Earnings per Share (EPS) of $0.04 missed the expected $0.12.Revenue of approximately $112 million, slightly below the estimated $113 million.Price-to-Earnings (P/E) ratio of 41.17 indicates high investor confidence.Yext, Inc. (NYSE:YEXT) specializes in brand visibility solutions, aiding businesses in managing their digital presence. On December 8, 2025, Yext reported an Earnings per Share (EPS) of $0.04, which was below the expected $0.12. The company's revenue was approximately $112 million, slightly missi ...

Core Viewpoint - Yext reported quarterly earnings of $0.14 per share, exceeding the Zacks Consensus Estimate of $0.12 per share, marking a 16.67% earnings surprise compared to the previous year's earnings of $0.12 per share [1][2]. Financial Performance - Yext's revenues for the quarter ended October 2025 were $112 million, slightly missing the Zacks Consensus Estimate by 0.72%, and down from $113.99 million year-over-year [2]. - Over the last four quarters, Yext has surpassed consensus EPS estimates two times and topped consensus revenue estimates three times [2]. Stock Performance - Yext shares have increased approximately 39.5% since the beginning of the year, outperforming the S&P 500's gain of 16.8% [3]. - The current Zacks Rank for Yext is 3 (Hold), indicating that the shares are expected to perform in line with the market in the near future [6]. Future Outlook - The consensus EPS estimate for the upcoming quarter is $0.13 on revenues of $114.79 million, and for the current fiscal year, it is $0.66 on revenues of $450.17 million [7]. - The outlook for the Technology Services industry, where Yext operates, is currently in the top 38% of Zacks industries, suggesting a favorable environment for stock performance [8].

Financial Performance - Revenue for the three months ended October 31, 2025, was $111,998, a decrease of 1.7% compared to $113,989 for the same period in 2024[19]. - Gross profit for the three months ended October 31, 2025, was $82,795, down from $87,742 in the prior year, reflecting a gross margin of 73.9%[19]. - Operating expenses decreased to $75,015 for the three months ended October 31, 2025, compared to $98,110 in the same period of 2024, a reduction of 23.5%[19]. - Net income for the three months ended October 31, 2025, was $6,136, compared to a net loss of $12,799 for the same period in 2024[19]. - Total revenue for the nine months ended October 31, 2025, was $334.6 million, representing an increase of 8.6% from $307.9 million in the same period of 2024[49]. - For the nine months ended October 31, 2025, Yext reported a net income of $33.7 million, compared to a net loss of $20.7 million for the same period in 2024[31]. - Revenue from North America for the nine months ended October 31, 2025, was $270.6 million, up 10.9% from $244.2 million in 2024[49]. - The company reported a net income of $6.1 million for the three months ended October 31, 2025, compared to a net loss of $12.8 million for the same period in 2024, resulting in a basic net income per share of $0.05[131]. - Non-GAAP net income for the three months ended October 31, 2025, was $17.495 million, an increase from $15.615 million in the same period of 2024[194]. - Adjusted EBITDA for the three months ended October 31, 2025, was $27.220 million, compared to $23.094 million in the same period of 2024, reflecting a growth of 18.4%[194]. Assets and Liabilities - Total assets as of October 31, 2025, were $555,773, down from $610,078 as of January 31, 2025, a decrease of 8.9%[17]. - Total liabilities decreased to $400,601 as of October 31, 2025, from $456,885 as of January 31, 2025, a reduction of 12.3%[17]. - Cash and cash equivalents increased to $139,916 as of October 31, 2025, compared to $123,133 as of January 31, 2025, an increase of 13.6%[17]. - The company’s accumulated deficit improved to $(673,463) as of October 31, 2025, from $(707,120) as of January 31, 2025[17]. - The company’s total stockholders' equity increased to $155,172 as of October 31, 2025, from $153,193 as of January 31, 2025[17]. - As of October 31, 2025, the Company's total marketable securities amounted to $88.2 million, with money market funds comprising $28.4 million[76]. - Accounts payable and accrued expenses totaled $39.030 million as of October 31, 2025, a decrease from $70.022 million as of January 31, 2025[97]. Cash Flow and Financing - Cash provided by operating activities for the nine months ended October 31, 2025, was $26.3 million, compared to $11.9 million in 2024[31]. - Free cash flow for the three months ended October 31, 2025, was $(20.335) million, compared to $(16.372) million in the same period of 2024[199]. - The company reported net cash used in investing activities of $(20,451) thousand for the nine months ended October 31, 2025, compared to $(91,176) thousand in the same period of 2024[214]. - Net cash provided by financing activities was $10.1 million for the nine months ended October 31, 2025, compared to $(13,213) thousand in the same period of 2024[214]. - The company entered into a May 2025 Credit Agreement providing for a senior secured initial term loan facility of up to $100 million, maturing on May 15, 2030[110]. - As of October 31, 2025, the Company's principal debt obligation was $100 million, with a net carrying amount of $98.167 million after accounting for unamortized costs[117]. - The company incurred original issue discount costs of $1.0 million and debt issuance costs of $0.7 million in connection with the May 2025 Credit Agreement[211]. - The May 2025 Credit Agreement requires the company to maintain minimum qualified cash of at least $35.0 million at all times[210]. - As of October 31, 2025, the company was in compliance with all debt covenants[212]. Acquisitions - The company completed the acquisition of Hearsay on August 1, 2024, to enhance its digital presence platform capabilities[57]. - The total consideration transferred for the acquisition of Hearsay amounted to $180.7 million, which includes cash consideration of $132.5 million and contingent consideration of $39.8 million[58][60][61]. - The contingent consideration is tied to an earnout arrangement that could require payments of up to $75.0 million based on achieving specific Annual Recurring Revenue (ARR) milestones by September 2026[61]. - The Company recognized acquisition-related costs totaling $11.2 million, which were expensed as incurred and included $8.8 million related to the incentive pool for Hearsay founders and early employees[65]. - The purchase price allocation for the acquisition of Hearsay included identifiable intangible assets valued at $101.9 million, with customer relationships valued at $76.2 million and technology at $24.8 million[66][70]. - The acquisition of Places Scout was completed for a purchase price of $20.3 million, with $5.6 million allocated to technology and $0.9 million to customer relationships[73][74]. - The Company issued approximately 2.1 million replacement equity awards with a fair value of $11.8 million as part of the Hearsay acquisition, with $7.8 million allocated to pre-acquisition services[62]. - The company completed the acquisition of KabanaSoft for $20.3 million, enhancing its competitive intelligence and AI capabilities[142]. Revenue Recognition and Backlog - As of October 31, 2025, unearned revenue was $154.6 million, indicating a strong backlog of future revenue[54]. - The company had $415.6 million in remaining performance obligations as of October 31, 2025, with $377.1 million expected to be recognized as revenue over the next 24 months[56]. - Revenue from direct customers was $93.3 million for the three months ended October 31, 2025, down $2.2 million or 2% from $95.5 million in 2024, primarily due to customer attrition[166]. - Revenue from direct customers for the nine months ended October 31, 2025, was $279.2 million, an increase of $27.1 million or 11% from $252.2 million in 2024[176]. - Total Annual Recurring Revenue (ARR) decreased by 1% to $444.36 million in 2025 from $448.65 million in 2024[151]. Stock-Based Compensation - Stock-based compensation expense for the nine months ended October 31, 2025, was $38.0 million, slightly up from $37.1 million in 2024[31]. - Total stock-based compensation expense for the three months ended October 31, 2025, was $12.338 million, a decrease of 2.8% from $12.693 million in the same period of 2024[99]. - For the nine months ended October 31, 2025, total stock-based compensation expense increased to $37.959 million, up 2.3% from $37.091 million in 2024[99]. - The balance of restricted stock and restricted stock units (RSUs) as of October 31, 2025, was 8,857,312, with a weighted-average grant date fair value of $7.30[102]. - The Company granted 1,025,000 performance-based restricted stock units (PSUs) during the nine months ended October 31, 2025, which vest based on achieving specific metrics[103]. Tax and Compliance - The Company recorded a provision for income taxes of $0.5 million for the three months ended October 31, 2025, compared to $3.0 million for the same period in 2024[120]. - The effective tax rate differs from the U.S. federal statutory tax rate primarily due to full valuation allowances related to net deferred tax assets[121]. - The projected tax rate for non-GAAP income was updated to 25.5% for fiscal year 2026, compared to 25% in fiscal year 2025[187]. Market Conditions and Strategic Initiatives - Macroeconomic conditions, including inflation and foreign currency fluctuations, may adversely impact the company's financial condition and operating results in future periods[139]. - Michael Walrath, CEO of Yext, proposed to acquire all outstanding shares at $9.00 per share, with no decision made yet by the Board[141]. - The company operates as a single segment, with consolidated net income (loss) used to measure segment profit or loss[132]. - The company’s digital presence platform, known as the Answers Platform, is utilized by over 200 service and application providers, enhancing its market reach[135].

Revenue Performance - Revenue for Q3 FY 2026 was $112.0 million, a 2% decrease compared to $114.0 million in Q3 FY 2025[4] - Total revenue for the three months ended October 31, 2025, was $111,998, a decrease of 1.7% compared to $113,989 for the same period in 2024[43] - Revenue for the nine months ended October 31, 2025, was $334.575 million, representing a 9% increase from $307.866 million in 2024[63] - Total Annual Recurring Revenue (ARR) as of October 31, 2025, was $444.360 million, down 1% from $448.649 million in 2024[65] Profitability Metrics - Gross profit was $82.8 million, a decrease of 6% from $87.7 million in Q3 FY 2025, resulting in a gross margin of 73.9%[8] - The company reported a net income of $6,136 for the three months ended October 31, 2025, compared to a net loss of $12,799 in the same period of 2024[43] - GAAP net income for Q3 2025 was $6,136, compared to a loss of $12,799 in Q3 2024, representing a significant turnaround[47] - Non-GAAP net income for Q3 2025 was $17,495, compared to $15,615 in Q3 2024, reflecting a year-over-year increase of 11.3%[56] - GAAP net income for the nine months ended October 31, 2025, was $33.657 million, compared to a loss of $20.673 million in 2024[60] - Non-GAAP net income for the same period was $50.329 million, up from $28.717 million year-over-year[60] Cash Flow and Liquidity - Cash, cash equivalents, and restricted cash totaled $158.9 million as of October 31, 2025, up from $138.7 million as of January 31, 2025[11] - Cash and cash equivalents at the end of the period were $139,916, an increase from $123,133 at the beginning of the period[41] - The company reported a net cash provided by operating activities of $26,312 for the nine months ended October 31, 2025, compared to $11,865 in 2024[45] - Free cash flow for the nine months ended October 31, 2025, was $24.662 million, compared to $10.096 million in 2024[63] Customer Metrics - Dollar-Based Net Retention Rate (NRR) for total and direct customers was 96%, while NRR for third-party reseller customers was 99%[10] - Direct customers represented 83% of total ARR, totaling $368.6 million, a 2% year-over-year decrease[15] - The dollar-based net retention rate for total customers was 96% as of October 31, 2025, compared to 92% a year earlier[65] - The dollar-based gross retention rate for total customers improved to 88% as of October 31, 2025, from 84% in the same period last year[65] Operating Expenses - Operating expenses for the three months ended October 31, 2025, were $75,015, down from $98,110 in the same period of 2024, reflecting a reduction in sales and marketing expenses[43] - GAAP operating expenses for Q3 2025 were $75,015, down from $98,110 in Q3 2024, leading to a GAAP operating margin of 7%[53] - Non-GAAP operating expenses for Q3 2025 were $62,285, compared to $70,288 in Q3 2024, with a non-GAAP operating margin of 22%[53] Stock and Shareholder Returns - Share repurchase program year-to-date totaled $59.6 million, with approximately $22.3 million remaining for future purchases[11] - GAAP net income per share attributable to common stockholders (diluted) was $0.06 for the nine months ended October 31, 2025, compared to a loss of $0.16 in 2024[60] - Non-GAAP net income per share attributable to common stockholders (diluted) increased to $0.38 from $0.22 year-over-year[60] Performance Obligations - Remaining Performance Obligations (RPO) were $415.6 million, with $377.1 million expected to be recognized as revenue over the next 24 months[10]

Core Insights - Yext, Inc. is transitioning from its Knowledge Assistant tool to a new suite of features aimed at enhancing flexibility and brand control in its digital experience platform [1][3] - The company is focusing on a modular, mobile-optimized web architecture, reflecting a strategic pivot towards a mobile-first future [2][3] Product Updates - Yext has deprecated its Knowledge Assistant tool and introduced new features such as a user-editable schema for technical SEO, optional starting locations for map-based locator pages, and customizable banner sections for directory and locator modules [2][3] - The recent updates follow a beta release of the new Yext mobile app, indicating a shift in the platform's core functionality [3] Company Overview - Yext, Inc. provides a platform for managing digital knowledge and customer-facing content across various digital endpoints, including websites and search engines [4]

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]