Five9 Raises Full-Year AI Outlook to 60% Growth After Strong Q2

Five9 beat Wall Street's expectations for the second quarter of 2026, and AI revenue accelerated to 78% year-over-year growth, pushing the company to raise its full-year AI outlook for the second time this year.

The contact center software vendor reported Q2 revenue of $312.4 million, up 10% year-over-year and above the high end of its own guidance. Subscription revenue grew 14%, marking a third consecutive quarter of acceleration. And in a call dominated by AI momentum and a marquee new enterprise deal, Mathradas used his second earnings call as CEO to argue that Five9's voice heritage, not its AI features alone, is what separates it from point-solution competitors.

Beyond the numbers, Five9 CEO Amit Mathradas used yesterday's earning call to sketch out where he thinks the CX market is heading. Contact centers are shifting from cost centers to be contained into growth levers, he said, with enterprises now weighing service quality against customer loyalty and retention rather than just handle time.

That's reallocating spend away from labor and toward platform software and pushing large, on-premises customers toward cloud migration specifically because legacy architecture can't run agentic voice AI well. Mathradas also argued the market is bifurcating: AI point solutions will keep shipping features quickly and win in simpler environments, but complex, regulated enterprises are choosing platforms that already own routing, compliance and human handoffs over best-of-breed point products.

Five9 Raises AI Outlook to 60% as Growth Beats Guidance

Five9's subscription revenue splits into two buckets: a steady, mature CCaaS business growing 7% year-over-year, and an AI business that's now the company's clear growth driver.

• Revenue beat guidance. Q2 revenue came in at $312.4 million, up 10% year-over-year and above the high end of Five9's own guidance range, with subscription revenue growing 14%.
• AI accelerated past guidance. CFO Bryan Lee told analysts AI revenue accelerated to 78% growth in Q2, up from 68% in Q1, pushing Five9 to raise its full-year AI growth outlook to "at least 60%" year-over-year, up from the "more than 40%" outlook it gave last quarter. "That was primarily driven by several customers who are ready to deploy faster than what we forecasted. And as we've always said, we have the PS (professional services) resources to throttle up and down to meet whatever the customer demands are," Lee said.
• The acceleration wasn't driven by new bookings. Lee said several backlog customers were ready to deploy faster than forecast, so Five9 temporarily expanded its professional services capacity to pull Q3 and Q4 ramp schedules into Q2. Even stripping out those pulled-forward deployments, Lee said, AI revenue growth would still have landed around 68% — roughly matching Q1's pace.
• Profitability told a more mixed story. Adjusted gross margin fell to 61% from 63.0% a year earlier, and adjusted EBITDA margin slipped to 22% from 24.0%, both reflecting the temporary professional services surge.
• Guidance moved higher. Five9 raised its full-year 2026 revenue guidance midpoint to $1.266 to $1.272 billion, up from $1.26 billion, and guided Q3 revenue to a midpoint of $319 million. Lee emphasized that the back-half guidance carries "essentially no dependency" on new-logo bookings — it's a backlog-conversion story.

Related Article: Five9 Debuts Agentic Voice AI Agents for Contact Centers

The $100 Million Deal That Ran Through Google's Marketplace

The quarter's headline win was a five-year, roughly $100 million total-contract-value agreement with a Fortune 100 financial services company migrating off on-premises infrastructure. Five9 expects the deal to ramp to approximately $25 million in subscription annual recurring revenue once fully deployed — with negligible 2026 contribution, a gradual 2027 ramp and larger gains after that.

Mathradas said the win came out of a competitive process against other enterprise-grade CX providers, decided on the strength of Five9's proof-of-concept and delivery execution — working jointly with Google and a systems integrator. It's also a notable channel milestone: the first full-size deal Five9 has closed through the Google Cloud Marketplace, following the joint enterprise CX AI solution the two companies launched in January integrating Five9's platform with Gemini Enterprise and Vertex AI.

Analysts pressed on repeatability, noting marketplace deals typically run in the low single-digit millions, not $25 million in ARR. Mathradas said Five9's Google pipeline spans a range of deal sizes, and that this one reflects deeper, hands-on integration work with Google that will continue as more on-prem-to-cloud migrations move through the pipeline.

The deal is also structured on Five9's newer revenue-commit model, which lets customers flex the mix between human agent seats and AI agents over the contract term — a bet that the seat-versus-agent ratio inside large accounts will keep shifting.

"In some of these cloud migrations," Mathradas said, "especially the ones from on-prem to cloud, they tend to be the larger customers and this is one that came through first. Talking about the resources and working together with (Google), we've always said this wasn't just a signature deal in terms of signing a joint agreement and selling. This was hands on keyboard, right? ... Driving better integrations. ... And those are investments that have already been made from us and we will continue to make them with Google as the needs evolve and we play in different parts of the ecosystem."

What Analysts Asked About CX Strategy and Operations

Editor's note: The following is a summary of analyst questions and executive responses from Five9's Q2 2026 earnings call, focused on CX strategy, product and operations.

Analyst	Question	Response
David Hynes, Canaccord	As AI agents span contact centers, CRM and back-office systems, who owns the orchestration layer?	Mathradas said Five9's voice and routing heritage lets it direct calls to specific human agents based on skill and empathy scores — a level of precision he said point solutions outside the routing layer can't match.
Raimo Lenschow, Barclays	Does the Fortune 100 win signal a broader industry realization that AI requires cloud, not on-prem, infrastructure?	Mathradas agreed, saying on-premises architecture isn't built to run agentic voice AI effectively, which is pushing large enterprises toward cloud migration.
Scott Berg, Needham & Company	How does Five9 make Google Marketplace deals of this size repeatable, given the channel typically produces smaller deals?	Mathradas said the Google pipeline includes a range of deal sizes and that this win reflects deeper, hands-on integration work with Google that will continue.
Elizabeth Elliott, Morgan Stanley	What's driving faster-than-expected AI deployment timelines, and how repeatable is that across the pipeline?	Lee said Five9 flexes professional services capacity to match customer readiness; this round, the customer aligned internally faster than usual. Mathradas added that demand is broad-based, not isolated to a few accounts.
Catharine Trebnick, Rosenblatt	How has the sales pipeline and win rate trended, and how have the new sales leadership hires changed execution?	Lee said pipeline conversion is on track. Mathradas said the new hires are shifting the sales org from product-selling to platform-and-solution-selling, describing "a new pep in the step" across teams.
Giancarlo Valle, Truist	Are contact center seat counts stable or growing, and what's the outlook for the next 6-12 months?	Lee said concurrent seats are growing in line with CCaaS revenue with no seat compression observed, and highlighted the new revenue-commit model giving customers flexibility between human and AI agent mix.
Yanni Samoilis, Baird	Who else competed for the Fortune 100 deal, and will AI products be layered in later?	Mathradas said the field included known enterprise-grade CX providers; the current award covers the CCaaS portion only, with AI components to be determined as the relationship develops.
Jack Nichols, KeyBanc	Where is customer demand strongest for the new Voice AI Agents — self-service, agent assist or automation?	Mathradas said demand spans both simple use cases, like password resets, and complex, regulated scenarios, with customers increasingly expanding from simple entry points into more complex deployments.

Mathradas Bets Voice Ownership Is the Differentiator

Asked where the orchestration layer sits as AI agents span contact centers, CRM systems and back-office tools, Mathradas leaned on Five9's telephony heritage. Because Five9 already runs agentic quality management across human agents — scoring empathy and skill — he argued the platform can route an escalated call to the specific agent best suited to it, something a standalone AI point solution sitting outside the routing layer can't do.

Five9 better be good at AI transferring calls; after all, its own report finds most contact center leaders think they're doing that well but customers disagree.

"As a point solution, you are the hammer," Mathradas told analysts. "... A company like Five9 that is built around voice is the entire toolbox."

That framing extends the argument Five9 has been building publicly for months. The company launched its next-generation Voice AI Agents in June at Customer Contact Week, positioning them as a replacement for scripted bots and legacy IVR. Mathradas said early deployments are following a familiar pattern: customers starting with simple use cases like password resets, then expanding into more complex, regulated scenarios that the company's prior-generation AIVA product had been built for from the outset.

"What a company like Five9 can do is because we have run agentic quality management on all your agents," said Mathradas, who added the tech can identify which agents are best-of-breed to handle that question, which agents have a high empathy score.

"And now with my agentic routing," he added, "I can send that call specifically to that one agent that has high empathy and high ability to answer that question."