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]

Core Insights - Verint Systems (VRNT) is currently rated as a Strong Buy (1) by Zacks, while Intuit (INTU) holds a Hold (3) rating, indicating a more favorable outlook for VRNT in terms of earnings estimates and revisions [3] - Value investors typically assess stocks using traditional metrics such as P/E ratio, P/S ratio, earnings yield, and cash flow per share to identify undervalued opportunities [4] Valuation Metrics - VRNT has a forward P/E ratio of 7.99, significantly lower than INTU's forward P/E of 31.17, suggesting that VRNT may be undervalued compared to INTU [5] - The PEG ratio for VRNT is 0.67, while INTU's PEG ratio is 2.16, indicating that VRNT has a more favorable earnings growth outlook relative to its price [5] - VRNT's P/B ratio stands at 1.77, compared to INTU's P/B of 9.27, further supporting the notion that VRNT is more attractively valued [6] - Overall, VRNT's Value grade is B, while INTU's Value grade is F, reinforcing the conclusion that VRNT is the better option for value investors at this time [6]

Group 1 - Verint Systems (NASDAQ: VRNT) reported solid Q3 earnings but faces pressure from weak topline growth and market concerns regarding AI and increased competition [1] - The company is experiencing challenges in maintaining growth amidst a competitive landscape [1] Group 2 - The article highlights the importance of analyzing undercovered companies, particularly in sectors like technology, software, electronics, and energy transition [1] - The author emphasizes the goal of identifying asymmetric investment opportunities to achieve market-beating returns [1]

Financial Data and Key Metrics Changes - In Q3 2025, revenue reached $224 million, exceeding guidance by approximately $14 million, representing about 5% year-over-year growth when adjusted for last year's divestiture [11][27] - Non-GAAP diluted EPS was $0.54, approximately $0.11 ahead of guidance [13][29] - Gross margin expanded to 72%, up approximately 70 basis points year-over-year, reflecting a favorable shift towards higher-margin recurring revenue [28] Business Line Data and Key Metrics Changes - Bundled SaaS revenue increased by 19% year-over-year, an acceleration from previous quarters, driven by AI momentum [12][30] - Unbundled SaaS revenue was reported at $73 million, ahead of expectations, with a forecast of around $100 million for Q4 due to a large pool of renewals [31] - New SaaS ACV bookings increased by 37% year-over-year in Q3 [36] Market Data and Key Metrics Changes - SaaS ARR increased by 11% year-over-year, driven by AI adoption, with expectations for double-digit growth in Q4 [37] - The company reported strong customer outcomes from AI deployments, with significant savings reported by clients in various sectors [16][18] Company Strategy and Development Direction - The company aims to maintain its leadership in the CX automation market, emphasizing its unique hybrid cloud model that allows for quick AI integration without disruptive infrastructure changes [44][50] - The focus on AI innovation is expected to drive future growth, with plans to showcase these advancements at the upcoming Investor Day [23][41] Management's Comments on Operating Environment and Future Outlook - Management noted that the contact center market is in the early stages of AI adoption, with increasing customer demand for tangible AI business outcomes [19][70] - There is an expectation for improved sales cycles in 2025 as customers gain a better understanding of AI solutions [67][71] Other Important Information - The company completed a tuck-in acquisition during Q3, contributing approximately $1 million in revenue, with potential for several million in Q4 [54][57] - The company is executing a $200 million share repurchase program and plans to expand on its capital allocation strategy during the Investor Day [39] Q&A Session Summary Question: Is Verint gaining market share in the contact center arena? - Management believes Verint is leading the CX automation market and gaining share due to strong customer-reported outcomes and a unique platform offering [44][46] Question: Can you provide details on the recent tuck-in acquisition? - The acquisition involved a startup focused on AI technology, contributing about $1 million in Q3, with potential for more in Q4 [54][57] Question: Are customers seeing changes in seat counts and net spending? - Some customers are reducing workforce while others are reallocating agents to focus on relationship building, indicating varied strategies in response to AI deployment [60][62] Question: How is the partnership with RingCentral expected to impact growth? - The partnership aims to enhance cloud-to-cloud integration, providing customers with seamless access to Verint's capabilities, expected to be a growth engine in 2025 [75][76] Question: What were the key announcements from the recent Engage conference? - The conference highlighted customer success stories and the introduction of new bots, with a focus on bundling capabilities to enhance customer experience [78][81]

Core Insights - Verint Systems (VRNT) reported revenue of $224.19 million for the quarter ended October 2024, marking a year-over-year increase of 2.5% and exceeding the Zacks Consensus Estimate of $210.21 million by 6.65% [1] - The company's EPS for the same period was $0.54, down from $0.65 a year ago, but it surpassed the consensus EPS estimate of $0.43 by 25.58% [1] Revenue Breakdown - Perpetual revenue (non-GAAP) was reported at $23.47 million, exceeding the average estimate of $21.39 million by analysts, but reflecting a year-over-year decline of 4.4% [3] - Professional services revenue (non-GAAP) was $20.86 million, falling short of the $23.02 million average estimate and showing a significant year-over-year decrease of 36.5% [3] - Support revenue (non-GAAP) reached $25.46 million, slightly above the average estimate of $24.80 million, but still representing a year-over-year decline of 24.3% [3] Stock Performance - Over the past month, Verint's shares have returned +9.7%, outperforming the Zacks S&P 500 composite's +5.8% change [4] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [4]

Core Viewpoint - Verint Systems reported quarterly earnings of $0.54 per share, exceeding the Zacks Consensus Estimate of $0.43 per share, although down from $0.65 per share a year ago [1][3] Financial Performance - The earnings surprise for the quarter was 25.58%, with the company previously expected to post earnings of $0.53 per share but actually reporting $0.49 per share in the prior quarter, resulting in a surprise of -7.55% [2] - For the quarter ended October 2024, Verint posted revenues of $224.19 million, surpassing the Zacks Consensus Estimate by 6.65%, compared to $218.67 million in the same quarter last year [3] - Over the last four quarters, Verint has exceeded consensus EPS estimates three times and has topped consensus revenue estimates three times as well [3] Stock Performance and Outlook - Verint shares have declined approximately 10.2% since the beginning of the year, contrasting with the S&P 500's gain of 26.8% [5] - The company's earnings outlook is mixed, with a current Zacks Rank of 3 (Hold), indicating expected performance in line with the market in the near future [8] - The current consensus EPS estimate for the upcoming quarter is $1.40 on revenues of $291.59 million, and for the current fiscal year, it is $2.92 on revenues of $933.24 million [9] Industry Context - The Computer - Software industry, to which Verint belongs, is currently ranked in the top 26% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [10]

Wall Street analysts forecast that Verint Systems (VRNT) will report quarterly earnings of $0.43 per share in its upcoming release, pointing to a year-over-year decline of 33.9%. It is anticipated that revenues will amount to $210.21 million, exhibiting a decline of 3.9% compared to the year-ago quarter.The current level reflects no revision in the consensus EPS estimate for the quarter over the past 30 days. This demonstrates how the analysts covering the stock have collectively reappraised their initial p ...

Verint Systems Inc VRNT shares are in the spotlight Thursday after The Bear Cave released a bearish report on the contact center company. What To Know: Short-selling firm The Bear Cave has customer experience (CX) automation company Verint Systems in its crosshairs. The short seller published a report Thursday morning titled, "Problems at Verint Systems (VRNT)," arguing that the company is likely to be disrupted by AI advancement. "Verint's management insists Verint will be an AI beneficiary as customers us ...