Shares of Ribbon Communications Inc. (RBBN) surged 6.29% in after-hours trading on Wednesday following the release of the company's better-than-expected fourth quarter 2024 results. The communications software and IP optical networking solutions provider reported quarterly adjusted earnings of $0.16 per share, beating the consensus estimate of $0.12 by 33.33%. Revenue of $251.36 million also exceeded expectations of $243.61 million.

The solid Q4 performance was driven by strong demand from service providers, enterprise customers, and U.S. federal agencies across both product and service segments. Product revenue grew 11% year-over-year to $148.34 million, while service revenue increased 2.6% to $103.02 million. Ribbon's gross margin improved to 55.7% from 53.8% a year earlier, reflecting the company's focus on operational efficiency.

Looking ahead, Ribbon provided an upbeat outlook for 2025, projecting revenue between $870 million and $890 million, representing mid-single digit growth. The company expects Adjusted EBITDA in the range of $130 million to $140 million, benefiting from continued momentum in network modernization initiatives across service providers and enterprises. For the first quarter of 2025, Ribbon forecasts revenue of $185 million to $195 million and Adjusted EBITDA of $12 million to $18 million.