Q1 2025 OneSpan Inc Earnings Call Transcript
Key Points
- OneSpan Inc (OSPN) achieved record high adjusted EBITDA of $23 million, a 15% increase from the previous year.
- The company reported a 9% growth in Annual Recurring Revenue (ARR), aligning with their full-year 2025 guidance.
- Subscription revenue grew by 9%, driven by demand for software authentication, app shielding, and e-signature solutions.
- OneSpan Inc (OSPN) generated $29 million in cash from operations and ended the quarter with $105 million in cash on hand.
- The company paid its first quarterly dividend of $0.12 per share, totaling approximately $4.6 million, and plans to continue this program.
- Total revenue declined slightly in the first quarter, primarily due to lower hardware revenues as banks adopt mobile-first policies.
- The transition from legacy perpetual maintenance contracts to term-based subscriptions resulted in lower maintenance revenue.
- Headwinds from sunsetted products impacted revenue by $1.4 million in the quarter, with similar impacts expected in the future.
- The on-time renewal rate slipped due to two large contracts not closing as expected in Q1, though they are anticipated to close in Q2.
- Potential tariff impacts and foreign currency fluctuations pose risks, with up to $1 million in incremental tariff-related costs expected for 2025.
Good day, and thank you for standing by. Welcome to the Q1 2025 OneSpan earnings conference call. (Operator Instructions) Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Joe Maxa, Vice President of Investor Relations. Please go ahead.
Thank you, operator. Hello, everyone, and thank you for joining the OneSpan first quarter 2025 earnings conference call. This call is being webcast and can be accessed on the Investor Relations section of OneSpan's website at investors.onespan.com.
Joining me on the call today is Victor Limongelli, our Chief Executive Officer; and Jorge Martell, our Chief Financial Officer. This afternoon, after market close, OneSpan issued a press release announcing results for our first quarter 2025. To access a copy of the press release and other investor information, please visit our website. Following our prepared comments today, we will open the call for questions.
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