OpenText reported steady Q3 revenue and increased profits on Thursday, after markets closed. It was a warm welcome for the company’s new CEO, who is taking over as the company has been restructuring to focus on its core businesses.
The company’s quarterly revenue was $1.28 billion USD ($1.75 billion CAD), up two percent year over year, and annual recurring revenue of over $1 billion USD. Of that revenue, $493 million was attributed to its cloud business, which grew 6.6 percent in Q3. Its net income was $173 million USD. The company increased its projected cloud revenue growth from three to four percent, to four to five percent for this year.
Ayman Antoun,
“Data is not a feature, it is the foundation.”
OpenText
The $OTEX stock was up 3.6 percent on the day on the Toronto Stock Exchange, but shares have fallen more than 25 percent year-to-date, in part due to a broader downturn in the software sector due to AI-related anxiety.
CEO Ayman Antoun, who assumed leadership of the company in late April, said on the earnings call that he’s excited to join “an iconic” Canadian tech company at a defining time for the industry, and to help shepherd it toward sustainable growth. He said he has started a detailed review of the business, and in particular is focused on strengthening go-to-market execution and deepening existing relationships with business partners.
“Data is not a feature, it is the foundation,” Antoun told investors. “We will build a sustainable, organic growth plan … so that we can measure progress and hold ourselves accountable along the way.”
The Kitchener-Waterloo-based company is in the midst of executing a three-year “business optimization plan” to keep costs in check. In March, OpenText laid off four percent of its global workforce. Over the last year it has also sold off two of its non-core businesses to pay off debt.
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Founded in 1991, OpenText provides a suite of cloud-based information management solutions to businesses, competing with the likes of IBM, Abbyy, and Hyland. The company has adapted over the years to introduce cloud and AI services, including cybersecurity and AI agents.
The company’s investor presentation on Thursday noted a refocusing on its core businesses: cybersecurity (which wraps around its other offerings), as well as human-generated data, machine-generated data, and transaction-generated data. Antoun described the three types of data as “data you and I generate, there’s the data that systems produce…and the data that organizations create when they interact with each other”—all of which he said provide opportunities for OpenText to highlight its expertise.
It said in this latest earnings report that it serves more than 31 million public cloud users, 120,000 enterprise clients in 180 countries, and manages more than a trillion pages of data.
With files from Alex Riehl
Feature image courtesy Ayman Antoun on LinkedIn.