Last week, ShoreTel Inc. (NASDAQ:SHOR) delivered a decent quarter and the stock jumped a few percentage points, but there is more to the story than just one good quarter or a small pop. The results were probably the best ever in the company's history, yet a closer look points to a beginning of a new ShoreTel with predictable and growing recurring revenues making up closer to half of the total revenues. Recurring revenues, consisting of Cloud and support services, dominating the total revenues should lead to better top line growth, better gross margins and improved cash flows.
In some respects, the results of the transformation that began after the new CEO was hired are just starting to percolate...
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