Core Insights - Verint Systems Inc (NASDAQ:VRNT) is experiencing a significant decline, reaching 52-week lows, down 11.4% to $19.15 following a disappointing fourth-quarter report where both earnings and revenue missed estimates [1] - The company's full-year guidance midpoint also fell below expectations, contributing to a year-to-date decline of approximately 30% [2] - The stock is currently trading below all major moving averages, indicating bearish pressure, particularly from the 20-day moving average [2] Analyst Reactions - Several analysts have reduced their price targets for Verint Systems, with Evercore ISI cutting its target from $34 to $23 [3] - Among the seven analysts covering the stock, four have a "buy" or "strong buy" rating, while three maintain a "hold" rating [3] - The 12-month consensus price target remains at $36, representing an 88.4% premium to the current trading levels [3] Options Activity - Verint Systems has seen a surge in options trading, with volume reaching eight times its average daily amount, although the absolute numbers remain relatively low [2] - The most popular option is the April 20 put, with new positions being opened [2]

Financial Performance - Verint Systems reported Q4 earnings of $0.99 per share, missing the analyst consensus estimate of $1.27 per share [1] - Quarterly sales were $253.55 million, falling short of the analyst consensus estimate of $276.99 million [1] Guidance and Growth - The company issued FY26 EPS guidance with its midpoint below estimates [1] - Verint exceeded its Q4 FYE 2025 ARR guidance by $8 million and raised its Q4 FYE 2026 ARR guidance [2] - SaaS ACV bookings from new deals grew by 30% year-over-year, while Bundled SaaS Revenue increased by 23% year-over-year [2] Market Reaction - Following the earnings announcement, Verint shares dipped 11.6% to trade at $19.11 [3] - Analysts adjusted their price targets for Verint, with Needham maintaining a Buy rating but lowering the target from $40 to $30, and Evercore ISI Group maintaining an In-Line rating while cutting the target from $34 to $23 [4]

Group 1 - Michael Wiggins De Oliveira is an inflection investor, focusing on buying undervalued companies at pivotal moments when their profitability is expected to increase significantly over the next year [1] - The investment strategy emphasizes technology and the Great Energy Transition, including uranium, with a concentrated portfolio of approximately 15 to 20 stocks and an average holding period of 18 months [1] Group 2 - Michael has over 10 years of experience analyzing companies in the tech and energy sectors, and has built a following of over 40,000 on Seeking Alpha [2] - He leads the investing group Deep Value Returns, which offers insights through a concentrated portfolio of value stocks, timely updates on stock picks, and a weekly webinar for live advice [2] - The Deep Value Returns community is described as active, vibrant, and supportive, providing accessible chat options for both new and experienced investors [2]

Financial Data and Key Metrics Changes - In Q4, the company's ARR growth reached 5%, exceeding the guidance of 4% [10][34] - The ARR outlook for Q4 2026 has been raised from $760 million to $768 million, reflecting an 8% growth [12][48] - Q4 revenue was reported at $254 million, below the guidance of $277 million, primarily due to unbundled SaaS revenue shortfalls [44][45] Business Line Data and Key Metrics Changes - SaaS ACV bookings from new deals increased by 30% year over year to $32 million, marking a quarterly record [27][35] - Bundled SaaS revenue grew 17% year over year, with acceleration from 9% growth in Q1 to 23% growth in Q4 [37][38] Market Data and Key Metrics Changes - The company reported strong AI momentum, with over 90 of the Fortune 500 brands using Verint AI-powered bots [26] - The CX market is in an early stage of AI adoption, with significant growth potential as more customers transition from AI experiments to large-scale deployments [26][29] Company Strategy and Development Direction - The company emphasizes a hybrid cloud approach, allowing customers to layer AI on existing infrastructure without disruption [20][89] - The focus is on delivering strong and differentiated AI business outcomes, which are seen as a key competitive advantage in the CX market [13][17] Management's Comments on Operating Environment and Future Outlook - Management noted that customer confidence is improving, with many moving from small-scale AI experiments to larger deployments [60][66] - The company expects continued ARR growth acceleration, driven by increased AI consumption and customer expansions [29][30] Other Important Information - Cash contribution for fiscal 2025 was reported at $228 million, an increase of 2% year over year [40] - The company has initiated a $200 million stock buyback program and increased its revolver to $500 million [52][53] Q&A Session Summary Question: Customer confidence in buying solutions and deal sizes - Management indicated that customers are moving from small-scale AI experiments to larger deployments, with significant ROI driving this shift [60][62] Question: Impact of pushed unbundled revenue on FY26 guidance - Management clarified that the pushed deals were from existing customers and did not impact the ARR guidance, which remains at 8% growth [68][70] Question: Dynamics of slipped deals and their nature - All slipped deals were from existing customers, with no renewals involved, and the timeline for rollouts has changed [94][96] Question: Channel mix and growth areas - The company is seeing growth in channel partners as they become more capable of selling AI solutions, with a focus on co-selling [100][104] Question: Macro concerns from customers - Management noted that customers are hesitant to undertake infrastructure projects but are increasingly willing to invest in AI solutions that provide tangible results [108][110] Question: Competitive market dynamics and market share - Management believes the company is gaining market share in the CX automation market, driven by its bot strategy and strong customer outcomes [122][126]

Verint Systems Inc. (NASDAQ:VRNT) Q4 2025 Earnings Conference Call March 26, 2025 4:30 PM ET Company Participants Matthew Frankel - CFA, Investor Relations Dan Bodner - CEO Grant Highlander - CFO Conference Call Participants Joshua Reilly - Needham Peter Levine - Evercore Timothy Horan - Oppenheimer Shaul Eyal - TD Cowen Operator Good day, and thank you for standing by. Welcome to Verint Systems Inc. fourth quarter 2025 earnings conference call. At this time, all participants are in a listen-only mode. Afte ...

Verint Systems (VRNT) reported $253.55 million in revenue for the quarter ended January 2025, representing a year-over-year decline of 4.4%. EPS of $0.99 for the same period compares to $1.07 a year ago.The reported revenue represents a surprise of -8.43% over the Zacks Consensus Estimate of $276.87 million. With the consensus EPS estimate being $1.27, the EPS surprise was -22.05%.While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall ...

Verint Systems (VRNT) came out with quarterly earnings of $0.99 per share, missing the Zacks Consensus Estimate of $1.27 per share. This compares to earnings of $1.07 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -22.05%. A quarter ago, it was expected that this maker of software for analyzing intercepted communications would post earnings of $0.43 per share when it actually produced earnings of $0.54, delivering a surprise ...

Revenue and Business Model - For the fiscal year ended January 31, 2025, approximately 80% of the company's revenue came from its subscription business, measured using Subscription Annual Recurring Revenue (ARR) [28]. - The company derived approximately 72% of its revenue from the Americas, 18% from EMEA, and 10% from APAC for the year ended January 31, 2025 [48]. - The company’s solutions are used by over 80 of the Fortune 100 companies across more than 175 countries [48]. AI and Technology Development - The company has developed over 50 AI-powered bots in its open platform, designed to automate specific micro-workflows with high precision [34]. - The platform's core, Verint Da Vinci AI, combines various AI models to create bots that enhance innovation and efficiency across applications [37]. - The behavioral data hub at the platform core helps brands leverage customer interaction data to derive critical business insights [39]. - The company has hundreds of issued patents and patent applications worldwide, focusing on areas such as AI and machine learning [85]. Customer Engagement and Market Trends - The customer engagement industry is experiencing growth in customer interactions and expectations, leading brands to seek AI-powered platforms for cost-effective CX automation [25]. - The economic benefits of CX automation for brands include increased workforce productivity and higher customer loyalty, while the company expects a shift in capital from labor to AI-powered solutions [30]. - The company aims to drive adoption of its open platform by enabling brands to deploy AI across customer engagement workflows with minimal operational disruption [27]. - The company is well-positioned to capitalize on the CX automation market opportunity due to its extensive experience in customer and workforce engagement software [26]. Competition and Risks - The company faces risks related to competition, technological advancements, and the ability to execute its SaaS strategy effectively [20]. - The company faces strong competition from various vendors, including major players like Microsoft, Amazon, and Salesforce [81]. Financial Performance and Position - As of January 31, 2025, the company had cash and cash equivalents totaling approximately $215.7 million, down from $241.4 million in 2024 [381]. - The company recorded net foreign currency losses of $5.9 million for the year ended January 31, 2025, compared to $0.4 million in 2024 [386]. - A hypothetical 10% change in interest rates would not have had a material impact on the company's financial statements [378]. - The company performed a sensitivity analysis indicating that a 10% increase in the relative value of the U.S. dollar would decrease the estimated fair value of foreign exchange derivatives by approximately $0.6 million [389]. - The company is exposed to market risk related to changes in interest rates and foreign currency exchange rate fluctuations, managing this through derivative instruments [392]. - The company has investment guidelines designed to maintain safety and liquidity, focusing on preserving principal while maximizing investment income [380]. Employee and Organizational Insights - As of January 31, 2025, the company employed approximately 3,800 employees, with 39% in the Americas, 33% in EMEA, and 28% in APAC [61]. - Approximately 80% of global employees participated in the Great Place to Work® survey, with nearly 94% feeling welcome upon joining the company [75]. - As of January 31, 2025, females represented approximately 28% of the company’s employee base and 26% of leadership roles [68]. - The company donated over $540,000 to charitable organizations in the year ended January 31, 2025, with more than 2,400 employees participating in approximately 100 events [80]. Research and Development - The company has a well-defined roadmap for R&D, focusing on enhancing existing solutions and introducing new features based on market research and customer demand [59]. - The company’s R&D activities are primarily conducted in the United States, the United Kingdom, Israel, India, Hungary, Ireland, and Indonesia [58]. Economic and Market Conditions - The company believes that current macroeconomic factors, including inflation, are impacting customer spending decisions [393]. - The company’s business is subject to seasonal and cyclical factors, with revenue typically highest in the fourth quarter and lowest in the first quarter [51].

Subscription Revenue - Q4 FYE 2025 subscription ARR reached $712 million, reflecting a 5.2% year-over-year growth[6] - For FYE 2026, subscription ARR guidance has been raised to between $760 million and $768 million, indicating an 8% year-over-year growth[11] - Subscription ARR increased to $711,753,000 for the year ended January 31, 2025, representing a year-over-year growth of 5.2%[23] - Bundled SaaS ARR was $328 million, showing a 16.5% year-over-year increase[6] - Bundled SaaS ARR reached $327,961,000, reflecting a year-over-year increase of 16.5%[24] - SaaS ACV from new deals amounted to $32 million, representing a 30.3% growth year-over-year[6] - SaaS ACV from new deals for the three months ended January 31, 2025, was $32,482,000, a 30.3% increase from $24,920,000 in 2024[25] Financial Performance - Cash generation for Q4 was $913 million, exceeding guidance by $8 million[4] - Cash contribution for Q4 was $228 million, also surpassing guidance by $16 million[4] - Revenue for Q4 was reported at $254 million, impacted by unbundled SaaS revenue dynamics[6][7] - Total revenue for the three months ended January 31, 2025, was $253,546,000, a decrease of 4.2% compared to $265,109,000 for the same period in 2024[21] - Net income for the year ended January 31, 2025, was $83,099,000, significantly up from $39,634,000 in 2024[61] - Total assets increased to $2,290,049,000 as of January 31, 2025, from $2,226,424,000 in 2024[59] - Total stockholders' equity rose to $889,274,000 as of January 31, 2025, compared to $832,666,000 in 2024[59] Earnings and Margins - Non-GAAP diluted EPS for Q4 was $0.99, while GAAP diluted EPS was $0.45[6] - Operating income for the year ended January 31, 2025, was $106,387,000, compared to $68,185,000 in 2024[21] - GAAP operating income for the three months ended January 31, 2025, was $46,324,000, representing an increase from $40,207,000 in the same period of 2024, with a GAAP operating margin of 18.3% compared to 15.2%[35] - Non-GAAP operating income for the year ended January 31, 2025, was $224,436,000, compared to $222,646,000 in 2024, with a non-GAAP operating margin of 24.7%[35] - Non-GAAP gross profit for the year ended January 31, 2025, was $663,949,000, with a non-GAAP gross margin of 73.0%[31] Cash Flow and Investments - Free cash flow for the year ended January 31, 2025, was $129,881,000, an increase from $124,905,000 in 2024[43] - Cash flows from operating activities provided $157,447,000 for the year ended January 31, 2025, compared to $150,642,000 in 2024[61] - The company reported a net cash used in investing activities of $84,041,000 for the year ended January 31, 2025, compared to $37,379,000 in 2024[61] Expenses and Taxation - Research and development expenses for the three months ended January 31, 2025, were $39,481,000, representing 15.6% of GAAP revenue[32] - Selling, general and administrative expenses for the three months ended January 31, 2025, were $97,143,000, accounting for 38.3% of GAAP revenue, down from 40.9% in 2024[33] - The company reported a GAAP provision for income taxes of $15,249,000 for the year ended January 31, 2025, with a non-GAAP effective income tax rate of 12.5%[37] Debt and Capital Structure - Total gross debt as of January 31, 2025, was $415,000,000, with net debt amounting to $197,777,000[42] - Net Debt is calculated as the sum of long-term and short-term debt minus cash and cash equivalents, providing insight into the company's capital structure and financial leverage[79] Definitions and Metrics - Adjusted EBITDA is defined as net income before interest, taxes, depreciation, amortization, and other specified expenses, providing a clearer view of operating performance[78] - Free Cash Flow is defined as GAAP cash from operating activities minus capital expenditures, indicating the cash available for investment and financing activities[80] - Subscription Annual Recurring Revenue (ARR) represents the annualized run-rate value of active subscription agreements, helping to measure the performance of subscription contracts[87] - Cash Generation combines ARR and nonrecurring revenue, providing an estimate of the cash-producing potential of the business[89] - Cash Contribution is defined as Cash Generation minus cost of revenue and operating expenses, assessing the effectiveness of revenue conversion into cash[89]

Core Insights - Wall Street analysts forecast that Verint Systems (VRNT) will report quarterly earnings of $1.27 per share, reflecting a year-over-year increase of 18.7% [1] - Anticipated revenues for the quarter are projected to be $276.87 million, showing a 4.4% increase compared to the same quarter last year [1] - The consensus EPS estimate has remained unchanged over the past 30 days, indicating a reassessment of projections by covering analysts [1] Revenue Estimates - Analysts project 'Revenue- Perpetual revenue - non-GAAP' to reach $25.91 million, representing a change of +0.6% from the prior-year quarter [4] - The consensus estimate for 'Revenue- Professional services revenue - non-GAAP' is $26.91 million, indicating a decline of -6.1% from the year-ago quarter [4] - 'Revenue- Support revenue - non-GAAP' is expected to be $25.20 million, reflecting a year-over-year change of -19.4% [5] Stock Performance - Shares of Verint have experienced a return of -14.9% over the past month, compared to a -7.5% change in the Zacks S&P 500 composite [6] - Verint holds a Zacks Rank 3 (Hold), suggesting it is expected to mirror overall market performance in the near future [6]