BMO Capital has increased its price target for OneStream (OS, Financial), boosting it from $29 to $33 while maintaining an Outperform rating. This decision follows insights gained from the company's recent Splash user event, where management, customers, and partners gathered. At the event, OneStream revealed a substantial enhancement of its AI capabilities within its forecasting solutions, alongside the introduction of new AI Agents designed to primarily assist FP&A users. According to BMO, OneStream's long-term growth prospects with large, complex finance organizations remain robust.
OS Key Business Developments
Release Date: May 08, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- OneStream Inc (OS, Financial) achieved a total revenue growth of 24% in Q1 2025.
- The company reported a strong free cash flow margin of 26%.
- Subscription revenue increased by 31% year over year, indicating strong demand for their services.
- OneStream's international business saw a 40% year-over-year revenue growth, highlighting its global expansion success.
- The company launched new product innovations, including ESG reporting and planning solutions, and a CPM express offering for rapid implementation.
Negative Points
- License revenue decreased by 40% compared to last year due to customer fast conversions.
- There is heightened uncertainty in the broader markets, which may lead to deal headwinds and potential downsells.
- Ongoing customer conversions to SaaS continue to impact license revenue negatively.
- The macroeconomic environment is causing some companies and government agencies to slow or pause spending.
- There is a cautious outlook for the rest of the year despite strong current results, reflecting potential demand issues.
