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Business Wire
4 days ago
- Business
- Business Wire
Jabil Posts Third Quarter Results
ST. PETERSBURG, Fla.--(BUSINESS WIRE)--Today, Jabil Inc. (NYSE: JBL), reported preliminary, unaudited financial results for its third quarter of fiscal year 2025. Third Quarter of Fiscal Year 2025 Highlights: Net revenue: $7.8 billion U.S. GAAP operating income: $403 million U.S. GAAP diluted earnings per share: $2.03 Core operating income (Non-GAAP): $420 million Core diluted earnings per share (Non-GAAP): $2.55 "We delivered a strong third quarter, outperforming expectations across key end-markets such as cloud, data center infrastructure, and capital equipment,' said CEO Mike Dastoor. "Our Intelligent Infrastructure segment remains a critical growth engine, benefiting from accelerating AI-driven demand. Despite softness in areas like EVs, Renewables, and 5G, our diversified portfolio and operational discipline have us tracking toward record core earnings per share. Looking ahead, we remain focused on enhancing core margins, optimizing cash flow, and returning value to shareholders—primarily through share repurchases and targeted investments in higher-margin opportunities," he added. Fourth Quarter of Fiscal Year 2025 Outlook: ____________________ (1) Core operating income and core diluted earnings per share exclude anticipated adjustments of $17 million for amortization of intangibles (or $0.14 per diluted share) and $20 million for stock-based compensation expense and related charges (or $0.18 per diluted share) and $60 million to $40 million (or $0.53 to $0.35 per diluted share) for restructuring, severance and related charges. Expand Fiscal Year 2025 Outlook: (Definitions: 'U.S. GAAP' means U.S. generally accepted accounting principles. Jabil defines core operating income as U.S. GAAP operating income less amortization of intangibles, stock-based compensation expense and related charges, restructuring, severance and related charges, distressed customer charges, loss on disposal of subsidiaries, settlement of receivables and related charges, impairment of notes receivable and related charges, goodwill impairment charges, business interruption and impairment charges, net, (gain) loss from the divestiture of businesses, acquisition and divestiture related charges, plus other components of net periodic benefit cost. Jabil defines core earnings as core operating income, less loss on debt extinguishment, loss (gain) on securities, other components of net periodic benefit cost, income (loss) from discontinued operations, gain (loss) on sale of discontinued operations and certain other expenses, net of tax and certain deferred tax valuation allowance charges. Jabil defines core diluted earnings per share as core earnings divided by the weighted average number of outstanding diluted shares as determined under U.S. GAAP. Jabil defines adjusted free cash flow as net cash provided by (used in) operating activities less net capital expenditures (acquisition of property, plant and equipment less proceeds and advances from sale of property, plant and equipment). Jabil reports core operating income, core earnings, core diluted earnings per share and adjusted free cash flow to provide investors an additional method for assessing operating income, earnings, diluted earnings per share and free cash flow from what it believes are its core manufacturing operations. See the accompanying reconciliation of Jabil's core operating income to its U.S. GAAP operating income, its calculation of core earnings and core diluted earnings per share to its U.S. GAAP net income and U.S. GAAP earnings per share and additional information in the supplemental information.) Forward Looking Statements: This release contains forward-looking statements, including those regarding our anticipated financial results for our third quarter of fiscal year 2025 and our guidance for future financial performance in our fourth quarter of fiscal year 2025 (including, net revenue, U.S. GAAP operating income, U.S. GAAP diluted earnings per share, core operating income (Non-GAAP), core diluted earnings per share (Non-GAAP) results and the components thereof, including but not limited to amortization of intangibles, stock-based compensation expense and related charges and restructuring, severance and related charges); and our full year 2025 (including net revenue, core operating margin (Non-GAAP), core diluted earnings per share (Non-GAAP), the components thereof and adjusted free cash flow (Non-GAAP)). The statements in this release are based on current expectations, forecasts and assumptions involving risks and uncertainties that could cause actual outcomes and results to differ materially from our current expectations. Such factors include, but are not limited to: our determination as we finalize our financial results for our third quarter of fiscal year 2025 that our financial results and conditions differ from our current preliminary unaudited numbers set forth herein; scheduling production, managing growth and capital expenditures and maximizing the efficiency of our manufacturing capacity effectively; managing rapid declines or increases in customer demand and other related customer challenges that may occur; our dependence on a limited number of customers; our ability to purchase components efficiently and reliance on a limited number of suppliers for critical components; risks arising from relationships with emerging companies; changes in technology and competition in our industry; our ability to introduce new business models or programs requiring implementation of new competencies; competition; transportation issues; our ability to maintain our engineering, technological and manufacturing expertise; retaining key personnel; risks associated with international sales and operations, including geopolitical uncertainties; energy price increases or shortages; our ability to achieve expected profitability from acquisitions; risk arising from our restructuring activities; issues involving our information systems, including security issues; regulatory risks (including the expense of complying, or failing to comply, with applicable regulations; risk arising from design or manufacturing defects; risk arising from compliance, or failure to comply, with environmental, health and safety laws or regulations; risk arising from litigation; and intellectual property risk); financial risks (including customers or suppliers who become financially troubled; turmoil in financial markets; tax risks; credit rating risks; risks of exposure to debt; currency fluctuations; and asset impairment); changes in financial accounting standards or policies; risk of natural disaster, climate change or other global events; and risks arising from expectations relating to environmental, social and governance considerations. Additional factors that could cause such differences can be found in our Annual Report on Form 10-K for the fiscal year ended August 31, 2024 and our other filings with the Securities and Exchange Commission. We assume no obligation to update these forward-looking statements. Supplemental Information Regarding Non-GAAP Financial Measures: Jabil provides supplemental, non-GAAP financial measures in this release to facilitate evaluation of Jabil's core operating performance. These non-GAAP measures exclude certain amounts that are included in the most directly comparable U.S. GAAP measures, do not have standard meanings and may vary from the non-GAAP financial measures used by other companies. Management believes these 'core' financial measures are useful measures that facilitate evaluation of the past and future performance of Jabil's ongoing operations on a comparable basis. Jabil reports core operating income, core earnings, core diluted earnings per share and adjusted free cash flows to provide investors an additional method for assessing operating income, earnings, earnings per share and free cash flow from what it believes are its core manufacturing operations. Among other uses, management uses non-GAAP financial measures to make operating decisions, assess business performance and as a factor in determining certain employee performance when determining incentive compensation. The Company determines an annual normalized tax rate ('normalized core tax rate') for the computation of the non-GAAP (core) income tax provision to provide better consistency across reporting periods. In estimating the normalized core tax rate annually, the Company utilizes a full-year financial projection of core earnings that considers the mix of earnings across tax jurisdictions, existing tax positions, and other significant tax matters. The Company may adjust the normalized core tax rate during the year for material impacts from new tax legislation or material changes to the Company's operations. Detailed definitions of certain of the core financial measures are included above under 'Definitions' and a reconciliation of the disclosed core financial measures to the most directly comparable U.S. GAAP financial measures is included under the heading 'Supplemental Data' at the end of this release. Meeting and Replay Information: Jabil will hold a conference call today at 8:30 a.m. ET to discuss its earnings for the third quarter of fiscal year 2025. To access the live audio webcast and view the accompanying slide presentation, visit the Investor Relations section of Jabil's website, located at An archived replay of the webcast will also be available after completion of the call. About Jabil: At Jabil (NYSE: JBL), we are proud to be a trusted partner for the world's top brands, offering comprehensive engineering, supply chain, and manufacturing solutions. With over 50 years of experience across industries and a vast network of over 100 sites worldwide, Jabil combines global reach with local expertise to deliver both scalable and customized solutions. Our commitment extends beyond business success as we strive to build sustainable processes that minimize environmental impact and foster vibrant and diverse communities around the globe. Discover more at JABIL INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in millions, except for per share data) (Unaudited) Three months ended Nine months ended May 31, 2025 May 31, 2024 May 31, 2025 May 31, 2024 Net revenue $ 7,828 $ 6,765 $ 21,550 $ 21,919 Cost of revenue 7,147 6,157 19,687 19,906 Gross profit 681 608 1,863 2,013 Operating expenses: Selling, general and administrative 274 268 835 890 Research and development 7 9 22 29 Amortization of intangibles 17 12 45 27 Restructuring, severance and related charges 16 55 144 252 Gain from the divestiture of businesses (45 ) — (45 ) (944 ) Acquisition and divestiture related charges 9 3 17 64 Operating income 403 261 845 1,695 Loss on securities 46 — 46 — Interest and other, net 67 60 186 197 Income before income tax 290 201 613 1,498 Income tax expense 68 72 174 248 Net income 222 129 439 1,250 Net income attributable to noncontrolling interests, net of tax — — — — Net income attributable to Jabil Inc. $ 222 $ 129 $ 439 $ 1,250 Earnings per share attributable to the stockholders of Jabil Inc.: Basic $ 2.05 $ 1.08 $ 3.98 $ 10.01 Diluted $ 2.03 $ 1.06 $ 3.94 $ 9.86 Weighted average shares outstanding: Basic 108.0 119.9 110.2 124.9 Diluted 109.3 121.7 111.5 126.9 Expand JABIL INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in millions) (Unaudited) Nine months ended May 31, 2025 May 31, 2024 Cash flows provided by operating activities: Net income $ 439 $ 1,250 Depreciation, amortization, and other, net 622 557 Gain from the divestiture of businesses (45 ) (944 ) Change in operating assets and liabilities, exclusive of net assets acquired 36 318 Net cash provided by operating activities 1,052 1,181 Cash flows (used in) provided by investing activities: Acquisition of property, plant and equipment (299 ) (660 ) Proceeds and advances from sale of property, plant and equipment 60 115 Cash paid for business and intangible asset acquisitions, net of cash (393 ) (90 ) Proceeds from the divestiture of businesses, net of cash 54 2,108 Other, net — (6 ) Net cash (used in) provided by investing activities (578 ) 1,467 Cash flows used in financing activities: Borrowings under debt agreements 1,604 1,895 Payments toward debt agreements (1,720 ) (1,987 ) Payments to acquire treasury stock (975 ) (1,824 ) Dividends paid to stockholders (28 ) (32 ) Net proceeds from exercise of stock options and issuance of common stock under employee stock purchase plan 33 31 Treasury stock minimum tax withholding related to vesting of restricted stock (41 ) (68 ) Other, net (38 ) (4 ) Net cash used in financing activities (1,165 ) (1,989 ) Effect of exchange rate changes on cash and cash equivalents 13 (6 ) Net (decrease) increase in cash and cash equivalents (678 ) 653 Cash and cash equivalents at beginning of period 2,201 1,804 Cash and cash equivalents at end of period $ 1,523 $ 2,457 Expand JABIL INC. AND SUBSIDIARIES SUPPLEMENTAL DATA RECONCILIATION OF U.S. GAAP FINANCIAL RESULTS TO NON-GAAP MEASURES (in millions, except for per share data) (Unaudited) Three months ended Nine months ended May 31, 2025 May 31, 2024 May 31, 2025 May 31, 2024 Operating income (U.S. GAAP) $ 403 $ 261 $ 845 $ 1,695 Amortization of intangibles 17 12 45 27 Stock-based compensation expense and related charges 19 3 84 72 Restructuring, severance and related charges (1) 16 55 144 252 Net periodic benefit cost — 2 1 7 Business interruption and impairment charges, net (2) 1 14 10 14 Gain from the divestiture of businesses (3) (45 ) — (45 ) (944 ) Acquisition and divestiture related charges (3) 9 3 17 64 Adjustments to operating income 17 89 256 (508 ) Core operating income (Non-GAAP) $ 420 $ 350 $ 1,101 $ 1,187 Net income attributable to Jabil Inc. (U.S. GAAP) $ 222 $ 129 $ 439 $ 1,250 Adjustments to operating income 17 89 256 (508 ) Loss on securities (4) 46 — 46 — Net periodic benefit cost — (2 ) (1 ) (7 ) Adjustments for taxes (6 ) 14 (18 ) 51 Core earnings (Non-GAAP) $ 279 $ 230 $ 722 $ 786 Diluted earnings per share (U.S. GAAP) $ 2.03 $ 1.06 $ 3.94 $ 9.86 Diluted core earnings per share (Non-GAAP) $ 2.55 $ 1.89 $ 6.48 $ 6.20 Diluted weighted average shares outstanding (U.S. GAAP and Non-GAAP) 109.3 121.7 111.5 126.9 Expand ____________________ (1) Charges recorded during the three months and nine months ended May 31, 2025 and May 31, 2024, primarily related to the 2025 Restructuring Plan and 2024 Restructuring Plan, respectively. (2) Charges recorded during the nine months ended May 31, 2025, relate primarily to costs associated with damage from Hurricanes Helene and Milton, which impacted our operations in St. Petersburg, Florida and Asheville and Hendersonville, North Carolina. Charges recorded during the three months and nine months ended May 31, 2024, related to costs associated with product quality liabilities. (3) We completed the divestiture of our Mobility Business and recorded a pre-tax gain of $944 million during the nine months ended May 31, 2024. Certain post-closing adjustments were realized in March 2025, which resulted in the recognition of a $54 million pre-tax gain during the three months ended May 31, 2025. We incurred transaction and disposal costs in connection with the sale of approximately $64 million during the nine months ended May 31, 2024. (4) Charges recorded during the three months and nine months ended May 31, 2025, relate to an impairment of an investment in Preferred Stock. Expand ____________________ (1) Certain customers co-invest in PP&E with us. As we acquire PP&E, we recognize the cash payments in acquisition of PP&E. When our customers reimburse us and obtain control, we recognize the cash receipts in proceeds and advances from the sale of PP&E. Expand
Yahoo
13-06-2025
- Business
- Yahoo
Zedge Inc (ZDGE) Q3 2025 Earnings Call Highlights: Revenue Growth and Strategic Initiatives ...
Total Revenue: $7.8 million, up 1.3% year-over-year. Subscription Revenue: Increased by 13.4% year-over-year. Net Active Subscriber Growth: Up 37% year-over-year. Deferred Revenue: $4.9 million, with a 100% gross margin. Zedge Premium Net Revenue: More than doubled compared to last year. Average Revenue Per Monthly Active User: Increased by 33% year-over-year to $0.10. GuruShots Revenue: Decreased by 45% year-over-year. SG&A Expenses: Decreased by 6% to $6.3 million. GAAP Income from Operations: $0.2 million, compared to negative $0.1 million last year. GAAP Net Income: $0.2 million, with EPS of $0.01. Non-GAAP Net Income: $0.9 million, with EPS of $0.06. Free Cash Flow: $0.8 million for the quarter. Adjusted EBITDA: Increased 46% to $1.2 million. Cash and Cash Equivalents: $20.4 million, up 2% sequentially. Warning! GuruFocus has detected 3 Warning Signs with ZDGE. Release Date: June 12, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Zedge Inc (ZDGE) returned to revenue growth in Q3 2025, with a 1.3% increase to $7.8 million. The company achieved a 46% year-over-year increase in adjusted EBITDA, reaching $1.2 million. Zedge Plus subscriber base grew to nearly 900,000, marking a 37% year-over-year increase. Zedge Premium revenue more than doubled, driven by expanded offerings and increased usage of AI-generated content. The company ended the quarter with a strong balance sheet, holding $20.4 million in cash and no debt. GuruShots revenue declined by 45% year-over-year due to reduced user acquisition spending. Monthly active users (MAU) decreased year-over-year, although the focus shifted to higher lifetime value users. The advertising market faced disruptions due to TikTok's absence in the US for part of the quarter. Restructuring charges amounted to $0.6 million, impacting financial results. The company anticipates continued cash outflows related to restructuring and retention bonuses in the near term. Q: Can you rank the different pieces of advertising revenue that had the biggest impact this quarter? A: Jonathan Reich, CEO: It's challenging to rank precisely as we pursue advertising comprehensively. However, our team focuses on optimizing CPMs, which is crucial for valuing our inventory. Q: How did TikTok's return impact your advertising revenue, and what are your expectations for the future? A: Jonathan Reich, CEO: TikTok returned mid-February, impacting only part of the quarter. They are a significant player in the market, and their re-entry helped increase pricing. We focus on high-value users in well-developed markets, which also contributed to the improvement. Q: What are your plans to stabilize and grow monthly active users (MAU)? A: Jonathan Reich, CEO: We aim to stabilize MAU by focusing on high-value users in well-developed markets. We've seen some improvement and continue to optimize user acquisition to drive revenue, even if it means losing users in less developed markets. Q: Can you explain the new features in Emojipedia and their expected impact? A: Jonathan Reich, CEO: Emojipedia is testing features like AI-generated emojis and mini-games. We're focusing on releasing digital stickers for World Emoji Day in July, which should drive additional interest and engagement. Q: How is Zedge Premium performing, and what are your future plans for it? A: Jonathan Reich, CEO: Zedge Premium remains a core part of our marketplace. We've expanded content availability to the web, opening new channels for customer purchases. We also view our creator community as a strategic asset for our new B2B marketplace, Q: What is the rollout plan for and how do you see it evolving? A: Jonathan Reich, CEO: We're actively building relationships with prospective customers and have published research to demonstrate our dataset's advantages. We're addressing unique content needs for foundational AI models, which is a promising new revenue source. Q: Can you elaborate on the upcoming AI audio generator feature? A: Jonathan Reich, CEO: We'll roll it out on a limited basis before the end of June. Users can create custom ringtones or sounds using text prompts. It will likely be part of our subscription offering, potentially boosting subscription momentum. Q: How do you expect restructuring and retention costs to impact future financials? A: Yi Tsai, CFO: Restructuring charges in Q4 will be about $325,000, with some severance payments extending over five months. The last retention bonus payment was made in May, impacting Q4 cash flow by about $600,000. These costs will be immaterial in FY26. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
11-06-2025
- Business
- Yahoo
Oracle Announces Fiscal 2025 Fourth Quarter and Fiscal Full Year Financial Results
Q4 Remaining Performance Obligations up 41% to $138 billion Q4 GAAP Earnings per Share $1.19, non-GAAP Earnings per Share $1.70 Q4 Total Revenue $15.9 billion, up 11% Q4 Cloud Revenue (IaaS plus SaaS) $6.7 billion, up 27% Q4 Cloud Infrastructure (IaaS) Revenue $3.0 billion, up 52% Q4 Cloud Application (SaaS) Revenue $3.7 billion, up 12% Q4 Fusion Cloud ERP (SaaS) Revenue $1.0 billion, up 22% Q4 NetSuite Cloud ERP (SaaS) Revenue $1.0 billion, up 18% FY 2025 Total Revenue $57.4 billion, up 8% AUSTIN, Texas, June 11, 2025 /PRNewswire/ -- Oracle Corporation (NYSE: ORCL) today announced fiscal 2025 Q4 and full-year 2025 results. Total quarterly revenues were up 11% year-over-year in USD and constant currency to $15.9 billion. Cloud services and license support revenues were up 14% in USD and constant currency to $11.7 billion. Cloud license and on-premise license revenues were up 9% in USD and up 8% in constant currency to $2.0 billion. Q4 GAAP operating income was $5.1 billion. Non-GAAP operating income was $7.0 billion, up 5% in USD and up 4% in constant currency. GAAP net income was $3.4 billion, and non-GAAP net income was $4.9 billion. GAAP earnings per share was $1.19 while non-GAAP earnings per share was $1.70. Short-term deferred revenues were $9.4 billion. Operating cash flow was $20.8 billion during fiscal year 2025, up 12% in USD. Fiscal year 2025 total revenues were up 8% in USD and up 9% in constant currency to $57.4 billion. Cloud services and license support revenues were up 12% in USD and constant currency to $44.0 billion. Cloud license and on-premise license revenues were up 2% in USD and up 3% in constant currency to $5.2 billion. Fiscal year 2025 GAAP operating income was $17.7 billion, and non-GAAP operating income was $25.0 billion. GAAP net income was $12.4 billion while non-GAAP net income was $17.3 billion. GAAP earnings per share was $4.34, while non-GAAP earnings per share was $6.03. "FY25 was a very good year—but we believe FY26 will be even better as our revenue growth rates will be dramatically higher," said Oracle CEO, Safra Catz. "We expect our total cloud growth rate—applications plus infrastructure—will increase from 24% in FY25 to over 40% in FY26. Cloud Infrastructure growth rate is expected to increase from 50% in FY25 to over 70% in FY26. And RPO is likely to grow more than 100% in FY26. Oracle is well on its way to being not only the world's largest cloud application company—but also one of the world's largest cloud infrastructure companies." "MultiCloud database revenue from Amazon, Google and Azure grew 115% from Q3 to Q4," said Oracle Chairman and CTO, Larry Ellison. "We currently have 23 MultiCloud datacenters live with 47 more being built over the next 12 months. We expect triple-digit MultiCloud revenue growth to continue in FY26. Revenue from Oracle Cloud@Customer datacenters grew 104% year-over-year. We have 29 Oracle Cloud@Customer dedicated datacenters live with another 30 being built in FY26. Overall Oracle Cloud Infrastructure consumption revenue grew 62% in Q4. We expect OCI consumption revenue to grow even faster in FY26. OCI revenue growth rates are skyrocketing—so is demand." The board of directors declared a quarterly cash dividend of $0.50 per share of outstanding common stock. This dividend will be paid to stockholders of record as of the close of business on July 10, 2025, with a payment date of July 24, 2025. A sample list of customers which purchased Oracle Cloud services during the quarter will be available at A list of recent technical innovations and announcements is available at To learn what industry analysts have been saying about Oracle's products and services see Earnings Conference Call and WebcastOracle will hold a conference call and webcast today to discuss these results at 4:00 p.m. Central. A live and replay webcast will be available on the Oracle Investor Relations website at About OracleOracle offers integrated suites of applications plus secure, autonomous infrastructure in the Oracle Cloud. For more information about Oracle (NYSE: ORCL), please visit us at TrademarksOracle, Java, MySQL, and NetSuite are registered trademarks of Oracle Corporation. NetSuite was the first cloud company—ushering in the new era of cloud computing. "Safe Harbor" Statement: Statements in this press release relating to future plans, expectations, beliefs, intentions and prospects, including projections for our growth in FY26 and our expectations of relative size among cloud applications and infrastructure companies, are "forward-looking statements" and are subject to material risks and uncertainties. Risks and uncertainties that could affect our current expectations and our actual results, include, among others: our ability to develop new products and services, integrate acquired products and services and enhance our existing products and services, including our AI products; our management of complex cloud and hardware offerings, including the sourcing of technologies and technology components; our ability to secure datacenter capacity; significant coding, manufacturing or configuration errors in our offerings; risks associated with acquisitions; economic, political and market conditions; information technology system failures, privacy and data security concerns; cybersecurity breaches; unfavorable legal proceedings, government investigations, and complex and changing laws and regulations. A detailed discussion of these factors and other risks that affect our business is contained in our SEC filings, including our most recent reports on Form 10-K and Form 10-Q, particularly under the heading "Risk Factors." Copies of these filings are available online from the SEC or by contacting Oracle's Investor Relations Department at (650) 506-4073 or by clicking on SEC Filings on the Oracle Investor Relations website at All information set forth in this press release is current as of June 11, 2025. Oracle undertakes no duty to update any statement in light of new information or future events. ORACLE CORPORATIONQ4 FISCAL 2025 FINANCIAL RESULTS CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS ($ in millions, except per share data)Three Months Ended May 31,% Increase% Increase (Decrease)2025 % of 2024 % of (Decrease) in ConstantRevenues Revenues in US $ Currency (1)REVENUES Cloud services and license support $ 11,698 74 % $ 10,234 72 % 14 % 14 % Cloud license and on-premise license 2,007 13 % 1,838 13 % 9 % 8 % Hardware 850 5 % 842 6 % 1 % 0 % Services 1,348 8 % 1,373 9 % (2 %) (2 %) Total revenues 15,903 100 % 14,287 100 % 11 % 11 %OPERATING EXPENSES Cloud services and license support 3,343 21 % 2,522 18 % 33 % 32 % Hardware 252 2 % 241 2 % 4 % 4 % Services 1,145 7 % 1,160 8 % (1 %) (2 %) Sales and marketing 2,306 15 % 2,114 15 % 9 % 9 % Research and development 2,654 17 % 2,226 15 % 19 % 20 % General and administrative 467 3 % 402 3 % 16 % 16 % Amortization of intangible assets 544 3 % 743 5 % (27 %) (27 %) Acquisition related and other 4 0 % 101 1 % (96 %) (97 %) Restructuring 79 0 % 92 0 % (15 %) (16 %) Total operating expenses 10,794 68 % 9,601 67 % 12 % 12 %OPERATING INCOME 5,109 32 % 4,686 33 % 9 % 7 % Interest expense (978) (6 %) (878) (6 %) 11 % 11 % Non-operating income (expenses), net 20 0 % (26) 0 % * * INCOME BEFORE INCOME TAXES 4,151 26 % 3,782 27 % 10 % 8 % Provision for income taxes 724 4 % 639 5 % 13 % 11 %NET INCOME $ 3,427 22 % $ 3,143 22 % 9 % 7 % EARNINGS PER SHARE: Basic $ 1.22$ 1.14Diluted $ 1.19$ 1.11 WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: Basic 2,8052,753Diluted 2,8712,834(1) We compare the percent change in the results from one period to another period using constant currency disclosure. We present constant currency information to provide a framework for assessing how our underlying businesses performed excluding the effect of foreign currency rate fluctuations. To present this information, current and comparative prior period results for entities reporting in currencies other than United States dollars are converted into United States dollars at the exchange rates in effect on May 31, 2024, which was the last day of our prior fiscal year, rather than the actual exchange rates in effect during the respective periods. Movements in international currencies relative to the United States dollar during the three months ended May 31, 2025 compared with the corresponding prior year period increased our operating income by 2 percentage points.* Not meaningful ORACLE CORPORATIONQ4 FISCAL 2025 FINANCIAL RESULTS RECONCILIATION OF SELECTED GAAP MEASURES TO NON-GAAP MEASURES (1) ($ in millions, except per share data) Three Months Ended May 31,% Increase (Decrease)in US $ % Increase (Decrease)in Constant Currency (2) 20252025 20242024GAAP Non-GAAP GAAP Non-GAAP REVENUES$ 15,903$ -$ 15,903 $ 14,287$ -$ 14,28711 % 11 % 11 % 11 % TOTAL OPERATING EXPENSES$ 10,794$ (1,926)$ 8,868 $ 9,601$ (1,983)$ 7,61812 % 16 % 12 % 16 % Stock-based compensation (3)1,299(1,299)- 1,047(1,047)-24 % * 24 % * Amortization of intangible assets (4)544(544)- 743(743)-(27 %) * (27 %) * Acquisition related and other4(4)- 101(101)-(96 %) * (97 %) * Restructuring79(79)- 92(92)-(15 %) * (16 %) *OPERATING INCOME$ 5,109$ 1,926$ 7,035 $ 4,686$ 1,983$ 6,6699 % 5 % 7 % 4 %OPERATING MARGIN %32 %44 % 33 %47 %(67) bp. (244) bp. (96) bp. (266) TAX EFFECTS (5)$ 724$ 472$ 1,196 $ 639$ 519$ 1,15813 % 3 % 11 % 2 %NET INCOME$ 3,427$ 1,454$ 4,881 $ 3,143$ 1,464$ 4,6079 % 6 % 7 % 5 %DILUTED EARNINGS PER SHARE$ 1.19$ 1.70 $ 1.11$ 1.638 % 5 % 6 % 3 %DILUTED WEIGHTED AVERAGE COMMON SHARES OUTSTANDING2,871-2,871 2,834-2,8341 % 1 % 1 % 1 %(1) This presentation includes non-GAAP measures. Our non-GAAP measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures, and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. For a detailed explanation of the adjustments made to comparable GAAP measures, the reasons why management uses these measures, the usefulness of these measures and the material limitations on the usefulness of these measures, please see Appendix A. (2) We compare the percent change in the results from one period to another period using constant currency disclosure. We present constant currency information to provide a framework for assessing how our underlying businesses performed excluding the effect of foreign currency rate fluctuations. To present this information, current and comparative prior period results for entities reporting in currencies other than United States dollars are converted into United States dollars at the exchange rates in effect on May 31, 2024, which was the last day of our prior fiscal year, rather than the actual exchange rates in effect during the respective periods. (3) Stock-based compensation was included in the following GAAP operating expense categories:Three Months Ended Three Months EndedMay 31, 2025 May 31, Cloud services and license support$ 150$ (150)$ - $ 140$ (140)$ - Hardware7(7)- 6(6)- Services52(52)- 44(44)- Sales and marketing200(200)- 178(178)- Research and development737(737)- 583(583)- General and administrative153(153)- 96(96)- Total stock-based compensation$ 1,299$ (1,299)$ - $ 1,047$ (1,047)$ -(4) Estimated future annual amortization expense related to intangible assets as of May 31, 2025 was as follows: Fiscal 2026$ 1,639 Fiscal 2027672 Fiscal 2028635 Fiscal 2029561 Fiscal 2030522 Thereafter558 Total intangible assets, net$ 4,587 (5) Income tax effects were calculated reflecting an effective GAAP tax rate of 17.5% and 16.9% in the fourth quarter of fiscal 2025 and 2024, respectively, and an effective non-GAAP tax rate of 19.7% and 20.1% in the fourth quarter of fiscal 2025 and 2024, respectively. The difference in our GAAP and non-GAAP tax rates in each of the fourth quarters of fiscal 2025 and 2024 was primarily due to the net tax effects related to stock-based compensation expense; acquisition related and other items, including the tax effects on amortization of intangible assets; and restructuring expense, partially offset by the net deferred tax effects related to an income tax benefit that was previously recorded due to the partial realignment of our legal entity structure.* Not meaningful ORACLE CORPORATIONFISCAL 2025 YEAR TO DATE FINANCIAL RESULTS CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS ($ in millions, except per share data)Year Ended May 31,% Increase% Increase (Decrease)2025 % of 2024 % of (Decrease) in ConstantRevenues Revenues in US $ Currency (1)REVENUES Cloud services and license support $ 44,029 77 % $ 39,383 74 % 12 % 12 % Cloud license and on-premise license 5,201 9 % 5,081 10 % 2 % 3 % Hardware 2,936 5 % 3,066 6 % (4 %) (4 %) Services 5,233 9 % 5,431 10 % (4 %) (3 %) Total revenues 57,399 100 % 52,961 100 % 8 % 9 %OPERATING EXPENSES Cloud services and license support 11,569 20 % 9,427 18 % 23 % 23 % Hardware 782 1 % 891 2 % (12 %) (11 %) Services 4,576 8 % 4,825 9 % (5 %) (5 %) Sales and marketing 8,651 15 % 8,274 15 % 5 % 5 % Research and development 9,860 17 % 8,915 17 % 11 % 11 % General and administrative 1,602 3 % 1,548 3 % 3 % 4 % Amortization of intangible assets 2,307 4 % 3,010 6 % (23 %) (23 %) Acquisition related and other 75 0 % 314 0 % (76 %) (76 %) Restructuring 299 1 % 404 1 % (26 %) (26 %) Total operating expenses 39,721 69 % 37,608 71 % 6 % 6 %OPERATING INCOME 17,678 31 % 15,353 29 % 15 % 16 % Interest expense (3,578) (6 %) (3,514) (7 %) 2 % 2 % Non-operating income (expenses), net 60 0 % (98) 0 % * * INCOME BEFORE INCOME TAXES 14,160 25 % 11,741 22 % 21 % 21 % Provision for income taxes 1,717 3 % 1,274 2 % 35 % 36 %NET INCOME $ 12,443 22 % $ 10,467 20 % 19 % 20 % EARNINGS PER SHARE: Basic $ 4.46$ 3.82Diluted $ 4.34$ 3.71 WEIGHTED AVERAGE COMMON SHARES OUTSTANDING: Basic 2,7892,744Diluted 2,8662,823(1) We compare the percent change in the results from one period to another period using constant currency disclosure. We present constant currency information to provide a framework for assessing how our underlying businesses performed excluding the effect of foreign currency rate fluctuations. To present this information, current and comparative prior period results for entities reporting in currencies other than United States dollars are converted into United States dollars at the exchange rates in effect on May 31, 2024, which was the last day of our prior fiscal year, rather than the actual exchange rates in effect during the respective periods. Movements in international currencies relative to the United States dollar during the year ended May 31, 2025 compared with the corresponding prior year period decreased each of our total revenues and operating income by 1 percentage point.* Not meaningful ORACLE CORPORATIONFISCAL 2025 YEAR TO DATE FINANCIAL RESULTS RECONCILIATION OF SELECTED GAAP MEASURES TO NON-GAAP MEASURES (1) ($ in millions, except per share data) Year Ended May 31,% Increase (Decrease)in US $ % Increase(Decrease) in ConstantCurrency (2) 20252025 20242024GAAP Non-GAAP GAAP Non-GAAP REVENUES$ 57,399$ -$ 57,399 $ 52,961$ -$ 52,9618 % 8 % 9 % 9 % TOTAL OPERATING EXPENSES$ 39,721$ (7,355)$ 32,366 $ 37,608$ (7,702)$ 29,9066 % 8 % 6 % 9 % Stock-based compensation (3)4,674(4,674)- 3,974(3,974)-18 % * 18 % * Amortization of intangible assets (4)2,307(2,307)- 3,010(3,010)-(23 %) * (23 %) * Acquisition related and other75(75)- 314(314)-(76 %) * (76 %) * Restructuring299(299)- 404(404)-(26 %) * (26 %) *OPERATING INCOME$ 17,678$ 7,355$ 25,033 $ 15,353$ 7,702$ 23,05515 % 9 % 16 % 9 %OPERATING MARGIN %31 %44 % 29 %44 %181 bp. 8 bp. 182 bp. 4 TAX EFFECTS (5)$ 1,717$ 2,514$ 4,231 $ 1,274$ 2,459$ 3,73335 % 13 % 36 % 14 %NET INCOME $ 12,443$ 4,841$ 17,284 $ 10,467$ 5,243$ 15,71019 % 10 % 20 % 11 %DILUTED EARNINGS PER SHARE$ 4.34$ 6.03 $ 3.71$ 5.5617 % 8 % 18 % 9 %DILUTED WEIGHTED AVERAGE COMMON SHARES OUTSTANDING2,866-2,866 2,823-2,8232 % 2 % 2 % 2 %(1) This presentation includes non-GAAP measures. Our non-GAAP measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures, and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. For a detailed explanation of the adjustments made to comparable GAAP measures, the reasons why management uses these measures, the usefulness of these measures and the material limitations on the usefulness of these measures, please see Appendix A. (2) We compare the percent change in the results from one period to another period using constant currency disclosure. We present constant currency information to provide a framework for assessing how our underlying businesses performed excluding the effect of foreign currency rate fluctuations. To present this information, current and comparative prior period results for entities reporting in currencies other than United States dollars are converted into United States dollars at the exchange rates in effect on May 31, 2024, which was the last day of our prior fiscal year, rather than the actual exchange rates in effect during the respective periods. (3) Stock-based compensation was included in the following GAAP operating expense categories:Year Ended Year EndedMay 31, 2025 May 31, Cloud services and license support$ 609$ (609)$ - $ 525$ (525)$ - Hardware29(29)- 23(23)- Services202(202)- 167(167)- Sales and marketing757(757)- 667(667)- Research and development2,638(2,638)- 2,225(2,225)- General and administrative439(439)- 367(367)- Total stock-based compensation$ 4,674$ (4,674)$ - $ 3,974$ (3,974)$ -(4) Estimated future annual amortization expense related to intangible assets as of May 31, 2025 was as follows: Fiscal 2026$ 1,639 Fiscal 2027672 Fiscal 2028635 Fiscal 2029561 Fiscal 2030522 Thereafter558 Total intangible assets, net$ 4,587 (5) Income tax effects were calculated reflecting an effective GAAP tax rate of 12.1% and 10.9% in fiscal 2025 and 2024, respectively, and an effective non-GAAP tax rate of 19.7% and 19.2% in fiscal 2025 and 2024, respectively. The difference in our GAAP and non-GAAP tax rates in each of fiscal 2025 and 2024 was primarily due to the net tax effects related to stock-based compensation expense; acquisition related and other items, including the tax effects on amortization of intangible assets; and restructuring expense, partially offset by the net deferred tax effects related to an income tax benefit that was previously recorded due to the partial realignment of our legal entity structure.* Not meaningful ORACLE CORPORATIONFISCAL 2025 FINANCIAL RESULTS CONDENSED CONSOLIDATED BALANCE SHEETS ($ in millions) May 31, May 31,2025 2024 ASSETSCurrent Assets:Cash and cash equivalents $ 10,786$ 10,454 Marketable securities 417207 Trade receivables, net 8,5587,874 Prepaid expenses and other current assets 4,8184,019Total Current Assets 24,57922,554Non-Current Assets: Property, plant and equipment, net 43,52221,536 Intangible assets, net 4,5876,890 Goodwill, net 62,20762,230 Deferred tax assets 11,87712,273 Other non-current assets 21,58915,493Total Non-Current Assets 143,782118,422TOTAL ASSETS $ 168,361$ 140,976LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities:Notes payable and other borrowings, current $ 7,271$ 10,605 Accounts payable 5,1132,357 Accrued compensation and related benefits 2,2431,916 Deferred revenues 9,3879,313 Other current liabilities 8,6297,353Total Current Liabilities 32,64331,544Non-Current Liabilities:Notes payable and other borrowings, non-current 85,29776,264 Income taxes payable 10,26910,817 Operating lease liabilities 11,5366,255 Other non-current liabilities 7,6476,857Total Non-Current Liabilities 114,749100,193Stockholders' Equity 20,9699,239TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 168,361$ 140,976 ORACLE CORPORATION FISCAL 2025 FINANCIAL RESULTS CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS ($ in millions) Year Ended May 31, 2025 2024 Cash Flows From Operating Activities: Net income $ 12,443$ 10,467Adjustments to reconcile net income to net cash provided by operating activities: Depreciation 3,8673,129Amortization of intangible assets 2,3073,010Deferred income taxes (1,637)(2,139)Stock-based compensation 4,6743,974Other, net 667720Changes in operating assets and liabilities: Increase in trade receivables, net (653)(965)Decrease in prepaid expenses and other assets 266542Decrease in accounts payable and other liabilities (608)(594)Decrease in income taxes payable (659)(127)Increase in deferred revenues 154656Net cash provided by operating activities 20,82118,673Cash Flows From Investing Activities: Purchases of marketable securities and other investments (1,272)(1,003)Proceeds from sales and maturities of marketable securities and other investments 776572Acquisitions, net of cash acquired -(63)Capital expenditures (21,215)(6,866)Net cash used for investing activities (21,711)(7,360)Cash Flows From Financing Activities: Payments for repurchases of common stock (600)(1,202)Proceeds from issuances of common stock 653742Shares repurchased for tax withholdings upon vesting of restricted stock-based awards (900)(2,040)Payments of dividends to stockholders (4,743)(4,391)Proceeds from issuances of (repayments of) commercial paper, net 1,889(167)Proceeds from issuances of senior notes and term loan credit agreements, net of issuance costs 19,548-Repayments of senior notes and term loan credit agreements (15,841)(3,500)Other financing activities, net 1,0924Net cash provided by (used for) financing activities 1,098(10,554)Effect of exchange rate changes on cash and cash equivalents 124(70)Net increase in cash and cash equivalents 332689Cash and cash equivalents at beginning of period 10,4549,765Cash and cash equivalents at end of period $ 10,786$ 10,454 ORACLE CORPORATION FISCAL 2025 FINANCIAL RESULTS FREE CASH FLOW - TRAILING 4-QUARTERS (1) ($ in millions) Fiscal 2024 Fiscal 2025 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 GAAP Operating Cash Flow $ 17,745 $ 17,039 $ 18,239 $ 18,673 $ 19,126 $ 20,287 $ 20,745 $ 20,821 Capital Expenditures (8,290) (6,935) (5,981) (6,866) (7,855) (10,745) (14,933) (21,215) Free Cash Flow $ 9,455 $ 10,104 $ 12,258 $ 11,807 $ 11,271 $ 9,542 $ 5,812 $ (394) Operating Cash Flow % Growth over prior year 68 % 13 % 18 % 9 % 8 % 19 % 14 % 12 % Free Cash Flow % Growth over prior year 76 % 20 % 68 % 39 % 19 % (6 %) (53 %) (103 %)GAAP Net Income $ 9,375 $ 10,137 $ 10,642 $ 10,467 $ 10,976 $ 11,624 $ 12,160 $ 12,443 Operating Cash Flow as a % of Net Income 189 % 168 % 171 % 178 % 174 % 175 % 171 % 167 % Free Cash Flow as a % of Net Income 101 % 100 % 115 % 113 % 103 % 82 % 48 % (3) %(1) To supplement our statements of cash flows presented on a GAAP basis, we use non-GAAP measures of cash flows on a trailing 4-quarter basis to analyze cash flow generated from operations. We believe free cash flow is also useful as one of the bases for comparing our performance with our competitors. The presentation of non-GAAP free cash flow is not meant to be considered in isolation or as an alternative to net income as an indicator of our performance, or as an alternative to cash flows from operating activities as a measure of liquidity. ORACLE CORPORATION FISCAL 2025 FINANCIAL RESULTS SUPPLEMENTAL ANALYSIS OF GAAP REVENUES (1) ($ in millions) Fiscal 2024 Fiscal 2025 Q1 Q2 Q3 Q4 TOTAL Q1 Q2 Q3 Q4 TOTAL REVENUES BY OFFERINGS Cloud services $ 4,635 $ 4,775 $ 5,054 $ 5,311 $ 19,774$ 5,623 $ 5,937 $ 6,210 $ 6,737 $ 24,506 License support 4,912 4,864 4,909 4,923 19,6094,896 4,869 4,797 4,961 19,523 Cloud services and license support 9,547 9,639 9,963 10,234 39,38310,519 10,806 11,007 11,698 44,029 Cloud license and on-premise license 809 1,178 1,256 1,838 5,081870 1,195 1,129 2,007 5,201 Hardware 714 756 754 842 3,066655 728 703 850 2,936 Services 1,383 1,368 1,307 1,373 5,4311,263 1,330 1,291 1,348 5,233 Total revenues $ 12,453 $ 12,941 $ 13,280 $ 14,287 $ 52,961$ 13,307 $ 14,059 $ 14,130 $ 15,903 $ 57,399AS REPORTED REVENUE GROWTH RATES Cloud services 30 % 25 % 25 % 20 % 25 %21 % 24 % 23 % 27 % 24 % License support 2 % 2 % 1 % 0 % 1 %0 % 0 % (2 %) 1 % 0 % Cloud services and license support 13 % 12 % 12 % 9 % 12 %10 % 12 % 10 % 14 % 12 % Cloud license and on-premise license (10 %) (18 %) (3 %) (15 %) (12 %)7 % 1 % (10 %) 9 % 2 % Hardware (6 %) (11 %) (7 %) (1 %) (6 %)(8 %) (4 %) (7 %) 1 % (4 %) Services 2 % (2 %) (5 %) (6 %) (3 %)(9 %) (3 %) (1 %) (2 %) (4 %) Total revenues 9 % 5 % 7 % 3 % 6 %7 % 9 % 6 % 11 % 8 %CONSTANT CURRENCY REVENUE GROWTH RATES (2)Cloud services 29 % 24 % 24 % 20 % 24 %22 % 24 % 25 % 27 % 24 % License support 0 % 0 % 1 % 1 % 0 %0 % 0 % 0 % 0 % 0 % Cloud services and license support 12 % 11 % 11 % 10 % 11 %11 % 12 % 12 % 14 % 12 % Cloud license and on-premise license (11 %) (19 %) (3 %) (14 %) (12 %)8 % 3 % (8 %) 8 % 3 % Hardware (8 %) (12 %) (7 %) 0 % (7 %)(8 %) (3 %) (5 %) 0 % (4 %) Services 1 % (3 %) (5 %) (6 %) (3 %)(8 %) (3 %) 1 % (2 %) (3 %) Total revenues 8 % 4 % 7 % 4 % 6 %8 % 9 % 8 % 11 % 9 %CLOUD SERVICES AND LICENSE SUPPORT REVENUES BY ECOSYSTEM Applications cloud services and license support $ 4,471 $ 4,474 $ 4,584 $ 4,642 $ 18,172$ 4,769 $ 4,784 $ 4,811 $ 5,019 $ 19,383 Infrastructure cloud services and license support 5,076 5,165 5,379 5,592 21,2115,750 6,022 6,196 6,679 24,646 Total cloud services and license support revenues $ 9,547 $ 9,639 $ 9,963 $ 10,234 $ 39,383$ 10,519 $ 10,806 $ 11,007 $ 11,698 $ 44,029AS REPORTED REVENUE GROWTH RATES Applications cloud services and license support 11 % 10 % 10 % 6 % 9 %7 % 7 % 5 % 8 % 7 % Infrastructure cloud services and license support 15 % 14 % 13 % 12 % 14 %13 % 17 % 15 % 19 % 16 % Total cloud services and license support revenues13 % 12 % 12 % 9 % 12 %10 % 12 % 10 % 14 % 12 %CONSTANT CURRENCY REVENUE GROWTH RATES (2) Applications cloud services and license support 11 % 9 % 10 % 6 % 9 %7 % 7 % 6 % 8 % 7 % Infrastructure cloud services and license support 14 % 12 % 13 % 13 % 13 %14 % 17 % 18 % 19 % 17 % Total cloud services and license support revenues12 % 11 % 11 % 10 % 11 %11 % 12 % 12 % 14 % 12 %GEOGRAPHIC REVENUES Americas $ 7,841 $ 8,067 $ 8,270 $ 8,945 $ 33,122$ 8,372 $ 8,933 $ 9,000 $ 10,034 $ 36,339 Europe/Middle East/Africa 3,005 3,170 3,316 3,539 13,0303,228 3,381 3,421 3,996 14,025 Asia Pacific 1,607 1,704 1,694 1,803 6,8091,707 1,745 1,709 1,873 7,035 Total revenues$ 12,453 $ 12,941 $ 13,280 $ 14,287 $ 52,961$ 13,307 $ 14,059 $ 14,130 $ 15,903 $ 57,399 (1) The sum of the quarterly information presented may vary from the year-to-date information presented due to rounding.(2) We compare the percent change in the results from one period to another period using constant currency disclosure. We present constant currency information to provide a framework for assessing how our underlying businesses performed excluding the effect of foreign currency rate fluctuations. To present this information, current and comparative prior period results for entities reporting in currencies other than United States dollars are converted into United States dollars at the exchange rates in effect on May 31, 2024 and 2023 for the fiscal 2025 and fiscal 2024 constant currency growth rate calculations presented, respectively, rather than the actual exchange rates in effect during the respective periods. APPENDIX A ORACLE CORPORATIONQ4 FISCAL 2025 FINANCIAL RESULTSEXPLANATION OF NON-GAAP MEASURES To supplement our financial results presented on a GAAP basis, we use the non-GAAP measures indicated in the tables, which exclude certain business combination accounting entries and expenses related to acquisitions, as well as other significant expenses including stock-based compensation, that we believe are helpful in understanding our past financial performance and our future results. Our non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. Our management regularly uses our supplemental non-GAAP financial measures internally to understand, manage and evaluate our business and make operating decisions. These non-GAAP measures are among the primary factors management uses in planning for and forecasting future periods. Compensation of our executives is based in part on the performance of our business based on these non-GAAP measures. Our non-GAAP financial measures reflect adjustments based on the following items, as well as the related income tax effects: Stock-based compensation expenses: We have excluded the effect of stock-based compensation expenses from our non-GAAP operating expenses, income tax effects and net income measures. Although stock-based compensation is a key incentive offered to our employees, and we believe such compensation contributed to the revenues earned during the periods presented and also believe it will contribute to the generation of future period revenues, we continue to evaluate our business performance excluding stock-based compensation expenses. Stock-based compensation expenses will recur in future periods. Amortization of intangible assets: We have excluded the effect of amortization of intangible assets from our non-GAAP operating expenses, income tax effects and net income measures. Amortization of intangible assets is inconsistent in amount and frequency and is significantly affected by the timing and size of our acquisitions. Investors should note that the use of intangible assets contributed to our revenues earned during the periods presented and will contribute to our future period revenues as well. Amortization of intangible assets will recur in future periods. Acquisition related and other expenses; and restructuring expenses: We have excluded the effect of acquisition related and other expenses and the effect of restructuring expenses from our non-GAAP operating expenses, income tax effects and net income measures. We incurred expenses in connection with our acquisitions and also incurred certain other operating expenses or income, which we generally would not have otherwise incurred in the periods presented as a part of our continuing operations. Acquisition related and other expenses consisted of personnel related costs for transitional and certain other employees, certain business combination adjustments including certain adjustments after the measurement period has ended, and certain other operating items, net. Restructuring expenses consisted of employee severance and other exit costs. We believe it is useful for investors to understand the effects of these items on our total operating expenses. Although acquisition related and other expenses and restructuring expenses may diminish over time with respect to past acquisitions and/or strategic initiatives, we generally will incur certain of these expenses in connection with any future acquisitions and/or strategic initiatives. View original content: SOURCE Oracle
Yahoo
10-06-2025
- Business
- Yahoo
GitLab Reports First Quarter Fiscal Year 2026 Financial Results
First Quarter Fiscal Year 2026 Highlights: Total revenue of $214.5 million, up 27% year-over-year GAAP operating margin of (16)%; non-GAAP operating margin of 12% Operating cash flow of $106.3 million and non-GAAP adjusted free cash flow of $104.1 million SAN FRANCISCO, June 10, 2025--(BUSINESS WIRE)--All-Remote-GitLab Inc. (NASDAQ: GTLB), the most comprehensive, intelligent DevSecOps platform, today reported financial results for its first quarter fiscal year of 2026, ended April 30, 2025. "First quarter fiscal year 2026 results underscore the power of our AI-native DevSecOps platform to help customers deliver mission-critical software. We're giving every developer the AI-driven edge they need to innovate faster and more efficiently," said Bill Staples, GitLab chief executive officer. "As AI transforms development practices, our unified platform enables organizations to integrate these capabilities within a framework that helps maintain enterprise controls and deliver the required scalability and security." "I am pleased with our team's execution which resulted in 27% revenue growth in the first quarter, significant year-over-year operating margin expansion, and record adjusted free cash flow," said Brian Robins, GitLab chief financial officer. "GitLab's platform approach continues to drive momentum across the business, and, with our GitLab 18 release, we offer the most comprehensive, intelligent DevSecOps platform in the market." First Quarter Fiscal Year 2026 Financial Highlights (in millions, except per share data and percentages): Q1 FY 2026 Q1 FY 2025 Y/Y Change Revenue $ 214.5 $ 169.2 27 % GAAP Gross margin 88 % 89 % Non-GAAP Gross margin 90 % 91 % GAAP Operating margin (16 )% (32 )% Non-GAAP Operating margin 12 % (2 )% GAAP Operating loss $ (34.6 ) $ (53.6 ) $ 19.0 Non-GAAP Operating income (loss) $ 26.1 $ (3.8 ) $ 29.9 GAAP Net loss attributable to GitLab $ (35.9 ) $ (55.2 ) $ 19.3 Non-GAAP Net income attributable to GitLab $ 29.4 $ 4.5 $ 24.9 GAAP Net loss per share attributable to GitLab, basic $ (0.22 ) $ (0.35 ) $ 0.13 GAAP Net loss per share attributable to GitLab, diluted $ (0.22 ) $ (0.35 ) $ 0.13 Non-GAAP Net income per share attributable to GitLab, basic $ 0.18 $ 0.03 $ 0.15 Non-GAAP Net income per share attributable to GitLab, diluted $ 0.17 $ 0.03 $ 0.14 GAAP net cash provided by operating activities $ 106.3 $ 38.1 $ 68.2 Non-GAAP adjusted free cash flow $ 104.1 $ 37.4 $ 66.7 A reconciliation between GAAP and non-GAAP financial measures is contained in this release under the section titled "Non-GAAP Financial Measures." Additional Financial Highlights: Customers with more than $5,000 of ARR reached 10,104, an increase of 13% year-over-year. Customers with more than $100,000 of ARR reached 1,288, an increase of 26% year-over-year. Dollar-Based Net Retention Rate was 122%. Total RPO grew 40% year-over-year to $955.1 million, while cRPO grew 34% to $584.8 million. Business Highlights: Announced GitLab 18, including major new innovations across core DevOps workflows, security and compliance processes, and AI capabilities natively integrated into the platform. Announced the general availability of GitLab Duo with Amazon Q, which embeds Amazon Q's autonomous agents directly into the GitLab DevSecOps platform for GitLab Ultimate self-managed customers on Amazon Web Services (AWS). Achieved Authority to Operate status at the Moderate impact level from the Federal Risk and Authorization Management Program (FedRAMP) for GitLab Dedicated for Government under the sponsorship of the General Services Administration (GSA). Named a Leader in the Forrester Wave™: DevOps Platforms, Q2 2025 report. Received the 2025 Google Cloud Technology Partner of the Year Award in the Application Development - DevOps category for the fifth consecutive year. Second Quarter and Fiscal Year 2026 Financial Outlook For the second quarter and fiscal year 2026, GitLab Inc. expects (in millions, except share and per share data): Q2 FY 2026 Guidance FY 2026 Guidance Revenue $226.0 - $227.0 $936 - $942 Non-GAAP operating income $23.0 - $24.0 $117 - $121 Non-GAAP diluted net income per share assuming approximately 171 million and 172 million weighted average shares outstanding during Q2 FY 2026 and FY 2026, respectively. $0.16 - $0.17 $0.74 - $0.75 These statements are forward-looking and actual results may differ materially as a result of many factors. Refer to the Forward-Looking Statements safe harbor below for information on the factors that could cause our actual results to differ materially from these forward-looking statements. A reconciliation of GAAP to non-GAAP financial measures has been provided in the financial statement tables included in this press release. An explanation of these measures is also included below in Non-GAAP Financial Measures. We have not provided the most directly comparable GAAP financial guidance measures because certain items are out of our control or cannot be reasonably predicted. Accordingly, a reconciliation of non-GAAP guidance for operating income (loss) and net income (loss) per share to the corresponding GAAP measures is not available. Conference Call Information GitLab will host a conference call today, June 10, 2025, at 1:30 p.m. (PT) / 4:30 p.m. (ET) to discuss its first quarter fiscal year 2026 financial results and its guidance for the second quarter and full fiscal year 2026. Interested parties may register for the call in advance by visiting A live webcast of this conference call will be available on GitLab's investor relations website ( and a replay will also be archived on the website for one year. About GitLab GitLab is the most comprehensive, intelligent DevSecOps platform for software innovation. GitLab enables organizations to increase developer productivity, improve operational efficiency, reduce security and compliance risk, and accelerate digital transformation. More than 50 million registered users and more than 50% of the Fortune 100 trust GitLab to ship better, more secure software faster. Non-GAAP Financial Measures GitLab believes non-GAAP measures are useful in evaluating its operating performance. GitLab uses this supplemental information to evaluate its ongoing operations and for internal planning and forecasting purposes. GitLab believes that non-GAAP financial information, when taken collectively with its GAAP financial information, may be helpful to investors because it provides consistency and comparability with past financial performance. However, non-GAAP financial information is presented for supplemental informational purposes only, has limitations as an analytical tool, and should not be considered in isolation or as a substitute for financial information presented in accordance with GAAP. Reconciliations of non-GAAP financial measures to the most directly comparable financial results as determined in accordance with GAAP are included at the end of this press release following the accompanying financial data. We define non-GAAP financial measures as GAAP measures, excluding certain items such as stock-based compensation expense, amortization of acquired intangible assets, foreign exchange (gain) loss, equity method investment loss and impairment, acquisition related expenses, charitable donation of common stock, restructuring charges, a non-recurring income tax adjustment related to bilateral advance pricing agreement ("BAPA") negotiations, non-recurring charges associated with the formation of our GitLab Information Technology (Hubei) Co., LTD Joint Venture in China ("JiHu"), and other expenses that the Company believes are not indicative of its ongoing operations. In addition to these exclusions, effective Q1 FY26 we utilize a fixed long-term projected tax rate in our computation of the non-GAAP income tax provision which reflects the new location of GitLab's intellectual property in the U.S. following the conclusion of our bilateral advance pricing agreements. For FY26, we have determined the projected non-GAAP tax rate to be 22%. Shares used for net income per share on a non-GAAP basis include incremental dilutive shares related to restricted stock units, options, and shares issuable under GitLab Inc.'s 2021 Employee Stock Purchase Plan that are anti-dilutive on a GAAP basis. A reconciliation of non-GAAP guidance measures to corresponding GAAP measures is not available on a forward-looking basis without unreasonable effort due to the uncertainty of expenses that may be incurred in the future. Investors are encouraged to review the related GAAP financial measures and the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures and not rely on any single financial measure to evaluate our business. Adjusted Free Cash Flow Adjusted free cash flow is a non-GAAP financial measure that we calculate as net cash provided by operating activities less cash used for purchases of property and equipment, plus any non-recurring income tax payments related to BAPA or minus any non-recurring income tax refunds related to BAPA, plus any non-recurring payments related to the formation of JiHu. We believe that adjusted free cash flow is a useful indicator of liquidity that provides information to management and investors about the amount of cash generated from our operations that, after the investments in property and equipment, any non-recurring income tax payments or refunds related to BAPA, and any non-recurring payments related to the formation of JiHu, can be used for strategic initiatives, including investing in our business, and strengthening our financial position. One limitation of adjusted free cash flow is that it does not reflect our future contractual commitments. Additionally, adjusted free cash flow does not represent the total increase or decrease in our cash balance for a given period. Forward-Looking Statements This press release and the accompanying earnings call contain "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934. Although we believe that the expectations reflected in the forward-looking statements contained in this release and the accompanying earnings call are reasonable, they are subject to known and unknown risks, uncertainties, assumptions and other factors that may cause actual results or outcomes to be materially different from any future results or outcomes expressed or implied by the forward-looking statements. These risks, uncertainties, assumptions, and other factors include, but are not limited to the following: our ability to effectively manage our growth; our revenue growth rate in the future; our ability to achieve and sustain profitability, our business, financial condition, and operating results; security and privacy breaches; intense competition in our markets and loss of market share to our competitors; our ability to respond to rapid technological changes; the market for our services may not grow; a decline in our customer renewals and expansions; fluctuations in our operating results; our incorporation of artificial intelligence features into our products; our transparency; our publicly available company Handbook; customers staying on our free self-managed or SaaS product offering; our ability to accurately predict the long-term rate of customer subscription renewals or adoption, or the impact of these renewals and adoption; our hiring model; the effects of ongoing armed conflict in different regions of the world on our business; and general economic conditions (including changes in interest rates, inflation, tariffs, uncertainty of the federal budget, increased volatility in the capital markets, and instability in the global banking sector) and slow or negative growth of our markets. Further information on these and additional risks, uncertainties, and other factors that could cause actual outcomes and results to differ materially from those included in or contemplated by the forward-looking statements contained in this release are included under the caption "Risk Factors" and elsewhere in the filings and reports we make with the Securities and Exchange Commission. We do not undertake any obligation to update or release any revisions to any forward-looking statement or to report any events or circumstances after the date of this press release or to reflect the occurrence of unanticipated events, except as required by law. Operating Metrics Annual Recurring Revenue ("ARR"): We define annual recurring revenue as the annual run-rate revenue of subscription agreements, including our self-managed and SaaS offerings but excluding professional services, from all customers as measured on the last day of a given month. We calculate ARR by taking the monthly recurring revenue ("MRR") and multiplying it by 12. MRR for each month is calculated by aggregating, for all customers during that month, monthly revenue from committed contractual amounts of subscriptions, including our self-managed license, self-managed subscription, and SaaS subscription offerings but excluding professional services. Dollar-Based Net Retention Rate: We calculate Dollar-Based Net Retention Rate as of a period end by starting with our customers as of the 12 months prior to such period end ("Prior Period ARR"). We then calculate the ARR from these customers as of the current period end ("Current Period ARR"). The calculation of Current Period ARR includes any upsells, price adjustments, user growth within a customer, contraction, and attrition. We then divide the total Current Period ARR by the total Prior Period ARR to arrive at the Dollar-Based Net Retention Rate. GitLab Inc. Condensed Consolidated Balance Sheets (in thousands, except per share data) (unaudited) April 30, 2025(1) January 31, 2025(1) ASSETS CURRENT ASSETS: Cash and cash equivalents $ 255,719 $ 227,649 Short-term investments 849,113 764,728 Accounts receivable, net of allowance for doubtful accounts of $1,154 and $991 as of April 30, 2025 and January 31, 2025, respectively 201,408 264,565 Deferred contract acquisition costs, current 35,455 38,964 Prepaid expenses and other current assets 39,066 40,411 Total current assets 1,380,761 1,336,317 Property and equipment, net 4,856 4,013 Operating lease right-of-use assets 329 381 Goodwill 16,029 16,139 Intangible assets, net 15,819 17,834 Deferred contract acquisition costs, non-current 19,830 20,142 Other non-current assets 4,366 4,437 TOTAL ASSETS $ 1,441,990 $ 1,399,263 LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Accounts payable $ 11,288 $ 7,519 Accrued expenses and other current liabilities 66,308 54,680 Accrued compensation and benefits 28,119 40,233 Deferred revenue, current 450,668 442,599 Total current liabilities 556,383 545,031 Deferred revenue, non-current 25,981 26,369 Other non-current liabilities 7,029 6,557 TOTAL LIABILITIES 589,393 577,957 STOCKHOLDERS' EQUITY: Preferred stock, $0.0000025 par value; 50,000 shares authorized as of April 30, 2025 and January 31, 2025; no shares issued and outstanding as of April 30, 2025 and January 31, 2025 — — Class A Common stock, $0.0000025 par value; 1,500,000 shares authorized as of April 30, 2025 and January 31, 2025; 145,894 and 144,444 shares issued and outstanding as of April 30, 2025 and January 31, 2025, respectively — — Class B Common stock, $0.0000025 par value; 250,000 shares authorized as of April 30, 2025 and January 31, 2025; 19,203 and 19,469 shares issued and outstanding as of April 30, 2025 and January 31, 2025, respectively — — Additional paid-in capital 2,013,228 1,952,031 Accumulated deficit (1,203,489 ) (1,167,614 ) Accumulated other comprehensive loss (1,459 ) (8,508 ) Total GitLab stockholders' equity 808,280 775,909 Noncontrolling interests 44,317 45,397 TOTAL STOCKHOLDERS' EQUITY 852,597 821,306 TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 1,441,990 $ 1,399,263 __________ (1) As of April 30, 2025 and January 31, 2025, the condensed consolidated balance sheet includes assets of the consolidated variable interest entity, GitLab Information Technology (Hubei) Co., LTD ("JiHu"), of $45.0 million and $46.5 million, respectively, and liabilities of $10.2 million and $10.3 million, respectively. The assets of JiHu can be used only to settle obligations of JiHu and creditors of JiHu do not have recourse against the general credit of GitLab Inc. GitLab Inc. Condensed Consolidated Statements of Operations (in thousands, except per share data) (unaudited) Three Months Ended April 30, 2025 2024 Revenue: Subscription—self-managed and SaaS $ 194,481 $ 151,179 License—self-managed and other 20,028 18,008 Total revenue 214,509 169,187 Cost of revenue: Subscription—self-managed and SaaS 19,268 13,839 License—self-managed and other 5,767 4,937 Total cost of revenue 25,035 18,776 Gross profit 189,474 150,411 Operating expenses: Sales and marketing 107,587 92,424 Research and development 65,410 54,140 General and administrative 51,087 57,487 Total operating expenses 224,084 204,051 Loss from operations (34,610 ) (53,640 ) Interest income 10,862 12,030 Other expense, net (9,971 ) (889 ) Loss before income taxes (33,719 ) (42,499 ) Provision for income taxes 2,539 12,977 Net loss $ (36,258 ) $ (55,476 ) Net loss attributable to noncontrolling interest (383 ) (243 ) Net loss attributable to GitLab $ (35,875 ) $ (55,233 ) Net loss per share attributable to GitLab Class A and Class B common stockholders, basic and diluted: $ (0.22 ) $ (0.35 ) Weighted-average shares used to compute net loss per share attributable to GitLab Class A and Class B common stockholders, basic and diluted: 164,491 158,157 GitLab Inc. Condensed Consolidated Statements of Cash Flows (in thousands) (unaudited) Three Months Ended April 30, 2025 2024 CASH FLOWS FROM OPERATING ACTIVITIES: Net loss, including amounts attributable to noncontrolling interest. $ (36,258 ) $ (55,476 ) Adjustments to reconcile net loss to net cash provided by operating activities: Stock-based compensation expense 55,827 42,252 Charitable donation of common stock 1,739 2,957 Amortization of intangible assets 2,020 1,087 Depreciation expense 556 937 Amortization of deferred contract acquisition costs 13,899 11,109 Net amortization of premiums or discounts on short-term investments (2,996 ) (4,900 ) Unrealized foreign exchange loss, net 9,901 720 Other non-cash expense, net 208 412 Changes in assets and liabilities: Accounts receivable 65,928 31,072 Prepaid expenses and other current assets 1,527 10,362 Deferred contract acquisition costs (8,126 ) (8,540 ) Other non-current assets 379 (419 ) Accounts payable 3,586 1,336 Accrued expenses and other current liabilities 9,979 20,023 Accrued compensation and benefits (13,084 ) (13,152 ) Deferred revenue 1,205 (4,448 ) Other non-current liabilities 12 2,806 Net cash provided by operating activities 106,302 38,138 CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of short-term investments. (245,952 ) (144,392 ) Proceeds from maturities of short-term investments 163,606 254,687 Proceeds from sales of short-term investments 1,367 — Purchases of property and equipment. (912 ) (700 ) Payments for business combination, net of cash acquired — (20,210 ) Net cash provided by (used in) investing activities (81,891 ) 89,385 CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from the issuance of common stock upon exercise of stock options, including early exercises, net of repurchases 3,328 5,093 Net cash provided by financing activities 3,328 5,093 Impact of foreign exchange on cash and cash equivalents 331 (290 ) Net increase in cash and cash equivalents. 28,070 132,326 Cash and cash equivalents at beginning of period 227,649 287,996 Cash and cash equivalents at end of period $ 255,719 $ 420,322 GitLab Inc. Reconciliation of GAAP to Non-GAAP (in thousands, except per share data) (unaudited) Three Months Ended April 30, 2025 2024 Gross profit on GAAP basis $ 189,474 $ 150,411 Gross margin on GAAP basis 88 % 89 % Stock-based compensation expense 1,929 1,855 Amortization of acquired intangibles 2,020 1,087 Gross profit on non-GAAP basis $ 193,423 $ 153,353 Gross margin on non-GAAP basis 90 % 91 % Sales and marketing on GAAP basis $ 107,587 $ 92,424 Stock-based compensation expense (22,091 ) (17,397 ) Restructuring charges — (730 ) Sales and marketing on non-GAAP basis $ 85,496 $ 74,297 Research and development on GAAP basis $ 65,410 $ 54,140 Stock-based compensation expense (14,272 ) (12,336 ) Research and development on non-GAAP basis $ 51,138 $ 41,804 General and administrative on GAAP basis $ 51,087 $ 57,487 Stock-based compensation expense (17,535 ) (10,664 ) Restructuring charges — (276 ) Charitable donation of common stock (1,739 ) (2,957 ) Acquisition related expenses (183 ) (2,051 ) Other non-recurring charges (963 ) (473 ) General and administrative on non-GAAP basis $ 30,667 $ 41,066 Loss from operations on GAAP basis $ (34,610 ) $ (53,640 ) Stock-based compensation expense 55,827 42,252 Amortization of acquired intangibles 2,020 1,087 Restructuring charges — 1,006 Charitable donation of common stock 1,739 2,957 Acquisition related expenses 183 2,051 Other non-recurring charges 963 473 Income (loss) from operations on non-GAAP basis $ 26,122 $ (3,814 ) Other expense, net on GAAP basis $ (9,971 ) $ (889 ) Foreign exchange losses, net 9,954 785 Other non-recurring charges 170 174 Other income, net on non-GAAP basis $ 153 $ 70 Net loss attributable to GitLab common stockholders on GAAP basis $ (35,875 ) $ (55,233 ) Stock-based compensation expense 55,827 42,252 Amortization of acquired intangibles 2,020 1,087 Restructuring charges — 1,006 Charitable donation of common stock 1,739 2,957 Acquisition related expenses 183 2,051 Foreign exchange losses 9,954 785 Income tax adjustment (1) (5,631 ) 8,922 Other non-recurring charges 1,133 647 Net income attributable to GitLab common stockholders on non-GAAP basis $ 29,350 $ 4,474 GAAP net loss per share, basic and diluted $ (0.22 ) $ (0.35 ) Non-GAAP net income per share, basic $ 0.18 $ 0.03 Non-GAAP net income per share, diluted $ 0.17 $ 0.03 Shares used in per share calculation - basic on GAAP basis 164,491 158,157 Effect of dilutive securities 5,669 8,767 Shares used in per share calculation - diluted on non-GAAP basis 170,160 166,924 (1) Income tax adjustment in Q1 FY2025 consists primarily of one-time charges associated with the formation of Jihu and BAPA negotiations, while in Q1 FY2026, it primarily reflects an assumed provision for income taxes based on our long-term projected tax rate of 22%. GitLab Inc. Reconciliation of GAAP Cash Flow from Operating Activities to Adjusted Free Cash Flow (in thousands) (unaudited) Three Months Ended April 30, 2025 2024 Computation of adjusted free cash flow (1) GAAP net cash provided by operating activities $ 106,302 $ 38,138 Less: Purchases of property and equipment (912 ) (700 ) Less: Income tax refunds related to BAPA (1,293 ) — Add: Payments related to the formation of JiHu — — Non-GAAP adjusted free cash flow $ 104,097 $ 37,438 (1) No non-recurring payments related to the formation of JiHu were recorded during the periods presented. View source version on Contacts Media Contact: Lisa BoughnerVP, Global CommunicationsGitLab Investor Contact: Kelsey TurcotteVP, Investor RelationsGitLab Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
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10-06-2025
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Comtech Announces Financial Results for Third Quarter of Fiscal 2025
CHANDLER, Ariz., June 09, 2025--(BUSINESS WIRE)--June 9, 2025-- Comtech Telecommunications Corp. (NASDAQ: CMTL) ("Comtech" or the "Company"), a global communications technology leader, today reported financial results for its third quarter ended April 30, 2025. Consolidated Financial Results Net sales of $126.8 million Gross margin of 30.7% Operating loss of $1.5 million and net loss attributable to common shareholders of $14.5 million Adjusted EBITDA (a Non-GAAP measure) of $12.6 million, or 9.9% Net bookings of $71.0 million, representing a book-to-bill ratio of 0.56x (as described below, gross bookings during the third quarter were $107.4 million, representing a book-to-bill ratio of 0.85x) Funded backlog of $708.1 million and revenue visibility of approximately $1.2 billion GAAP cash flows provided by operations of $2.3 million Ken Traub, Chairman, President and CEO, stated: "We are pleased to report that our transformation plan is gaining traction and notable progress is already evident in our improved performance. In the third quarter, we secured a $40 million capital infusion that enabled us to re-negotiate terms with our senior secured lenders, which not only waived prior covenant breaches but also provided for more financial flexibility going forward. In addition, we have implemented measures to align accountability throughout the organization, improve operational efficiency, streamline our product lines, increase gross margins and reduce administrative costs. With a more targeted product-market focus, we have strengthened customer relationships and notched important new business wins. Nevertheless, we recognize Comtech has long-standing and lingering challenges, and while we have made significant progress, our transformation is still in the early innings. I am grateful to our entire dedicated team as well as all of our stakeholders for their loyalty, perseverance and contributions in helping us on the journey in building a strong, successful future for Comtech." Third Quarter Fiscal 2025 Consolidated Results Commentary Consolidated net sales were $126.8 million in the third quarter, a decrease of 1.0% compared to the prior year period and an increase of 0.2% sequentially from last quarter. Net sales in the Terrestrial and Wireless Networks ("T&W") segment were higher compared to the prior year period due to changes in products and services mix, including approximately $3.0 million of incremental NG-911 services revenue in the more recent period due to reaching an agreement with a statewide customer to retroactively invoice for certain recurring services provided in the past. Net sales in the Satellite and Space Communications ("S&S") segment were lower compared to the prior year period due to decreased net sales of troposcatter solutions to the U.S. Marine Corps and U.S. Army, as both contracts wind down as anticipated. This was offset in part by higher net sales of SATCOM solutions, including VSAT and similar equipment sales to the U.S. Army and satellite ground infrastructure solutions. Consolidated gross profit was $38.9 million, or 30.7% of consolidated net sales, in the third quarter, in line with the prior year period gross profit of $39.0 million, or 30.4%. The third quarter gross profit is a sequential increase from the $33.7 million, or 26.7%, reported in the immediately preceding quarter. The sequential improvement is primarily due to a more favorable sales mix and production efficiencies, as well as the inclusion of the incremental NG-911 services revenue discussed above in which most of the expenses were previously incurred. Consolidated operating loss was $1.5 million in the third quarter, compared to an operating loss of $3.5 million in the prior year period. Operating loss improvement from the prior year period is primarily the result of cost reduction initiatives which have reduced operating expenses. Operating loss in the third quarter significantly improved from the $10.3 million operating loss reported in the second quarter. The sequential improvement in the more recent quarter is due to the above improvements in gross profit and the benefit of cost reduction initiatives, lowering the Company's overall operating expenses. Operating loss in the more recent period includes, among other things: $5.0 million of amortization of intangibles; $4.3 million of restructuring costs (mainly at the parent level); $1.2 million of amortization of stock-based compensation; and $0.8 million of CEO transition costs. Consolidated net loss attributable to common shareholders was $14.5 million in the third quarter, compared to net loss attributable to common shareholders of $1.0 million in the prior year period and net loss attributable to common shareholders of $22.4 million in the immediately preceding quarter. In addition to those items discussed above, and as more fully discussed in the Company's SEC filings, net loss attributable to common shareholders in the more recent period was impacted by higher interest expense, changes in the estimated fair values of derivatives and warrants, the write-off of deferred financing costs and debt discounts and accrued dividends related to the Company's Convertible Preferred Stock. Consolidated Adjusted EBITDA (a non-GAAP measure) was $12.6 million in the third quarter, compared to Adjusted EBITDA of $11.9 million in the prior year period and Adjusted EBITDA of $2.9 million in the immediately preceding quarter. The improvements in Adjusted EBITDA are due to the factors and initiatives described above. Consolidated net bookings were $71.0 million in the third quarter, a decrease of 30.2% and 10.5%, respectively, compared to the prior year period and immediately preceding quarter. The book-to-bill ratio in the more recent quarter was 0.56x. Consolidated net bookings reflect a $36.4 million debooking related to the low margin U.S. Army GFSR contract that was protested by and ultimately awarded to the incumbent in May 2025; gross bookings for the third quarter, excluding such debooking, were $107.4 million, an increase of 5.6% and 35.3%, respectively, compared to the prior year period and immediately preceding quarter, representing a quarterly book-to-bill ratio of 0.85x. The reduction in bookings reflects, in part, a more focused product positioning and sales approach. Consolidated backlog was $708.1 million as of April 30, 2025, compared to $763.8 million as of January 31, 2025 and $798.9 million as of July 31, 2024. Revenue visibility, measured as the sum of funded backlog and the total unfunded value of certain multi-year contracts, was approximately $1.2 billion at the end of the third quarter. GAAP cash flows from operations were $2.3 million in the third quarter, an improvement from both the prior year period's cash outflows of $3.8 million and the prior quarter's cash outflows of $0.2 million, and are due primarily to the combination of the improvements in GAAP operating performance, as described above, together with improved working capital management which includes progress toward completion of contracts that are accounted for over time (that previously led to high levels of unbilled accounts receivable), including related shipments, billings and collections from customers. Satellite and Space Communications ("S&S") Segment Commentary S&S net sales were $67.6 million in the third quarter, a decrease of 5.3% compared to the prior year period and 8.3% sequentially from last quarter. Compared to the prior year period, S&S experienced lower net sales of troposcatter solutions to the U.S. Marine Corps and U.S. Army as those two contracts wind down as anticipated, offset in part by higher net sales of SATCOM solutions (including VSAT and similar equipment sales to the U.S. Army and satellite ground infrastructure solutions). Sequentially, S&S experienced lower net sales of troposcatter solutions to the U.S. Marine Corps and U.S. Army, offset in part by higher net sales of SATCOM solutions (primarily satellite ground infrastructure solutions). The S&S segment is executing on initiatives to grow sales of next generation products, improve gross margins and reduce operating expenses. With recent strategic wins in digital satellite communication infrastructure, resilient communications programs and multi-orbit connectivity, the S&S segment is capitalizing on its differentiated technologies and extensive customer relationships to develop new vectors for growth. As part of the Company's commitment to improve operational discipline, Steve Black recently joined the S&S leadership team from General Dynamics as the new segment Chief Operating Officer reporting to Daniel Gizinski. S&S operating income was $2.7 million in the third quarter, compared to operating income of $2.8 million in the prior year period and $1.2 million in the immediately preceding quarter. S&S operating income in the third quarter was impacted by $0.9 million of restructuring costs, compared to $0.6 million and $1.4 million, respectively, in the prior year period and immediately preceding quarter. The sequential increase in quarterly operating income primarily reflects lower selling, general and administrative expenses (due to cost reduction actions), partially offset by lower net sales and gross profit. These cost reductions represent the results of actions that have been implemented to rationalize product lines and streamline the organization, which in addition to generating cost savings, have helped to improve accountability at the site level and enhance focus on priority products, production and customer commitments. S&S net income was $2.9 million for the third quarter, compared to a net income of $1.8 million in the prior year period and $1.6 million in the immediately preceding quarter. S&S Adjusted EBITDA was $5.7 million in the third quarter, compared to Adjusted EBITDA of $7.2 million in the prior year period and $4.7 million in the immediately preceding quarter. Compared to the prior year period, Adjusted EBITDA reflects lower net sales and gross profit (both in dollars and as a percentage of related segment net sales), offset in part by lower selling, general and administrative expenses and research and development expenses. The sequential increase in Adjusted EBITDA primarily reflects lower selling, general and administrative expenses, offset in part by lower net sales and gross profit. S&S book-to-bill ratio for the third quarter was 0.26x. Excluding the aforementioned $36.4 million debooking associated with the U.S. Army GFSR contract, the segment's book-to-bill ratio was 0.80x. This ratio compares to 0.85x in the prior year period and 0.64x in the second quarter. The reduction in bookings reflects, in part, a more focused product positioning and sales approach. Key S&S contract awards and product milestones during the third quarter included: Completed initial deliveries of next generation VSAT systems to a strategically significant allied Navy partner, an important step for a comprehensive fleet modernization program that includes ships, submarines and ground-based stations – deliveries are expected to continue over a two-year period; $8.5 million in aggregate orders from three commercial customers for high-power amplifiers and frequency converters for use in airborne related applications; Incremental funding of approximately $6.8 million for continued, ongoing training and support of complex cybersecurity operations for U.S. government customers; Additional funding of approximately $5.8 million from a major U.S. prime contractor in support of NASA's Orion Production and Operations Contract ("OPOC"), commonly known as the Artemis project; Approximately $5.0 million in funded orders from a long-time international customer for the procurement of ongoing maintenance and support services related to long-range missile and rocket launch tracking systems; and In excess of $3.6 million in funded orders calling for the supply of VSAT equipment and related services for the U.S. Army. Terrestrial & Wireless Networks ("T&W") Segment Commentary T&W net sales were $59.2 million in the third quarter, an increase of 4.6% and 12.0%, respectively, compared to the prior year period and immediately preceding quarter. Compared to the prior year period, as well as sequentially, T&W experienced higher net sales of next-generation 911 ("NG-911") services and location-based solutions, offset in part by lower net sales of call handling solutions. Third quarter net sales and gross profit benefited from approximately $3.0 million of incremental NG-911 services revenue due to reaching an agreement with a statewide customer to retroactively invoice for certain recurring services provided in the past. Key growth drivers for the T&W segment are expected to include customer upgrades to next-generation core services, new cloud-based emergency response products and increasing interest from international carriers for 5G location technologies. T&W operating income was $8.4 million in the third quarter, compared to operating income of $5.7 million in the prior year period and operating income of $3.4 million in the immediately preceding quarter. Compared to the prior year period, as well as sequentially, the increase in quarterly operating income primarily reflects higher net sales and gross profit, both in dollars and as a percentage of related segment net sales and including the NG-911 services revenue discussed above in which most of the expenses were previously incurred, offset in part by higher selling, general and administrative expenses and research and development expenses. T&W net income was $8.6 million in the third quarter, compared to net income of $5.3 million in the prior year period and $3.4 million in the immediately preceding quarter. T&W Adjusted EBITDA was $13.9 million in the third quarter, compared to Adjusted EBITDA of $11.3 million in the prior year period and $8.9 million in the immediately preceding quarter. Compared to the prior year period, as well as sequentially, Adjusted EBITDA reflects those factors discussed above. T&W book-to-bill ratio in the third quarter was 0.91x, compared to 0.72x in the prior year period and 0.61x in the second quarter. Key T&W contract awards and product milestones during the third quarter included: A new contract, valued at over $27.0 million during the initial five-year term, for statewide NG-911 services for a Southeastern state; Various funded orders totaling $9.0 million for wireless location-based messaging services; Over $2.5 million of initial funding from a new international customer for location-based messaging services; More than $2.5 million of incremental funding for an existing NG-911 customer in a Midwestern state; Various funded orders, aggregating $1.4 million, primarily for location and maintenance and support services for a large wireless carrier in the U.S.; and Additional funding from a Mid-Atlantic state for ancillary network and call handling services. Additionally, T&W announced that it is nearing the completion of the development of its latest NG-911 call handling solution, which features a new architecture leveraging cloud and AI capabilities and designed to serve first responders in the U.S., Canada and Australia even better. The Company anticipates launching its revolutionary new product at this year's upcoming National Emergency Number Association ("NENA") conference. Cost-Savings and Profit Improvement Initiatives Comtech continues to execute on its transformation plan which includes a thorough review of processes, product lines, staffing levels and cost structures to implement actions to reduce costs, enable a more efficient and effective organization and improve the Company's cash conversion cycle. Comtech has ceased manufacturing operations in the U.K. More than 70 products within the S&S segment have been discontinued, and the Company is completing the final deliveries of outstanding orders for these discontinued products over the next few months. Further, the Company has reduced its global workforce by approximately 15% since July 31, 2024, which represents approximately $33.0 million in annualized labor costs. Over the course of the nine months ended April 30, 2025, severance associated with such actions approximated $2.7 million (primarily within selling, general and administrative expenses). The Company continues to evaluate additional opportunities to improve operational efficiency, reduce costs and improve profitability. While the Company continues to invest in R&D, it is obtaining customer funding for research and development to adapt its products to specialized customer requirements. During the third quarter, customers reimbursed the Company $5.9 million in connection with R&D efforts. Such amount is in addition to the $4.4 million of Comtech funded R&D reported in the third quarter of fiscal 2025. This customer-funded R&D not only offsets the Company's expenditures, but helps to ensure that R&D expenditures are aligned with customer and market demand. Capital Structure and Liquidity As previously disclosed on March 3, 2025, the Company amended its Credit Facility and Subordinated Credit Facility to, among other things, waive existing breaches under the facilities, and suspend testing of the Net Leverage Ratio and Fixed Charge Coverage Ratio covenants until the quarter ending on October 31, 2025. As of June 6, 2025, Comtech's available sources of liquidity approximate $27.3 million, consisting of qualified cash and cash equivalents and the remaining available portion of the committed Revolver Loan. At both April 30, 2025 and June 6, 2025, total outstanding borrowings under the Credit Facility were $168.0 million, including $23.4 million drawn on the Revolver Loan. As of April 30, 2025, total outstanding borrowings under the Amended Subordinated Credit Facility were $65.0 million (excluding accreted interest and make whole adjustments), and the liquidation preference of the Company's outstanding convertible preferred stock was $199.7 million (excluding potential increases in the liquidation preference and other obligations that could be triggered by, among other things, breaches of covenants, asset sales and/or change in control of the Company). Conference Call and Webcast Information Comtech will host a conference call with investors and analysts on Monday, June 9, 2025 at 5:00 pm Eastern Time. A live webcast of the conference call will be accessible on the Investor Relations section of Comtech's website at Alternatively, investors can access the conference call by dialing (800) 225-9448 (primary) or (203) 518-9708 (alternate) and using the conference I.D. of "Comtech." A replay will be available through Monday, June 23, 2025, by dialing (800) 934-2123 or (402) 220-1137. About Comtech Comtech Telecommunications Corp. is a leading provider of satellite and space communications technologies; terrestrial and wireless network solutions; Next Generation 911 ("NG-911") and emergency services; and cloud native capabilities to commercial and government customers around the world. Through its culture of innovation and employee empowerment, Comtech leverages its global presence and decades of technology leadership and experience to create some of the world's most innovative solutions for mission-critical communications. For more information, please visit Cautionary Note Regarding Forward-Looking Statements Certain information in this press release contains, and oral statements made by the Company's representatives from time to time may contain, forward-looking statements. Forward-looking statements can be identified by words such as: "anticipate," "believe," "continue," "could," "estimate," "expect," "future," "goal," "outlook," "intend," "likely," "may," "plan," "potential," "predict," "project," "seek," "should," "strategy," "target," "will," "would," and similar references to future periods. Forward-looking statements include, among others, statements regarding expectations for its strategic alternatives process, expectations for further portfolio-shaping opportunities, expectations for other operational initiatives, the intended use of proceeds from the Credit Facility and Amended Subordinated Credit Facility, expectations for completing further financing initiatives, future performance and financial condition, plans to address its ability to continue as a going concern, the plans and objectives of management and assumptions regarding such future performance, financial condition, and plans and objectives that involve certain significant known and unknown risks and uncertainties and other factors not under its control which may cause actual results, future performance and financial condition, and achievement of plans and objectives of management to be materially different from the results, performance or other expectations implied by these forward-looking statements. Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times at, or by which, such performance or results will be achieved. Forward-looking information is based on information available at the time and/or the Company's good faith belief with respect to future events, and is subject to risks and uncertainties that are difficult to predict and many of which are outside of the Company's control. Factors that could cause actual results to differ materially from current expectations include, among other things: the outcome and effectiveness of the aforementioned strategic alternatives process, further portfolio-shaping opportunities, other operational initiatives, and the completion of further financing activities; its ability to access capital and liquidity so that the Company is able to continue as a going concern; its ability to implement changes in executive leadership; the possibility that the expected synergies and benefits from strategic activities will not be fully realized, or will not be realized within the anticipated time periods; the risk that acquired businesses will not be integrated successfully; impacts from, and uncertainties regarding, future actions that may be taken by activist stockholders; the possibility of disruption from acquisitions or dispositions, making it more difficult to maintain business and operational relationships or retain key personnel; the risk that the Company will be unsuccessful in implementing a tactical shift in its Satellite and Space Communications segment away from bidding on large commodity service contracts and toward pursuing contracts for niche products and solutions with higher margins; the nature and timing of receipt of, and performance on, new or existing orders that can cause significant fluctuations in net sales and operating results; the timing and funding of government contracts; adjustments to gross profits on long-term contracts; risks associated with international sales; rapid technological change; evolving industry standards; new product announcements and enhancements; changing customer demands and/or procurement strategies and ability to scale opportunities and deliver solutions to current and prospective customers; changes and uncertainty in prevailing economic and political conditions (including financial and capital market conditions), including as a result of Russia's military incursion into Ukraine, the Israel-Hamas war and attacks in the Red Sea region or any tariff, trade restrictions or similar matters; changes in the price of oil in global markets; changes in prevailing interest rates and foreign currency exchange rates; risks associated with legal proceedings, customer claims for indemnification, and other similar matters; risks associated with obligations under its credit facilities; risks associated with large contracts; risks associated with supply chain disruptions; and other factors described in this and other Company filings with the Securities and Exchange Commission. However, the risks described above are not the only risks that the Company faces. Additional risks and uncertainties, not currently known to the Company or that do not currently appear to be material, may also materially adversely affect its business, financial condition and/or operating results in the future. The Company describe risks and uncertainties that could cause actual results and events to differ materially in the "Risk Factors," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Quantitative and Qualitative Disclosures about Market Risk" sections of its SEC filings. The Company does not intend to update or revise publicly any forward-looking statements, whether because of new information, future events, or otherwise, except as required by law. Appendix: Condensed Consolidated Statements of Operations (Unaudited) Condensed Consolidated Balance Sheets (Unaudited) Use of Non-GAAP Financial Measures COMTECH TELECOMMUNICATIONS CORP. AND SUBSIDIARIES Consolidated Statements of Operations (Unaudited) (Unaudited) Three months ended April 30, Nine months ended April 30, 2025 2024 2025 2024 Net sales $ 126,787,000 128,076,000 $ 369,161,000 414,212,000 Cost of sales 87,842,000 89,122,000 281,960,000 284,178,000 Gross profit 38,945,000 38,954,000 87,201,000 130,034,000 Expenses: Selling, general and administrative 30,203,000 28,697,000 115,679,000 91,699,000 Research and development 4,425,000 5,746,000 12,492,000 20,401,000 Amortization of intangibles 5,044,000 5,289,000 16,680,000 15,866,000 Impairment of long-lived assets, including goodwill — — 79,555,000 — Proxy solicitation costs — — 2,682,000 — CEO transition costs 805,000 2,492,000 1,072,000 2,492,000 Loss (gain) on business divestiture, net — 200,000 — (2,013,000 ) 40,477,000 42,424,000 228,160,000 128,445,000 Operating (loss) income (1,532,000 ) (3,470,000 ) (140,959,000 ) 1,589,000 Other expenses (income): Interest expense 12,907,000 5,146,000 33,447,000 15,343,000 Interest (income) and other (509,000 ) 409,000 — 1,246,000 Write-off of deferred financing costs and debt discounts 3,479,000 — 4,891,000 — Change in fair value of warrants and derivatives (49,542,000 ) (6,439,000 ) (15,450,000 ) (6,439,000 ) Income (loss) before (benefit from) provision for income taxes 32,133,000 (2,586,000 ) (163,847,000 ) (8,561,000 ) (Benefit from) provision for income taxes (1,801,000 ) (5,381,000 ) (635,000 ) 639,000 Net income (loss) $ 33,934,000 2,795,000 $ (163,212,000 ) (9,200,000 ) Gain (loss) on extinguishment of convertible preferred stock — — 51,179,000 (13,640,000 ) Adjustments to reflect redemption value of convertible preferred stock: Convertible preferred stock issuance costs — (76,000 ) — (4,349,000 ) Dividends on convertible preferred stock (48,405,000 ) (3,759,000 ) (80,656,000 ) (7,643,000 ) Net loss attributable to common stockholders $ (14,471,000 ) (1,040,000 ) $ (192,689,000 ) (34,832,000 ) Net loss per common share: Basic $ (0.49 ) (0.04 ) $ (6.56 ) (1.21 ) Diluted $ (0.49 ) (0.04 ) $ (6.56 ) (1.21 ) Weighted average number of common shares outstanding – basic 29,399,000 28,854,000 29,395,000 28,753,000 Weighted average number of common and common equivalent shares outstanding – diluted 29,399,000 28,854,000 29,395,000 28,753,000 COMTECH TELECOMMUNICATIONS CORP. AND SUBSIDIARIES Consolidated Balance Sheets (Unaudited) April 30, 2025 July 31, 2024 Assets Current assets: Cash and cash equivalents $ 28,434,000 32,433,000 Accounts receivable, net 151,472,000 195,595,000 Inventories, net 77,691,000 93,136,000 Prepaid expenses and other current assets 17,063,000 15,387,000 Total current assets 274,660,000 336,551,000 Property, plant and equipment, net 44,462,000 47,328,000 Operating lease right-of-use assets, net 31,177,000 31,590,000 Goodwill 204,625,000 284,180,000 Intangibles with finite lives, net 178,148,000 194,828,000 Deferred financing costs, net 1,850,000 3,251,000 Other assets, net 16,222,000 14,706,000 Total assets $ 751,144,000 912,434,000 Liabilities, Convertible Preferred Stock and Stockholders' Equity Current liabilities: Accounts payable $ 27,188,000 42,477,000 Accrued expenses and other current liabilities 59,162,000 62,245,000 Current portion of credit facility, net 148,882,000 4,050,000 Current portion of subordinated credit facility, net 65,471,000 — Operating lease liabilities, current 7,589,000 7,869,000 Contract liabilities 64,386,000 65,834,000 Interest payable 5,000 1,072,000 Total current liabilities 372,683,000 183,547,000 Non-current portion of credit facility, net — 173,527,000 Operating lease liabilities, non-current 29,581,000 30,258,000 Income taxes payable, non-current 1,866,000 2,231,000 Deferred tax liability, net 5,763,000 6,193,000 Long-term contract liabilities 20,186,000 21,035,000 Warrant and derivative liabilities 31,564,000 5,254,000 Other liabilities 3,996,000 4,060,000 Total liabilities 465,639,000 426,105,000 Commitments and contingencies Convertible preferred stock, par value $0.10 per share; authorized and issued 178,181 shares at April 30, 2025 (redemption value of $199,661,000 which includes accrued dividends of $1,486,000) and authorized and issued 171,827 shares at July 31, 2024 (redemption value of $180,076,000, which includes accrued dividends of $1,341,000) 170,072,000 180,076,000 Stockholders' equity: Preferred stock, par value $0.10 per share; authorized and unissued 1,821,819 and 1,828,173 shares at April 30, 2025 and July 31, 2024, respectively — — Common stock, par value $0.10 per share; authorized 100,000,000 shares; issued 44,395,660 and 43,766,109 shares at April 30, 2025 and July 31, 2024, respectively 4,440,000 4,377,000 Additional paid-in capital 567,647,000 640,145,000 Retained (deficit) earnings (14,805,000 ) 103,580,000 557,282,000 748,102,000 Less: Treasury stock, at cost (15,033,317 shares at April 30, 2025 and July 31, 2024) (441,849,000 ) (441,849,000 ) Total stockholders' equity 115,433,000 306,253,000 Total liabilities, convertible preferred stock and stockholders' equity $ 751,144,000 912,434,000 Use of Non-GAAP Financial Measures To provide investors with additional information regarding the Company's financial results, this release contains "Non-GAAP financial measures" under the rules of the SEC. The Company's Adjusted EBITDA is a Non-GAAP measure that represents earnings (loss) before interest, income taxes, depreciation, amortization of intangibles, impairment of long-lived assets, including goodwill, amortization of cost to fulfill assets, amortization of stock-based compensation, CEO transition costs, change in fair value of warrants and derivatives, proxy solicitation costs, restructuring costs (non-inventory related), strategic emerging technology costs (for next-generation satellite technology), and write-off of deferred financing costs and debt discounts, and in the recent past, acquisition plan expenses, change in fair value of the convertible preferred stock purchase option liability, COVID-19 related costs, facility exit costs, strategic alternatives expenses and other and loss on business divestiture. These items, while periodically affecting its results, may vary significantly from period to period and may have a disproportionate effect in a given period, thereby affecting the comparability of results. Although closely aligned, the Company's definition of Adjusted EBITDA is different than EBITDA (as such term is defined in its Credit Facility) utilized for financial covenant calculations and also may differ from the definition of EBITDA or Adjusted EBITDA used by other companies and therefore may not be comparable to similarly titled measures used by other companies. Adjusted EBITDA is also a measure frequently requested by its investors and analysts. The Company believes that investors and analysts may use Adjusted EBITDA, along with other information contained in its SEC filings, including GAAP measures, in assessing performance and comparability of results with other companies. Non-GAAP measures reflect the GAAP measures as reported, adjusted for certain items as described herein and also excludes the effects of the Company's outstanding convertible preferred stock. These Non-GAAP financial measures have limitations as an analytical tool as they exclude the financial impact of transactions necessary to conduct its business, such as the granting of equity compensation awards, and are not intended to be an alternative to financial measures prepared in accordance with GAAP. These measures are adjusted as described in the reconciliation of GAAP to Non-GAAP measures in the tables presented herein, but these adjustments should not be construed as an inference that all of these adjustments or costs are unusual, infrequent or non-recurring. Non-GAAP financial measures should be considered in addition to, and not as a substitute for or superior to, financial measures determined in accordance with GAAP. Investors are advised to carefully review the GAAP financial results that are disclosed in the Company's SEC filings. As the Company has not provided future financial targets, there is no need to reconcile its business outlook to the most directly comparable GAAP measures. Furthermore, even if targets had been provided, items such as stock-based compensation, adjustments to the provision for income taxes, amortization of intangibles and interest expense, which are specific items that impact these measures, have not yet occurred, are out of the Company's control, or cannot be predicted. For example, quantification of stock-based compensation expense requires inputs such as the number of shares granted and market price that are not currently ascertainable. Accordingly, reconciliations to the Non-GAAP forward looking metrics would not be available without unreasonable effort and such unavailable reconciling items could significantly impact the Company's financial results. Three months ended April 30, Nine months ended April 30, Fiscal Year 2025 2024 2025 2024 2024 Reconciliation of GAAP Net Loss to Adjusted EBITDA: Net income (loss) $ 33,934,000 $ 2,795,000 $ (163,212,000 ) $ (9,200,000 ) $ (99,985,000 ) (Benefit from) provision for income taxes (1,801,000 ) (5,381,000 ) (635,000 ) 639,000 (295,000 ) Interest expense 12,907,000 5,146,000 33,447,000 15,343,000 22,153,000 Interest (income) and other (509,000 ) 409,000 — 1,246,000 678,000 Write-off of deferred financing costs and debt discounts 3,479,000 — 4,891,000 — 1,832,000 Change in fair value of warrants and derivatives (49,542,000 ) (6,439,000 ) (15,450,000 ) (6,439,000 ) (4,273,000 ) Amortization of stock-based compensation 1,195,000 404,000 2,520,000 5,238,000 6,096,000 Amortization of intangibles 5,044,000 5,289,000 16,680,000 15,866,000 21,154,000 Depreciation 2,726,000 3,121,000 8,400,000 9,073,000 12,159,000 Impairment of long-lived assets, including goodwill — — 79,555,000 — 64,525,000 Amortization of cost to fulfill assets — 240,000 261,000 720,000 960,000 Restructuring costs (non-inventory related) 4,338,000 2,755,000 14,222,000 9,197,000 12,470,000 Strategic emerging technology costs — 880,000 280,000 3,228,000 4,110,000 Proxy solicitation costs — — 2,682,000 — — CEO transition costs 805,000 2,492,000 1,072,000 2,492,000 2,916,000 Loss (gain) on business divestiture, net — 200,000 — (2,013,000 ) 1,199,000 Adjusted EBITDA $ 12,576,000 $ 11,911,000 $ (15,287,000 ) $ 45,390,000 $ 45,699,000 Reconciliations of GAAP consolidated operating income (loss), net income (loss) attributable to common stockholders and net income (loss) per diluted common share to the corresponding Non-GAAP measures are shown in the tables below (numbers and per share amounts in the tables may not foot due to rounding). Non-GAAP net income (loss) attributable to common stockholders and Non-GAAP net income (loss) per diluted common share reflect Non-GAAP provisions for income taxes based on year-to-date results, as adjusted for the Non-GAAP reconciling items included in the tables below. The Company evaluates its Non-GAAP effective income tax rate on an ongoing basis, and it can change from time to time. The Company's Non-GAAP effective income tax rate can differ materially from its GAAP effective income tax rate. April 30, 2025 Three months ended Nine months ended Operating(Loss)Income Net LossAttributableto CommonStockholders Net LossperDilutedCommonShare* OperatingLoss Net LossAttributableto CommonStockholders Net LossperDilutedCommonShare* Reconciliation of GAAP to Non-GAAP Earnings: GAAP measures, as reported $ (1,532,000 ) $ (14,471,000 ) $ (0.49 ) $ (140,959,000 ) $ (192,689,000 ) $ (6.56 ) Adjustments to reflect redemption value of convertible preferred stock — 48,405,000 1.65 — 80,656,000 2.74 Change in fair value of warrants and derivatives — (49,542,000 ) (1.68 ) — (15,450,000 ) (0.53 ) Gain on extinguishment of convertible preferred stock — — — — (51,179,000 ) (1.74 ) Impairment of long-lived assets, including goodwill — — — 79,555,000 79,555,000 2.71 Amortization of intangibles 5,044,000 4,807,000 0.16 16,680,000 15,968,000 0.54 Restructuring costs (non-inventory related) 4,338,000 4,061,000 0.14 14,222,000 13,582,000 0.46 Proxy solicitation costs — — — 2,682,000 2,523,000 0.09 Amortization of stock-based compensation 1,195,000 1,195,000 0.04 2,520,000 2,401,000 0.08 CEO transition costs 805,000 749,000 0.02 1,072,000 1,041,000 0.04 Strategic emerging technology costs — — — 280,000 266,000 0.01 Amortization of cost to fulfill assets — — — 261,000 261,000 0.01 Net discrete tax benefit — (442,000 ) (0.02 ) — (374,000 ) (0.01 ) Non-GAAP measures $ 9,850,000 $ (5,238,000 ) $ (0.18 ) $ (23,687,000 ) $ (63,439,000 ) $ (2.16 ) April 30, 2024 Three months ended Nine months ended Operating(Loss)Income Net (Loss)IncomeAttributableto CommonStockholders Net (Loss)IncomeperDilutedCommonShare* OperatingIncome Net (Loss)IncomeAttributableto CommonStockholders Net (Loss)IncomeperDilutedCommonShare* Reconciliation of GAAP to Non-GAAP Earnings: GAAP measures, as reported $ (3,470,000 ) $ (1,040,000 ) $ (0.04 ) $ 1,589,000 $ (34,832,000 ) $ (1.21 ) Loss on extinguishment of convertible preferred stock — — — — 13,640,000 0.47 Adjustments to reflect redemption value of convertible preferred stock — 3,835,000 0.13 — 11,992,000 0.41 Change in fair value of warrants and derivatives — (6,439,000 ) (0.22 ) — (6,439,000 ) (0.22 ) Amortization of intangibles 5,289,000 4,098,000 0.14 15,866,000 12,292,000 0.42 Restructuring costs 2,755,000 2,121,000 0.07 9,197,000 7,075,000 0.24 Amortization of stock-based compensation 404,000 323,000 0.01 5,238,000 4,089,000 0.14 Strategic emerging technology costs 880,000 678,000 0.02 3,228,000 2,486,000 0.09 CEO transition costs 2,492,000 1,919,000 0.07 2,492,000 1,919,000 0.07 Amortization of cost to fulfill assets 240,000 240,000 0.01 720,000 720,000 0.02 Loss (gain) on business divestiture, net 200,000 200,000 0.01 (2,013,000 ) (1,247,000 ) (0.04 ) Net discrete tax (benefit) expense — (229,000 ) (0.01 ) — 768,000 0.03 Non-GAAP measures $ 8,790,000 $ 5,706,000 $ 0.20 $ 36,317,000 $ 12,463,000 $ 0.43 Fiscal Year 2024 Operating(Loss)Income Net (Loss)IncomeAttributable toCommonStockholders Net (Loss)Incomeper DilutedCommonShare* Reconciliation of GAAP to Non-GAAP Earnings: GAAP measures, as reported $ (79,890,000 ) $ (135,440,000 ) $ (4.70 ) Loss on extinguishment of convertible preferred stock — 19,555,000 0.68 Adjustments to reflect redemption value of convertible preferred stock — 15,900,000 0.55 Change in fair value of warrants and derivatives — (4,273,000 ) (0.15 ) Impairment of long-lived assets, including goodwill 64,525,000 63,800,000 2.21 Amortization of intangibles 21,154,000 16,389,000 0.57 Restructuring costs 12,470,000 9,736,000 0.34 Amortization of stock-based compensation 6,096,000 4,797,000 0.17 Strategic emerging technology costs 4,110,000 3,795,000 0.13 CEO transition costs 2,916,000 2,245,000 0.08 Loss on business divestiture 1,199,000 1,199,000 0.04 Amortization of cost to fulfill assets 960,000 960,000 0.03 Net discrete tax expense — 4,136,000 0.14 Non-GAAP measures $ 33,540,000 $ 2,799,000 $ 0.10 * Per share amounts may not foot due to rounding. In addition, due to the GAAP net loss for the period, Non-GAAP EPS for the three and nine months ended April 30, 2024 and fiscal 2024 was computed using weighted average diluted shares outstanding of 28,936,000, 28,948,000 and 29,132,000, during the respective period. ECMTL View source version on Contacts Investor Relations Contact Maria Media Contacts Jamie Longacre Square Partnerscomtech@ Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
