Mizuho Securities Downgrades RingCentral Inc to Neutral

Investing.com — Mizuho Securities has downgraded RingCentral Inc (NYSE:RNG) to "neutral," citing uncertainties in its subscription revenue growth trajectory for 2025. The firm maintained its price target at $42. Shares of RingCentral were down more than 7%.

Strategic Shift

The downgrade follows RingCentral’s strategic shift to prioritize its internally developed contact center solution, RingCX, over its longstanding partnership with NICE.

> “With the future of the NICE partnership now in question, we see risk to consensus subscription revenue growth in 2025 and lack of catalysts for revenue re-acceleration,” analysts wrote.

Mizuho (NYSE:MFG) analysts noted that the partnership had been a significant driver of growth for RingCentral’s contact-center-as-a-service (CCaaS) revenue. With its future now uncertain, the analysts expressed concerns over a lack of clear catalysts for revenue acceleration next year.

Broader Software Sector Pressures

RingCentral is one of several software companies facing pressures from a cautious macroeconomic environment. While the broader software sector shows resilience, Mizuho highlighted risks such as elongating sales cycles and heightened competition.

Other Downgrades

Brokerage also downgraded 8×8 Inc (NASDAQ:EGHT) to “underperform,” trimming its price target to $2.50 from $2.75. Shares of the company were down about 16% at $2.6.