eGain (EGAN) Q3 2025 earnings summary

Executive summary

• Q3 2025 revenue was $21.0 million, down 6% year-over-year, but profitability and operating cash flow exceeded expectations.

• Secured a major expansion deal with a U.S. mega bank, expanding platform usage to over 100,000 users, with full rollout expected by late fall.

• Launched a new AI Agent for Contact Center, receiving strong customer interest and early adoption, especially among banking clients.

• Recognized as a leader in Gartner's quadrant for generative AI knowledge management apps and as an emerging leader in Generative AI Technologies.

• eGain positions itself as the #1 AI Knowledge Platform, targeting large enterprises and trusted by major brands across multiple sectors.

Financial highlights

• Q3 total revenue was $21.0 million, down 6% year-over-year; SaaS revenue comprised 93% of total revenue, with professional services revenue declining.

• SaaS gross margin was 77% (vs. 78% prior year); total gross margin was 69% (vs. 71% prior year); GAAP net income was $66,000 ($0.00/share), non-GAAP net income was $765,000 ($0.03/share).

• Adjusted EBITDA margin was 6% (vs. 10% prior year); operating cash flow for Q3 was $2.2 million (11% margin), nine-month operating cash flow was $9.6 million.

• Cash and cash equivalents at quarter end: $68.7 million.

• R&D expense increased 13–15% year-over-year, reflecting investment in AI Knowledge.

Outlook and guidance

• Q4 2025 revenue expected between $22.8M–$23.3M; GAAP net income $1.1M–$1.6M ($0.04–$0.06/share); non-GAAP net income $1.7M–$2.2M ($0.06–$0.08/share).

• FY25 revenue guidance revised to $88.0M–$88.5M; GAAP net income raised to $2.5M–$3.0M ($0.09–$0.10/share); non-GAAP net income $5.1M–$5.6M ($0.18–$0.20/share).

• SaaS ARR for knowledge customers expected to grow in the high teens for FY25; total SaaS ARR to return to growth.

• Guidance includes $2.6M stock-based compensation and $360K depreciation/amortization for FY25.

• Existing capital resources are expected to support operations for at least the next 12 months.