Q4 2025 Varonis Systems Inc Earnings Call Transcript
Key Points
- Varonis Systems Inc (VRNS) reported strong momentum in its SaaS business, which now accounts for 86% of total ARR, with SaaS ARR increasing 32% year over year, excluding conversions.
- The company successfully converted approximately $65 million of non-SaaS ARR to SaaS in Q4, driven by the end-of-life announcement for its self-hosted platform.
- Varonis Systems Inc (VRNS) announced the acquisition of AllTrue, an AI security company, to enhance its ability to protect enterprises from emerging AI risks.
- The company reported a strong demand for its SaaS offerings, particularly in MDR and Copilot, and continued momentum in cloud environments.
- Varonis Systems Inc (VRNS) ended the year with approximately 6,400 subscription customers, growing 14% year over year, and maintained a SaaS dollar-based net retention rate of 110%.
- The transition from on-premise to SaaS is creating a headwind for total company ARR growth, with non-SaaS ARR renewal rates below historical levels.
- Varonis Systems Inc (VRNS) expects a $30 million to $50 million headwind in ARR contribution margin and free cash flow in 2026 due to the end-of-life announcement for its self-hosted platform.
- The company reported a decrease in operating income and operating margin in Q4 2025 compared to the same period last year.
- Varonis Systems Inc (VRNS) anticipates lower ARR contribution margin and free cash flow in 2026 due to the impact of the end-of-life announcement.
- The company faces challenges in converting certain federal and state government customers to its SaaS platform, which may impact conversion rates.
Greetings, and welcome to the Varonis Systems fourth-quarter 2025 earnings conference call. (Operator Instructions) As a reminder, this conference is being recorded. It is now my pleasure to introduce Tim Perz, Investor Relations. Please go ahead.
Thank you, operator. Good afternoon. Thank you for joining us today to review Varonis' fourth-quarter and full-year 2025 financial results. With me on the call today are Yaki Faitelson, Chief Executive Officer; and Guy Melamed, Chief Financial Officer and Chief Operating Officer of Varonis. After preliminary remarks, we will open the call to a question-and-answer session.
During this call, we may make statements related to our business that would be considered forward-looking statements under federal securities laws, including projections of future operating results for our first quarter and full year ending December 31, 2026. Due to a number of factors, actual results may differ materially from those set forth in such statements. These factors are
| Access to All Earning Calls and Stock Analysis | |
| 30-Year Financial on one screen | |
| All-in-one Stock Screener with unlimited filters | |
| Customizable Stock Dashboard | |
| Real Time Insider Trading Transactions | |
| 8,000+ Institutional investors’ 13F holdings | |
| Powerful Excel Add-in and Google sheets Add-on | |
| All data downloadable | |
| Quick customer support | |
| And much more... |
Trustpilot
We'd love to learn more about your experiences on GuruFocus.com and how we can improve!
Take Survey
