OneSpan (OSPN) Q4 2025 earnings summary

Executive summary

• FY 2025 revenue was flat at $243.2M, with strong Digital Agreements growth offsetting a slight decline in Cybersecurity revenue; over 80% of 2026 revenue is expected from software, with hardware declining to less than 20% of business, down from over 50% in 2019.

• Subscription revenue grew 12% to $156.1M, and ARR increased 11.5% to $187M.

• Strategic acquisitions (Nok Nok Labs, ThreatFabric, Build38) enhanced technology and customer value proposition.

• Both divisions are now profitable, with strong cash generation and disciplined capital allocation.

• Returned $32M to shareholders through dividends and share repurchases in 2025.

Financial highlights

• Q4 2025 revenue grew 3% year-over-year to $63M; full year revenue was flat at $243.2M due to hardware decline.

• Adjusted EBITDA for FY 2025 was $78M (32% margin); Q4 Adjusted EBITDA was $19M (31% margin).

• Gross margin improved to 74% in 2025, up from 72% in 2024.

• ARR at year-end was $187M, up 11.5% year-over-year.

• Free cash flow reached $50M, with $70.5M in cash and no long-term debt at year-end.

Outlook and guidance

• 2026 total revenue guidance: $244M–$249M (0–2% growth); software and services revenue expected at $201M–$204M; hardware revenue to decline 8–12%.

• ARR expected at $192M–$196M (3–5% growth).

• Adjusted EBITDA for 2026 projected at $64M–$68M, including Build38 acquisition impact.

• Quarterly dividend increased 8% to $0.13 per share, annualized to $0.52 per share.