Crexendo Inc. has announced it has completed the acquisition of Estech Systems LLC (ESI), a provider of cloud communication solutions and one of Crexendo's longest-tenured NetSapiens platform licensees. The transaction represents a transformative step in Crexendo's growth strategy and significantly strengthens its position in the cloud communications market. The acquisition is expected to be immediately accretive to revenue and EBITDA, and positions Crexendo to approach $100-million run rate in annual revenue with enhanced operating leverage.

Strategic and Financial Highlights

• Acquisition expected to increase Crexendo's revenue, earnings and cash flow following closing.
• Purchase price of $35 million, consisting of $27.3 million in cash and $7.7 million in common stock, representing a multiple of approximately 1.35x unaudited 2025 revenue.
• ESI generated approximately $26 million in revenue in 2025.
• Expected cost synergies from facilities consolidation, licensing optimization, cross-utilization of employees, operational expenses, network expenses and Oracle Cloud Infrastructure migration.
• Significant opportunity for revenue synergies through cross-selling, expanded channel reach and platform expansion.

Founded in 1987 and headquartered in Plano, Texas, ESI brings a strong sales- and engineering-driven organization, deep customer relationships and a proven track record of delivering mission-critical communications solutions. ESI currently supports more than 6,200 retail accounts and more than 75,000 seats. The acquisition enhances Crexendo's market presence and expands its operational scale.

Crexendo expects to realize meaningful cost synergies as workloads migrate to Oracle Cloud Infrastructure and duplicative infrastructure is consolidated. Management anticipates operational efficiencies across facilities, overhead, licensing and network costs, while leveraging ESI's engineering and sales bench to reduce incremental hiring needs. These initiatives are expected to enhance EBITDA margins and cash flow over the next 12 to 24 months.

Leadership Commentary

"This acquisition is exactly the type of transaction we have been talking about for years," said Jeff Korn, chairman and CEO, Crexendo. "ESI is a best-in-class organization with exceptional people, strong engineering capabilities and a long history of success serving customers on our NetSapiens platform. By incorporating ESI into Crexendo, we are combining our strong double-digit organic growth with an accretive acquisition from our deep 'fishing pond' of licensees. The result is a stronger, more scalable company with expanded capabilities for our customers, partners and shareholders. I could not be more ecstatic about how this acquisition will positively affect our future growth and success and am excited to welcome the ESI team to Crexendo."

"We are incredibly excited to join the Crexendo team," said George Platt, president and CEO, Estech Systems LLC. "Crexendo has been a trusted partner for many years, and this transaction allows us to deliver even greater value to our customers by combining our sales, engineering and customer support expertise with Crexendo's scale, platform innovation and resources. Together, we are building a stronger organization that is well positioned to serve our customers for decades to come. I would also like to thank our founder, Eric Suder, for the immeasurable impact he has made on ESI's employees, their families, our customers and the community."

Strategic Rationale

The acquisition meaningfully strengthens Crexendo's competitive position by expanding its scale, deepening its expertise in cloud communications and reinforcing the power of the NetSapiens platform. The combined company benefits from a broader customer base, enhanced operational leverage, and a unified focus on delivering secure, scalable and AI-enabled communications solutions.

This transaction underscores Crexendo's disciplined M&A strategy: combining strong organic growth with highly accretive acquisitions drawn from its ecosystem of successful NetSapiens licensees.

Korn and the management team will discuss the acquisition in more detail on the upcoming year-end conference call.

In other news, Crexendo Inc. has announced its partnership with AppDirect, a technology service distributor that connects businesses to the technology services they need to operate and grow.

This partnership expands Crexendo's national distribution footprint and accelerates go-to-market execution by enabling AppDirect's extensive advisor and reseller ecosystem to seamlessly source and deliver Crexendo's cloud communications solutions. AppDirect enables advisors, resellers, and service providers to source, sell, and manage technology solutions through an online marketplace. By partnering with AppDirect, Crexendo gains access to a broad ecosystem that makes it easier for partners to deliver Crexendo's cloud-based communications services to its customers.

AppDirect's marketplace empowers thousands of technology advisors and service providers to discover, quote, provision and manage solutions through a unified platform. By integrating into this ecosystem, Crexendo strengthens its channel strategy and enhances scalability, positioning the company to drive incremental revenue growth through an expanded indirect sales network.

"We are excited to partner with AppDirect and look forward to a successful partnership," said Theresa Weitzel, director of channel sales, Crexendo. "This partnership supports our mission of supporting partner success while delivering immense value to customers."

"This partnership represents another important step in expanding Crexendo's distribution strategy and reinforcing our long-term growth initiatives," Korn said. "AppDirect's advisor community and marketplace capabilities provide a powerful channel to accelerate adoption of our cloud communications platform. We believe this relationship enhances our ability to scale efficiently while delivering meaningful value to partners, customers and shareholders.

"This strategic relationship underscores Crexendo's continued focus on expanding its indirect channel distribution, increasing partner activation and engagement, driving scalable, capital-efficient revenue growth and strengthening our competitive position within the UCaaS market," Korn continued.

The partnership aligns two organizations committed to innovation, operational excellence and enabling modern work environments through reliable, scalable cloud technology solutions.

"Partnering with Crexendo allows our advisors to deliver a robust, cloud-based communications platform that meets the evolving needs of today's businesses," said Jason DiFulvio, associate vice president of channel sales, AppDirect. "Crexendo's technology, combined with our advisor ecosystem, creates a strong opportunity to drive customer success and mutual growth."

Crexendo looks forward to building a strong relationship with AppDirect and supporting partners and customers through this collaboration.