Core Viewpoint - eGain reported its fiscal 2025 third quarter results, highlighting a decline in revenue but an increase in profitability and cash flow, alongside significant business developments including a major expansion deal and product launch [2][5]. Financial Highlights Fiscal 2025 Third Quarter - Total revenue was $21.0 million, a decrease of 6% year over year [5]. - GAAP net income was $66,000, or $0.00 per share, compared to $1.5 million, or $0.05 per share in Q3 2024 [5]. - Non-GAAP net income was $765,000, or $0.03 per share, down from $2.6 million, or $0.08 per share in Q3 2024 [5]. - Cash provided by operating activities was $2.2 million, with an operating cash flow margin of 11% [5]. - Adjusted EBITDA was $1.2 million, compared to $2.3 million in Q3 2024 [5]. Fiscal 2025 First Nine Months - Total revenue for the first nine months was $65.2 million, down 7% year over year [5]. - GAAP net income was $1.4 million, or $0.05 per share, compared to $6.3 million, or $0.20 per share in the same period last year [5]. - Non-GAAP net income was $3.3 million, or $0.12 per share, down from $9.8 million, or $0.31 per share in the same period last year [5]. - Adjusted EBITDA was $4.2 million, compared to $8.8 million in the same period last year [5]. Fourth Quarter Financial Guidance - eGain expects total revenue for Q4 to be between $22.8 million to $23.3 million [5]. - GAAP net income is projected to be between $1.1 million to $1.6 million, or $0.04 to $0.06 per share [5]. - Non-GAAP net income is expected to be between $1.7 million to $2.2 million, or $0.06 to $0.08 per share [5]. - Full year revenue guidance has been lowered to $88.0 million to $88.5 million, while GAAP net income guidance has been raised to $2.5 million to $3.0 million [5]. Business Developments - eGain secured one of its largest expansion deals with a U.S. megabank shortly after the quarter closed [2]. - The company launched its AI Agent for Contact Center, which assists agents in real-time using trusted knowledge and reasoning [2]. - eGain was recognized by Gartner as an emerging leader in the Generative AI Technologies market [2].

Financial Performance - Total revenue for Q3 2025 was $21.0 million, down 6% year over year[5] - GAAP net income for Q3 2025 was $66,000, or $0.00 per share, compared to $1.5 million, or $0.05 per share in Q3 2024[5] - Non-GAAP net income for Q3 2025 was $765,000, or $0.03 per share, compared to $2.6 million, or $0.08 per share in Q3 2024[5] - Total revenue for the three months ended March 31, 2025, was $21,009 million, a decrease of 6% compared to $22,350 million for the same period in 2024[16] - GAAP total revenue for the nine months ended March 31, 2025, was $65,197 million, a decrease of 7% compared to $70,341 million in 2024[22] - GAAP SaaS revenue was $60,230 million, down 7% from $64,643 million in the prior year[22] - GAAP professional services revenue decreased by 13% to $4,967 million from $5,698 million year-over-year[22] - Constant currency growth rates indicate a consistent decline across major revenue segments, with total GAAP revenue down 8%[22] Cash Flow and Guidance - Cash provided by operating activities was $2.2 million, with an operating cash flow margin of 11%[5] - Total cash and cash equivalents decreased to $68.7 million from $83.0 million in Q3 2024[5] - eGain expects total revenue for Q4 2025 to be between $22.8 million and $23.3 million[5] - GAAP net income guidance for Q4 2025 is projected to be between $1.1 million and $1.6 million, or $0.04 to $0.06 per share[5] - Non-GAAP net income guidance for Q4 2025 is projected to be between $1.7 million and $2.2 million, or $0.06 to $0.08 per share[5] - eGain is lowering its total revenue guidance for the full fiscal year 2025 to $88.0 million to $88.5 million[10] - eGain is raising its GAAP net income guidance for the full fiscal year 2025 to $2.5 million to $3.0 million, or $0.09 to $0.10 per share[10] Expenses and Profitability - Research and development expenses increased to $7,514 million for the three months ended March 31, 2025, up from $6,655 million in the prior year, representing a 13% increase[20] - Total operating expenses for the three months ended March 31, 2025, were $14,259 million, slightly down from $14,554 million in the same quarter of 2024[16] - Adjusted EBITDA for the three months ended March 31, 2025, was $1,172 million, down from $2,252 million in the same quarter of 2024[18] - The company incurred stock-based compensation of $699 million for the three months ended March 31, 2025, compared to $1,110 million in the same period of 2024[18] - The total cost of revenue for the three months ended March 31, 2025, was $6,723 million, a slight decrease from $6,858 million in the same quarter of 2024[16] - Non-GAAP total cost of revenue decreased by 2% to $19,390 million from $19,762 million year-over-year[22] - Non-GAAP gross profit was $45,807 million, reflecting a 9% decline from $50,579 million in the previous year[22] - Non-GAAP research and development expenses increased by 17% to $22,120 million compared to $18,852 million in the prior year[22] - GAAP operating expenses totaled $43,942 million, slightly down from $44,876 million year-over-year[22] - Non-GAAP operating expenses increased by 1% to $42,668 million from $42,287 million in the previous year[22] Strategic Focus - The company is focusing on new product development and market expansion strategies to drive future growth[22]

Company Announcement - eGain will announce its fiscal 2025 third quarter financial results on May 14, 2025, after market close [1] - The announcement will be followed by an investor conference call and webcast at 2:00 p.m. Pacific Time (5:00 p.m. ET) [1] - CEO Ashu Roy and CFO Eric Smit will host the call and webcast [1] Investor Relations - Investors can access the live call by dialing 844-481-2704 (U.S. toll free) or +1 412-317-0660 (International) [3] - A live and archived webcast will be available on eGain's website [3] - A phone replay of the conference call will be available starting two hours after the call for one week [3]

Empowers human agents with real-time guidance in the flow of customer conversationsSUNNYVALE, Calif., March 18, 2025 (GLOBE NEWSWIRE) -- eGain (NASDAQ: EGAN), the leader in AI Knowledge Management, today announced the launch of eGain AI Agent for Contact Center, a groundbreaking solution to address the challenge of variable agent performance in contact centers. Using this solution, all agents can help customers like experts do, improving agent experience and customer satisfaction. "84% of contact center age ...

SUNNYVALE, Calif., March 11, 2025 (GLOBE NEWSWIRE) -- eGain (NASDAQ: EGAN), the AI knowledge platform for service, today announced that CEO Ashu Roy and CFO Eric Smit will be hosting meetings with investors on March 17, 2025, at the 37th Annual Roth Conference taking place March 16-18, 2024 in Dana Point, California. In its recently released earnings press release, eGain CEO Ashu Roy said, “We won several new enterprise logos in the second quarter. As a result, our annual recurring revenue from AI Knowledge ...

Group 1 - eGain (NASDAQ: EGAN) reported weak Q2 results and lowered its full-year revenue guidance [1] - Despite the weak performance, the bullish investment thesis for eGain remains intact [1] Group 2 - The author has a long position in eGain shares, indicating confidence in the company's future performance [2] - The analysis focuses on undercovered companies, particularly in technology, software, electronics, and energy transition sectors [1]

Financial Data and Key Metrics Changes - Total revenue for Q2 was $22.4 million, down 6% year over year, primarily due to the impact of two large client losses last year [21] - SaaS revenue accounted for 93% of total revenue, exceeding internal expectations, while PS revenue came in lower than expected [22] - Non-GAAP net income was $1.3 million or $0.05 per share, compared to $3.4 million or $0.11 per share in the year-ago quarter [25] - Non-GAAP gross margin for SaaS was 78%, unchanged from a year ago, while total gross margin was 71%, down from 72% a year ago [24] Business Line Data and Key Metrics Changes - AI knowledge hub ARR increased by 17% year over year, while total SaaS ARR decreased by 3% year over year but was up 2% sequentially [20][28] - The number of seven-figure deals in the pipeline has more than doubled in the last six months, indicating larger knowledge opportunities [14] Market Data and Key Metrics Changes - SaaS ARR for AI knowledge customers accounted for 55% of total SaaS ARR at the end of the quarter, up from 46% a year ago [28] - LTM dollar-based SaaS net retention for AI knowledge customers was 99%, while net retention for all customers was 89% [28] Company Strategy and Development Direction - The company is focusing on knowledge centralization in enterprises, which is critical for AI projects [12] - eGain AI Agent, an omnichannel conversational product, is set to launch in the current quarter, reflecting strong customer interest [17][19] - The company is actively investing in shaping the AI knowledge market to automate business operations, starting with customer service [19] Management's Comments on Operating Environment and Future Outlook - Management noted that larger deals are taking more time to close due to increased scrutiny and vetting processes [14] - The company is lowering its PS revenue targets for fiscal 2025 by approximately $2 million due to product improvements leading to faster deployment [23] - Updated guidance for total revenue is now $88.5 million to $90 million, down from $92 million to $93 million [32] Other Important Information - The company repurchased 121,000 shares at an average price of $5.73 per share, totaling $2.4 million [26] - Total cash and cash equivalents at the end of the quarter were $70.5 million, indicating a strong balance sheet [26] Q&A Session Summary Question: Can you discuss the evolution of professional services and the substantial reduction in guidance? - Management explained that the reduction is due to efforts to add more connectors and prebuilt capabilities, which decreases the need for custom integration [41] Question: What was the competitive landscape in winning the US airline deal? - The airline had multiple knowledge systems and was looking for a consolidation solution, which eGain provided by replacing their legacy systems [45][46]

Group 1: Earnings Performance - eGain reported quarterly earnings of $0.04 per share, exceeding the Zacks Consensus Estimate of $0.02 per share, but down from $0.11 per share a year ago, representing an earnings surprise of 100% [1] - Over the last four quarters, eGain has surpassed consensus EPS estimates four times [2] - The company posted revenues of $22.39 million for the quarter ended December 2024, missing the Zacks Consensus Estimate by 0.32%, compared to $23.82 million in the same quarter last year [2] Group 2: Stock Performance and Outlook - eGain shares have not increased since the beginning of the year, while the S&P 500 has gained 2.9% [3] - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters and any recent changes to these expectations [4] - The current consensus EPS estimate for the coming quarter is $0.07 on revenues of $23.37 million, and $0.23 on revenues of $92.13 million for the current fiscal year [7] Group 3: Industry Context - The Internet - Software industry, to which eGain belongs, is currently in the top 30% of over 250 Zacks industries, indicating a favorable outlook [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5] - Another company in the same industry, Synchronoss, is expected to report quarterly earnings of $0.10 per share, reflecting a year-over-year change of +111.8% [9]

Revenue Performance - Total revenue for Q2 2025 was $22.4 million, down 6% year over year[4] - Total revenue for Q2 2024 was $22,389 million, a decrease of 6% compared to $23,815 million in Q2 2023[15] - SaaS revenue was $20,847 million, down 5% from $21,996 million year-over-year[19] - GAAP total revenue decreased by 8% to $44,188 million compared to $47,991 million in the previous year[21] - GAAP SaaS revenue declined by 8% to $40,667 million from $44,319 million year-over-year[21] - Annual recurring revenue from AI Knowledge Hub customers grew by 17% year over year and 5% sequentially[2] Income Metrics - GAAP net income for Q2 2025 was $671,000, or $0.02 per share, compared to $2.2 million, or $0.07 per share in Q2 2024[4] - Non-GAAP net income for Q2 2025 was $1.3 million, or $0.05 per share, compared to $3.4 million, or $0.11 per share in Q2 2024[4] - Net income for Q2 2024 was $671 million, a significant drop from $2,185 million in Q2 2023, marking a decrease of 69%[15] - Non-GAAP net income for Q2 2024 was $1,293 million, compared to $3,380 million in Q2 2023, reflecting a decline of 62%[17] - eGain is raising its GAAP net income guidance range to $1.1 million to $1.7 million, or $0.04 to $0.06 per share[9] - eGain is lowering its non-GAAP net income range to $4.1 million to $4.7 million, or $0.14 to $0.16 per share[9] Cash Flow and Assets - Cash provided by operating activities was $6.4 million, with an operating cash flow margin of 29%[4] - Total cash and cash equivalents were $70.5 million, down from $86.8 million in Q2 2024[4] - Total assets decreased from $127.9 million in June 2024 to $111.3 million in December 2024[13] Expenses - Operating expenses increased to $15,059 million in Q2 2024, up from $14,400 million in Q2 2023, representing a rise of 4.6%[15] - Research and development expenses rose to $7,708 million in Q2 2024, up from $6,660 million in Q2 2023, an increase of 15.7%[15] - Non-GAAP research and development expenses increased by 19% to $14,878 million from $12,528 million[21] - GAAP operating expenses slightly increased by 1% to $29,683 million from $30,322 million[21] - Non-GAAP sales and marketing expenses decreased by 11% to $9,832 million compared to $11,097 million last year[21] - Non-GAAP general and administrative expenses decreased by 14% to $4,181 million from $4,875 million[21] Profitability - Gross profit for Q2 2024 was $15,709 million, compared to $16,825 million in Q2 2023, reflecting a decline of 6.6%[15] - Adjusted EBITDA for Q2 2024 was $1,632 million, down from $3,771 million in Q2 2023, a decrease of 57%[17] - Non-GAAP gross profit fell by 10% to $31,304 million compared to $34,744 million in the prior year[21] Guidance and Future Strategy - eGain is lowering its total revenue guidance range to $88.5 million to $90.0 million for fiscal 2025[9] - The company is focusing on new product development and market expansion strategies to drive future growth[21]

Core Insights - eGain reported a 17% year-over-year growth in annual recurring revenue from AI Knowledge Hub customers, indicating strong demand for customer service automation solutions [2] - Total revenue for the second quarter of fiscal 2025 was $22.4 million, a decrease of 6% year-over-year [5] - The company expects total revenue for fiscal 2025 to be between $88.5 million and $90.0 million, reflecting a downward adjustment from previous guidance [5] Financial Highlights for Q2 Fiscal 2025 - GAAP net income was $671,000, or $0.02 per share, compared to $2.2 million, or $0.07 per share, in Q2 2024 [5] - Non-GAAP net income was $1.3 million, or $0.05 per share, down from $3.4 million, or $0.11 per share, in the same quarter last year [5] - Adjusted EBITDA for the quarter was $1.6 million, compared to $3.8 million in Q2 2024 [5] Financial Performance for the First Six Months of Fiscal 2025 - Total revenue for the first six months was $44.2 million, down 8% year-over-year [5] - GAAP net income for the first half was $1.3 million, or $0.05 per share, compared to $4.8 million, or $0.15 per share, in the same period last year [5] - Non-GAAP net income for the first six months was $2.6 million, or $0.09 per share, down from $7.2 million, or $0.23 per share, in the prior year [5] Financial Guidance for Q3 and Full Year Fiscal 2025 - For Q3 fiscal 2025, eGain anticipates total revenue between $21.0 million and $21.5 million, with a GAAP net loss projected between $300,000 and $800,000 [5] - The company has raised its GAAP net income guidance for the full fiscal year to a range of $1.1 million to $1.7 million, or $0.04 to $0.06 per share [5] - Non-GAAP net income guidance for the full year has been lowered to a range of $4.1 million to $4.7 million, or $0.14 to $0.16 per share [5]