E2open Parent (ETWO) Q3 2025 earnings summary

Executive summary

• Q3 subscription revenue was $132.0 million, above guidance midpoint, with improved retention and major upsell and cross-sell wins across multiple industries.

• Total Q3 revenue was $151.7 million, down 3.7%–4% year-over-year, with subscriptions revenue declining 0.6%–1% and professional services down 20%.

• Net loss for the quarter was $381.6 million, including $369.1 million goodwill impairment and $10.0 million intangible asset impairment, both triggered by share price decline.

• Adjusted EBITDA was $53.6 million (35.3% margin), slightly down year-over-year.

• Management team broadened with new Chief Strategy Officer and Chief Product and Technology Officer to accelerate innovation and client engagement.

Financial highlights

• Total revenue for the nine months ended November 30, 2024, was $455.0 million, down 4% year-over-year.

• Non-GAAP gross margin for Q3 was 68.8%; GAAP gross margin was 49.9%–50%.

• Adjusted EBITDA margin was 35%–35.3% for the quarter and nine-month period.

• Adjusted operating cash flow for Q3 was $21.1 million; cash and equivalents at quarter-end were $151.2 million, up $40.9 million year-over-year.

• Net cash provided by operating activities for the nine months was $46.1 million, down from $56.7 million prior year.

Outlook and guidance

• Q4 subscription revenue expected at $131–$134 million, a year-over-year decline of 2.5% to 0.3%.

• FY25 subscription revenue guidance revised to $526–$529 million (down 2.0% to 1.5% year-over-year).

• FY25 total revenue expected at $607–$611 million (down 4.3% to 3.7% year-over-year).

• FY25 gross margin expected at 68–70%; Adjusted EBITDA near low end of $215–$225 million range, margin ~35%.

• Year-end FY25 net leverage expected around 4.1x; strong positive adjusted operating cash flow anticipated.