Bridgeline Digital (BLIN) Q3 2025 earnings summary

Executive summary

• Q3 FY2025 revenue was $3.8M, down 2% year-over-year, with net loss widening to $0.8M from $0.3M YoY; subscription and licenses revenue rose to $3.1M, 81% of total.

• HawkSearch now represents over 60% of total revenue, growing at a double-digit rate, with 114% net revenue retention.

• 16–20 new customers added in Q3, with $1.7M in contracts and $600K in ARR; over 30 licenses sold to existing customers.

• HawkSearch ranked #1 B2B search software by Gartner, driving market recognition and customer expansion.

• YTD bookings at $6M with $2M in ARR; nine-month revenue was $11.5M, flat year-over-year.

Financial highlights

• Gross profit for Q3 was $2.5M (66% margin), with subscription/license margin at 70% and services margin at 50%.

• Operating expenses were $3.2M, up from $3.1M YoY, mainly due to higher sales and marketing spend.

• Adjusted EBITDA for Q3 was -$330K, compared to +$3K YoY.

• Cash and cash equivalents at June 30, 2025, were $2.1M, up from $1.4M at September 30, 2024.

• Basic and diluted net loss per share for Q3 was $(0.07).

Outlook and guidance

• HawkSearch growth is expected to offset legacy product declines and drive consolidated revenue growth by Q1 2026.

• Professional services revenue expected to remain steady at ~$750K per quarter with 50% margin through 2026.

• Increased marketing spend to $500K per quarter, sustained into FY2026, fueling pipeline and lead generation.

• Management plans to deepen B2B industry presence through targeted AI campaigns and events.

• Current cost structure supports future revenue growth; up to $50M in debt or equity securities may be offered under shelf registration.