Cognyte Software Reports Better than Expected Q2 with $0.05 EPS
Cognyte Software Ltd. (NASDAQ: CGNT), a global leader in investigative analytics software, announced robust financial results for the second quarter of fiscal year 2025 (Q2 FYE25).
For the three months ending July 31, 2024, Cognyte reported GAAP revenue of $84.4 million, marking an increase from $77.1 million in the same period last year. Non-GAAP revenue mirrored this growth, also registering $84.4 million compared to $77.1 million the previous year. The company’s gross margin improved to 70.6% GAAP and 71.3% non-GAAP, up from 68.7% GAAP and 69.2% non-GAAP in Q2 FYE24.
The company’s earnings per share (EPS) showed significant improvement, with GAAP EPS at -$0.03 compared to -$0.13 in the same quarter last year. On a non-GAAP basis, EPS turned positive, reaching $0.05 compared to -$0.03 in the previous year. CEO Elad Sharon attributed the strong results to the company’s effective execution of its growth strategy, highlighting the role of AI-driven solutions in driving follow-on orders and new customer acquisitions.
Cognyte Software Beats EPS and Revenue Expectations in Q2 FY’25
Cognyte’s performance in Q2 FYE25 exceeded market expectations. Analysts had anticipated an EPS of -$0.023 and revenue of $83.69 million.
The actual EPS of -$0.03 GAAP and $0.05 non-GAAP not only surpassed the expected EPS but also demonstrated a significant turnaround from the previous year’s performance. Similarly, the reported revenue of $84.4 million exceeded the forecasted $83.69 million, indicating a robust demand for Cognyte’s solutions.
The company’s revenue growth of approximately 11% year-over-year for the first half of fiscal 2025 further underscores its strong market position. CFO David Abadi noted that the company achieved $13.3 million in Adjusted EBITDA in H1 FYE25, a substantial improvement from near breakeven results in the first half of the prior fiscal year. This performance reflects the significant value Cognyte’s advanced solutions offer to its customers, driving increased demand and financial gains.
Cognyte Raises Fiscal 2025 Guidance, Again
Cognyte has raised its fiscal 2025 guidance once again, reflecting confidence in its ongoing growth trajectory. The company now expects non-GAAP revenue for the year ending January 31, 2025, to be approximately $347 million at the midpoint, with a range of +/-2%. This represents an 11% growth from the previous year’s revenue. The Adjusted EBITDA is projected to be around $25 million at the midpoint of the revenue outlook, while the diluted EPS is anticipated to be a loss of $0.03 at the midpoint.
The revised guidance excludes certain GAAP measures such as amortization of intangible assets, stock-based compensation, and potential impacts from future business acquisitions. The company emphasized that its non-GAAP outlook does not account for any business acquisitions that may close after the date of the guidance and assumes foreign currency exchange rates remain consistent with current levels. This cautious yet optimistic outlook underscores Cognyte’s strategic focus and operational resilience.
Disclaimer: The author does not hold or have a position in any securities discussed in the article.
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