Yext, Inc. (NYSE:YEXT) is one of the small-cap tech stocks hedge funds were buying in Q2. On October 29, 2025, Yext published its latest product update, formally deprecating its Knowledge Assistant tool, which had previously allowed businesses to manage listings via conversational input. In its place, the company introduced a slate of new features aimed at improving flexibility and brand control across its digital experience platform. These included a user-editable schema for technical SEO, an optional s ...

Core Thesis - Yext, Inc. is experiencing a significant business transformation, highlighted by a take-private proposal from CEO Michael Walrath at $9 per share, which represents an 11.2% premium and is viewed as a potential floor price by investors [2][4] Business Developments - The company has made two transformative acquisitions, Hearsay Systems and Places Scout, enhancing its capabilities in digital client engagement, structured data, and search analytics [2] - The launch of Yext Scout, an AI-driven visibility and benchmarking platform, is expected to provide real-time insights across various search platforms, including ChatGPT and Gemini [2] Financial Performance - Yext has shown strong early momentum with over 1,000 waitlist sign-ups and renewed customer interest, alongside back-to-back quarters of double-digit revenue growth [3] - The company has achieved record Adjusted EBITDA margins above 23% and steady Annual Recurring Revenue (ARR) expansion [3] - Valuation metrics indicate an undemanding position for the software platform, with an EV/Adjusted EBITDA of approximately 9–10x and a sales multiple of around 2x [3] Shareholder Dynamics - Major shareholders, including Lead Edge Capital and Lynrock Lake, may advocate for a higher bid, potentially attracting additional bidders [4] - The current $9 offer is seen as a floor, with expectations for an increase to $9.75 or higher due to strategic momentum and investor alignment [4]

Core Viewpoint - Yext (YEXT) shares have recently declined by 5.7% over the past two weeks, but the formation of a hammer chart pattern suggests potential support and a possible trend reversal in the future [1][2]. Technical Analysis - The hammer chart pattern indicates a potential bottom, suggesting that selling pressure may be subsiding [2][5]. - This pattern typically forms during a downtrend, where the stock opens lower, makes a new low, but then closes near or above the opening price, indicating buying interest [4][5]. - Hammer candles can appear on various timeframes and are utilized by both short-term and long-term investors [5]. Fundamental Analysis - There is a strong consensus among Wall Street analysts to raise earnings estimates for Yext, which supports a bullish outlook for the stock [2][7]. - Over the last 30 days, the consensus EPS estimate for the current year has increased by 300%, indicating that analysts expect better earnings than previously predicted [8]. - Yext currently holds a Zacks Rank of 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks, which typically outperform the market [9][10].

Core Viewpoint - Yext (YEXT) has been upgraded to a Zacks Rank 2 (Buy) due to an upward trend in earnings estimates, which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Price Movement - The Zacks rating system is based on the consensus measure of EPS estimates from sell-side analysts, reflecting the company's changing earnings picture [1][2]. - A strong correlation exists between earnings estimate revisions and near-term stock price movements, making the Zacks rating system valuable for investors [4][6]. Institutional Investor Influence - Institutional investors utilize earnings estimates to determine the fair value of a company's shares, impacting stock price movements through their large transactions [4]. Yext's Earnings Outlook - The recent rating upgrade for Yext indicates an improvement in the company's underlying business, which is expected to drive the stock price higher [5]. - Yext is projected to earn $0.66 per share for the fiscal year ending January 2026, with a significant increase of 300% in the Zacks Consensus Estimate over the past three months [8]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with a proven track record of Zacks Rank 1 stocks generating an average annual return of +25% since 1988 [7]. - Yext's upgrade to Zacks Rank 2 places it in the top 20% of Zacks-covered stocks, indicating a strong potential for market-beating returns in the near term [10].

Group 1 - The main theme in the stock market for 2025 is the influx of investors into large-cap growth stocks, leading to unbalanced valuations [1] - The article highlights the author's extensive experience in covering technology companies and involvement with startups, indicating a deep understanding of current industry trends [1] Group 2 - The article does not provide any specific financial data or performance metrics related to the companies mentioned [2][3]

Core Insights - A significant decline in value percentile rankings has affected several major technology companies, indicating a shift in market perceptions regarding their relative worth and fundamental strength [1] Group 1: Value Ranking Explanation - The value ranking utilizes percentile-based metrics to compare a company's market price with its core fundamentals, including assets, earnings, sales, and operating performance [2] Group 2: Declining Value Rankings of Tech Stocks - Notable tech stocks experiencing significant decreases in their value scores include Hewlett Packard Enterprise Co. (HPE), Vimeo Inc. (VMEO), DocuSign Inc. (DOCU), and Yext Inc. (YEXT) [3][8] - The decline in value rankings for these companies suggests that the perceived overvaluation in the tech sector is being actively challenged [8] Group 3: Company-Specific Value Ranking Changes - Hewlett Packard Enterprise's value ranking fell dramatically from 69.79 to 29.86, a decrease of 39.93 points week-on-week, while the stock gained 15.18% year-to-date and 43.53% over the year [9] - Vimeo's value percentile dropped from 57.23 to 26.75, a decrease of 30.48 points, with a year-to-date increase of 19.14% and a yearly increase of 52.27% [9] - DocuSign's value score decreased by 22.32 points to 23.24, with a year-to-date decline of 11.25% and a yearly increase of 41.28% [9] - Yext's value metric declined from 27.62 to 9.04, a drop of 18.58 points, with a year-to-date increase of 32.26% and a yearly increase of 33.08% [9]

Financial Performance - Revenue for the three months ended July 31, 2025, was $113,094,000, representing a 15.5% increase from $97,887,000 in the same period of 2024[19] - Gross profit for the six months ended July 31, 2025, was $167,412,000, up from $150,038,000 in 2024, indicating an increase of 11.6%[19] - Net income for the three months ended July 31, 2025, was $26,751,000, compared to a net loss of $4,057,000 in the same period of 2024[19] - Net income for the six months ended July 31, 2025, was $27.5 million, compared to a net loss of $7.9 million for the same period in 2024[29] - Total revenue for the six months ended July 31, 2025, was $222.6 million, representing a 14.8% increase from $193.9 million in 2024[45] - Adjusted EBITDA for the three months ended July 31, 2025, was $26,369,000, compared to $9,787,000 for the same period in 2024, representing a significant increase[185] - GAAP net income for the six months ended July 31, 2025, was $27,521,000, up from a loss of $7,874,000 in the same period in 2024[184] Assets and Liabilities - Total current assets increased to $300,353,000 as of July 31, 2025, from $285,801,000 as of January 31, 2025, reflecting a growth of 5.4%[17] - Total liabilities decreased to $473,637,000 as of July 31, 2025, down from $456,885,000 as of January 31, 2025, a reduction of 3.7%[17] - Cash and cash equivalents increased to $178,761,000 as of July 31, 2025, compared to $123,133,000 as of January 31, 2025, marking a significant increase of 45.2%[17] - The total stockholders' equity as of July 31, 2025, was $152,529,000, slightly down from $153,193,000 as of January 31, 2025[17] - As of July 31, 2025, total assets amounted to $107.1 million, with $47.35 million in Level 1 assets and $59.76 million in Level 2 assets[77] Cash Flow - Cash provided by operating activities for the six months ended July 31, 2025, was $46.1 million, an increase from $27.7 million in 2024[29] - Free cash flow for the three months ended July 31, 2025, was $7,834,000, compared to a negative free cash flow of $11,194,000 in the same period in 2024[190] - The company reported a free cash flow margin of 20% for the six months ended July 31, 2025, compared to 14% in the same period in 2024[190] - Changes in accounts receivable positively impacted cash flows, with an increase of $47.3 million for the six months ended July 31, 2025[206] Expenses - Operating expenses for the three months ended July 31, 2025, were $55,360,000, down from $83,160,000 in the same period of 2024, a decrease of 33.5%[19] - The Company incurred total expenses of $89.48 million for the three months ended July 31, 2025, compared to $86.94 million for the same period in 2024, reflecting an increase of about 2.9%[123] - Cost of revenue for the three months ended July 31, 2025, was $28,060, representing 25% of total revenue[155] - Cost of revenue for the six months ended July 31, 2025, was $55.2 million, an increase of $11.3 million or 26%, primarily due to higher amortization expenses and personnel-related costs[169] Acquisitions - The company completed the acquisition of Hearsay on August 1, 2024, to enhance its digital presence platform capabilities[53] - The total consideration transferred for the acquisition of Hearsay amounted to $180.7 million, including $132.5 million in cash and liabilities incurred[54] - The acquisition of Places Scout was completed for a purchase price of $20.3 million, with $13.8 million allocated to goodwill[67][68] - The Company recognized acquisition-related costs totaling $11.2 million, which included $8.8 million related to the incentive pool for Hearsay founders and early employees[59] Stock-Based Compensation - Stock-based compensation expense increased to $25.6 million in the first half of 2025 from $24.4 million in 2024[29] - Total stock-based compensation expense for Q2 2025 was $12.962 million, a 5.1% increase from $12.333 million in Q2 2024[91] - Research and development stock-based compensation increased to $3.818 million in Q2 2025, up 46.4% from $2.607 million in Q2 2024[91] Debt and Credit Agreements - The company entered into a credit agreement providing for term loan facilities of up to $200 million[135] - The company is required to maintain minimum qualified cash of at least $35 million under the May 2025 Credit Agreement[105] - As of July 31, 2025, the company had $100 million in principal debt obligations under the May 2025 Credit Agreement[109] - The May 2025 Credit Agreement includes financial covenants requiring a minimum qualified cash of at least $35 million at all times[201] Revenue Growth - Revenue from North America for the six months ended July 31, 2025, was $179.9 million, up 18.3% from $152.2 million in 2024[45] - The company’s international revenue for the six months ended July 31, 2025, was $42.7 million, a slight increase from $41.7 million in 2024[45] - Revenue from direct customers was $94.5 million for the three months ended July 31, 2025, up 19% from $79.3 million in 2024, while revenue from third-party resellers remained stable at $18.6 million[158] Other Financial Metrics - The Company achieved a net income of $26.75 million for the three months ended July 31, 2025, compared to a net loss of $4.06 million for the same period in 2024[122] - The diluted net income per share attributable to common stockholders for the three months ended July 31, 2025, was $0.03, compared to a loss of $0.03 per share in the same period of 2024[122] - Dollar-Based Net Retention Rate for Direct Customers improved to 95% from 91% year-over-year[146] - Annual Recurring Revenue (ARR) for Direct customers increased to $369,541, representing an 18% growth from $313,392 in the previous year[143] - Total ARR reached $444,362, up 15% from $387,296 year-over-year[143]

[Executive Summary & Key Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Key%20Highlights) Yext reported strong Q2 FY2026 results exceeding guidance, alongside a non-binding acquisition proposal from its CEO [Second Quarter Fiscal 2026 Performance Overview](index=1&type=section&id=Second%20Quarter%20Fiscal%202026%20Performance%20Overview) Yext exceeded Q2 FY2026 guidance for **revenue** and **Adjusted EBITDA**, reporting strong year-over-year growth - Yext exceeded its prior quarterly guidance for both **revenue** and **Adjusted EBITDA**, and was within the high end of its range for **non-GAAP EPS**[2](index=2&type=chunk) Key Financial Highlights (Three months ended July 31, 2025 vs 2024) | Metric | Q2 FY2026 (2025) | Q2 FY2025 (2024) | YoY Change | | :-------------------------- | :--------------- | :--------------- | :--------- | | Revenue | $113.1 million | $97.9 million | 16% | | Adjusted EBITDA | $26.4 million | $9.8 million | 169.4% | | Adjusted EBITDA Margin | 23% | 10% | +13 percentage points | | Net Income (Loss) | $26.8 million | $(4.1) million | Not Applicable | | Non-GAAP EPS (basic) | $0.13 | $0.05 | 160% | | ARR (as of July 31) | $444.4 million | $387.3 million | 15% | - Results for the three months ended July 31, 2025, included the results of **Hearsay Social, Inc.** and **KabanaSoft, LLC (Places Scout)**, which were not included in the comparative period of the three months ended July 31, 2024[4](index=4&type=chunk) [Pending Acquisition Proposal](index=1&type=section&id=Pending%20Acquisition%20Proposal) Yext's **CEO** proposed to acquire outstanding shares, leading to Q2 FY2026 conference call cancellation - **Michael Walrath**, **CEO and Chairman**, submitted a non-binding proposal to acquire all outstanding shares of Yext not already owned by him at **$9.00 per share** in cash[3](index=3&type=chunk) - In light of the pending proposal, Yext will not hold a corresponding conference call[3](index=3&type=chunk) [Company Information](index=2&type=section&id=Company%20Information) This section details Yext's platform, forward-looking statement disclaimers, and contact information [About Yext](index=2&type=section&id=About%20Yext) Yext is a leading brand visibility platform for discovery and engagement across digital channels - **Yext (NYSE: YEXT)** is the leading brand visibility platform, built for discovery and engagement across **AI search**, **traditional search**, **social media**, **websites**, and **direct communications**[15](index=15&type=chunk) - The platform is powered by over **2 billion trusted data points** and a suite of integrated products, offering **real-time insights**, **AI-driven recommendations**, and execution at scale[15](index=15&type=chunk) [Statement Regarding Forward-Looking Statements](index=2&type=section&id=Statement%20Regarding%20Forward-Looking%20Statements) Forward-looking statements are subject to risks and uncertainties, which may cause actual results to differ - The release includes **forward-looking statements** regarding Yext's future expectations, beliefs, intentions, or strategies, including the effects, benefits, and challenges of a potential **acquisition transaction**[16](index=16&type=chunk) - These statements are subject to many **risks and uncertainties**, including the possibility that any **acquisition transaction** does not occur, conditions are not satisfied, required approvals are not obtained, potential litigation, and possible disruption to current plans and operations[16](index=16&type=chunk)[18](index=18&type=chunk) - Yext assumes no obligation to update or revise any **forward-looking statements**[18](index=18&type=chunk) [Contact Information](index=5&type=section&id=Contact%20Information) Contact details are provided for **investor relations** and **public relations** inquiries - **Investor Relations** can be reached at **IR@yext.com**[39](index=39&type=chunk) - **Public Relations** can be reached at **PR@yext.com**[39](index=39&type=chunk) [GAAP Financial Statements](index=6&type=section&id=GAAP%20Financial%20Statements) This section presents Yext's **GAAP financial statements**, including **balance sheets**, **operations**, and **cash flows** [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Yext's **total assets** increased to **$626.2 million**, driven by **cash** and new **long-term debt** Condensed Consolidated Balance Sheets (Selected Data, in thousands) | Metric | July 31, 2025 | January 31, 2025 | | :-------------------------------- | :------------ | :--------------- | | Total assets | $626,166 | $610,078 | | Cash and cash equivalents | $178,761 | $123,133 | | Accounts receivable, net | $66,404 | $112,942 | | Goodwill | $110,686 | $96,782 | | Total liabilities | $473,637 | $456,885 | | Unearned revenue, current | $185,592 | $229,144 | | Long term debt, net | $98,281 | — | | Total stockholders' equity | $152,529 | $153,193 | [Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income%20%28Loss%29) Yext reported Q2 FY2026 **net income** of **$26.8 million**, a significant improvement from a prior year **net loss** Condensed Consolidated Statements of Operations (Selected Data, in thousands) | Metric | Three months ended July 31, 2025 | Three months ended July 31, 2024 | | :------------------------------------------ | :------------------------------- | :------------------------------- | | Revenue | $113,094 | $97,887 | | Gross profit | $85,034 | $75,594 | | Total operating expenses | $55,360 | $83,160 | | Income (loss) from operations | $29,674 | $(7,566) | | Net income (loss) | $26,751 | $(4,057) | | Net income (loss) per share, basic | $0.22 | $(0.03) | | Net income (loss) per share, diluted | $0.03 | $(0.03) | - **General and administrative expenses** showed a significant change, reporting a credit of **$(61) thousand** in Q2 FY2026 compared to an expense of **$22,623 thousand** in Q2 FY2025[43](index=43&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) **Net cash** from **operating activities** increased to **$46.1 million**, with **investing outflow** and **financing inflow** Condensed Consolidated Statements of Cash Flows (Selected Data, in thousands) | Metric | Six months ended July 31, 2025 | Six months ended July 31, 2024 | | :------------------------------------------ | :----------------------------- | :----------------------------- | | Net cash provided by operating activities | $46,132 | $27,660 | | Net cash used in investing activities | $(19,936) | $(1,192) |\n| Net cash provided by (used in) financing activities | $40,748 | $(2,008) | | Cash, cash equivalents and restricted cash at end of period | $209,538 | $234,823 | - Key drivers for **cash flow from operating activities** included **net income** of **$27.5 million** and **stock-based compensation expense** of **$25.6 million**, partially offset by adjustments to **contingent consideration** of **$(21.6) million**[45](index=45&type=chunk) - **Financing activities** were significantly impacted by proceeds from **debt issuance** of **$99.0 million** and **share repurchases** of **$(45.4) million**[45](index=45&type=chunk) [Non-GAAP Financial Measures & Reconciliations](index=3&type=section&id=Non-GAAP%20Financial%20Measures%20%26%20Reconciliations) This section defines and reconciles Yext's **non-GAAP financial measures** for core business performance [Non-GAAP Measurements Definitions](index=3&type=section&id=Non-GAAP%20Measurements%20Definitions) Yext uses **non-GAAP measures**, excluding **stock-based compensation** and **acquisition costs**, for consistent performance - **Non-GAAP financial measures** exclude the effects of **stock-based compensation expenses**, **acquisition-related costs**, and **amortization of acquired intangibles** to provide consistency and comparability with past financial performance[19](index=19&type=chunk)[20](index=20&type=chunk)[22](index=22&type=chunk) - **Adjusted EBITDA** is defined as **GAAP net income (loss)** before **interest**, **taxes**, **depreciation**, **amortization**, **other income/expense**, **stock-based compensation expense**, and **acquisition-related costs**[23](index=23&type=chunk) - **Constant currency revenue** provides a framework for assessing performance by excluding the effect of **foreign currency rate fluctuations**, while **free cash flow** is defined as **net cash** from **operating activities** less **capital expenditures**[25](index=25&type=chunk)[26](index=26&type=chunk) [Adjusted EBITDA Reconciliation](index=9&type=section&id=Adjusted%20EBITDA%20Reconciliation) Yext's **Adjusted EBITDA** for Q2 FY2026 significantly increased to **$26.4 million**, with an improved **23.3% margin** GAAP Net Income (Loss) to Adjusted EBITDA Reconciliation (in thousands) | Metric | Three months ended July 31, 2025 | Three months ended July 31, 2024 | | :-------------------------------- | :------------------------------- | :------------------------------- | | GAAP net income (loss) | $26,751 | $(4,057) | | Adjusted EBITDA | $26,369 | $9,787 | | GAAP net income (loss) as a % of revenue | 23.7% | -4.1% | | Adjusted EBITDA margin | 23.3% | 10.0% | [Non-GAAP Operating Expenses Reconciliation](index=10&type=section&id=Non-GAAP%20Operating%20Expenses%20Reconciliation) **Non-GAAP operating expenses** decreased to **$64.7 million** (**57%** of **revenue**) in Q2 FY2026, indicating improved efficiency Non-GAAP Operating Expenses Reconciliation (Three months ended July 31, in thousands) | Metric | 2025 | 2024 | | :------------------------------------------ | :----- | :----- | | GAAP sales and marketing | $32,069 | $41,957 | | Non-GAAP sales and marketing | $29,959 | $38,802 | | Non-GAAP sales and marketing as a % of revenue | 26% | 40% | | GAAP research and development | $23,352 | $18,580 | | Non-GAAP research and development | $19,149 | $15,973 | | Non-GAAP research and development as a % of revenue | 17% | 16% | | GAAP general and administrative | $(61) | $22,623 | | Non-GAAP general and administrative | $15,582 | $14,581 | | Non-GAAP general and administrative as a % of revenue | 14% | 15% | [Non-GAAP Gross Profit and Operating Income Reconciliation](index=11&type=section&id=Non-GAAP%20Gross%20Profit%20and%20Operating%20Income%20Reconciliation) **Non-GAAP gross profit** increased to **$88.3 million** (**78.1% margin**), showing improved operational efficiency Non-GAAP Gross Profit and Operating Income Reconciliation (Three months ended July 31, in thousands) | Metric | 2025 | 2024 | | :------------------------------------------ | :----- | :----- | | GAAP gross profit | $85,034 | $75,594 | | Non-GAAP gross profit | $88,304 | $76,292 | | Non-GAAP gross margin | 78.1% | 77.9% | | GAAP income (loss) from operations | $29,674 | $(7,566) | | Non-GAAP income from operations | $23,614 | $6,936 | | Non-GAAP operating margin | 21% | 7% | [Non-GAAP Net Income and EPS Reconciliation](index=12&type=section&id=Non-GAAP%20Net%20Income%20and%20EPS%20Reconciliation) **Non-GAAP net income** for Q2 FY2026 was **$16.3 million**, with **diluted EPS** rising to **$0.12** Non-GAAP Net Income and EPS Reconciliation (Three months ended July 31, in thousands, except per share data) | Metric | 2025 | 2024 | | :------------------------------------------ | :----- | :----- | | GAAP net income (loss) | $26,751 | $(4,057) | | Non-GAAP net income | $16,309 | $6,752 | | Non-GAAP net income as a % of revenue | 14.4% | 6.9% | | GAAP basic EPS | $0.22 | $(0.03) | | Non-GAAP basic EPS | $0.13 | $0.05 | | GAAP diluted EPS | $0.03 | $(0.03) | | Non-GAAP diluted EPS | $0.12 | $0.05 | - The projected **tax rate** for **non-GAAP income tax provision** was updated to **25.5%** in the second quarter of fiscal 2026, compared to **23.5%** at the start of the fiscal year and **25%** in fiscal year 2025[21](index=21&type=chunk)[56](index=56&type=chunk) Non-GAAP Net Income and EPS Reconciliation (Six months ended July 31, in thousands, except per share data) | Metric | 2025 | 2024 | | :------------------------------------------ | :----- | :----- | | GAAP net income (loss) | $27,521 | $(7,874) | | Non-GAAP net income | $32,834 | $13,104 | | Non-GAAP net income as a % of revenue | 14.8% | 6.8% | | GAAP basic EPS | $0.22 | $(0.06) | | Non-GAAP basic EPS | $0.26 | $0.10 | | GAAP diluted EPS | $0.05 | $(0.06) | | Non-GAAP diluted EPS | $0.25 | $0.10 | [Constant Currency Revenue and Free Cash Flow Reconciliation](index=14&type=section&id=Constant%20Currency%20Revenue%20and%20Free%20Cash%20Flow%20Reconciliation) **Constant currency revenue** grew **14%**, and **free cash flow** improved to **$7.8 million** with a **7% margin** Constant Currency Revenue and Free Cash Flow (Three months ended July 31, in thousands) | Metric | 2025 | 2024 | Growth Rates | | :------------------------------------------ | :----- | :----- | :----------- | | Revenue (GAAP) | $113,094 | $97,887 | 16% | | Revenue on a constant currency basis (Non-GAAP) | $111,875 | Not Applicable | 14% | | Net cash provided by (used in) operating activities | $8,407 | $(10,649) | Not Applicable | | Free cash flow | $7,834 | $(11,194) | Not Applicable | | Free cash flow margin | 7% | -11% | Not Applicable | Constant Currency Revenue (Six months ended July 31, in thousands) | Metric | 2025 | 2024 | Growth Rates | | :------------------------------------------ | :----- | :----- | :----------- | | Revenue (GAAP) | $222,577 | $193,877 | 15% | | Revenue on a constant currency basis (Non-GAAP) | $220,825 | Not Applicable | 14% | [Operating Metrics & Supplemental Information](index=2&type=section&id=Operating%20Metrics%20%26%20Supplemental%20Information) This section defines key **operating metrics** and provides supplemental information on **ARR**, **retention rates**, and **RPO** [Operating Metrics Definitions](index=4&type=section&id=Operating%20Metrics%20Definitions) Yext defines **ARR** as annualized recurring contract amounts, and **retention rates** measure **customer retention** - **Annual recurring revenue (ARR)** for **Direct customers** is the **annualized recurring amount** of all contracts in the **enterprise**, **mid-size**, and **small business customer base**[30](index=30&type=chunk) - **Dollar-based net retention rate (NRR)** assesses the ability to retain **customers** and expand the **ARR** they generate, calculated by comparing **ARR** from a cohort of **customers** over a **12-month period**, including **expansion, contraction, and churn**[37](index=37&type=chunk) - **Dollar-based gross retention rate** assesses the ability to retain **customers**, similar to **NRR** but excludes **customer expansion**[38](index=38&type=chunk) [Annual Recurring Revenue (ARR)](index=15&type=section&id=Annual%20Recurring%20Revenue%20%28ARR%29) **Total Annual Recurring Revenue (ARR)** reached **$444.4 million**, a **15%** year-over-year increase Annual Recurring Revenue (in thousands) | Metric | July 31, 2025 | July 31, 2024 | Variance (Dollars) | Percent | | :-------------------------- | :------------ | :------------ | :----------------- | :------ | | Direct Customers | $369,541 | $313,392 | $56,149 | 18% | | Third-Party Reseller Customers | $74,821 | $73,904 | $917 | 1% | | Total Annual Recurring Revenue | $444,362 | $387,296 | $57,066 | 15% | - **ARR** as of July 31, 2025, included an approximate **$3.2 million positive impact** from **foreign currency exchange rates** on a **constant currency basis**[11](index=11&type=chunk) [Dollar-Based Net Retention Rate (NRR)](index=15&type=section&id=Dollar-Based%20Net%20Retention%20Rate%20%28NRR%29) Yext's total **Dollar-Based Net Retention Rate (NRR)** was **95%**, an improvement from **91%** in the prior year Dollar-Based Net Retention Rate | Metric | Jul. 31, 2025 | Jul. 31, 2024 | | :-------------------------- | :------------ | :------------ | | Direct Customers | 95% | 91% | | Third-Party Reseller Customers | 98% | 93% | | Total Customers | 95% | 91% | [Dollar-Based Gross Retention Rate](index=15&type=section&id=Dollar-Based%20Gross%20Retention%20Rate) The total **Dollar-Based Gross Retention Rate** was **88%**, an improvement from **84%** in the prior year Dollar-Based Gross Retention Rate | Metric | Jul. 31, 2025 | Jul. 31, 2024 | | :-------------------------- | :------------ | :------------ | | Direct Customers | 87% | 83% | | Third-Party Reseller Customers | 88% | 88% | | Total Customers | 88% | 84% | [Remaining Performance Obligations (RPO)](index=2&type=section&id=Remaining%20Performance%20Obligations%20%28RPO%29) **Remaining Performance Obligations (RPO)** totaled **$445.0 million**, with **$407.2 million** expected over **24 months** - **Remaining Performance Obligations (RPO)** were **$445.0 million** as of July 31, 2025[12](index=12&type=chunk) - **$407.2 million** of **RPO** is expected to be recognized as **revenue** over the **next twenty-four months**[12](index=12&type=chunk)

Company Overview - Yext (YEXT) shares increased by 8.8% to $8.8, driven by CEO Michael Walrath's proposal to take the company private at a cash offer of $9.00 per share, representing an 11% premium over the previous closing price [1] - The stock had previously experienced a 1.1% loss over the past four weeks [1] Earnings Expectations - Yext is expected to report quarterly earnings of $0.12 per share, reflecting a year-over-year increase of 140% [2] - Revenue projections for Yext stand at $111.22 million, which is a 13.6% increase compared to the same quarter last year [2] Stock Performance and Trends - The consensus EPS estimate for Yext has remained unchanged over the last 30 days, indicating that stock price movements may not sustain without earnings estimate revisions [3] - Yext currently holds a Zacks Rank of 3 (Hold), suggesting a neutral outlook [3] - Acuity (AYI), another company in the same industry, saw a 1.8% increase in its stock price, closing at $319.38, with a 7.2% return over the past month [3] Acuity Overview - Acuity's consensus EPS estimate for its upcoming report is $4.6, which is a 7% increase from the previous year [4] - Acuity also holds a Zacks Rank of 3 (Hold), similar to Yext [4]

Core Viewpoint - Yext's CEO and chairman, Michael Walrath, has proposed to acquire all outstanding shares of the company not already owned by him, and the board has formed a special subcommittee to evaluate this proposal [2][3] Group 1: Acquisition Proposal - Walrath's acquisition proposal is set at $9.00 per share, and he emphasizes his commitment to the company and its stakeholders while being open to other qualified bidders [2][3] - The board of directors is currently assessing the proposal through a special subcommittee of independent directors [2] Group 2: Company Performance and Expectations - Yext expects to report revenue for the quarter ended July 31 in the range of $111 million to $111.5 million, with adjusted EBITDA between $24.5 million and $25 million, and non-GAAP net income per share of 12 to 13 cents [4] - In the previous quarter ended April 30, Yext reported revenue of $109.5 million, adjusted EBITDA of $24.7 million, and non-GAAP earnings per share of 13 cents [4] - Walrath noted that the first quarter results showed solid execution and growing interest in Yext's platform, exceeding guidance on revenue and profitability [5]