#Canada #financial results #OpenText #Waterloo #Cloud Growth

OpenText Financial Results for Q1 FY2026

On November 5, 2025, OpenText Corporation (NASDAQ: OTEX, TSX: OTEX) revealed its financial performance for the first quarter ending September 30, 2025. The company reported total revenues of $1.29 billion, marking a 1.5% increase year-over-year. Cloud revenues increased by 6%, contributing $485 million to the total revenue, continuing the trend of 19 consecutive quarters of organic growth in cloud services.

Key Financial Highlights

OpenText's quarterly earnings showcased strong profitability with a net income margin of 11% and an adjusted EBITDA margin of 36.3%. Notably, the GAAP earnings per share (EPS) hit $0.58, while the non-GAAP EPS reached $1.05, reflecting significant year-on-year increases of 81.3% and 12.9%, respectively.

• - Total Revenues: $1,288 million (+1.5% YoY)
• - Cloud Revenue: $485 million (+6% YoY)
• - Net Income: GAAP $147 million (+73.8% YoY)
• - Adjusted EBITDA: $467 million (+5.3% YoY)
• - Free Cash Flow: $101 million

Operational Insights

James McGourlay, the interim CEO of OpenText, expressed satisfaction with the financial metrics, attributing the company's strong performance to the growth in its content management cloud services. He emphasized the effective operational model of OpenText, which aligns with the company's fiscal margin goals for FY2026. The firm is also focused on bolstering its position in AI-focused Information Management, with upcoming innovations set to be showcased at the OpenText World User Conference in Nashville.

Steve Rai, the newly appointed Chief Financial Officer, remarked on the solid performance in terms of margin and cash flow generation. The ongoing Business Optimization Plan is expected to enhance operational efficiencies further, indicating the company's commitment to innovation and strategic investment.

Shareholder Value Enhancement

In a strategic move, OpenText announced a definitive agreement to divest its on-premise solution, eDOCS, as part of its portfolio-shaping initiative aimed at enhancing shareholder value. P. Thomas Jenkins, Executive Chair of the Board, indicated that such steps are part of the firm’s overarching strategy to focus on its core Information Management for AI business, thereby aligning with the future direction of the market.

Market Positioning

The firm continues to gain recognition in the industry, having been named a leader in the 2025 Gartner Magic Quadrant for Application Security Testing for the 11th consecutive year. Additionally, OpenText has expanded its core threat detection capabilities through improved integrations with Microsoft, further strengthening its offerings in the financial services sector.

Forward-Looking Statements

While navigating the market's uncertainties, OpenText remains strategically poised for continued growth through emphasis on operational optimization, product innovation, and shareholder return initiatives. The results for Q1 FY2026 demonstrate the company's robust financial health and commitment to leading the information management solutions market.

Conclusion

OpenText's financial report for the first quarter of fiscal 2026 paints a picture of a resilient company capitalizing on the expanding cloud market and adjusting its offerings to meet evolving customer needs. As the company prepares to showcase innovations at upcoming industry conferences, stakeholders can expect OpenText to remain a key player in the tech landscape.