eGain (EGAN) investor relations material

Executive summary

• Achieved 8% year-over-year revenue growth to $23.5 million for Q1 2026, driven by a 10% increase in SaaS revenue and a 23% rise in AI Knowledge ARR, now 60% of SaaS ARR.

• Gross margin improved to 76% non-GAAP (up from 70%) and 75% GAAP (up from 69%), with adjusted EBITDA margin at 21%.

• Net income increased to $2.8 million GAAP ($0.10/share) and $4.7 million non-GAAP ($0.17/share), with operating cash flow of $10.4 million (44% margin).

• Launched three major new AI products, including eGain AI Knowledge Method, AI Agent v2, and Composer, generating strong customer and partner interest.

• Secured notable new clients and expanded relationships, with key wins in health insurance, energy, Liberty Mutual, and JPMorgan Chase.

Financial highlights

• SaaS revenue was $21.9 million (93% of total), up 10% year-over-year; professional services revenue was $1.6 million, down 19%.

• Non-GAAP net income was $4.7 million ($0.17/share); adjusted EBITDA margin was 21%; operating cash flow was $10.4 million.

• Cash and equivalents totaled $70.9 million as of September 30, 2025.

• Repurchased $1.5 million in stock at an average price of $6.38/share; 231,000 shares repurchased in Q1 2026.

• Operating expenses included R&D at $7.3 million, sales and marketing at $4.0 million, and G&A at $3.5 million.

Outlook and guidance

• Q2 2026 revenue expected between $22.3M–$22.8M; GAAP net income $1.2M–$1.7M; non-GAAP net income $1.9M–$2.4M; adjusted EBITDA $2.7M–$3.2M (12%–14% margin).

• FY 2026 revenue guidance: $90.5M–$92.0M; GAAP net income $3.5M–$5.0M; non-GAAP net income $8.3M–$9.8M; adjusted EBITDA $10.4M–$11.9M (11%–13% margin).

• Diluted shares outstanding expected at 28.8M for Q2 and full year, impacting EPS guidance by 1%.

• Management expects SaaS revenue to continue increasing steadily as the business grows.

• Remaining performance obligations were $86.9 million, with $58.4 million expected to be recognized as revenue within one year.