OneSpan Inc. (OSPN) Q3 2025 Earnings Call Transcript
Adjusted EBITDA $17.5 million (31% of revenue), a slight increase from $17 million (30.2% of revenue) in the same period last year. This improvement was driven by operational efficiency.
Cash from Operations $11 million, contributing to a record $47 million in cash from operations over the first 9 months of 2025. This was supported by strong profitability and cash generation.
Annual Recurring Revenue (ARR) $180 million, up 10% year-over-year. Growth was driven by subscription revenue increases and customer contract expansions.
Total Revenue $57.1 million, a 1% increase year-over-year. Growth in subscription revenue was offset by a decline in hardware revenue due to a shift towards mobile-first authentication approaches.
Subscription Revenue Grew 12%, including 10% organic growth. This was driven by cloud and on-prem authentication software, mobile app shielding software, and customer contract expansions.
Gross Margin 74%, consistent with last year's Q3. This stability was attributed to product mix.
GAAP Operating Income $8.2 million, down from $11.3 million in Q3 2024. The decline was due to increased operating expenses, including share-based compensation and costs related to the Nok Nok acquisition.
GAAP Net Income Per Share $0.17, down from $0.21 in the same period last year. The decrease was attributed to higher operating expenses.
Non-GAAP Earnings Per Share $0.33, consistent with Q3 2024. This metric excludes long-term incentive compensation, amortization, restructuring charges, and other nonrecurring items.
Cybersecurity Business ARR $115.5 million, up 11% year-over-year. Growth was driven by cloud and on-prem authentication software, app shielding software, and the Nok Nok acquisition.
Cybersecurity Business Revenue $40.3 million, a 1% decrease year-over-year. Subscription revenue growth was offset by a decline in hardware revenue and maintenance services.
Digital Agreements ARR $65 million, up 8% year-over-year. Growth was driven by new SaaS contracts, contract expansions, and increased one-time revenue.
Digital Agreements Revenue $16.7 million, a 9% increase year-over-year. Growth was driven by subscription revenue increases and the transition to a SaaS business model.
Cash and Cash Equivalents $85.6 million at the end of Q3 2025, compared to $92.9 million at the end of Q2 2025 and $83.2 million at the end of 2024. The decrease was due to share repurchases, dividend payments, and acquisition-related payments.
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