Verint Systems Inc (VRNT) Q2 2025 Earnings Report

- Revenue: $210.17 million in Q2 2025; YoY growth 0.0%, QoQ -5.02% (per earnings metrics).
- Gross profit: $142.405 million; gross margin 67.76% (GAAP).
- Operating income: $13.87 million; operating margin 6.60%.
- EBITDA: $24.135 million; EBITDA margin ~11.48%.
- Net income: $5.531 million; net margin 2.63%.
- GAAP EPS: $0.0235; Diluted EPS: $0.0232.
- Non-GAAP highlights: Revenue $210 million; gross margin 71.2% (up 170 bps YoY); Adjusted EBITDA up 7% YoY; Non-GAAP diluted EPS $0.49; Bundled SaaS revenue up 15% YoY; New Bundled SaaS ACV bookings +37% YoY; Renewal term lengths ~20% longer YoY.
- Cash flow: Net cash provided by operating activities $3.863 million; Free cash flow negative $3.578 million due to working capital dynamics and stock-based compensation; Cash at end of period $208.664 million; Net debt $234.217 million; Net debt well under 1x LTM EBITDA.
- Balance sheet: Total assets $2.1837 billion; total liabilities $908.641 million; stockholders’ equity $1.272 billion; cash and equivalents $207.845 million; deferred revenue $231.459 million (current) and $12.832 million (non-current).
- Guidance: FY2025 non-GAAP revenue guidance $933 million +/- 2%; gross margin expansion of at least 150 bps; Adjusted EBITDA growth ~10%; Diluted EPS guidance around $2.90. H2 revenue progression guided to roughly +6% adjusted revenue with ~11% EBITDA uplift YoY.
- FY2027 target (Rule of 40): 10% revenue growth and 30% adjusted EBITDA margin.

Themes and key management takeaways from the QQ2 2025 earnings call:
- Strategy and AI differentiation: Verint emphasizes AI business outcomes now, not just promises for the future. Dan Bodner highlighted the Open Platform as a bot factory with Verint Da Vinci AI at the core, designed to deliver tangible outcomes quickly within existing workflows. He noted that AI adoption is in its early stages and Verint is positioned to capture a very large TAM in the contact center market. The company also underscored a hybrid cloud architecture that enables AI deployment without disruptive rip-and-replace projects.
- Quantitative AI momentum and bookings: Management highlighted “New AI bookings increased over 40% in Q2 year-over-year” and Bundled SaaS revenue growth of 15% YoY, with new Bundled SaaS ACV bookings up 37% YoY. They also pointed to longer renewal terms (renewal contract term lengths ~20% longer YoY) and AI-driven retention improvements as proof points of demand strength and stickiness.
- Customer outcomes and ROI: The team shared compelling case studies, such as a healthcare provider expanding bot deployments from 300 to 30,000 agents and achieving a ROI of $17 million annually from reduced call duration. Other examples include a leading bank generating $10 million in agent capacity by driving self-service, and a BPO avoiding $6 million of self-service fraud in a single month, illustrating the tangible ROI of Verint’s AI bots.
- Competitive dynamics and go-to-market: Dan noted competition is present but demand remains strong with AI-first buyers prioritizing outcomes within existing ecosystems. The Switzerland approach (AI-first deployment with flexible infrastructure) was cited as a differentiator that reduces disruption, enabling faster ROI without immediate cloud migrations.
- Financial model and guidance discipline: Grant emphasized continued gross margin expansion (71.2% non-GAAP in Q2), healthy Bundled SaaS mix, and a path to ~10% EBITDA growth for the year. The company reiterated its FY2025 guidance and outlined the H2 trajectory, including an anticipated Q3 revenue of about $210 million and Q4 around $291 million. The leadership reaffirmed the Rule of 40 journey toward 2027 targets.
- Risks and near-term execution: It was acknowledged that unbundled SaaS is more sensitive to renewal timing and that a single large unbundled deal moved between quarters. The management team reiterated the AI opportunity’s early-stage status and the need to convert AI deployments into ongoing consumption, which should gradually support higher ARR and revenue cadence.

Verdict: Cautiously Positive. Verint’s QQ2 2025 earnings underscore a disciplined, AI-driven growth framework with tangible near-term profitability improvements and a clear long-term path to scale. The company’s AI Open Platform and hybrid cloud deployment model differentiate Verint from peers by enabling immediate business outcomes without disruptive infrastructure changes, which should support higher add-on bot consumption, greater ARR expansions, and improved retention. The reaffirmed guidance for FY2025 (approximately 5% revenue growth and ~10% EBITDA growth) coupled with a 2H ramp to ~$210m in Q3 and ~$291m in Q4 revenue suggests a stable cadence and upside optionality if AI-led renewals convert at a faster pace and if new AI-driven use cases continue to materialize (self-service, agent co-pilots, fraud detection). The balance sheet remains solid, with net debt under 1x LTM EBITDA and a new $200m buyback program signaling management’s confidence in the platform's value and capital allocation discipline. Key monitorables include the pace of Bundled SaaS bookings, AI-driven ARR expansion, churn/retention dynamics, and progress toward the Rule of 40 targets by FY2027. Relative to peers, Verint trades with a robust AI-outcomes narrative, reasonable gross margins, and a manageable cost structure, but execution risk in scaling Open Platform adoption and translating AI outcomes into sustained revenue growth remains essential to unlocking higher multiple valuation.