond yield has recently surged due to concerns over a new large government stimulus package that is expected to increase government spending and debt. Such stimulus, along with other factors like inflation and a weak currency, has caused a rampant sell-off in the Japanese bond market, driving yields up to multi-decade highs and causing overall volatility (some domestic holders are selling their bonds at a pace not seen in 30 years). As a result, sentiment has shifted to skittishness, and investor appetite for Japanese government debt has waned. The government of Japan will face higher interest payments on its debt, which could strain its budget further or cause it to default. While the outcome is not yet clear, these events could have significant implications for the global economy.  The yield on JP10Y shot up 67% YTD, to 1.8% in one year (versus 1.078% in January 2025). Investors are watching it closely.

The fastest-moving financial fraud in history? The story that’s making waves and contributing to AI selloff/profit-taking and big rotation in the stock market, called “Nvidia’s $610B AI Ponzi scheme,” became the most read on social media. Apparently, uncovered by its own Nvidia-powered AI engine, the company has $33B in unbilled revenue, up 89% in one year, with average customer payments stretching to 53 days (up from 43). The company disclosed ~$20B in unsold chips, up 32% in three months, as demand has outstripped supply, which is constrained. In addition, Nvidia gave $2B as a cash investment to xAI, and xAI, in turn, borrowed $12.5B to buy Nvidia chips. Classic Silicon Valley quid pro quo? It gets even more interesting when Microsoft puts $13B into OpenAI, which in turn commits $50B of Microsoft Azure purchases. Microsoft then orders $100B in Nvidia chips for the cloud. Similarly, Oracle extends $300B in cloud credits to OpenAI, which in turn goes and orders Nvidia chips for OCI. This circular trade, which Nvidia bears have termed as “vibe revenue,” has Nvidia booking sales that nobody is paying for. If it begins to unravel, bears say, it will spook the market further. OpenAI’s annual burn of $9.3B versus the $3.7B in revenue it generates also points to the fact that something doesn’t add up, in a familiar financial sense. But as with the dot-com era, we’re in uncharted territory. 

What about BTC? The Bitcoin trade, which already fell from its peak of $126,000 in October to $85,000 by November 21, is closely correlated to AI speculation. Bitcoin DATs (digital asset treasuries) have been popping up like truffles in Umbria in November. You can find a good list of them here. Total accumulated crypto treasuries today are standing at $178B (with Michael Saylor’s Strategy leading the pack at $48B in bitcoin holdings, or nearly 3% of the total 21M bitcoin supply). If the market sentiment dips lower, AI startups holding bitcoins as collateral for loans will be subject to margin calls. If the loans default, forcing Bitcoin sales, the index will drop further. Nvidia’s next two quarters are therefore critical in containing a massive sell-off and AI/crypto bubble burst. Michael Burry, the infamous “Big Short” investor of subprime mortgage credit default swaps, as well as many others like Ray Dalio, have made their short bets public (Burry predicting Nvidia’s stock at $140). Typically, when things get that obvious, there are many crosscurrents working against the desired outcome. We shall see.

Capital relocation from tech to other sectors. The recent market rotation on Nasdaq is certainly not the full story, i.e., AI trade fading and other technology stocks selling off as investors rotate out of tech stocks into other sectors. With markets toying with all-time highs in October, one would never think that the general technology universe is underperforming. Yet, if you separate the Mag7 from the rest of the tech universe, an interesting dynamic emerges. From the start of 2023 through October 2025, the Mag7 tech stocks – Apple, Alphabet, Microsoft, Amazon, Meta, Tesla, and Nvidia – have returned a cumulative 316%. During the same time, the S&P 500 gained about 80% while the S&P 500, excluding the Mag7, returned 54%. All this is due to vastly divergent KPIs. From 2023 to 2025, Goldman Sachs projected the Mag7 would grow at a CAGR of 11% compared to 3% for the rest of the 493 companies in the S&P 500 index. Moreover, the net profit margins for the Mag7 are roughly double those of the rest of the index, boosting average P/E multiples.

SaaS growth rates have been collapsing over the past decade. An alarming chart, circulated by Aventis Advisors, is pointing to a big structural shift in SaaS. The average SaaS growth rate overall went from 36% to 12% in a decade and is expected to fall to ~10% in 2026. One can make a hasty conclusion that AI is cannibalizing the same workflows SaaS used to monetize. That may bring us a full circle based on our software valuation discussion below and two types of software businesses that are emerging – utility-like ones, which are durable and necessary, but no longer where real value lives, and compounders, which sit outside the software code and gain strength as they grow. In the CX market, for example, AI is not only powering the platform ($24B market) but expanding into the broader labor force and call center services sector ($320B total addressable market, or TAM), taking human workflows out of their norm, and replacing them with agentic AI automation. Pricing models are equally shifting from per-seat monetization to outcome-based, interaction-driven, or utility-based pricing. That unpredictability puts uncertainty and pressure on future SaaS revenue growth. 

We believe the value transfer has already shifted from SaaS to AI. The topic of SaaS cannibalization has been rising in importance for many investors, manifesting itself in the underperformance of tech stocks, excluding the Mag7. We wrote about the democratization of software in our February report, pointing out how AI could potentially disrupt the entire software stack and eat into the software development value chain. There are a number of cross-currents at play: (1) AI is focusing on selling “outcomes” while SaaS is used to “sell” workflows, (2) enterprise budgets are scaling down SaaS and flowing into digital labor, (3) entire product categories and their moats are blending and becoming indistinguishable (CX, CRM, robotic process automation [RPA], data analytics), (4) enterprises have been consolidating their SaaS tools, aiming to reduce SaaS sprawl while AI accelerates that purge, (4) AI companies are growing at speeds SaaS can’t match (OpenAI targeting $80B in revenue in just over three years since launching its product), and (5) value is moving down the stack to compute, data, foundational/frontier models, and supporting agents while SaaS is becoming a UI layer that sits on top of that infrastructure and model, tying all the loose ends – not the engine driving the work. Combining these points, SaaS has now matured into a stable, cash-flow asset class, which is at the right-tail end of Geoff Moore’s product adoption curve. AI is sitting at the left-tail end, waiting to cross the chasm, and is the new growth engine. This means newly emerging business founders will have a choice: Build SaaS and optimize it like an infrastructure (enjoying growth through consolidation and harvesting of cash flows) or build AI agents that replace the workflows SaaS was built to monetize (enjoying growth and accruing value). One may see a strong parallel to the UCaaS/CCaaS universe (discussed below).

A word about future software valuations. It is widely known that AI coding agents like Cursor, GitHub Copilot, Windsurf, Claude Code, and OpenAI Codex have become table stakes for developers building code and new software applications. So, if the software can be rebuilt by GenAI and in the nick of time versus the classical means, then where does the real value lie? Customer base, go-to-market, or cost savings from customer migrations? The new valuation framework must focus on how quickly one can rebuild the stack using AI coding agent and whether any “outside” moat remains. As discussed previously, this leads us to the two types of businesses: (1) utility businesses, and (2) compounding businesses. What differentiates the latter are strong force multipliers like community density, network effects, proprietary data lock-in and ownership, and economic moat that multiply and compound over time. The value in compounding businesses sits “outside” the code. A rebuild of the stack by AI agent does not replace these dynamics, and these businesses gain strength as they grow. If you are a founder building a new software business, incorporating these compounding principles early into the business mission leads to better valuation. On the flip side, if you’re a legacy software stack or a utility business in the world of AI, your value will continue to erode, in our view. Prepare for sale and lay off arrogance. Utility companies will struggle to sell at meaningful multiples because they can be recreated faster than they can be acquired. Compounders will become premium assets because they cannot be replicated by starting from scratch.

Now, let’s shift focus to a few worthy news items in the UC/CX sector.

While Five9 woes amplify and growth inflection isn’t expected until 2H’26 … Five9 delivered a quarter that was mostly about getting profitability back into the spotlight. 3Q EPS beat by $0.05 while revenue of $285.8M came inline. For the full year, the company offered guidance with revenue in a range that was marginally below the Street’s $1.15B consensus, and inline EPS. Overall revenue in the 3Q grew 8% YoY, slowing from 12% YoY growth in 2Q. Equally, subscription revenue (81% of total) saw slower growth of 10% in 3Q versus 16% in 2Q. Management chalked up slower growth to tough compare from the year-ago period, as one of its largest customers completed its multiyear ramp throughout 2024 – an unpleasant surprise for investors who expect companies to be able to overcome and lap these fluctuations. Adjusted EBITDA margins reached all-time highs of 25% (up 530 bps YoY). AI bookings grew 80% YoY (versus triple-digit growth in 2Q). A familiar dichotomy emerged between Enterprise, which contributed 91% of total revenue (with subscription portion growing 18% YoY), and Commercial/SMB, which represented the remaining 9% (with subscription revenue declining in the teens YoY), as management admitted they underinvested in the Commercial business, promoting sales reps to enterprise sales while new Commercial hires were still ramping up. Stock dipped below $18/share, levels not seen since 2017. Management proclaimed 2025 as a transitional year, with 2026 driving the inflection in growth.

… Five9’s Genius routing engine appears to be a game-changer. Despite financial and operational setbacks, the Five9 CX Summit this month unveiled what is perhaps the most innovative CCaaS tech in the market, in our view. Five9’s Genius Routing replaces classic rule-based routing and low-code tools with decision chains with AI-based routing, using multi-criteria optimization with the ability to loosen the criteria to ensure service levels are met. Furthermore, AI pulls agent profiles and proficiency levels and pairs them with self-service inputs such as intent, urgency, and emotion, to make routing decisions in real time. This is reminiscent of Afiniti’s behavioral routing engine, which struggled to gain traction with enterprises, mainly due to its outcome-based revenue share model, and likely given it was ahead of its time. Other innovations launched were Agentic QM engine, with autoscoring in real time and priority action selection/escalations, and OneVUE, a CX data repository/knowledge base with the ability to ingest third-party data (like CRM), leveraging technology from the Aceyus acquisition.

NICE hits a major reset at $3B revenue level … NICE’s earnings report saw EPS beat consensus by a penny and revenue relatively inline (a tad above consensus). Overall revenue grew 6% YoY in the quarter. Cloud revenue grew 13% YoY (12% ex-Cognigy) to the tune of a $2.3B run rate, growth rate slowing down materially from 25% last year. Operating margin came in at 31.5% (vs. 32% a year ago), reaching peak territory. AI ARR increased 49% YoY (43% ex-Cognigy). Guidance for 2025 (with one quarter remaining) was raised by $11M to $2.93B-$2.95B at midpoint (~7% growth), mostly reflecting Cognigy’s quarterly revenue run rate of $10M. Despite slow growth, cloud net retention rate (NRR) for the trailing 12 months was 109%, showcasing continued strong customer loyalty and expansion activity as the company scales across its customer base. CX contributed 84% of revenue (growing 6% YoY), while Actimize (financial crime and compliance) took the remaining 16% (growing 7% YoY). This unimpressive 3Q earnings print was followed by Capital Markets Day the following week, which sent the stock lower by as much as 20%. The main culprit was a new midterm financial guidance, which pointed to heavy investments in the next 2-3 years. Management plans to spend an incremental $160M to unlock new opportunities to drive future growth. EBIT margins are expected to drop by 5%-6% in 2026 (from 31% today and 32% last year) as its investments in cloud go-to-market (as well as international expansion) and AI-driven growth. As a result, we would not expect the recovery any time soon, nor any revenue acceleration before 2028.

… reminiscent of prior transformation. We’d point out that at the time of its last major transformation, when NICE acquired inContact circa 2016 to break into CCaaS, its revenue was just over $1B (with a market cap of $3.85B). Today, nearly 10 years and 3 times more revenues later, the company is at an approximately $3B revenue run rate while its market cap stands at ~$7B (down from its peak of $17.3B in March 2024 and year-end 2024 market cap of $11B), needing to transform itself again (via the acquisition of Cognigy) as it embraces the new technology evolution and rightsizes the business for the next decade of growth. If NICE can execute through its strategy, the next destination should witness a company in the $10B revenue range (3x the size in 10 years) and $25B-30B in market cap. A lot is riding on the new management team, whose track record remains unproven, yet no one so far (us included) could accuse them of not taking bold moves and showing willingness to cannibalize themselves for this right cause (a classic Netflix Harvard Business School study?). Based on the midterm guidance provided, management committed to double its revenue over the next four years, with cloud revenue growth expected to accelerate to 17%-19% (vs. 12%-13% today). Management also announced onboarding of a new COO, Anand Chandra, who hails from The Walt Disney Company, where he was responsible for Customer Experience (and was previously with Meta and HPE) and was also a customer of NICE.

NICE Actimize listed for sale. Reportedly, NICE hired bankers who are telling the company they can get $1.5B-2B for the Actimize business. NICE acquired the business for $280M in 2007. In 2024, Actimize grew 12% and generated $453M in revenue (16% of total), yielding $158.3M in operating profits (34% of divisional profits and 29% of the total company’s). In 2025, it is expected to deliver ~$490M (~8%-9% growth). Overall profitability has declined from 2019, when Actimize contributed more than half of overall operating profit. With the financial compliance market remaining hot, it is not inconceivable to think that this business could fetch a 10x-12x EBITDA multiple to land in the contemplated valuation range. Actimize develops financial crime and compliance products, including anti-money-laundering tools, fraud-detection systems, and regulatory-compliance solutions.

Zoom earnings again failed to generate buyer interest. Zoom delivered a clean beat quarter, boosting the stock ~10% after print to its 52-week highs, though failing to show a follow-through in the following days. Revenue grew 4.2% YoY and were modestly ahead of consensus (by 6%), supported by the enterprise segment, which grew 6.1% YoY and contributed to 60% of total revenue. Online churn hit an all-time low at 2.7% (has been improving for five consecutive quarters), while the number of customers, contributing more than $100k in revenue, grew 9% YoY. Non-GAAP operating margins came in at an astounding 41.2%, and the company raised EPS guidance for fiscal 2026 (with one quarter remaining) by 2% ahead of consensus. Zoom has embarked on a multiyear cycle driven by AI monetization (e.g., AI Companion usage grew over 4x from the year-ago period), while its core products (Contact Center, Phone, and Workvivo) continue to grow steadily and take share in the market. Zoom Phone eclipsed 10M seats, growing ARR in the mid-teens (well above its peer group), and seeing a strong uptick within healthcare and financials verticals. With $8B in its cash war chest and the stock rangebound for over three years, investors are growing impatient for a transformational deal.

Market consolidation is picking up steam. While both the UCaaS and CCaaS markets remain muted, overshadowed in part by the risks of AI disintermediation, several providers are taking clear advantage of a dour sentiment and depressed valuations in the sector. Verint is going private with Thoma Bravo – old news, but worth mentioning, as it sets the overall industry consolidation tone and gets merged with Calabrio. Ooma picked up two cloud comms vendors focused on the SMB market – Denver-based FluentStream and Phone.com. FluentStream had TTM revenue of $24.5M and $10M in EBITDA, implying 1.8x TTM revenue multiple and 4.5x EBITDA (before synergies). Phone.com was acquired for a roughly 1x revenue multiple and 18x EBITDA (before synergies). With $22M-$23M in revenue run rate and assuming ~15% SG&A synergies, Phone.com’s EBITDA valuation gets into a more reasonable 6.5x-7x range. RingCentral acquired a small legacy WFM vendor, CommunityWFM, filling the hole in RingCX and paving the way to a more competitive integrated stack. UJET acquired Spiral, which develops a platform that collects omnichannel customer feedback using AI to identify trends and emerging issues, enhancing its CCaaS platform (and flattening the level playing field with Sprinklr). Based in Seattle, Spiral was founded in 2018 and had 14 employees, with roughly $7M of capital raised to date. Finally, it is important to note that several larger UCaaS/CCaaS assets are hitting the market, all at the same time as the main UCaaS/CCaaS leaderboard (Ring, 8x8, Five9, and even Zoom) are struggling to lure investors into their stocks, and legacy providers (Avaya, Mitel/Unify) are still clenching for a transformation miracle. Such a setup is ripe for a sensational consolidation moment, in our view.

M&A

Odigo and Akio: Odigo acquired French software vendor Akio. The acquisition enhances Odigo’s ability to serve businesses from small SMEs to large international enterprises (up to 60,000 users). The merger creates a unified offering by combining Odigo’s platforms with Akio’s expertise in CCaaS for SMEs and mid-market organizations. Clients will benefit from a complete portfolio. Akio’s specializations in voice analytics, reputation management, and agent performance optimization, as well as its digital channel expertise (email, chat, WhatsApp, RCS), complement Odigo’s Agentic AI for autonomous customer interactions, ensuring a comprehensive, reliable, and data-sovereign customer experience solution.

Cisco Acquires Twice: Cisco acquired EzDubs and NeuralFabric. EzDubs has a nice sound to it. The core innovation behind EzDubs is its “speech-to-speech” model. EzDubs’ technology works directly with the audio itself. This means the translation preserves the “prosody,” “emotion,” “sarcastic tone,” and “uniqueness” of the original speaker’s voice. It captures essential human elements that text-based systems strip away. The EzDubs team will join Cisco Collaboration to work on product, engineering, and go-to-market efforts. Real-time AI services such as translation have had big impacts on meetings, but calling remains limited. 

This acquisition positions Cisco to accelerate its vision to transcend borders, languages, and cultures. The acquisition is expected to break language barriers and facilitate multicultural collaboration. 

NeuralFabric allows enterprises to securely train SLMs on proprietary data and deploy models across SaaS and on-prem environments for greater flexibility and control. The company was acquired to complement its AI Canvas product, which extends across Cisco’s solutions, including Webex. 

Zoom Acquires Twice: Zoom is finally spending some of its cash on acquisitions (again). This month, it has announced two acquisitions: Bonsai and BrightHire. 

Bonsai suggests expanding the scope of the suite. It is designed to help solopreneurs and small business owners manage their client relationships and finances. It could be a CRM-lite expansion play like many CCaaS providers are considering, or a stronger play for solopreneurs. Zoom intends to integrate Bonsai across its suite. The last time I heard the word solopreneur was at Zoomtopia. CMO Kimberly Storin announced the Zoom Zolopreneur 50, an initiative aimed at celebrating high-growth, AI- and innovation-powered businesses driven by solo founders. She expects the next few years to reveal the first solopreneur unicorn company. 

The acquisition of BrightHire is more evident within its existing portfolio. BrightHire is a video interviewing application. It’s also already integrated with Zoom. Even better, Zoom Ventures invested in BrightHire’s Series B funding round.

BrightHire complements Zoom’s strategy of utilizing AI tools for enhanced conversations and faster, more informed decision-making. As the name implies, it’s optimized for hiring, but video interviews have many more use cases than interviewing prospective candidates. 

UJET and Spiral: UJET acquired Spiral, a conversational analytics and VoC company. This was the first acquisition since Vasili Triant became CEO. When he was heading Cisco CC, he quickly acquired CloudCherry, also a VoC company. Good move for UJET: 

Beyond CCaaS: UJET is pivoting its go-to-market strategy beyond the traditional “rip and replace” CCaaS model. Spiral is an “over-the-top offering” that doesn’t require customers to use the UJET CCaaS platform.

Wider Market Reach: Spiral can be sold as a bundled offering with UJET or as a separate product that works with competitors like Five9, Genesys, Amazon, and Cisco. This allows UJET to drive revenue and customer value across a broader ecosystem.

AI and Data Foundation: Spiral, a conversational analytics application, becomes the “nucleus” for building UJET’s AI assets and complements its partnership with Google. It converts all customer conversations (calls, emails, social, reviews) into “ultra-specific issues” and makes them searchable with an AI agent and natural language, providing immediate customer value.

Salesforce and Informatica: Salesforce completed its acquisition of Informatica. Salesforce intends to integrate Informatica’s technology stack, including data integration, quality, governance, and unified metadata, to improve Agentforce. Informatica will continue to support its partners. 

Ooma Phone FluentStream: Ooma, Inc., has entered into a definitive agreement to acquire Phone.com for approximately $23.2M in cash, following its recent announcement to acquire FluentStream.

The Phone.com acquisition is anticipated to be accretive to Ooma’s adjusted EBITDA and non-GAAP earnings per share upon closing, which is expected in the fourth quarter of Ooma’s fiscal year 2026, pending regulatory approval. Phone.com, a UCaaS provider serving SMBs, is projected to generate $22M-$23M in annual revenue and $1.0M-$1.5M in adjusted EBITDA before synergies. The company serves about 36,000 customers and 87,000 users across North America. Ooma’s Board of Directors has approved the transaction, and the company plans to finance the acquisition using a combination of cash on hand and bank debt.

Leadership Changes

Jason Moss now leads Marketing and Ecosystem for Acuity Intelligent Spaces, overseeing the Atrius, Distech Controls, QSC, and Q-SYS brands. Chris Jaynes has been named Chief Technology Officer for AIS, focusing on integrating AV and building management technologies. It’s been announced that when the Yorktel-Kinly merger closes in January, Ken Scaturro will be the CEO of the combined company. Stephen Hamill was promoted to CRO at 8x8.

Farewell, HP | Poly: This month, ex-Poly CEO Dave Shull announced his departure from HP, almost three years to the day after leading the sale and merger of Poly into HP. Shull returned to lead Poly about a year ago within HP, but to this day, the portfolio remains largely the same as before HP acquired it. Shull was possibly the last senior Poly exec to go. Poly has been disappearing since HP acquired it. 

Meet Us

Dave Michels is the founder and chief protagonist of TalkingPointz and the editor-in-chief of the Insider Report. [email protected]. David Danto is AV Aficionado at TalkingPointz. [email protected]. 

Goodreads

1. 600 Paramount Skydance employees quit instead of returning to the office – It cost the company $185M.
2. Markets plunge worldwide after ‘Big Short’ investor Michael Burry reveals $1.1B bet against AI stocks – More and more people are saying “bubble,” arguably without any visible ROI on AI.
3. Satya Nadella is haunted at the prospect of Microsoft not surviving the AI era – Worries about missing the AI market might explain the culture of fear some Microsoft employees are experiencing.
4. Google issues security alert about malicious VPNs stealing user data – Who better to spy on than users who insist on privacy? 
5. Cisco To Acquire AI Startup NeuralFabric for GenAI Push – NeuralFabric’s technology will work within Cisco’s AI Canvas.
6. The human touch: A CIO’s wake-up call on customer service AI – As AI reshapes customer service, many businesses risk losing the human touch that customers value most. 
7. Project Kuiper is now Amazon Leo – Amazon Leo is a simple nod to the low Earth orbit satellite constellation that powers the network. 
8. Silicon Valley Lost Its Spine – Meta is the most egregious: It dismantled its fact-checking system before Mr. Trump returned to office, loosened its hate-speech rules, and paid Mr. Trump $25M for suspending him – all before Mr. Trump had spent 10 days back in office. The surrender is now routine.
9. Cloudflare Says It Has Resolved Outage That Disrupted Parts of the Internet – Services from Cloudflare underpin thousands of websites, including X, Spotify, and OpenAI. The company said a crash in a software system was to blame.
10. Unified Communications (UC) Industry Set to Reach $535.5B by 2033: Emerging Trends and Competitive Strategies Shaping the Landscape – Predictions by Research And Markets.
11. Building a GenAI Agent for Partner-Guest Messaging – Booking built a Generative AI agent that assists its partners with suggested responses to guest inquiries.

Other Recent Stuff

Effective in 2025, we moved Insider Lite to Substack. You can view the most recent edition here. This is free content, and Substack makes things easier for everyone, but you will need to subscribe separately here. Insider Lites typically publish 1-3x a month.

• Why Orchestration Is the Word of the Year – Thoughts from the fall conference season
• UC Weekly News Analyst Year-End Wrap Discussion – Video chat
• MDEP at Ignite 2025 – The Line in the Sand Is Now Crystal Clear
• Ring Central’s Kristen Koenig on RC Video – TalkingPointz Chatz
• Tech Perspectives: Does Zoom Have a New Trophy Wife?
• Wildix Zagged Where Others Zigged
• Jason Uslan, CCO Wildix
• The Eternal AV Debate – What to name your conference room – Be sure to read not just the post but the excellent industry discussion beneath.
• Are Industry Analysts Doomed?
• Cisco WebexOne Demos
• UCaaS Mobility 3: Dave Michels on the Next Wave of Mobile-First Enterprise Communications 
• It’s Time to Admit CRM Is Failing 
• Bad News for Tech Workers – RTO has more to do with if you work than where you work. 
• Videoconferencing Finally Establishes Its Shot – Video manufacturers begin to use composited images.
• With hackers, we call it ransomware; when companies do it, we call it cloud – When your hardware purchases get intentionally bricked.
• Danto’s TechPerspective: Stop Hiding Behind AI – Fix Collaboration
• Introducing the Neat Board 32

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Recent Insider Reports (only new Insider Reports are behind the paywall) 

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6. Insider March 2025
7. Insider April 2025
8. Insider May 2025
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10. Insider July 2025
11. Insider August 2025 
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13. Insider October 2025

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Insider Reports offer timely, curated, and opinionated news. The Insider Report is published in the first week of every month. Enterprise subscriptions also include TalkingPointz research notes. These reports are geared toward the industry itself, though some enterprises subscribe, too. Core subscribers are vendors, providers, consultants, and (financial and industry) analysts. TalkingPointz offers enterprise vendor, channel, consultant, and personal subscriptions. Insider Lite is a free Substack newsletter.