Core Insights - Varonis Systems (VRNS) reported Q4 2025 earnings of 8 cents per share, exceeding the Zacks Consensus Estimate by 166.7%, compared to earnings of 18 cents per share in the previous year [1][9] - The company achieved revenues of $173.37 million for the quarter, surpassing the Zacks Consensus Estimate by 2.87%, and up from $158.5 million year-over-year [1][9] - Varonis has consistently beaten Zacks Consensus Estimates over the last four quarters, with an average surprise of 123.8% [1] Revenue Performance - Varonis' strong Q4 performance was driven by SaaS momentum, increased demand for automated data security, AI adoption, higher SaaS retention, and accelerating cloud workloads [2] - SaaS revenues, which accounted for 82.1% of total revenues, increased by 97.1% year-over-year to $142.3 million [3][9] - Total annual recurring revenues (ARR) reached $745.4 million, reflecting a year-over-year increase of 16.1%, with SaaS ARR of $638.5 million making up 86% of total ARR, rising 32% year-over-year [4][9] Margin and Operating Income - Varonis' gross margin decreased by 470 basis points to 78.9% in Q4 2025, attributed to the transition towards a SaaS-centric revenue model [5] - The company reported a non-GAAP operating income of $4.6 million, down from $15.3 million in the same quarter last year, with a non-GAAP operating margin of 2.7%, down from 9.7% [5] Cash Flow and Balance Sheet - As of December 31, 2025, Varonis had $921 million in cash and equivalents, a decrease from $1.1 billion as of September 30, 2025 [6] - The company generated $147.4 million in operating cash flow and reported free cash flow of $131.9 million for the year [6] Guidance - For Q1 2026, Varonis expects revenues between $164 million and $166 million, indicating a year-over-year growth of 20-22%, with a Zacks Consensus Estimate of $163.8 million [7] - The company anticipates SaaS ARR growth of 27-28% year-over-year, excluding conversions, and a non-GAAP operating loss between $10 million and $11 million [7] - For the full year 2026, total revenues are projected to be between $722 million and $730 million, suggesting a year-over-year growth of 16-17%, with a Zacks Consensus Estimate of $717.3 million [8] Future Projections - Varonis expects non-GAAP net loss per share to be in the range of 5 to 6 cents, with a Zacks Consensus Estimate of 4 cents per share [8] - The company projects SaaS ARR to be between $805 million and $840 million, implying year-over-year growth of 26-32% [11]

Q3 2025 Financial Highlights - Cloud subscriptions revenue reached $1136 million, a 21% year-over-year increase[9] - Total revenue for Q3 2025 was $1870 million, also up 21% year-over-year[9] - Subscriptions revenue in Q3 2025 amounted to $1472 million, reflecting a 20% year-over-year growth[9] - Adjusted EBITDA for Q3 2025 stood at $322 million[8] Gross Margin Performance - Subscriptions gross margin was 88%[9] - Professional services gross margin was 34%[9] - Overall gross margin was 77%[9] Revenue Retention and Renewal - Cloud Subscriptions Revenue Retention was 111% as of September 30, 2025[37] - Cloud Gross Renewal Rate was 98% in Q3 2025[14] Q4 2025 Guidance - Cloud subscriptions revenue is projected to be between $1150 million and $1170 million, representing a year-over-year growth of 16% to 18%[38] - Total revenue is expected to range from $1870 million to $1910 million, indicating a year-over-year increase of 12% to 15%[38] - Adjusted EBITDA is forecasted to be between $100 million and $130 million[38] - Non-GAAP diluted earnings per share are anticipated to be between $004 and $008[38]

Core Insights - Varonis Systems reported a revenue of $152.16 million for the quarter ended June 2025, reflecting a year-over-year increase of 16.7% [1] - The company's EPS was $0.03, down from $0.05 in the same quarter last year, but it exceeded the consensus estimate of $0.01, resulting in a surprise of +200% [1] - The reported revenue surpassed the Zacks Consensus Estimate of $147.79 million, indicating a positive surprise of +2.96% [1] Key Metrics - Annual Recurring Revenues reached $693.2 million, slightly above the estimated $687.37 million by six analysts [4] - Maintenance and Services revenues were reported at $13.89 million, significantly below the average estimate of $17.68 million, marking a year-over-year decline of -39.2% [4] - Term license subscriptions generated $32.37 million, exceeding the average estimate of $27.13 million based on two analysts [4] - SaaS revenues amounted to $105.9 million, slightly above the two-analyst average estimate of $105.03 million [4] Stock Performance - Varonis shares have returned +7.2% over the past month, outperforming the Zacks S&P 500 composite's +3.6% change [3] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [3]

Financial Performance - Total revenue for Q1 2025 was $1664 million, an 11% increase compared to Q1 2024[10] - Cloud subscriptions revenue reached $998 million in Q1 2025, a 15% growth from Q1 2024[10] - Subscriptions revenue totaled $1344 million in Q1 2025, reflecting a 14% increase year-over-year[10] - Adjusted EBITDA for Q1 2025 was $168 million[7] Margins - Subscriptions gross margin was 89%[10] - Professional services gross margin was 30%[10] - Overall gross margin stood at 78%[10] Customer Retention - Cloud subscriptions revenue retention rate was 112% as of March 31, 2025[8] - Cloud Gross Renewal Rate was 99% in Q1 2025[17] Guidance for Q2 and Full Year 2025 - Q2 2025 cloud subscriptions revenue is projected to be between $1010 million and $1030 million, representing a 14%-16% year-over-year growth[39] - Full year 2025 cloud subscriptions revenue is expected to range from $4190 million to $4230 million, a 14%-15% increase[39] - Full year 2025 total revenue is forecasted to be between $6800 million and $6880 million, indicating a 10%-12% growth[39]

Financial Performance - Varonis Systems reported $136.42 million in revenue for the quarter ended March 2025, representing a year-over-year increase of 19.7% [1] - The EPS for the same period was $0.00, compared to -$0.03 a year ago, indicating a significant improvement [1] - The reported revenue exceeded the Zacks Consensus Estimate of $133.22 million by +2.41% [1] - The EPS surprise was +100.00%, as the consensus EPS estimate was -$0.05 [1] Key Metrics - Annual Recurring Revenues reached $664.30 million, surpassing the $657.21 million average estimate based on six analysts [4] - Maintenance and Services revenues were $16.38 million, which is -31.9% year-over-year and below the $20.06 million average estimate [4] - Term license subscriptions generated $31.49 million, compared to the $35.14 million estimated by three analysts [4] - SaaS revenues were $88.56 million, exceeding the three-analyst average estimate of $78.28 million [4] Stock Performance - Varonis shares have returned +15.3% over the past month, outperforming the Zacks S&P 500 composite's +11.5% change [3] - The stock currently holds a Zacks Rank 4 (Sell), suggesting potential underperformance relative to the broader market in the near term [3]