Twilio, Concentrix, Zoom could see 'softer' CCaaS bookings in Q3: Barclays
Drew Angerer
Companies such as Twilio (NYSE:TWLO), Concentrix (NASDAQ:CNXC) and Zoom Video (NASDAQ:ZM) may see "softer" bookings in the third-quarter than seen in the second-quarter, as their respective contact-center-as-a-service businesses are "more mixed," Barclays said.
Analyst Ryan MacWilliams said recent checks are "more mixed" than they were for the second quarter.
"Partners weren't concerned about [third-quarter versus the second-quarter] but noted more CFO involvement at quarter-end and more deals pushing to [the fourth-quarter]," MacWilliams wrote in an investor note.
"[The third-quarter] seems like a solid quarter overall (coming off a strong 2Q) as we heard of a number of [wins for $1M or more] and it's possible large deals closed outside the partner channel (we continue to hear about [more than $10M])." 
MacWilliams added that partners were "optimistic" that any deals that were pushed out would close at the end of the year, with "aggressive" commissions from CCaaS vendors recently.
For Twilio (TWLO), MacWilliams said recent checks showed some of the company's small and medium-sized customers who started self-service have ran into issues with A2P 10DLC registration and they need to be walked through the process. 
"We ultimately believe this could impact Twilio's near-term customer count rather than be a long-term revenue headwind for TWLO, and could be a strategic move by TWLO to prioritize more profitable customers," MacWilliams added.
For Concentrix (CNXC), MacWilliams said the company has noted "continued volume weakness" in the consumer vertical and it removed seasonality out of its business. 
The analyst also said that the company's management is expecting a "steady rate of business from clients that have seen decreased volumes based on consumer demand." 
For Zoom (ZM), MacWilliams said he was happy to hear that the company's Contact Center's AI features were highlighted at the annual Zoomtopia conference this week, and that there is more focus on adding Phone onto Microsoft (MSFT) Teams deployments. 
"[T]here is a significant opportunity to activate around the MSFT Teams ecosystem as most customers opt for non-Teams calling due to its lack of certain feature functionality (e.g., multilevel auto-attendants, compliant PSTN call recording with reporting, operator/receptionist console, SMS, outbound dialer, etc.) and support that can be better provided by UCaaS or other direct routing vendors," MacWilliams wrote.
Lastly, MacWilliams said contact center customers are "interested" in testing artificial intelligence, but are "cautious" on purchasing any features. 
"Overall, partners mentioned that customers are purchasing more CCaaS feature options and AI upgrades upfront than in prior years as new customers are looking to increase the productivity and interaction efficiency of their CCaaS deployments," MacWilliams explained, adding that Ai upgrades in the space are likely to come next year as budgets reset.

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