IDT Corporation

What they do

IDT sells point-of-sale terminals and payment processing to U.S. independent retailers through National Retail Solutions (NRS), cross-border money transfers through BOSS Money, and AI-powered business communications through net2phone. Its Traditional Communications segment includes IDT Digital Payments, BOSS Revolution international calling sold through more than 30,000 retail agents, and IDT Global wholesale voice and SMS termination. The company reported $1.23 billion in fiscal 2025 revenue across these four segments.

Revenue drivers

• Traditional Communications — Largest segment at $860.2 million, or 69.8% of fiscal 2025 revenue, comprising IDT Digital Payments, BOSS Revolution, IDT Global, and smaller harvest-mode businesses. Segment revenue declined from $899.6 million in fiscal 2024.
• Fintech (BOSS Money) — Contributed $154.6 million, or 12.6% of fiscal 2025 revenue, up from $120.7 million in fiscal 2024. Money transfers to 50 destination countries, initiated mainly through the BOSS Money and BOSS Revolution apps and a licensed retail agent network.
• National Retail Solutions (NRS) — Contributed $128.8 million, or 10.5% of fiscal 2025 revenue, up from $103.1 million in fiscal 2024. Revenue comes from POS terminal sales, payment processing, merchant services, advertising and data, and SaaS fees.
• net2phone — Contributed $87.9 million, or 7.1% of fiscal 2025 revenue, up from $82.3 million in fiscal 2024. Sells UCaaS, CCaaS, and AI agentic solutions to businesses in North and South America.

Recent performance

For the third quarter of fiscal 2026 (ended April 30, 2026), revenue rose 5% year over year to $315.7 million from $302.0 million, gross profit rose 9% to $122.5 million, and gross margin expanded 170 basis points to 38.8%. Income from operations increased 12% to $29.8 million, GAAP EPS was $0.87 versus $0.86, and Adjusted EBITDA rose 13% to $37.5 million from $33.1 million. NRS revenue grew 22% to $38.0 million with 39,300 active POS terminals and recurring revenue up 22%, while income from operations at NRS, Fintech, and net2phone rose 33%, 29%, and 76%, respectively. Management cited steady cash generation from Traditional Communications alongside expansion of the three higher-margin businesses.

Strategy

Management is prioritizing growth of the three high-margin segments—NRS, Fintech, and net2phone—while harvesting cash from Traditional Communications. NRS expects Merchant Services and SaaS Fees to keep driving growth, and after the quarter close it acquired a controlling stake in OnCore Digital, a digital media brokerage. net2phone is expanding in the U.S. and Mexico, gaining traction with AI offerings expected to be accretive in fiscal 2027, and launched Integrate by net2phone, a no-code integration layer for CRM and ERP tools. IDT also says it is embedding machine learning and AI across segments for customer understanding, pricing, service, and back-office work.

Risks

• Immigrant population changes — The 10-K states that changes to immigrant populations could negatively impact certain of our businesses, including BOSS Revolution and BOSS Money.
• Cybersecurity and network disruption — The 10-K lists cyberattacks on IDT networks or systems, and network disruptions, security breaches, or failures of IT infrastructure, as risks.
• Geopolitical exposure — The 10-K notes international operations subject IDT to geopolitical and other risks including ongoing developments in Belarus, Ukraine, and Israel.
• Supplier and regulatory cost pressure — The 10-K cites dependence on a single supplier or small group of suppliers, and changes to supplier rates and increasing regulatory charges or tariffs.

Outlook

Management raised fiscal 2026 guidance to $150-$152 million in Adjusted EBITDA. It expects NRS Merchant Services and SaaS Fees to continue driving growth in coming quarters and says net2phone AI offerings should become accretive growth drivers in fiscal 2027. The company also flagged continued steady cash generation from Traditional Communications.