Financial Performance - Revenue for Q4 2024 was $114.2 million, an increase of 1.9% year over year[2] - Billings for Q4 2024 reached $172.1 million, up 7.1% year over year[2] - Total revenue for Q4 2024 was $114.213 million, a slight increase from $112.111 million in Q4 2023, while annual revenue decreased to $428.753 million from $431.496 million[21] - Gross profit for Q4 2024 was $72.712 million, compared to $68.399 million in Q4 2023, resulting in a gross margin of approximately 63.7%[21] - Operating income for Q4 2024 was $14.878 million, up from $11.547 million in Q4 2023, while the annual operating loss was $(32.128) million compared to a profit of $43.765 million in 2023[21] - Net income for Q4 2024 was $6.659 million, down from $9.351 million in Q4 2023, leading to a net loss of $(36.272) million for the year compared to a profit of $26.059 million in 2023[21] - Non-GAAP operating income for Q4 2024 was $19.059 million, slightly down from $19.313 million in Q4 2023, with annual non-GAAP operating income at $47.747 million compared to $66.122 million in 2023[23] Client Metrics - Active Clients increased by 1.4% to 3,081 as of December 31, 2024[5] - Active clients increased, indicating growth in the business and effectiveness of sales and marketing strategies[27] Revenue Composition - U.S. revenue decreased by 6.5% to $53.1 million, while international revenue increased by 10.5% to $61.1 million in Q4 2024[5] - Annualized Recurring Revenue was $414.8 million, down 4.1% compared to the same period last year[5] - Annualized Recurring Revenue (ARR) reflects the subscription revenue recognized during the fiscal quarter, multiplied by four, providing insight into future revenue potential[28] - Revenue Retention Rate measures the dollar-based subscription revenue recognized over a 12-month period from existing clients, indicating client retention and satisfaction[29] Costs and Liabilities - Rimini Street incurred reorganization costs of $1.1 million in Q4 2024 as part of its cost optimization efforts[5] - Total current liabilities decreased to $324.592 million in 2024 from $336.434 million in 2023, while total liabilities increased to $438.508 million from $433.292 million[20] - Cash and cash equivalents decreased to $88.792 million in 2024 from $115.424 million in 2023, reflecting a significant reduction in liquidity[20] Non-GAAP Measures - Non-GAAP Operating Income excludes litigation costs, stock-based compensation, and reorganization costs[30] - Non-GAAP Net Income is adjusted for litigation costs, stock-based compensation, and reorganization costs[31] - EBITDA is adjusted to exclude interest expense, income taxes, and depreciation and amortization[34] - Adjusted EBITDA further excludes litigation costs, stock-based compensation, and reorganization costs[34] Strategic Initiatives - The company announced a partnership with ServiceNow to enhance enterprise software support and innovation[12] - The company is suspending guidance until there is more clarity regarding ongoing litigation with Oracle[8]

Revenue and Financial Performance - The company recorded a net loss of $36.3 million for the year ended December 31, 2024, with an accumulated deficit of $238.5 million as of the same date [188]. - Revenue declined from $431.5 million for the year ended December 31, 2023, to $428.8 million for the year ended December 31, 2024, representing a 1% decrease [190]. - Approximately 62% of total revenue was derived from services provided to clients using Oracle software products [175]. - The Rimini II Injunction, if effective, would limit support services for Oracle's PeopleSoft software, which accounted for approximately 8% of total revenue for the year ended December 31, 2024 [170]. Litigation and Legal Risks - The company anticipates that ongoing litigation with Oracle may negatively impact client acquisition and retention, leading to potential revenue loss [176]. - Oracle was awarded $58.2 million in attorneys' fees and $0.3 million in costs related to the Rimini II litigation, totaling $58.7 million paid by the company for the year ended December 31, 2024 [166]. - The company plans to continue to appeal the District Court's award of attorneys' fees and costs to Oracle, with the opening brief due on March 11, 2025 [167]. - The company is subject to ongoing litigation with Oracle related to copyright infringement claims, which could adversely impact marketing and sales [202]. Competition and Market Dynamics - The company faces significant competition from enterprise software vendors like Oracle and SAP, which may have more resources and broader customer relationships [186]. - Competition is expected to increase, particularly if the company prevails in its appeal of the Rimini II litigation, potentially impacting sales and renewals [187]. - The market for independent software support services remains relatively undeveloped, which may hinder the company's growth prospects [184]. Operational Challenges - The company relies on its management team, and the loss of key personnel could adversely affect business operations [197]. - Attracting and retaining qualified personnel is challenging due to competitive hiring environments, particularly in the San Francisco Bay Area [199]. - New sales personnel typically take nine to twelve months to reach expected productivity levels, impacting the return on investment in sales efforts [200]. - The sales cycle for the company's products typically ranges from six to twelve months, which may delay revenue recognition [195]. - Retention rates are critical, as clients are not obligated to renew agreements after the expiration of non-cancelable terms, impacting future revenue [193]. Financial Stability and Debt Management - The company may need to incur additional debt under its 2024 Credit Facility if it cannot fund future growth or service its debt through operating cash flows [201]. - As of December 31, 2024, the company's outstanding indebtedness under its 2024 Credit Facility and finance leases totaled $87.2 million [246]. - The company expects to rely primarily on cash generated from operations to pay expenses and amounts due under its 2024 Credit Facility, which may be affected by various uncontrollable factors [247]. - The 2024 Credit Facility imposes operating and financial restrictions, including limitations on incurring additional indebtedness and engaging in certain transactions [248]. Cybersecurity and Data Protection - Cybersecurity threats are increasing, and any compromise of data security measures could harm the company's reputation and business [220]. - The company has experienced an increase in cybersecurity threats, including a successful phishing incident in 2021 that resulted in unauthorized sharing of client data, although it did not significantly impact business relationships [222]. - The company faces risks related to the unauthorized use of generative AI technology, which could expose proprietary information to unauthorized recipients [228]. Regulatory and Compliance Risks - The company is subject to various international privacy laws, including the General Data Protection Regulation (GDPR), which can impose fines of up to 4% of global annual revenue or €20 million for serious infringements [228]. - The company is currently under audit in several jurisdictions, which could lead to substantial tax liabilities and penalties for past sales [238]. - The company is subject to various global regulatory requirements, and noncompliance could result in significant penalties or sanctions [270]. Strategic Investments and Future Outlook - The company continues to invest in research and development, including partnerships with Salesforce and managed services for SAP and Oracle products [218]. - The company plans to continue investing significantly in sales and marketing operations to expand service offerings and enter new markets [189]. - Future acquisitions may divert management's attention and could result in dilutive issuances of equity securities or the incurrence of debt [266]. Market and Economic Conditions - Economic uncertainties, including rising inflation, may adversely affect demand for the company's products and services, resulting in delayed sales cycles and loss of clients [183]. - The company faces risks associated with global operations, including currency exchange rate fluctuations and regulatory changes [213]. - Catastrophic events, including natural disasters and geopolitical instability, could disrupt the company's business operations and adversely affect financial results [269]. Stockholder and Governance Matters - Approximately 37.9% of the company's outstanding capital stock is controlled by two stockholders, which may limit other stockholders' influence on key transactions [253]. - The company does not currently intend to pay dividends on its Common Stock, focusing instead on retaining earnings for business operations [256]. - The company's stock price may be volatile, influenced by various factors including large stockholder sales and the issuance of Common Stock upon the exercise of warrants [252].

Financial Performance - Rimini Street reported quarterly earnings of $0.22 per share, exceeding the Zacks Consensus Estimate of $0.07 per share, and up from $0.14 per share a year ago, representing an earnings surprise of 214.29% [1] - The company posted revenues of $104.67 million for the quarter ended September 2024, surpassing the Zacks Consensus Estimate by 5.31%, although this is a decrease from year-ago revenues of $107.45 million [2] Market Performance - Rimini Street shares have declined approximately 48.3% since the beginning of the year, contrasting with the S&P 500's gain of 22.3% [3] - The current Zacks Rank for Rimini Street is 3 (Hold), indicating that the shares are expected to perform in line with the market in the near future [6] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.08 on revenues of $98.1 million, and for the current fiscal year, it is $0.32 on revenues of $407.36 million [7] - The estimate revisions trend for Rimini Street is mixed, and changes in earnings expectations may occur following the recent earnings report [6] Industry Context - The Internet - Software industry, to which Rimini Street belongs, is currently ranked in the top 33% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8]

Revenue Performance - Revenue for Q3 2024 was $104.7 million, a decrease of 2.6% from $107.5 million in Q3 2023[2] - U.S. revenue decreased by 7.4% to $51.6 million, while international revenue increased by 2.7% to $53.1 million[2] - Subscription revenue accounted for 95.9% of total revenue at $100.4 million, down from 96.9% at $104.1 million in the prior year[2] - Revenue for Q3 2024 was $104.672 million, a decrease of 2.3% from $107.453 million in Q3 2023[13] Client Metrics - Active Clients as of September 30, 2024, were 3,097, a slight decrease of 0.1% from 3,099 clients a year earlier[2] - Active Clients are defined as distinct entities purchasing services, indicating business growth and sales success[18] Financial Losses - Operating loss for Q3 2024 was $49.6 million, compared to an operating income of $11.2 million in Q3 2023[2] - Net loss for Q3 2024 was $43.1 million, compared to net income of $6.8 million in the same period last year[2] - Net loss for Q3 2024 was $43.100 million, compared to a net income of $6.801 million in Q3 2023[13] Revenue Retention and Recurring Revenue - Annualized Recurring Revenue was $401.5 million, a decrease of 3.6% from $416.3 million in Q3 2023[2] - Revenue Retention Rate dropped to 89% from 94% in the previous year[2] - Revenue Retention Rate measures subscription revenue from existing clients over a 12-month period, providing insight into client retention[20] - Annualized Recurring Revenue is calculated by multiplying quarterly subscription revenue by four, indicating potential revenue for the next 12 months[19] Operating Expenses and Profitability - Total operating expenses increased significantly to $113.131 million in Q3 2024, compared to $56.104 million in Q3 2023[13] - Gross profit for Q3 2024 was $63.537 million, down from $67.343 million in Q3 2023, reflecting a gross margin of 60.7%[13] - Non-GAAP operating income for Q3 2024 was $13.402 million, down from $16.497 million in Q3 2023[14] - Adjusted EBITDA for Q3 2024 was $13.677 million, compared to $18.239 million in Q3 2023[14] Cost Management and Reorganization - The company incurred reorganization costs of $1.4 million in Q3 2024 as part of its cost optimization efforts[2] - Reorganization costs primarily consist of severance costs related to the company's restructuring efforts[24] Litigation Costs - The company reported a significant increase in litigation costs, totaling $59.391 million in Q3 2024, compared to $2.127 million in Q3 2023[13] Cash and Liabilities - Cash and cash equivalents increased to $119.494 million as of September 30, 2024, from $115.424 million at the end of 2023[12] - Total current liabilities decreased to $322.468 million from $336.434 million at the end of 2023[12] - Deferred revenue, current and noncurrent, at the end of Q3 2024 was $223.314 million, down from $238.399 million at the end of Q3 2023[14] Non-GAAP Financial Measures - Rimini Street reported key non-GAAP financial measures including non-GAAP operating income, non-GAAP net income, EBITDA, Adjusted EBITDA, and Billings[15] - Non-GAAP Operating Income excludes litigation costs, stock-based compensation, and reorganization costs, reflecting core operational performance[21] - Adjusted EBITDA excludes litigation costs, stock-based compensation, and reorganization costs, providing a clearer view of operational profitability[24] - The company emphasizes the importance of non-GAAP measures for consistent performance evaluation across reporting periods[16] Billings and Cash Flow - Billings represent the change in deferred revenue plus current period revenue, indicating cash flow dynamics[17] Compensation Strategy - The company’s compensation strategy includes stock-based compensation to align employee interests with shareholders[23]

Company Overview - As of September 30, 2024, the company employed approximately 2,070 professionals and supported over 3,090 active clients globally, including 76 Fortune 500 companies and 22 Fortune Global 100 companies[129]. - The company has designed and developed a new expanded solutions portfolio, including managed services for Oracle, SAP, IBM, Salesforce, and open-source database software[124]. - The company aims to expand its leadership position in independent enterprise software support and to sell management services (AMS) and Rimini ONE™ integrated services[117]. - The company is focused on attracting and retaining qualified personnel, including sales personnel, to enhance its operational capabilities[116]. - The company is exploring future acquisitions of or investments in complementary businesses, products, subscriptions, or technologies[116]. Financial Performance - Revenue for the three months ended September 30, 2024, was $104.7 million, a decrease of 3% from $107.5 million in the same period of 2023[148]. - The company recorded a net loss of $43.1 million for the three months ended September 30, 2024, compared to a net income of $6.8 million in the same period of 2023[147]. - Annualized recurring revenue decreased to $402 million as of September 30, 2024, down from $416 million in 2023, reflecting a decline in client retention[141]. - Revenue retention rate fell to 89% for the 12 months ended September 30, 2024, down from 94% in the previous year, attributed to client attrition[143]. - Gross profit margin decreased to 60.7% for the three months ended September 30, 2024, compared to 62.7% in the same period of 2023[145]. - Revenue declined from $319.4 million for the nine months ended September 30, 2023, to $314.5 million for the nine months ended September 30, 2024, a decrease of $4.8 million or 1.5%[164]. - Gross profit decreased from $200.6 million for the nine months ended September 30, 2023, to $188.3 million for the nine months ended September 30, 2024, a decrease of $12.3 million or 6%[166]. Expenses and Costs - Total operating expenses increased significantly to $113.1 million for the three months ended September 30, 2024, compared to $56.1 million in the same period of 2023[147]. - Sales and marketing expenses increased from $35.6 million for the three months ended September 30, 2023, to $35.8 million for the three months ended September 30, 2024, an increase of $0.2 million or 0.5%[152]. - General and administrative expenses decreased from $18.4 million for the three months ended September 30, 2023, to $16.5 million for the three months ended September 30, 2024, a decrease of $1.9 million or 10%[153]. - Reorganization costs recognized were $1.4 million for the three months ended September 30, 2024, compared to none for the same period in 2023[154]. - Litigation expense increased from no expense for the three months ended September 30, 2023, to $58.5 million for the three months ended September 30, 2024[156]. - Interest expense increased from $1.4 million for the three months ended September 30, 2023, to $1.6 million for the three months ended September 30, 2024[159]. Cash Flow and Liquidity - As of September 30, 2024, the company had available cash, cash equivalents, and restricted cash totaling $119.9 million[176]. - Deferred revenue amounted to $202.3 million as of September 30, 2024, reflecting the company's business model of collecting cash in advance for services[181]. - Cash flows used in operating activities for the nine months ended September 30, 2024, were approximately $1.2 million, driven by a net loss of $42.9 million[185]. - The company experienced a favorable change in operating assets and liabilities of approximately $41.0 million for the nine months ended September 30, 2024[185]. - Cash utilized in financing activities for the nine months ended September 30, 2023, was $5.1 million, attributed to principal payments of $3.9 million related to the Original Credit Facility and share repurchases totaling $1.0 million[195]. Debt and Financing - The company refinanced its Original Credit Facility with a new five-year senior secured credit facility totaling $110 million, consisting of a $75 million term loan and a $35 million revolving line of credit[204]. - As of September 30, 2024, the outstanding debt under the 2024 Credit Facility was $74.1 million, with no borrowings under the revolving line of credit until October 21, 2024, when $15 million was borrowed[205]. - The average interest rate on the new 2024 Credit Facility increased from 6.8% to 7.7% for the nine months ended September 30, 2024[174]. Market and Economic Conditions - The company anticipates that macro-economic trends, including inflation and changing interest rates, may impact its business operations[117]. - The decline in U.S. revenue was 7%, from $55.7 million in Q3 2023 to $51.6 million in Q3 2024, while international revenue grew by 3%[148]. - Approximately 51% of revenue for the three months ended September 30, 2024, was generated from international business, compared to 48% for the same period in 2023[201]. - A hypothetical 10% change in foreign currency exchange rates would have impacted income before income taxes by plus or minus $3.3 million as of September 30, 2024[203].

Core Viewpoint - Rimini Street, Inc. (RMNI) is experiencing undervaluation despite reporting recurrent revenue, a diverse client base, and international growth opportunities. The company has announced a stock repurchase program which may enhance stock demand and lower capital costs [1][6][20]. Group 1: Financial Performance - As of June 30, 2024, RMNI reported annualized recurring revenue of $399 million, with a market capitalization below $300 million. The company has over 3,000 active clients, including 74 Fortune 500 companies [3][4]. - The company has positive free cash flow and net income, with a conservative forecast suggesting significant undervaluation [1][3]. - The expected EPS growth for the year ending 2025 is projected at 5.7% year-over-year [2]. Group 2: Business Model and Client Base - RMNI offers a portfolio of enterprise software solutions and managed services, including partnerships with major vendors like SAP, IBM, and Salesforce. The company aims to optimize clients' technologies through its Rimini ONE service [2][3]. - The client base is well-diversified, with a significant portion of revenue generated from international markets. Approximately 50% of revenue comes from the United States, with the remainder from foreign jurisdictions [4][20]. Group 3: Strategic Initiatives - The company is reallocating resources and optimizing its cost structure, which may enhance future net profit margins. This includes ceasing services for Oracle PeopleSoft products, which accounted for 8% of total revenue in 2023 [5][20]. - RMNI has authorized an increase in its stock repurchase program from $15 million to $50 million over the next four years, which could lower the weighted average cost of capital (WACC) and potentially increase stock prices [6][7]. Group 4: Risks and Challenges - Ongoing litigation with Oracle poses risks, including potential fines and impacts on net income growth. The company has faced lawsuits for over ten years, but fines have been relatively small [15][16]. - Changes in pricing agreements with enterprise software vendors could negatively affect revenue and free cash flow margins. The company may need to adjust pricing models in response to competitive pressures [18][20]. - The sale of shares by a large shareholder could increase market volatility and downward pressure on stock prices, which may deter potential investors [19][20].

Rimini Street (RMNI) came out with quarterly earnings of $0.07 per share, missing the Zacks Consensus Estimate of $0.10 per share. This compares to earnings of $0.10 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of -30%. A quarter ago, it was expected that this company would post earnings of $0.12 per share when it actually produced earnings of $0.07, delivering a surprise of -41.67%. Over the last four quarters, the company h ...

Exhibit 99.1 FOR IMMEDIATE RELEASE Rimini Street Announces Fiscal Second Quarter 2024 Financial and Operating Results LAS VEGAS, July 31, 2024 – Rimini Street, Inc. (Nasdaq: RMNI), a global provider of end-to-end enterprise software support, products and services, the leading third-party support provider for Oracle and SAP software, and a Salesforce and AWS partner, today announced results for the fiscal second quarter ended June 30, 2024. Rimini Street will host a conference call and webcast to discuss the ...

In general, investments with original maturities of greater than three months and remaining maturities of less than one year are classified as short-term investments. Debt investments are classified as available-for-sale and gains and losses are recorded using the specific identification method. Changes in fair value are recorded in the operating statement. Fair value is calculated based on publicly available market information. To estimate fair value for the Company's interest rate swap agreement as of Jun ...

Financial Data and Key Metrics Changes - Annualized recurring revenue was $415.8 million for Q1 2024, a year-over-year increase of 1.8% [14] - Revenue for Q1 2024 was $106.7 million, a year-over-year increase of 1.2% [66] - Billings for Q1 2024 were $74.1 million, a decrease of 20% compared to the prior year [14] - Gross margin was 59.8% of revenue for Q1 2024, down from 62.7% in the prior year [14] - Net income attributable to shareholders for Q1 2024 was $1.3 million or $0.01 per diluted share, compared to $0.06 per diluted share in the prior year [21] Business Line Data and Key Metrics Changes - Revenue retention rate for service subscriptions was 89%, with more than 76% of subscription revenue non-cancelable for at least 12 months [14] - Sales and marketing expenses as a percentage of revenue were 36.7% for Q1 2024, compared to 32.7% in the prior year [20] - Non-GAAP operating margin was 8.3% of revenue for Q1 2024, down from 14.6% in the prior year [21] Market Data and Key Metrics Changes - Clients within the United States represented 50.4% of total revenue, while international clients represented 49.6% for Q1 2024 [66] - The total revenue measures on a constant currency basis were negatively impacted by 0.8% due to FX movements [66] Company Strategy and Development Direction - The company is focusing on hiring, training, and building out new solution sales capabilities globally [58] - There is a strong demand for a reliable partner for mission-critical transaction system services, which could significantly reduce IT spending [60] - The company is in the process of refocusing on its core product offerings after distractions from new product launches [29] Management's Comments on Operating Environment and Future Outlook - Management noted that the demand market remains strong despite challenges in new client sales [29] - The company is continuing to suspend guidance on future financial results until there is more clarity around litigation impacts [70] - Management expressed confidence in taking the right actions to accelerate growth and enhance shareholder value [65] Other Important Information - The company ended Q1 2024 with a cash balance of $129 million, down from $135 million in the prior year [17] - Deferred revenue as of March 31, 2024, was $254.3 million, compared to $287.4 million from the prior year [17] - The company refinanced its outstanding term loan with a new five-year senior secured credit facility [22] Q&A Session Summary Question: What are the reasons for the decline in retention rate and customer count growth? - Management indicated that the retention rate decline was influenced by larger deals rotating out and that the customer count growth was impacted by a focus on cross-selling existing services rather than acquiring new logos [84][76] Question: How is the initial reception for Rimini Custom? - The launch has been complex, but there is strong interest from customers looking for support solutions, particularly in light of recent market changes [39] Question: What are the key drivers for customer acquisition and churn? - The company is seeing increased awareness of its offerings among CFOs, which is driving demand, while churn is influenced by generational changes and shifts in IT procurement [41][100] Question: Has litigation impacted deal closings or retention? - Management acknowledged that there may be some impact on sales due to ongoing litigation with Oracle, but specific data to quantify this is not available [105] Question: What are the expectations for gross margins moving forward? - Management expects continued pressure on gross margins as the company scales to meet new client engagements, but is also working to improve efficiencies [67][19]