Verint Systems (VRNT) investor relations material

Executive summary

• Entered into a definitive merger agreement with Thoma Bravo for an all-cash acquisition valued at $2 billion, offering $20.50 per share to common stockholders and redemption of preferred stock at $1,000 per share plus accrued dividends, representing an 18% premium to the unaffected share price; transaction expected to close before fiscal year-end.

• Q2 FY2026 revenue was $208.0 million, down 1% year-over-year; six-month revenue was $416.1 million, down 3.6%.

• Net loss attributable to common shares was $5.7 million for Q2, or $0.09 per diluted share; non-GAAP net income was $20.0 million, or $0.33 per diluted share.

• Adjusted EBITDA for Q2 was $35.6 million (17.1% of revenue); free cash flow was $13.5 million for Q2 and $33.8 million for the six months.

• Reported strong AI momentum with 21% year-over-year growth in AI ARR, highlighting early-stage AI adoption in the CX market.

Financial highlights

• Recurring revenue for Q2 was $165.5 million, up slightly year-over-year, driven by bundled SaaS growth; nonrecurring perpetual and professional services revenue declined.

• Subscription ARR reached $728.5 million, up 6.4% year-over-year; AI ARR was $372.0 million, up 21.2% year-over-year; non-AI ARR declined 5.6% to $356.5 million.

• Gross margin was 67.6% (GAAP) and 69.6% (non-GAAP) for Q2; recurring revenue gross margin decreased from 78% to 76% due to higher cloud infrastructure costs and SaaS mix shift.

• Cash and cash equivalents were $175.0 million as of July 31, 2025; net debt was $239.4 million; total debt was $413.5 million.

• Adjusted operating margin was 1.6% (GAAP) and 14.0% (non-GAAP) for Q2; R&D expenses were 18.8% of revenue (GAAP) and 17.3% (non-GAAP).

Outlook and guidance

• Merger with Thoma Bravo expected to close before fiscal year-end, subject to regulatory, stockholder, and other customary approvals; financial guidance suspended due to the pending acquisition.

• Anticipates continued shift in revenue mix toward SaaS offerings, consistent with cloud-first strategy; expects more moderate pace of support conversions as SaaS transition nears completion.