Varonis Q3 Earnings Match Estimates, Revenues Increase Y/Y

Core Insights - Varonis Systems (VRNS) reported quarterly earnings of $0.06 per share, matching the Zacks Consensus Estimate, compared to earnings of $0.01 per share a year ago [1][9] - The company posted revenues of $161.58 million for Q3 2025, missing the Zacks Consensus Estimate by 2.71%, and reflecting a year-over-year increase from $148.07 million [1][9] - Varonis has consistently beaten Zacks Consensus Estimates in the previous four quarters, with an average surprise of 92.86% [1] Revenue Breakdown - SaaS revenues, which account for 77.9% of total revenues, increased by 117.7% year over year to $125.8 million [3] - Term license subscriptions, making up 15.4% of total revenues, decreased by 63.9% to $24.8 million [3] - Maintenance and services, representing 9.1% of total revenues, declined by 49.1% to $10.9 million [3] Geographic Performance - The United States contributed 72.7% of total revenues, increasing by 11.9% year over year to $114.4 million [4] - EMEA accounted for 20.8% of revenues, reflecting a 4.4% increase to $31.8 million [4] - Revenues from the rest of the world made up 6.5% of total revenues, growing by 14.4% year over year to $11.8 million [4] Margin and Operating Income - Varonis' gross margin contracted by 260 basis points to 83%, impacted by the transition to a SaaS business model [5] - The company reported a non-GAAP operating income of $1.61 million, down from $9.1 million in the same quarter last year [5] - The non-GAAP operating margin for Q3 2025 was 1%, compared to 6.1% in the year-ago quarter [5] Financial Position - As of September 30, 2025, Varonis had $1.1 billion in cash and equivalents, up from $807.4 million as of June 30, 2025 [6] - The company generated $122.7 million in operating cash flow and reported free cash flow of $111.6 million in the first three months of 2025 [6]