Five9 agrees to buy contact center AI startup Level AI for about $325 million in cash
Five9 agreed on 5 November 2026 to acquire Level AI for about $325 million in cash, alongside third quarter revenue of $323.3 million, up 13%.
By Berkant A.Published
Tech AI LatestFive9, the cloud contact center software company, agreed on 5 November 2026 to acquire Level AI, a startup that analyses customer service conversations with AI, for about $325 million in cash from its balance sheet. Five9 expects the deal to close in the fourth quarter of 2026. It announced the purchase with third quarter revenue of $323.3 million, up 13%, and raised its 2026 AI revenue growth outlook to at least 75%.
Key facts
- Announced: 5 November 2026 (Five9 release filed with the SEC)
- Price: about $325 million in cash, paid from the Five9 balance sheet; approved unanimously by the Five9 board
- Closing: expected in the fourth quarter of 2026, subject to closing conditions
- Five9 Q3 2026 revenue: $323.3 million, up 13% from $285.8 million
- Guidance: 2026 AI revenue growth of at least 75%, up from at least 60%; Level AI excluded from guidance
- Not stated: Level AI revenue and headcount
What Five9 is buying
Five9 said on 5 November 2026 that it has agreed to acquire Level AI in a transaction that values the startup at approximately $325 million, to be paid in cash from the Five9 balance sheet. The announcement filed with the SEC says the Five9 board approved the agreement unanimously. Five9 expects the deal to close in the fourth quarter of 2026, subject to customary closing conditions.
Level AI, founded in 2019 by Ashish Nagar, a former engineer on Amazon's Alexa team, sells software that analyses customer service conversations. Its products automate quality assurance scoring of agent calls and chats, produce customer experience analytics and assist human agents during live conversations. The company raised a $39.4 million Series C in July 2024 led by Adams Street Partners, bringing its total funding to $73.1 million, according to Level AI. Five9 has not disclosed Level AI's revenue or headcount.
Why Five9 wants it
Five9 sells cloud software that runs contact centers: call routing, agent desktops and, increasingly, AI agents that answer customers without a human. Level AI works on the layer above, turning the content of conversations into scores, trends and coaching, and it can do that for contact centers that still run on older on-premises systems. Five9 chief executive Amit Mathradas said Level AI "will also give us a new way to reach enterprises that want AI today but aren't ready to move their contact center to the cloud," as quoted by WebProNews from the announcement.
That is the commercial logic: Five9 can sell AI analytics to large companies before they are ready to replace their contact center platform, and then try to win the platform later. Level AI's analytics also overlap with the quality management and agent assist features that contact center vendors increasingly bundle with their own AI agents, and owning the product lets Five9 sell one suite instead of pointing customers to a third party.
The quarter behind the deal
Five9 announced the acquisition alongside its third quarter 2026 results. Revenue rose 13% to $323.3 million from $285.8 million a year earlier, and subscription revenue grew 16%. GAAP net income was $14.5 million, or $0.19 per diluted share; non-GAAP net income was $63.7 million, or $0.82 per diluted share.
AI is the fastest-growing part of the business: Five9's AI revenue grew 91% year over year in the quarter, according to the company's earnings call as reported by Investing.com and GuruFocus. The company raised its forecast for 2026 AI revenue growth to at least 75%, from at least 60% before. At the same time it set the midpoint of its full-year non-GAAP earnings per share outlook at $3.19, below its prior $3.26, which it attributed mainly to timing, planned organizational changes and a higher diluted share count. Five9 says its fourth quarter and full-year guidance exclude any revenue or operating contribution from Level AI.
Market reaction and what to watch
Investors focused on the lower earnings outlook and the price of the deal. DA Davidson cut its price target on Five9, saying the purchase price left it more measured on the potential return on investment, according to Investing.com. Reports of the share move on the day differ, so we do not cite a figure.
The points to watch are the closing date, any regulatory review, how Five9 prices Level AI's analytics for customers that stay on premises, and whether the 2027 outlook shows the cost of integrating the startup. The deal adds to our AI funding and acquisitions tracker, which lists other software companies buying AI startups this autumn, among them Dropbox's purchase of Tigris Data. More deals are on the AI business page.
What changed
| Before | Five9 and Level AI were separate companies; Level AI was a venture-backed startup with $73.1 million raised |
|---|---|
| After | Five9 has agreed to buy Level AI for about $325 million in cash, with closing expected in the fourth quarter of 2026 |
| Who it affects | Contact center operators using Five9 or Level AI, competing customer service AI vendors, Five9 shareholders |
Questions people ask
- How much is Five9 paying for Level AI?
- About $325 million in cash from its balance sheet, according to the announcement filed with the SEC on 5 November 2026.
- When will the Five9 and Level AI deal close?
- Five9 expects it to close in the fourth quarter of 2026, subject to customary closing conditions.
- What does Level AI do?
- It sells AI software that analyses customer service conversations: automated quality scoring, customer experience analytics and live assistance for human agents.
Sources
- Five9 to Acquire Level AI, Advancing AI-Powered CX Platform (Five9 (SEC filing), 5 Nov 2026)
- Five9 Announces Third Quarter 2026 Financial Results (Five9 (SEC filing), 5 Nov 2026)
- Five9 buys contact center intelligence startup Level AI after posting narrow earnings beat (SiliconANGLE, 5 Nov 2026)
- Five9 Agrees to Buy Level AI for About $325 Million in Cash (WebProNews, 5 Nov 2026)
- DA Davidson cuts Five9 stock price target on acquisition concerns (Investing.com, 6 Nov 2026)
- Level AI Series C funding (Level AI, 23 Jul 2024)
Reference pages
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