Rating affirmation and note downgrade
Moody’s affirmed RingCentral Inc.’s corporate family rating at Ba2 and its probability‑of‑default rating at Ba2‑PD on 27 June 2026, maintaining a stable outlook, while simultaneously downgrading the company’s senior unsecured notes from Ba3 to B1, two notches below the family rating. The agency kept the Speculative Grade Liquidity Rating at SGL‑1.
Leverage and debt reduction
For the twelve‑month period ending 31 March 2026, RingCentral’s debt‑to‑EBITDA ratio fell to 3.0×, down from 5.9× at the end of 2024, a reduction driven by more than $300 million of gross debt repayment. Moody’s projects leverage to further improve to the low‑2× range by year‑end 2026 as free cash flow continues to be used for debt repayment and as EBITDA margins are expected to rise into the high‑teens percent range.
Liquidity and cash generation
The SGL‑1 liquidity rating reflects Moody’s expectation of over $550 million of annual free cash flow for the next two years, a cash balance exceeding $100 million, and an undrawn $305 million revolving credit facility. Free‑cash‑flow‑to‑debt is anticipated to exceed 50 % in 2026, and the company has no material near‑term debt maturities after the March 2026 repayment of convertible notes.
Business fundamentals
RingCentral, one of the largest unified communications‑as‑a‑service providers, reported annualized recurring revenue above $2.5 billion, with growth expected in the mid‑single‑digit percent range. The firm’s contact‑center‑as‑a‑service offering, RingCX, is gaining market traction, supporting the Ba2 rating alongside modest leverage and strong cash generation.