Verint Systems (VRNT) Q3 2025 earnings summary

Executive summary

• Q3 FY2025 revenue reached $224.2 million, up 3% year-over-year as reported and 5% on a non-GAAP basis adjusted for divestiture, exceeding guidance by $14 million.

• Non-GAAP diluted EPS was $0.54, $0.11 above guidance, and GAAP diluted EPS was $0.39, both driven by SaaS and AI momentum and early renewal revenue.

• Bundled SaaS revenue grew 19% year-over-year, with SaaS ARR up 11% and new SaaS ACV bookings from new deals rising 37%.

• Large contract wins and strong customer-reported AI business outcomes in financial services, insurance, and healthcare sectors.

• Company completed several AI-focused acquisitions, divested its manual quality managed services business, and is positioned for long-term growth.

Financial highlights

• Q3 GAAP and non-GAAP revenue: $224.2 million, up 3% and 5% year-over-year respectively, with non-GAAP revenue ~$14 million ahead of guidance after divestiture adjustment.

• Q3 gross margin: 70.8% GAAP, up ~70bps year-over-year; non-GAAP gross margin: 72.0%.

• Recurring revenue grew 12% year-over-year to $179.9 million in Q3, with SaaS revenue up 29%.

• Free cash flow up 25% year-to-date, expected to exceed 30% growth for the full year.

• Q3 net income: $29.0 million (GAAP); Q3 non-GAAP net income: $39.2 million.

Outlook and guidance

• Full-year FYE25 non-GAAP revenue guidance maintained at $933 million ±2%, reflecting 5% adjusted growth.

• Non-GAAP diluted EPS guidance at $2.90 midpoint, up 6% year-over-year; gross margin expected to expand at least 150 basis points.

• Q4 recurring revenue expected at ~$213 million, with 8% recurring revenue growth for the year.

• Guidance excludes impact of future acquisitions, restructuring, and non-GAAP tax adjustments.

• Investor Day scheduled for January 14, 2025, to discuss long-term AI monetization strategy.