This article first appeared on GuruFocus .
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Total Revenue:$67.5 million, representing 15.5% year-over-year growth.
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Payments Revenue:Grew at roughly twice the rate of total revenue.
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Gross Profit:$49 million, up 16% year-over-year.
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Gross Margin:72.6%, a 30 basis point improvement year-over-year.
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Subscription and Payment Processing Gross Margin:77.9%.
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Operating Income:$3.2 million, compared to breakeven in Q2 2025.
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Operating Margin:4.7%, a 460 basis point improvement year-over-year.
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Sales and Marketing Expense:$25.8 million, or 38% of revenue, a 160 basis point improvement year-over-year and a 240 basis point improvement sequentially.
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General and Administrative Expenses:$10 million, or 15% of revenue, down from 17% in Q2 2025.
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Research and Development Expenses:$10 million, or 15% of revenue, a 40 basis point decrease year-over-year.
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Cash and Short-Term Investments:$78.5 million, an increase of $5.8 million sequentially.
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Cash from Operating Activities:$10.2 million in Q2.
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Free Cash Flow:$8.7 million in Q2.
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Dollar-Based Revenue Retention (GRR):89%.
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Dollar-Based Revenue Retention (NRR):92%.
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New Locations:Record gross and net location additions in Q2, with the largest increase in specialty medical.
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AI Interactions:Custom AI interactions totaled $70 million, up 165% year-over-year; Call Intelligence interactions increased 143%.
Release Date: August 06, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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Weave Communications Inc ( NYSE:WEAV ) delivered strong Q2 2026 results with total revenue of $67.5 million, representing 15.5% year-over-year growth, and payments revenue growing at roughly double that rate.
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The company achieved record gross and net new location additions in Q2, with its largest vertical, dental, adding more locations than in any quarter over the past eight quarters.
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Weave Communications Inc ( NYSE:WEAV ) significantly improved profitability, expanding operating margin to 4.7%, a 460 basis point improvement year-over-year, and converting 34% of revenue growth into incremental operating income.
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The company made strategic progress in its go-to-market model, including verticalizing its inbound sales function and implementing an SDR model, which contributed to a 240 basis point sequential improvement in sales and marketing efficiency.
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Weave Communications Inc ( NYSE:WEAV ) deepened its integration with the AthenaOne platform and joined Athena Health's marketplace, expanding its potential market to over 160,000 specialty medical providers.
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AI adoption is accelerating, with custom AI interactions totaling $70 million in Q2, up 165% year-over-year, and the AI receptionist product receiving positive customer feedback, including one customer reporting a doubling of receptionist effectiveness in 30 days.
Negative Points
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Weave Communications Inc ( NYSE:WEAV ) experienced a go-to-market transition disruption from May to July, leading to bookings slightly below expectations and a downward adjustment to its full-year revenue guidance.
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The company's full-year 2026 revenue guidance was revised down to a range of $273 million to $275 million, reflecting the impact of the sales model transition period.
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Weave Communications Inc ( NYSE:WEAV ) faced a slight headwind to Q2 revenue due to a quarter-over-quarter and year-over-year decrease in onboarding revenue from lower setup fees.
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Gross margin decreased by 60 basis points sequentially, impacted by increased usage fees for messaging, trued-up vendor invoices, and higher credit card fees associated with annual customer payments.
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The company's reported dollar-based net revenue retention (NRR) remained steady at 92%, indicating limited near-term expansion in existing customer revenue, despite improvements in monthly retention rates.
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The go-to-market transition involved a reduction in the outbound sales team size, which, while intended for efficiency, contributed to the temporary disruption and required a period of recalibration.
Q & A Highlights
Q: Can you reconcile the record growth in net locations with the lower revenue outlook, and how does the go-to-market disruption factor into this? A: Jason Christiansen (CFO) explained that while location adds were strong in Q1 and Q2, the sales transition period between May and July caused challenges in new sales due to lead distribution issues. This impact will flow through the back half of the year, which is reflected in the revised revenue guidance. Brett White (CEO) added that the bookings shortfall in May, June, and July will primarily show up in Q3 and Q4 revenue.
Q: How did you think about the duration of the go-to-market disruption when resetting guidance, and how confident are you in the new guide? A: Jason Christiansen (CFO) stated that the guidance reflects the company's best projections, and they anticipate being back to normal execution within the next couple of months. Brett White (CEO) emphasized that the demand environment remains strong, citing positive feedback from a major DSO event and the success of the new SDR model, which was actually generating too many leads for AEs to handle, causing the calibration issue.
Q: Can you provide more detail on the go-to-market changes, including the timeline for improvements and the size of the sales team? A: Brett White (CEO) explained that the inbound sales team was verticalized in Q1, which drove strong dental performance. The outbound transition to an SDR model caused the disruption, and the company accelerated the completion of this transition to August. The team is smaller, but many former AEs moved into SDR roles, which shortens the ramp time. The new model gives top sellers better leads and removes prospecting duties, which the team is positive about.
Q: What is the opportunity within Specialty Medical, and how does the deeper AthenaHealth integration unlock value? A: Brett White (CEO) explained that deeper integrations lead to higher ASPs, better retention, and lower CAC. The AthenaHealth integration moved from a level one to a level four integration, which is a significant step that enables read/write capabilities across multiple EHR tables. This will improve unit economics in the medical vertical. Jason Christiansen (CFO) added that in areas with existing integrations, like primary care and plastic surgery, improved ASPs are already showing.
Q: What drove the record location adds in the dental vertical, and is this trend sustainable? A: Brett White (CEO) attributed the strong dental performance to the verticalization of the inbound sales force, which puts specialized sellers in front of high-value leads. Jason Christiansen (CFO) added that the focus across sales and marketing, along with partnerships like the American Dental Association, indicates this is not a fleeting opportunity. The company views this as a real, long-term opportunity and has not lowered its long-term growth prospects.
Q: How is AI engagement translating into financial results, and is it driving higher ARPU or better retention? A: Brett White (CEO) explained that AI products like Call Intelligence and AI Receptionist are monetized as additional modules or upsells. The more functionality offered on the platform, the stickier the solution becomes, especially since Weave owns the trusted practice phone number. This leads to higher ARPU, higher LTV, and lower CAC. Jason Christiansen (CFO) added that some AI features, like the reviews assistant, are not explicitly monetized but make existing products stickier. Brett White (CEO) also noted that AI workflows drive greater payments volume, which is accelerating.
Q: Can you provide more color on the linearity of the May to July period and whether improvements were already visible? A: Brett White (CEO) stated that the verticalized inbound team showed positive results in Q1, driving dental improvements. The outbound transition was the disrupted part, and the company pulled the completion date forward to August. Early indicators are positive, and the team is optimistic about the new model. The company is now focused on executing the new model through August and September.
Q: Are there any changes in the demand environment, sales cycles, or budget scrutiny beyond the internal go-to-market changes? A: Brett White (CEO) reported no slackening in demand. He cited a recent DSO event where customers expressed urgency around standardizing workflows across hundreds of locations. The company's position as the owner of the patient-practice communication layer is seen as highly defensible. The hiccup in sales was not demand-related; in fact, the SDR motion was so successful that AEs' calendars became too full with lower-value opportunities.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
