Q4 2025 OneSpan Inc Earnings Call Transcript
Key Points
- OneSpan Inc (OSPN) reported a strong quarter and a record year of profitability, with $19 million of adjusted EBITDA in Q4 and $78 million for the full year.
- The company achieved an annual recurring revenue (ARR) of $187 million, marking an 11.5% year-over-year increase.
- Software and services accounted for 80% of revenue in 2025, up from 76% in 2024, indicating a successful shift towards a more software-centric business model.
- The acquisition of Build38 is expected to enhance OneSpan Inc (OSPN)'s app shielding capabilities, providing deeper integration with customers' mobile applications.
- The Digital Agreements business saw an 11% growth in Q4, driven by expansion of renewal contracts and new contracts, with a gross retention rate improving by over 4% in 2025 compared to 2024.
- Total revenue for 2025 was flat due to a 17% decline in hardware revenue, reflecting a long-term secular decline in consumer banking tokens.
- Q4 Cybersecurity revenue was flat year-over-year, indicating challenges in growing this segment.
- The company expects a modest near-term impact on profitability due to planned investments in sales, marketing, and R&D.
- The pending acquisition of Build38 is expected to dilute adjusted EBITDA by $3 million to $4 million in 2026.
- Hardware revenue is expected to decline by 8% to 12% in 2026, continuing the trend of decreasing hardware sales.
Good day, and thank you for standing by. Welcome to the Q4 2025 OneSpan earnings conference call. (Operator Instructions) Please be advised that today's conference is being recorded.
I would now like to hand your conference over to your first speaker today, Joe Maxa, VP of Investor Relations. Please go ahead.
Thank you, operator. Hello, everyone, and thank you for joining the OneSpan fourth quarter and full year 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 fourth quarter and full year 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
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