Weave Communications (NYSE:WEAV) reported second-quarter revenue growth and improved profitability, while management said a transition in its sales organization created a temporary bookings shortfall that prompted a revision to its full-year revenue outlook.
Total revenue rose 15.5% year over year to $67.5 million in the second quarter, CEO Brett White said. Payments revenue grew at roughly twice the pace of total revenue, while the company added a record number of new locations on both a gross and net basis. Dental, Weave’s largest vertical, added more locations on a gross and net basis than in any of the preceding eight quarters.
Profitability Improves as Sales Efficiency Rises
Gross profit increased 16% year over year to $49 million, producing a gross margin of 72.6%, up 30 basis points from a year earlier. Subscription and payment-processing gross margin was 77.9%.
Christiansen said customer-support costs declined as a percentage of revenue, aided by technology and AI adoption, product enhancements and self-service capabilities. Those improvements were partially offset by higher messaging usage fees, adjustments to certain vendor invoices and elevated credit-card fees associated with a larger group of customers paying annually in advance.
Sales and marketing expense totaled $25.8 million, or 38% of revenue, improving by 160 basis points from the prior year and 240 basis points sequentially. General and administrative expense was $10 million, or 15% of revenue, while research and development expense also totaled $10 million, or 15% of revenue.
The company ended the quarter with $78.5 million in cash and short-term investments, up $5.8 million sequentially. Cash provided by operating activities was $10.2 million, and free cash flow was $8.7 million. Weave said it generated positive free cash flow during the first half of 2026.
Go-to-Market Changes Affect Outlook
Management said it has been reorganizing its go-to-market organization to improve sales productivity and profitability. The company verticalized its inbound sales force during the first half of the year, assigning specialized sellers to key markets including dental and specialty medical. It also shifted outbound prospecting responsibilities toward a sales development representative, or SDR, model, allowing account executives to focus on demonstrations and closing sales.
White said the changes produced positive early results, including record location additions and improved sales-and-marketing efficiency. However, the move created an adjustment period from May through July as lead generation shifted to SDRs and account executives changed their responsibilities.
“It took time to calibrate the lead distribution with the appropriate execution, resulting in bookings slightly below our expectation, despite very strong demand,” White said.
Christiansen said the effects of those bookings shortfalls will be more visible in revenue during the second half of the year. Weave accelerated the transition and completed the move to the revised outbound-sales structure in the first week of August. White said the outbound team is smaller following the changes, though some former sellers moved into SDR roles.
For the full year, Weave now expects revenue of $273 million to $275 million. At the same time, it raised its non-GAAP operating-income outlook to $12 million to $14 million, reflecting expected operating-efficiency gains. For the third quarter, the company forecast revenue of $68.6 million to $69.6 million and operating income of $3 million to $4 million.
AI Products, Payments and Healthcare Integrations
White described Weave as an AI-powered patient engagement and payments platform for healthcare practices. The company said its tools are designed to help practices manage appointment scheduling, reduce administrative work and limit revenue leakage through payment and revenue-cycle workflows.
Weave added 70% more AI-powered features to its platform over the past year, according to White. Custom AI interactions totaled 70 million during the second quarter, up 165% from a year earlier. Call Intelligence interactions increased 143%, with customers analyzing more than 14.5 million calls and identifying 810,000 unscheduled opportunities for staff follow-up.
The company’s AI Receptionist can answer inbound calls and text messages, respond to common patient questions, and book, confirm, cancel and reschedule appointments. Weave introduced early access to voice capabilities for the product in May.
White said certain AI features are sold as additional modules or as part of higher-priced product bundles. He also said increased functionality can improve customer retention and create additional payment-processing opportunities as more workflows lead to collecting patient balances.
Payments volume growth accelerated in the first half of 2026 compared with the first half of the prior year, White said, though he did not provide a dollar figure for the volume.
Specialty Medical Expansion
Weave also expanded its relationship with athenahealth during the quarter, releasing a deeper integration with the athenaOne platform and joining athenahealth’s Marketplace. Management said the marketplace makes Weave’s offerings available to more than 160,000 specialty medical providers.
White said Weave’s athenahealth integration advanced from what the company classifies as level one to level four. Christiansen said level one largely involves syncing basic patient-contact information, while level four provides read-and-write capabilities across multiple electronic health record tables.
Management said deeper integrations can support higher average selling prices, better retention and lower customer-acquisition costs over time. Weave said it is earlier in specialty medical than in dental, optometry and veterinary markets, and has historically had fewer integrations in the medical market.
Despite the sales-transition disruption, White said management has not seen weakening demand. He pointed to interest from dental support organizations seeking to standardize workflows across multiple practices, as well as momentum from the company’s partnership with the American Dental Association, which he said had become Weave’s second-most productive affiliate program within several months.
About Weave Communications (NYSE:WEAV)
Weave Communications is a technology company that provides integrated communications and customer management solutions tailored for small- to medium-sized local businesses. Headquartered in Lehi, Utah, the company developed a cloud-based platform that unifies voice calling, business texting, appointment reminders and payment processing within a single interface.
The platform’s core offerings include a unified business phone system, two-way texting, automated appointment and recall reminders, secure payment acceptance and a basic customer relationship management module.
