Wed, Apr 30, 8:08 PM (23 days ago)
### OpenText Corporation (OTEX) Q1 2025 Financial Summary **Revenue Performance:** - **Total Revenue:** $1,254.4 million, down 13.3% year-over-year (YoY), adjusted for foreign exchange rate changes, down 11.9%. - **Cloud Services and Subscriptions:** $462.6 million, up 1.8% YoY, up 3.0% adjusted for FX. - **Customer Support:** $567.4 million, down 17.9% YoY, down 16.4% adjusted for FX. - **License:** $138.4 million, down 30.9% YoY, down 29.6% adjusted for FX. - **Professional Services and Other:** $86.0 million, down 14.7% YoY, down 12.6% adjusted for FX. **Gross Margin:** - **GAAP Gross Margin:** 71.6%. - **Non-GAAP Gross Margin:** 75.7%. **Operating Expenses:** - **Research and Development:** $197.3 million, down 12.9% YoY. - **Sales and Marketing:** $260.1 million, down 14.2% YoY. - **General and Administrative:** $115.7 million, down 20.8% YoY. - **Depreciation:** $32.5 million, up 1.1% YoY. - **Amortization of Acquired Intangibles:** $79.7 million, down 26.8% YoY. - **Special Charges (Recoveries):** $3.9 million, down 75.9% YoY. **Net Income:** - **GAAP Net Income:** $92.8 million, down 5.7% YoY. - **Non-GAAP Net Income:** $215.8 million, down 16.0% YoY. **Earnings Per Share (EPS):** - **GAAP EPS (Diluted):** $0.35, down 2.8% YoY. - **Non-GAAP EPS (Diluted):** $0.82, down 12.8% YoY. **Cash Flow:** - **Operating Cash Flow:** $672.4 million for the nine months ended March 31, 2025, down 14.1% YoY. - **Cash and Cash Equivalents:** $1,278.0 million as of March 31, 2025. **Debt and Leverage:** - **Total Debt:** $6.38 billion as of March 31, 2025. - **Consolidated Net Leverage Ratio:** 2.48:1.00 as of March 31, 2025. **Share Repurchase:** - **Repurchased Shares:** 4.4 million shares for $116.7 million in Q1 2025. **Outlook:** - **Fiscal 2025 Focus:** Growth in earnings and cash flows, investments in Information Management capabilities, strategic acquisitions, and operational efficiency. - **Business Trends:** Emphasis on recurring revenues, cloud modernization, AI integration, and cost optimization. - **Geopolitical Risks:** Monitoring geopolitical conflicts and diplomatic tensions, including the Russia-Ukraine and Middle East conflicts. **Key Metrics:** - **Cloud Net Renewal Rate:** 96% for the quarter ended March 31, 2025. - **Customer Support Net Renewal Rate:** 90% for the quarter ended March 31, 2025. - **Enterprise Cloud Bookings:** $151.2 million, down 8.4% YoY. **Uncertainties and Future Operations Impact:** - **Geopolitical Risks:** Potential impacts from conflicts and diplomatic tensions. - **Economic Uncertainties:** Inflation, higher interest rates, and global tariff policies. - **Operational Challenges:** Integration of acquisitions, restructuring efforts, and cost optimization initiatives. **Financial Health and Performance Metrics:** - **Revenue Growth:** Negative growth due to divestiture impacts and foreign exchange rate changes. - **Profit Margins:** Stable gross margins, with slight declines in operating margins. - **Cash Flow:** Strong operating cash flow, with a decrease due to higher tax payments and working capital changes. - **Earnings Changes:** Decline in both GAAP and Non-GAAP earnings per share. - **Quarterly Performance Discussion:** Focus on cost optimization, strategic investments, and operational efficiency. **Trends and Uncertainties:** - **Positive Trends:** Strong cloud renewal rates, strategic investments in AI and cloud technologies. - **Negative Trends:** Declines in customer support and license revenues, geopolitical risks. - **Future Operations Impact:** Continued focus on cost optimization, strategic acquisitions, and operational efficiency. **Note:** Amounts are usually in thousands, 000s.