Open Text (NASDAQ:OTEX) Releases Earnings Results, Beats Estimates By $0.01 EPS
by Jessica Moore · The Cerbat GemOpen Text (NASDAQ:OTEX – Get Free Report) (TSE:OTC) issued its quarterly earnings results on Thursday. The software maker reported $0.95 EPS for the quarter, topping analysts’ consensus estimates of $0.94 by $0.01, Zacks reports. Open Text had a net margin of 8.42% and a return on equity of 23.60%.
Here are the key takeaways from Open Text’s conference call:
- Cloud and Content momentum: Company reported a record Q3 cloud revenue of $493M with Content cloud up 22% YoY, ARR of $1.06B, 41 deals >$1M (up 28%), and $651M enterprise cloud bookings YTD—driving the core business growth.
- Improving profitability and cash generation: Q3 non‑GAAP EPS of $1.01 (a Q3 record), adjusted EBITDA margin of 34.1% and YTD free cash flow of $686M (highest Q3 YTD), plus an increased FCF growth outlook to 22%–25%.
- Full‑year revenue outlook unchanged: FY26 total revenue guidance remains 1%–2% growth after ~ $30M of divestiture adjustments, while management raised cloud revenue guidance to 4%–5% and enterprise cloud bookings to 16%–20%.
- Divestiture timing and market constraints: Vertica is expected to close soon, but other non‑core asset sales are being delayed or done selectively due to geopolitical and financing headwinds, as management avoids “fire sales.”
- New CEO focus and AI roadmap: Ayman Antoun (14 days in) set four priorities—listen, learn, assess, build—emphasizing client‑first execution, core portfolio focus and using OpenText as “client zero” to scale AI and realize productivity gains.
Open Text Stock Up 2.9%
Shares of NASDAQ OTEX traded up $0.66 during trading on Thursday, hitting $23.69. 3,501,947 shares of the company traded hands, compared to its average volume of 1,979,819. The business’s fifty day moving average is $23.08 and its 200 day moving average is $28.75. Open Text has a fifty-two week low of $20.00 and a fifty-two week high of $39.90. The firm has a market capitalization of $5.74 billion, a price-to-earnings ratio of 13.94 and a beta of 1.04. The company has a debt-to-equity ratio of 1.57, a quick ratio of 0.94 and a current ratio of 0.94.
Hedge Funds Weigh In On Open Text
Several institutional investors have recently made changes to their positions in OTEX. Tidal Investments LLC increased its position in shares of Open Text by 2.6% during the second quarter. Tidal Investments LLC now owns 18,059 shares of the software maker’s stock worth $527,000 after acquiring an additional 460 shares in the last quarter. WealthCollab LLC increased its position in shares of Open Text by 39.5% during the second quarter. WealthCollab LLC now owns 1,640 shares of the software maker’s stock worth $48,000 after acquiring an additional 464 shares in the last quarter. Vident Advisory LLC increased its position in shares of Open Text by 3.7% during the fourth quarter. Vident Advisory LLC now owns 15,715 shares of the software maker’s stock worth $512,000 after acquiring an additional 555 shares in the last quarter. EverSource Wealth Advisors LLC increased its position in shares of Open Text by 39.7% during the second quarter. EverSource Wealth Advisors LLC now owns 2,005 shares of the software maker’s stock worth $59,000 after acquiring an additional 570 shares in the last quarter. Finally, State of Tennessee Department of Treasury increased its position in shares of Open Text by 0.4% during the fourth quarter. State of Tennessee Department of Treasury now owns 147,862 shares of the software maker’s stock worth $4,817,000 after acquiring an additional 584 shares in the last quarter. Institutional investors and hedge funds own 70.37% of the company’s stock.
Wall Street Analysts Forecast Growth
OTEX has been the topic of several recent analyst reports. Canadian Imperial Bank of Commerce dropped their target price on shares of Open Text from $40.00 to $37.00 and set a “neutral” rating on the stock in a report on Friday, January 16th. Barclays cut their price target on Open Text from $30.00 to $25.00 and set an “equal weight” rating on the stock in a report on Monday, April 20th. Royal Bank Of Canada dropped their price objective on shares of Open Text from $33.00 to $30.00 and set a “sector perform” rating on the stock in a report on Friday, February 6th. TD Securities upgraded shares of Open Text to a “hold” rating in a report on Monday, February 2nd. Finally, Raymond James Financial dropped their price objective on shares of Open Text from $48.00 to $42.00 and set an “outperform” rating on the stock in a report on Friday, February 6th. Three investment analysts have rated the stock with a Buy rating and ten have issued a Hold rating to the company. Based on data from MarketBeat, the stock has an average rating of “Hold” and a consensus target price of $36.00.
Check Out Our Latest Stock Report on OTEX
About Open Text
Open Text Corporation is a Canadian enterprise information management (EIM) software company that develops solutions for organizations seeking to manage, protect and extract insight from their unstructured and structured data. The company’s platform encompasses document management, records management, digital asset management and archiving, enabling companies to govern information across its lifecycle.
Open Text’s product suite includes content services, business process management, customer experience management, analytics and security products.