Upland Software (UPLD) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenue was $63.7M, down 10% year-over-year, mainly due to divestitures and declines in sunset assets; Adjusted EBITDA was $13.1M (21% margin), flat in dollars but up from 19% margin year-over-year.

• Net loss attributable to common shareholders narrowed to $25.8M from $96.1M year-over-year, with net loss per share improving to $0.97 from $3.37.

• 107 new customers and 245 customer expansions were achieved, with significant wins in AI-enabled products.

• Divestiture of mobile messaging product lines sharpened focus on higher-margin, higher-growth markets.

• Completed several divestitures, generating $5.5M in proceeds and up to $4M in earn-outs, and completed sale of mobile messaging product lines for $10M.

Financial highlights

• Subscription and support revenue fell 10% to $60.2M; perpetual license revenue rose 9% to $1.6M; professional services revenue declined 15% to $1.9M.

• Gross profit margin was 72%, up from 70% in Q1 2024; gross profit was $45.6M.

• Q1 free cash flow reached $7.9M, and GAAP operating cash flow was $8.3M, both up year-over-year.

• Cash, cash equivalents, and restricted cash totaled $34M at quarter-end after $34M in term loan paydowns.

• Non-GAAP net income was $8.2M, up from $6.8M year-over-year; non-GAAP EPS was $0.29 basic, $0.23 diluted.

Outlook and guidance

• Q2 2025 revenue expected between $50.3M–$56.3M, a 23% YoY decline at midpoint; Adjusted EBITDA margin expected at 26%.

• Full-year 2025 revenue guidance is $209.5M–$227.5M, a 20% YoY decline at midpoint; Adjusted EBITDA margin expected at 27%, up from 20% in 2024.

• Core organic growth rate projected at 2% in Q2, increasing in the second half of 2025.

• Free cash flow outlook for 2025 is $20M, excluding $5M in one-time divestiture-related costs.

• Approximately $215M in remaining performance obligations, with 71% expected to be recognized as revenue in the next 12 months.