eGain(EGAN) - 2025 Q4 - Annual Results

eGain Announces Fourth Quarter and Fiscal Year 2025 Financial Results and $20 Million Stock Repurchase Program Expansion CEO Commentary CEO Ashu Roy expressed satisfaction with solid bookings and strong profitability in fiscal 2025, highlighting a significant deal and healthy pipeline, positioning eGain to capitalize on AI CX automation opportunities - CEO Ashu Roy noted solid bookings and strong profitability for fiscal 2025, driven by one of the largest deals ever signed and a healthy demand pipeline[2] - The company is well-positioned to capture opportunities in AI CX automation powered by trusted knowledge[2] About eGain eGain provides an AI Knowledge Hub designed to enhance customer experience and reduce costs by delivering reliable, consumable answers - eGain offers an AI Knowledge Hub that helps businesses improve customer experience and reduce costs[11] - The platform achieves this by delivering trusted, consumable answers[11] Fiscal 2025 Fourth Quarter Financial Highlights GAAP Financials (Q4 FY2025) Q4 FY2025 saw total revenue increase by 3% year-over-year and 11% sequentially, reaching $23.2 million. GAAP net income surged to $30.9 million, or $1.13 per basic share, primarily due to a $29.0 million tax benefit from the release of a valuation allowance Q4 FY2025 GAAP Financial Highlights | Metric | Q4 FY2025 | Q4 FY2024 | YoY Change | Sequential Change | | :----- | :-------- | :-------- | :--------- | :---------------- | | Total Revenue | $23.2 million | $22.462 million | +3% | +11% | | GAAP Net Income | $30.9 million | $1.5 million | +1960% | - | | GAAP EPS (Basic) | $1.13 | $0.05 | +2160% | - | | GAAP EPS (Diluted) | $1.11 | $0.05 | +2120% | - | - GAAP net income for Q4 FY2025 includes a tax benefit of approximately $29.0 million from the release of a majority of the company's valuation allowance[4] Adjusted EBITDA (Q4 FY2025) Adjusted EBITDA for Q4 FY2025 increased to $4.5 million, representing a 19% margin, up from $2.4 million (11% margin) in Q4 FY2024 Q4 FY2025 Adjusted EBITDA | Metric | Q4 FY2025 | Q4 FY2024 | Change | | :----- | :-------- | :-------- | :----- | | Adjusted EBITDA | $4.5 million | $2.4 million | +87.5% | | Adjusted EBITDA Margin | 19% | 11% | +8 ppts | Stock Repurchases (Q4 FY2025) In Q4 FY2025, eGain repurchased approximately 630,000 shares at an average price of $5.97 per share, totaling $3.8 million Q4 FY2025 Stock Repurchase Activity | Metric | Q4 FY2025 | | :----- | :-------- | | Shares Repurchased | ~630,000 | | Average Price per Share | $5.97 | | Total Value | $3.8 million | Fiscal 2025 Full Year Financial Highlights GAAP Financials (FY2025) Full year FY2025 total revenue was $88.4 million, down 5% year-over-year. GAAP net income significantly increased to $32.3 million, or $1.15 per basic share, primarily due to a $29.0 million tax benefit FY2025 GAAP Financial Highlights | Metric | FY2025 | FY2024 | YoY Change | | :----- | :----- | :----- | :--------- | | Total Revenue | $88.4 million | $92.803 million | -5% | | GAAP Net Income | $32.3 million | $7.8 million | +314% | | GAAP EPS (Basic) | $1.15 | $0.25 | +360% | | GAAP EPS (Diluted) | $1.13 | $0.25 | +352% | - GAAP net income for fiscal 2025 includes a tax benefit of approximately $29.0 million from the release of a majority of the company's valuation allowance[4] Adjusted EBITDA (FY2025) Adjusted EBITDA for fiscal 2025 was $8.6 million, representing a 10% margin, down from $11.2 million (12% margin) in fiscal 2024 FY2025 Adjusted EBITDA | Metric | FY2025 | FY2024 | Change | | :----- | :----- | :----- | :----- | | Adjusted EBITDA | $8.6 million | $11.2 million | -23.2% | | Adjusted EBITDA Margin | 10% | 12% | -2 ppts | Cash Flow & Cash Equivalents (FY2025) Cash provided by operations for fiscal 2025 was $5.3 million, with an operating cash flow margin of 6%. Total cash and cash equivalents decreased to $62.9 million as of June 30, 2025, from $70.0 million a year prior FY2025 Cash Flow and Cash Equivalents | Metric | FY2025 | FY2024 | Change | | :----- | :----- | :----- | :----- | | Cash Provided by Operations | $5.3 million | - | - | | Operating Cash Flow Margin | 6% | - | - | | Total Cash & Cash Equivalents (as of June 30) | $62.9 million | $70.0 million | -10.1% | Stock Repurchases (FY2025) For the full fiscal year 2025, eGain repurchased approximately 2,616,000 shares at an average price of $6.03 per share, totaling $15.8 million FY2025 Stock Repurchase Activity | Metric | FY2025 | | :----- | :----- | | Shares Repurchased | ~2,616,000 | | Average Price per Share | $6.03 | | Total Value | $15.8 million | Fiscal 2026 Financial Guidance Fiscal 2026 First Quarter Guidance For Q1 FY2026, eGain expects total revenue between $23.0 million and $23.5 million, GAAP net income of $0.9 million to $1.6 million, and Adjusted EBITDA of $3.7 million to $4.4 million (16% to 19% margin) Q1 FY2026 Financial Guidance | Metric | Guidance Range | | :----- | :------------- | | Total Revenue | $23.0 million - $23.5 million | | GAAP Net Income | $0.9 million - $1.6 million | | GAAP EPS | $0.03 - $0.06 | | Non-GAAP Net Income | $3.1 million - $3.8 million | | Non-GAAP EPS | $0.11 - $0.14 | | Adjusted EBITDA | $3.7 million - $4.4 million | | Adjusted EBITDA Margin | 16% - 19% | - Q1 FY2026 GAAP net income guidance includes approximately $800,000 in stock-based compensation expense and $1.4 million in warrant expense[4] Fiscal 2026 Full Year Guidance For the full fiscal year 2026, eGain anticipates total revenue between $90.5 million and $92.0 million, GAAP net income of $3.5 million to $5.0 million, and Adjusted EBITDA of $10.4 million to $11.9 million (11% to 13% margin) FY2026 Financial Guidance | Metric | Guidance Range | | :----- | :------------- | | Total Revenue | $90.5 million - $92.0 million | | GAAP Net Income | $3.5 million - $5.0 million | | GAAP EPS | $0.13 - $0.18 | | Non-GAAP Net Income | $8.3 million - $9.8 million | | Non-GAAP EPS | $0.30 - $0.36 | | Adjusted EBITDA | $10.4 million - $11.9 million | | Adjusted EBITDA Margin | 11% - 13% | - FY2026 GAAP net income guidance includes approximately $3.4 million in stock-based compensation expense[4] Guidance Assumption The financial guidance for Q1 and full fiscal year 2026 assumes a weighted average of approximately 27.5 million shares outstanding - Weighted average shares outstanding are expected to be approximately 27.5 million for both Q1 FY2026 and the full fiscal year 2026[5] Stock Repurchase Program Program Expansion Details The Board of Directors approved a $20 million increase to the stock repurchase program, raising the total authorized amount from $40 million to $60 million. The program will be funded by existing cash or future cash flows Stock Repurchase Program Expansion | Metric | Old Authorization | New Authorization | Increase | | :----- | :---------------- | :---------------- | :------- | | Total Program Amount | $40 million | $60 million | $20 million | - The stock repurchase program will be funded using existing cash or future cash flows[6] CEO Commentary on Repurchase Program CEO Ashu Roy stated that the strong balance sheet enables focus on long-term shareholder value, and the increased authorization reflects the belief that eGain's shares are undervalued and confidence in the AI knowledge market opportunity - CEO Ashu Roy emphasized that the strong balance sheet supports driving long-term shareholder value[7] - The increased repurchase authorization indicates management's belief that eGain's shares are undervalued and demonstrates confidence in the AI knowledge market opportunity[7] Non-GAAP Financial Measures Definition and Rationale eGain uses non-GAAP measures like Adjusted EBITDA and Non-GAAP net income to provide supplemental information for evaluating operating results and trends, comparing performance, and aiding management's financial and operational decision-making. These adjustments primarily account for depreciation, stock-based compensation, interest, taxes (including valuation allowance release), and severance - Adjusted EBITDA is defined as net income adjusted for depreciation, stock-based compensation, interest income, income taxes (including benefit from valuation allowance release), other expense, and severance[8] - Non-GAAP net income is adjusted for the benefit from income taxes related to the release of valuation allowance and stock-based compensation expense[8] - These non-GAAP measures are used by management for trend analysis, budgeting, planning, and to provide investors with additional tools for evaluating ongoing operating results and comparing with other software companies[8] GAAP to Non-GAAP Reconciliation - Q4 FY2025 For Q4 FY2025, non-GAAP income from operations was $3.743 million, Adjusted EBITDA was $4.468 million, and non-GAAP net income was $2.397 million. Supplemental data shows SaaS revenue growth of 6% (5% constant currency) and a non-GAAP gross profit increase of 8% (6% constant currency) Non-GAAP Income from Operations (Q4 FY2025) | Metric | Q4 FY2025 (Thousands USD) | Q4 FY2024 (Thousands USD) | | :----- | :-------- | :-------- | | GAAP Income from Operations | $3,247 | $1,192 | | Stock-based Compensation | $496 | $1,016 | | Non-GAAP Income from Operations | $3,743 | $2,208 | Adjusted EBITDA Reconciliation (Q4 FY2025) | Metric | Q4 FY2025 (Thousands USD) | Q4 FY2024 (Thousands USD) | | :----- | :-------- | :-------- | | Net Income (GAAP) | $30,865 | $1,506 | | Depreciation and amortization | $77 | $91 | | Stock-based compensation expense | $496 | $1,016 | | Interest income, net | ($440) | ($865) | | Provision for income taxes | $1,396 | $513 | | Benefit from income taxes related to valuation allowance release | ($28,964) | — | | Other expense, net | $390 | $38 | | Severance and related charges | $648 | $104 | | Adjusted EBITDA | $4,468 | $2,403 | Non-GAAP Net Income Reconciliation (Q4 FY2025) | Metric | Q4 FY2025 (Thousands USD) | Q4 FY2024 (Thousands USD) | | :----- | :-------- | :-------- | | Net Income (GAAP) | $30,865 | $1,506 | | Benefit from income taxes related to valuation allowance release | ($28,964) | — | | Stock-based compensation | $496 | $1,016 | | Non-GAAP Net Income | $2,397 | $2,522 | | Non-GAAP Basic EPS | $0.09 | $0.08 | | Non-GAAP Diluted EPS | $0.09 | $0.08 | Other GAAP to Non-GAAP Supplemental Financial Information (Q4 FY2025) Q4 FY2025 Revenue and Gross Profit (GAAP & Non-GAAP) | Metric | Q4 FY2025 (Thousands USD) | Q4 FY2024 (Thousands USD) | Growth Rate | Constant Currency Growth Rate | | :----- | :-------- | :-------- | :---------- | :---------------------------- | | GAAP SaaS Revenue | $21,691 | $20,439 | 6% | 5% | | GAAP Professional Services Revenue | $1,543 | $2,023 | (24%) | (25%) | | Total GAAP Revenue | $23,234 | $22,462 | 3% | 2% | | Non-GAAP Gross Profit | $17,066 | $15,869 | 8% | 6% | Q4 FY2025 Non-GAAP Operating Expenses | Metric | Q4 FY2025 (Thousands USD) | Q4 FY2024 (Thousands USD) | Growth Rate | Constant Currency Growth Rate | | :----- | :-------- | :-------- | :---------- | :---------------------------- | | Non-GAAP Research and Development | $6,844 | $6,350 | 8% | 7% | | Non-GAAP Sales and Marketing | $4,566 | $5,045 | (9%) | (11%) | | Non-GAAP General and Administrative | $1,913 | $2,266 | (16%) | (17%) | | Total Non-GAAP Operating Expenses | $13,323 | $13,661 | (2%) | (3%) | GAAP to Non-GAAP Reconciliation - FY2025 For the full fiscal year 2025, non-GAAP income from operations was $6.882 million, Adjusted EBITDA was $8.629 million, and non-GAAP net income was $5.739 million. Supplemental data shows a 4% (constant currency) decline in SaaS revenue and a 5% (constant currency) decline in total GAAP revenue, with non-GAAP gross profit decreasing by 5% (6% constant currency) Non-GAAP Income from Operations (FY2025) | Metric | FY2025 (Thousands USD) | FY2024 (Thousands USD) | | :----- | :----- | :----- | | GAAP Income from Operations | $4,433 | $5,971 | | Stock-based Compensation | $2,449 | $4,529 | | Non-GAAP Income from Operations | $6,882 | $10,500 | Adjusted EBITDA Reconciliation (FY2025) | Metric | FY2025 (Thousands USD) | FY2024 (Thousands USD) | | :----- | :----- | :----- | | Net Income (GAAP) | $32,254 | $7,780 | | Depreciation and amortization | $340 | $387 | | Stock-based compensation expense | $2,449 | $4,529 | | Interest income, net | ($2,469) | ($3,798) | | Provision for income taxes | $2,347 | $1,938 | | Benefit from income taxes related to valuation allowance release | ($28,964) | — | | Other expense, net | $1,265 | $51 | | Severance and related charges | $1,407 | $351 | | Adjusted EBITDA | $8,629 | $11,238 | Non-GAAP Net Income Reconciliation (FY2025) | Metric | FY2025 (Thousands USD) | FY2024 (Thousands USD) | | :----- | :----- | :----- | | Net Income (GAAP) | $32,254 | $7,780 | | Benefit from income taxes related to valuation allowance release | ($28,964) | — | | Stock-based compensation | $2,449 | $4,529 | | Non-GAAP Net Income | $5,739 | $12,309 | | Non-GAAP Basic EPS | $0.20 | $0.40 | | Non-GAAP Diluted EPS | $0.20 | $0.39 | Other GAAP to Non-GAAP Supplemental Financial Information (FY2025) FY2025 Revenue and Gross Profit (GAAP & Non-GAAP) | Metric | FY2025 (Thousands USD) | FY2024 (Thousands USD) | Growth Rate | Constant Currency Growth Rate | | :----- | :----- | :----- | :---------- | :---------------------------- | | GAAP SaaS Revenue | $81,921 | $85,082 | (4%) | (4%) | | GAAP Professional Services Revenue | $6,510 | $7,721 | (16%) | (16%) | | Total GAAP Revenue | $88,431 | $92,803 | (5%) | (5%) | | Non-GAAP Gross Profit | $62,873 | $66,448 | (5%) | (6%) | FY2025 Non-GAAP Operating Expenses | Metric | FY2025 (Thousands USD) | FY2024 (Thousands USD) | Growth Rate | Constant Currency Growth Rate | | :----- | :----- | :----- | :---------- | :---------------------------- | | Non-GAAP Research and Development | $28,964 | $25,202 | 15% | 15% | | Non-GAAP Sales and Marketing | $19,004 | $21,470 | (11%) | (12%) | | Non-GAAP General and Administrative | $8,023 | $9,276 | (14%) | (14%) | | Total Non-GAAP Operating Expenses | $55,991 | $55,948 | 0% | 0% | Condensed Consolidated Financial Statements Condensed Consolidated Balance Sheets As of June 30, 2025, total assets increased to $148.0 million from $127.9 million in 2024, primarily driven by an increase in "Other assets, net." Total liabilities decreased slightly to $67.3 million from $69.4 million, while total stockholders' equity significantly increased to $80.7 million from $58.5 million Condensed Consolidated Balance Sheets (Key Figures) | Metric | June 30, 2025 (Thousands USD) | June 30, 2024 (Thousands USD) | Change (Thousands USD) | | :-------------------- | :------------ | :------------ | :----- | | Cash and cash equivalents | $62,909 | $70,003 | ($7,094) | | Total current assets | $100,567 | $107,124 | ($6,557) | | Total assets | $148,005 | $127,852 | $20,153 | | Total current liabilities | $62,151 | $62,613 | ($462) | | Total liabilities | $67,274 | $69,356 | ($2,082) | | Total stockholders' equity | $80,731 | $58,496 | $22,235 | - The significant increase in total assets is largely attributable to a rise in "Other assets, net" from $1.511 million in 2024 to $28.592 million in 2025[15] Condensed Consolidated Statements of Operations For Q4 FY2025, total revenue was $23.234 million (up 3% YoY), and net income was $30.865 million (up significantly YoY due to tax benefit). For the full FY2025, total revenue was $88.431 million (down 5% YoY), and net income was $32.254 million (up significantly YoY due to tax benefit) Condensed Consolidated Statements of Operations (Q4 & FY2025) | Metric | Q4 FY2025 (Thousands USD) | Q4 FY2024 (Thousands USD) | FY2025 (Thousands USD) | FY2024 (Thousands USD) | | :-------------------- | :-------- | :-------- | :----- | :----- | | SaaS Revenue | $21,691 | $20,439 | $81,921 | $85,082 | | Professional Services Revenue | $1,543 | $2,023 | $6,510 | $7,721 | | Total Revenue | $23,234 | $22,462 | $88,431 | $92,803 | | Gross Profit | $16,880 | $15,556 | $62,008 | $65,211 | | Income from Operations | $3,247 | $1,192 | $4,433 | $5,971 | | Net Income | $30,865 | $1,506 | $32,254 | $7,780 | | Basic EPS | $1.13 | $0.05 | $1.15 | $0.25 | | Diluted EPS | $1.11 | $0.05 | $1.13 | $0.25 | - The significant increase in net income for both Q4 and FY2025 was primarily driven by a substantial benefit from income taxes, amounting to $27.568 million in Q4 and $26.617 million for the full year[17] Stock-Based Compensation Included in Costs and Expenses | Category | Q4 FY2025 (Thousands USD) | Q4 FY2024 (Thousands USD) | FY2025 (Thousands USD) | FY2024 (Thousands USD) | | :------- | :-------- | :-------- | :----- | :----- | | Cost of revenue | $186 | $313 | $865 | $1,237 | | Research and development | $117 | $329 | $640 | $1,424 | | Sales and marketing | $75 | $169 | $352 | $645 | | General and administrative | $118 | $205 | $592 | $1,223 | | Total Stock-based Compensation | $496 | $1,016 | $2,449 | $4,529 | Additional Information Conference Call Information eGain will host a teleconference on September 4, 2025, at 2:00 p.m. Pacific Time to discuss its fiscal 2025 fourth quarter and full year results, with live and archived webcasts available on its investor relations website - A teleconference to discuss Q4 and FY2025 results will be held on September 4, 2025, at 2:00 p.m. Pacific Time[9] - Live and archived webcasts will be available on the **"Investor relations" section of eGain's website (www.egain.com)**[9](index=9&type=chunk) - A phone replay will be available for one week following the call[9] Cautionary Note Regarding Forward-Looking Statements The press release contains forward-looking statements, including financial guidance and market opportunities, which are subject to risks, uncertainties, and assumptions that could cause actual results to differ materially. The company disclaims any obligation to update these statements - The press release includes forward-looking statements regarding financial guidance for FY2026, market demand for AI-enabled solutions, and the company's belief that its shares are undervalued[12] - These statements involve risks, uncertainties, and assumptions, such as technological advancements in generative AI, market demand fluctuations, and economic conditions, which could cause actual results to differ materially[12] - eGain assumes no obligation to update these forward-looking statements, except as required by law[12] Trademarks & Investor Relations This section provides information on eGain's trademarks and contact details for investor relations inquiries - eGain, the eGain logo, and other product names are trademarks or registered trademarks of eGain Corporation[13] - Investor relations contacts are Todd Kehrli and Jim Byers of PondelWilkinson, Inc.[13]