Octave Intelligence (OCTV) Q1 2026 earnings summary

Executive summary

• Completed spin-off from Hexagon, becoming an independent public company as of May 22, 2026, with shares listed on Nasdaq and Nasdaq Stockholm.

• Revenue grew 1% year-over-year to $386.5 million for Q1 2026, driven by SaaS and maintenance subscriptions, partially offset by license and services declines.

• Net income was $47.4 million, down from $59.5 million in Q1 2025, reflecting higher operating expenses and tax rate.

• Gross profit margin improved to 77% from 74% year-over-year due to cost reductions and portfolio mix.

Financial highlights

• Subscriptions revenue rose, led by 25% SaaS growth and 5% maintenance subscription growth; subscription licenses declined 2%.

• License revenue fell 18% due to customer shift to SaaS and subscriptions.

• Services and other revenue declined 11% due to prior-year divestitures.

• Operating expenses increased: R&D up 9%, sales and marketing up 9%, G&A up 17%, and amortization up 15%.

• Adjusted net income was $89.0 million, down from $93.6 million year-over-year.

• Free cash flow was $82.0 million, with a free cash flow margin of 21%.

Outlook and guidance

• Subscriptions expected to remain the primary growth driver, with continued SaaS adoption and migration from licenses.

• Non-recurring separation-related costs and increased public company expenses anticipated through at least 2027.

• Management expects sufficient liquidity for at least the next 12 months.