In the latest market close, OneSpan (OSPN) reached $14.46, with a -0.07% movement compared to the previous day. This change lagged the S&P 500's daily gain of 0.22%. On the other hand, the Dow registered a loss of 0.33%, and the technology-centric Nasdaq increased by 0.76%.Shares of the internet security company witnessed a loss of 10.84% over the previous month, trailing the performance of the Computer and Technology sector with its gain of 2.29% and the S&P 500's gain of 1.47%.The investment community wil ...

OneSpan (OSPN) ended the recent trading session at $14.68, demonstrating a -0.74% swing from the preceding day's closing price. This change lagged the S&P 500's 0.17% loss on the day. Meanwhile, the Dow lost 0.44%, and the Nasdaq, a tech-heavy index, lost 0.04%. Coming into today, shares of the internet security company had lost 3.59% in the past month. In that same time, the Computer and Technology sector gained 1.41%, while the S&P 500 gained 1.25%. The investment community will be closely monitoring the ...

Momentum investing revolves around the idea of following a stock's recent trend in either direction. In the 'long' context, investors will be essentially be "buying high, but hoping to sell even higher." With this methodology, taking advantage of trends in a stock's price is key; once a stock establishes a course, it is more than likely to continue moving that way. The goal is that once a stock heads down a fixed path, it will lead to timely and profitable trades. Even though momentum is a popular stock cha ...

The latest trading session saw OneSpan (OSPN) ending at $16.23, denoting a +0.5% adjustment from its last day's close. The stock outperformed the S&P 500, which registered a daily loss of 0.19%. On the other hand, the Dow registered a loss of 0.7%, and the technology-centric Nasdaq increased by 0.04%. Heading into today, shares of the internet security company had gained 3.53% over the past month, outpacing the Computer and Technology sector's gain of 0.73% and the S&P 500's gain of 1.95% in that time. Inve ...

Costs controlled: The most interesting factor behind OneSpan's recent performance has been the impressive cost cuts the company has materialized. OpEx was 35% lower in 1H24, and gross margins were 500 basis points higher. The workforce has been reduced by close to half. In this respect, 2Q24 maintained a quarterly OpEx trend of around $30/31 million, which is very salutary. Although OpEx may raise in 2H24 (potentially for bonuses and higher D&A), the company is in line to post $75 million in annualized savi ...

Company Performance - OneSpan's upcoming EPS is projected at $0.19, indicating a 205.56% increase compared to the same quarter of the previous year [2] - The company's shares have decreased by 0.92% over the last month, underperforming the Computer and Technology sector's gain of 6.52% and the S&P 500's gain of 3.53% [5] - In the latest trading session, OneSpan closed at $12.82, reflecting a -0.47% move from the previous day [8] Valuation Metrics - OneSpan has a Forward P/E ratio of 12.04, which is a discount compared to its industry's average Forward P/E of 30.12 [3] Analyst Sentiment - Recent revisions to analyst forecasts for OneSpan are important, as upward revisions indicate analysts' positivity towards the company's business operations [1] - OneSpan currently holds a Zacks Rank of 1 (Strong Buy), which has historically outperformed with an average annual gain of +25% since 1988 [6] - The Zacks Industry Rank for the Internet - Software industry is 81, placing it in the top 33% of all 250+ industries [10]

OneSpan (OSPN) closed the most recent trading day at $12.63, moving +0.8% from the previous trading session. The stock exceeded the S&P 500, which registered a gain of 0.16% for the day. On the other hand, the Dow registered a gain of 0.04%, and the technology-centric Nasdaq increased by 0.49%. Investors will be eagerly watching for the performance of OneSpan in its upcoming earnings disclosure. The company is forecasted to report an EPS of $0.19, showcasing a 205.56% upward movement from the corresponding ...

Investors will be eagerly watching for the performance of OneSpan in its upcoming earnings disclosure. In that report, analysts expect OneSpan to post earnings of $0.19 per share. This would mark year-over-year growth of 205.56%. The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Within the past 30 days, our conse ...

Core Viewpoint - OneSpan Inc. is a security software company specializing in e-signatures and fraud protection, currently rated as a Zacks Rank 1 (Strong Buy) with a D for Value and an A for Growth [1] Company Description - OneSpan Inc. designs and develops security software and e-signature solutions to protect devices and financial transactions from fraud and misuse, offering risk analytics, mobile security, and authentication services [2] Earnings History - Over the past year, OneSpan has achieved three consecutive earnings beats and one miss against the Zacks Consensus Estimate, with an average positive earnings surprise of 501% [3] - Two quarters ago, the company reported an EPS of $0.19 against an expected $0.01, resulting in an 1,800% positive earnings surprise [3] Earnings Estimates Revisions - The consensus estimate for the current quarter remains at $0.19, while the full fiscal year 2024 estimate has increased from $0.99 to $1.07 over the last 60 days [4] Valuation - OneSpan's forward PE multiple stands at 11.8x, significantly below the market average and many peers, with a price to book multiple of 2.8x and a price to sales multiple of 1.97x [5] - The company has improved its operating margins from negative 7.5% to positive 4.4% over the last three quarters, indicating potential for increased EPS alongside revenue growth [5]

PART I. FINANCIAL INFORMATION [Condensed Consolidated Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements%20(Unaudited)) OneSpan Inc. reported a significant Q1 2024 turnaround, achieving **$13.5 million** net income from a prior-year loss, and increasing cash to **$63.9 million** Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Cash and cash equivalents | $63,859 | $42,493 | | Accounts receivable, net | $32,382 | $64,387 | | Total current assets | $134,167 | $146,343 | | Total assets | $277,142 | $289,191 | | Deferred revenue (current) | $55,573 | $69,331 | | Total current liabilities | $92,171 | $114,830 | | Total liabilities | $106,273 | $130,050 | | Total stockholders' equity | $170,869 | $159,141 | Condensed Consolidated Statements of Operations Highlights (in thousands, except per share data) | Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Total revenue | $64,843 | $57,607 | | Gross profit | $47,395 | $39,286 | | Operating income (loss) | $14,110 | $(8,130) | | Net income (loss) | $13,468 | $(8,356) | | Diluted EPS | $0.35 | $(0.21) | Condensed Consolidated Statements of Cash Flows Highlights (in thousands) | Activity | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :--- | :--- | :--- | | Net cash provided by operating activities | $26,960 | $13,237 | | Net cash used in investing activities | $(3,080) | $(2,546) | | Net cash used in financing activities | $(1,795) | $(1,098) | | Net increase in cash | $21,351 | $10,162 | [Notes to Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) OneSpan's notes detail business transformation, segment performance, and restructuring, including **$1.5 million** in Q1 2024 cost reduction charges - In August 2023, the company modified its strategy to focus more on improving profitability margins, approving cost reduction actions (the "2023 Actions") to drive higher profitability while maintaining long-term growth potential[24](index=24&type=chunk) Segment Performance - Q1 2024 vs Q1 2023 (in thousands) | Segment | Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | :--- | | **Digital Agreements** | Revenue | $14,414 | $11,552 | | | Gross Profit | $9,892 | $8,448 | | | Operating Loss | $(265) | $(6,033) | | **Security Solutions** | Revenue | $50,429 | $46,055 | | | Gross Profit | $37,503 | $30,838 | | | Operating Income | $25,878 | $15,631 | Revenue by Major Products and Services (in thousands) | Category | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Subscription | $39,994 | $29,956 | | Maintenance and support | $10,571 | $11,161 | | Hardware products | $12,576 | $14,866 | | Professional services and other | $1,702 | $1,624 | | **Total Revenue** | **$64,843** | **$57,607** | - In connection with its restructuring plan, the company recorded **$1.5 million** in charges for Q1 2024, primarily for employee severance costs. The remaining restructuring liability as of March 31, 2024, is **$4.2 million**[87](index=87&type=chunk)[89](index=89&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=20&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses OneSpan's financial performance, highlighting **13% revenue growth** and a shift to operating income, with **Adjusted EBITDA at $19.8 million** [Business Transformation and Strategy](index=21&type=section&id=Business%20Transformation%20and%20Strategy) OneSpan's business transformation, initiated in late 2021, shifted in August 2023 to prioritize **Adjusted EBITDA margin improvement** via cost reduction - In response to challenges in growing Digital Agreements revenue, the company modified its strategy in August 2023 to focus more heavily on improving Adjusted EBITDA margin across the business[103](index=103&type=chunk) - The company expects to incur an additional **$2.5 million to $4.5 million** in restructuring charges related to the 2023 Actions, primarily for employee severance[106](index=106&type=chunk) - On January 4, 2024, Victor Limongelli was appointed as Interim Chief Executive Officer, replacing Matthew Moynahan[108](index=108&type=chunk) [Results of Operations](index=26&type=section&id=Results%20of%20Operations) Q1 2024 revenue increased **13% to $64.8 million**, with gross margin at **73%** and operating expenses down **30%**, leading to **$14.1 million** operating income Revenue Growth by Segment (Q1 2024 vs Q1 2023) | Segment | Revenue Growth | Key Drivers | | :--- | :--- | :--- | | Digital Agreements | +25% | Higher cloud subscription revenue from existing customer expansions | | Security Solutions | +9% | Higher on-premises term subscription revenue and customer conversions from perpetual to term licenses | Revenue by Geographic Region (in thousands) | Region | Q1 2024 | Q1 2023 | % Change | | :--- | :--- | :--- | :--- | | EMEA | $31,842 | $27,820 | +14% | | Americas | $21,344 | $20,498 | +4% | | APAC | $11,657 | $9,289 | +25% | - Total gross margin increased to **73%** in Q1 2024 from **68%** in Q1 2023, primarily due to a more favorable revenue mix between software and hardware, as well as lower third-party license costs[141](index=141&type=chunk)[145](index=145&type=chunk) - Operating expenses decreased by **$14.1 million (30%)** YoY, driven by significant reductions in Sales and Marketing (**-35%**), Research and Development (**-13%**), and General and Administrative (**-40%**) expenses, largely due to lower headcount and consulting fees[146](index=146&type=chunk)[148](index=148&type=chunk)[150](index=150&type=chunk)[152](index=152&type=chunk) [Liquidity and Capital Resources](index=31&type=section&id=Liquidity%20and%20Capital%20Resources) OneSpan's cash and cash equivalents increased to **$63.9 million** as of March 31, 2024, with **$27.0 million** from operations, improving liquidity - Cash and cash equivalents increased to **$63.9 million** at March 31, 2024, from **$42.5 million** at December 31, 2023[161](index=161&type=chunk)[162](index=162&type=chunk) - Cash provided by operating activities was **$27.0 million** for Q1 2024, more than double the **$13.2 million** generated in Q1 2023, primarily due to higher net income and a large decrease in accounts receivable[168](index=168&type=chunk) - Working capital increased to **$42.0 million** at March 31, 2024, from **$31.5 million** at December 31, 2023[169](index=169&type=chunk) [Key Business Metrics and Non-GAAP Financial Measures](index=32&type=section&id=Key%20Business%20Metrics%20and%20Non-GAAP%20Financial%20Measures) OneSpan's key metrics show strong performance, with ARR growing **9% to $154.6 million** and Adjusted EBITDA at **$19.8 million** - Annual Recurring Revenue (ARR) was **$154.6 million** at March 31, 2024, a **9% increase** from **$141.3 million** at March 31, 2023, driven by an increase in subscription contracts[181](index=181&type=chunk) - Net Retention Rate (NRR) was **107%** at March 31, 2024, compared to **108%** at March 31, 2023[183](index=183&type=chunk) Adjusted EBITDA Reconciliation (in thousands) | Line Item | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net income (loss) | $13,468 | $(8,356) | | Interest income, net | $(101) | $(503) | | Provision for income taxes | $1,034 | $689 | | Depreciation and amortization | $2,082 | $1,319 | | Long-term incentive compensation | $1,621 | $3,923 | | Restructuring and other related charges | $1,516 | $706 | | Other non-recurring items | $171 | $585 | | **Adjusted EBITDA** | **$19,791** | **$(1,637)** | [Quantitative and Qualitative Disclosures about Market Risk](index=34&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) No material changes in OneSpan's market risk were reported during Q1 2024, referring to the Annual Report on Form 10-K for details - There have been no material changes in the company's market risk during the first quarter of 2024[189](index=189&type=chunk) [Controls and Procedures](index=35&type=section&id=Item%204.%20Controls%20and%20Procedures) OneSpan's CEO and CFO concluded disclosure controls were effective as of March 31, 2024, with no material changes to internal controls during Q1 - The CEO and CFO concluded that as of March 31, 2024, the company's disclosure controls and procedures were effective[190](index=190&type=chunk) - No material changes were made to the company's internal control over financial reporting during the first quarter of 2024[191](index=191&type=chunk) PART II. OTHER INFORMATION [Legal Proceedings](index=35&type=section&id=Item%201.%20Legal%20Proceedings) OneSpan is involved in various legal proceedings, but management does not anticipate a material adverse impact on financial results - The company does not expect ongoing legal proceedings to have a material adverse impact on its financial results[193](index=193&type=chunk) [Risk Factors](index=35&type=section&id=Item%201A.%20Risk%20Factors) No material changes to OneSpan's risk factors were reported for the quarter, consistent with the prior Annual Report on Form 10-K - No material changes to risk factors were reported for the quarter[195](index=195&type=chunk) [Issuer Purchases of Equity Securities](index=35&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%2C%20Use%20of%20Proceeds%2C%20and%20Issuer%20Purchases%20of%20Equity%20Securities) OneSpan did not repurchase common stock in Q1 2024; **$15.8 million** remained available under the program expiring May 11, 2024 - The company did not purchase any of its shares during the first quarter of 2024[196](index=196&type=chunk) - As of March 31, 2024, approximately **$15.8 million** remained available for repurchase under the stock repurchase program, which was authorized until May 11, 2024[196](index=196&type=chunk) [Exhibits](index=36&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including CEO/CFO certifications and the 2024 Management Incentive Plan - Key exhibits filed include CEO and CFO certifications (Exhibits 31.1, 31.2, 32.1, 32.2) and the 2024 Management Incentive Plan (Exhibit 10.1)[197](index=197&type=chunk)[198](index=198&type=chunk)