Open Text Corporation announced its financial results for the second quarter ended December 31, 2025.
Fiscal 2026 Second Quarter Highlights (in millions)(1)
|
Total Revenues |
Cloud Revenues |
Profitability |
Diluted EPS |
Cash Flows |
|||
|
Net Income |
A-EBITDA |
GAAP |
Non-GAAP |
Operating |
Free Cash Flows |
||
|
$1,327 -0.6% Y/Y |
$478 +3.4% Y/Y |
$168 12.7% margin |
$491 37.0% margin |
$0.66 -24.1% Y/Y |
$1.13 +1.8% Y/Y |
$319 -8.4% Y/Y |
$279 -8.9% Y/Y |
“We had an excellent quarter, led by 18% revenue growth in our Content Management cloud business,” said James McGourlay, Interim Chief Executive Officer. “OpenText is at the forefront of Enterprise Information Management for AI, and at our recent OpenText World conference, our customers and partners demonstrated on the main stage how they leverage our Aviator AI solutions to solve complex problems, bringing insights, security and compliance to their information and most sensitive data. I would also like to welcome Ayman Antoun to the CEO role at OpenText, and I look forward to working with him on a smooth and steady transition.”
James McGourlay, OpenText Interim Chief Executive Officer
“With strong adjusted EBITDA margin and free cash flow performance in the quarter, the strength of the OpenText operating model continues to drive our business to meet the Company’s margin targets for Fiscal 2026,” said Steve Rai, Executive Vice President, Chief Financial Officer. “Our robust cash flow engine provides the scale and capital flexibility to continue investing for growth within our core Enterprise Information Management for AI market.”
Steve Rai, OpenText Executive Vice President, Chief Financial Officer
“Welcoming Ayman Antoun as our CEO marks a pivotal milestone in OpenText’s journey. He brings deep enterprise technology and software expertise with decades of experience leading large scale global transformations. Ayman’s leadership will help OpenText expand our market share as the world’s leader in secure, trusted data amid accelerating demand for cloud modernization and enterprise AI,” said P. Thomas Jenkins, Executive Chair of the Board and Chief Strategy Officer. “The closing of eDOCS and announced divestiture of Vertica demonstrates our continued progress in divesting non-core assets. We remain committed to building a leaner OpenText, focused on growth and helping clients leverage enterprise content to train agentic AI.”
P. Thomas Jenkins, OpenText Executive Chair & Chief Strategy Officer
Second Quarter Financial Highlights Y/Y
- Total revenues: $1.327 billion, -0.6% Y/Y
- Annual recurring revenues (ARR): $1.060 billion, +0.7% Y/Y
- Cloud revenues: $478 million, +3.4% Y/Y, 20 consecutive quarters of cloud organic growth
- Quarterly enterprise cloud bookings(2): $295 million, +18.0% Y/Y
- Cash flows: Operating $319 million and free cash flows(3) $279 million
- Net income: GAAP $168 million, -26.9% Y/Y, Non-GAAP(3) $286 million, -2.4% Y/Y
- Adjusted EBITDA(3) of $491 million, margin of 37.0%
- Diluted earnings per share (EPS): GAAP $0.66, Non-GAAP(3) $1.13
- Capital returns of $119 million including $69 million via dividends and $50 million of share repurchases
(1) Numbers presented are in millions of US dollars, except for per share or percentage metrics.
(2) Enterprise cloud bookings is defined as the total value from cloud services and subscription contracts, entered into in the period that are new, committed and incremental to our existing contracts, entered into with our enterprise based customers.
(3) Please see Note 2 “Use of Non-GAAP Financial Measures” to the condensed consolidated financial statements below.
Financial Highlights for Q2 Fiscal 2026 with Year Over Year Comparisons
|
Summary of Quarterly Results (In millions, except per share data) Revenues: |
Q2 FY’26 |
Q2 FY’25 |
$ Change |
% Change |
Q2 FY’26 in CC* |
% Change in CC* |
|
Cloud services and subscriptions |
$478 |
$462 |
$16 |
3.4 % |
$471 |
1.9 % |
|
Customer support |
$582 |
$591 |
($9) |
(1.5) % |
$569 |
(3.7) % |
|
Total annual recurring revenues** |
$1,060 |
$1,053 |
$7 |
0.7 % |
$1,040 |
(1.2) % |
|
License |
$184 |
$189 |
($5) |
(2.5) % |
$179 |
(5.3) % |
|
Professional service and other |
$83 |
$93 |
($10) |
(11.0) % |
$81 |
(13.1) % |
|
Total revenues |
$1,327 |
$1,335 |
($8) |
(0.6) % |
$1,299 |
(2.6) % |
|
GAAP-based operating income |
$292 |
$296 |
($4) |
(1.4) % |
N/A |
N/A |
|
Non-GAAP-based operating income (1) |
$456 |
$470 |
($14) |
(2.9) % |
$436 |
(7.2) % |
|
GAAP-based net income attributable to OpenText |
$168 |
$230 |
($62) |
(26.9) % |
N/A |
N/A |
|
Non-GAAP-based net income attributable to OpenText (1) |
$286 |
$293 |
($7) |
(2.4) % |
$272 |
(7.4) % |
|
GAAP-based EPS, diluted |
$0.66 |
$0.87 |
($0.21) |
(24.1) % |
N/A |
N/A |
|
Non-GAAP-based EPS, diluted (1) |
$1.13 |
$1.11 |
$0.02 |
1.8 % |
$1.07 |
(3.6) % |
|
Adjusted EBITDA (1) |
$491 |
$501 |
($10) |
(2.1) % |
$471 |
(6.1) % |
|
Operating cash flows |
$319 |
$348 |
($29) |
(8.4) % |
N/A |
N/A |
|
Free cash flows (1) |
$279 |
$307 |
($27) |
(8.9) % |
N/A |
N/A |
|
Summary of YTD Results (In millions, except per share data) Revenues: |
FY’26 YTD |
FY’25 YTD |
$ Change |
% Change |
FY’26 YTD in CC* |
% Change in CC* |
|
Cloud services and subscriptions |
$963 |
$919 |
$43 |
4.7 % |
$947 |
3.0 % |
|
Customer support |
$1,169 |
$1,186 |
($17) |
(1.5) % |
$1,141 |
(3.8) % |
|
Total annual recurring revenues** |
$2,131 |
$2,105 |
$26 |
1.2 % |
$2,089 |
(0.8) % |
|
License |
$319 |
$315 |
$4 |
1.3 % |
$311 |
(1.1) % |
|
Professional service and other |
$165 |
$183 |
($19) |
(10.2) % |
$160 |
(12.7) % |
|
Total revenues |
$2,615 |
$2,604 |
$11 |
0.4 % |
$2,560 |
(1.7) % |
|
GAAP-based operating income |
$562 |
$502 |
$60 |
11.9 % |
N/A |
N/A |
|
Non-GAAP-based operating income (1) |
$887 |
$881 |
$6 |
0.7 % |
$850 |
(3.5) % |
|
GAAP-based net income attributable to OpenText |
$315 |
$314 |
$— |
0.2 % |
N/A |
N/A |
|
Non-GAAP-based net income attributable to OpenText (1) |
$553 |
$542 |
$10 |
1.9 % |
$526 |
(3.0) % |
|
GAAP-based EPS, diluted |
$1.24 |
$1.18 |
$0.06 |
5.1 % |
N/A |
N/A |
|
Non-GAAP-based EPS, diluted (1) |
$2.18 |
$2.03 |
$0.15 |
7.4 % |
$2.08 |
2.5 % |
|
Adjusted EBITDA (1) |
$959 |
$945 |
$13 |
1.4 % |
$921 |
(2.5) % |
|
Operating cash flows |
$466 |
$270 |
$196 |
72.6 % |
N/A |
N/A |
|
Free cash flows (1) |
$381 |
$190 |
$191 |
100.8 % |
N/A |
N/A |
(1) Please see Note 2 “Use of Non-GAAP Financial Measures” to the condensed consolidated financial statements below.
Note: Items in tables may not add due to rounding. Percentages presented are calculated based on the underlying amounts.
*CC: Constant currency for this purpose is defined as the current period reported revenues/expenses/earnings represented at the prior comparative period’s foreign exchange rate.
**Annual recurring revenue is defined as the sum of Cloud services and subscriptions revenue and Customer support revenue.
Dividend
As part of the quarterly, non-cumulative cash dividend program, the Board declared on February 4, 2026, a cash dividend of $0.275 per common share. The record date for this dividend is March 6, 2026 and the payment date is March 20, 2026. OpenText believes strongly in returning value to its shareholders. Any future declarations of dividends and the establishment of future record and payment dates are all subject to the final determination and discretion of the Board of Directors.
Quarterly Business Highlights
- OpenText appoints Ayman Antoun as Chief Executive Officer, effective April 20, 2026
- OpenText announces divestiture of Vertica, a part of its non-core Analytics portfolio, for US$150 million
- OpenText completes divestiture of eDOCS, a non-core product, for US$163 million
- John Hastings and Margaret Stuart appointed to the Board of Directors in December 2025, totaling four new board members appointed in 2025
- OpenText unveiled next-generation AI Data Platform for secure information management at our OpenText World user conference
- OpenText expands collaboration with SAP to deliver AI-ready cloud content management at scale
- Key customer wins in the quarter include: Anritsu Service Assurance, Atos Group, BNP Paribas, Central Clinical
Labs, Dairy Farmers of America, Desjardins, Finova, Raiffeisen Informatik Consulting, Ricoh Corporation, Sklavenitis, Solenis, Turkcell, US Bank National Association
|
Summary of Quarterly Results |
Q2 FY’26 Q1 FY’26 Q2 FY’25 |
% Change (Q2 FY’26 vs Q1 FY’26) |
% Change (Q2 FY’26 vs Q2 FY’25) |
||
|
Revenue (millions) |
$ 1,327 $ |
1,288 $ |
1,335 |
3.0 % |
(0.6) % |
|
GAAP-based gross margin |
74.0 % |
72.8 % |
73.3 % |
130 bps |
70 bps |
|
Non-GAAP-based gross margin (1) |
77.6 % |
76.5 % |
77.2 % |
120 bps |
40 bps |
|
GAAP-based EPS, diluted |
$ 0.66 $ |
0.58 $ |
0.87 |
13.8 % |
(24.1) % |
|
Non-GAAP-based EPS, diluted (1) |
$ 1.13 $ |
1.05 $ |
1.11 |
7.6 % |
1.8 % |
(1) Please see Note 2 “Use of Non-GAAP Financial Measures” to the condensed consolidated financial statements below.
Conference Call Information
OpenText posted an investor presentation on its Investor Relations website and invites the public to listen to the earnings conference call webcast on Thursday, February 5, 2026 at 5:00 p.m. ET (2:00 p.m. PT) from the Investor Relations section of the Company’s website at https://investors.opentext.com. To join the webcast instantly, use this webcast link. A webcast replay will be available shortly following completion of the live call.
Please see below note (2) for a reconciliation of U.S. GAAP-based financial measures used in this press release to Non-GAAPbased financial measures.
