OpenText Unveils Fourth Quarter and Fiscal Year 2025 Results with Positive Cloud Growth and Shareholder Returns

OpenText Reports Strong Q4 and Fiscal Year 2025 Results

On August 7, 2025, OpenText Corporation (NASDAQ: OTEX, TSX: OTEX) disclosed its financial performance for the fourth quarter and the entire fiscal year 2025. The company achieved a remarkable cloud revenue of $1.86 billion, representing a 2.0% year-over-year growth. This success is attributed to a strategic focus on growth areas such as cloud services and artificial intelligence, coupled with an impressive 32% increase in cloud bookings.

Fiscal Year Highlights

In totality, OpenText garnered revenues of $5.168 billion, reflecting a 10.4% decline year on year. However, adjusting for the Annual Maintenance Contract (AMC) divestiture, the adjusted revenue reduction is only 3%. Notably, the annual recurring revenue (ARR) was recorded at $4.191 billion, down by 7.6% from the previous year.

Despite operating in a challenging market environment, OpenText reported an adjusted EBITDA of $1.784 billion, translating to a healthy margin of 34.5%, reflecting the company's operational efficiency and focus on maintaining profitability amidst fluctuating market conditions.

CEO Mark J. Barrenechea commented on the results, emphasizing the accelerated growth in cloud bookings and the significant demand driven by the AI-driven Titanium X platform. In his statement, he said, "We are excited about the new fiscal year ahead and the growth opportunities that AI, cloud, and security are poised to bring, translating to anticipated overall revenue growth of 1% to 2% for fiscal 2026."

Fourth Quarter Performance

During Q4 2025, OpenText's revenue totaled $1.311 billion, a 3.8% decrease compared to the same period last year. Nonetheless, cloud revenues consistently grew, showcasing an increase of 2.1% year over year, continuing a trend of 18 consecutive quarters of organic cloud growth. Operating cash flows reached $158 million, with free cash flows reported at $124 million.

The reported diluted earnings per share (EPS) for Q4 were $0.11 based on GAAP, while on a non-GAAP basis, EPS was $0.97. The significant year-over-year decline in GAAP net income was pegged at $29 million, representing a staggering 88.4% drop due to earlier fluctuations. The company remains committed to returning value to its shareholders, announcing a 5% dividend increase, making the new quarterly dividend $0.2750 per share, effective September 2025.

Shareholder Returns and Future Plans

OpenText has committed to a $300 million share repurchase program, indicating its confidence in future growth prospects, operational execution, and expanding cash flow. This program will pave the way for OpenText to buy back its common shares over the next year. The management's resolve to engage in share buybacks and increase dividends demonstrates a strong commitment to enhancing shareholder value and reflects confidence in OpenText's strategic direction for the upcoming fiscal years.

The company's leadership, led by CFO Chadwick Westlake, highlighted the operational discipline that led to sustained margin and cash flow growth despite the complex market landscape. As OpenText prepares for the upcoming fiscal year, its focus on AI and cloud-driven solutions positions it favorably for sustained growth in a digital-first age.

In summary, OpenText’s fiscal 2025 results reflect a company navigating through tough market conditions yet managing to achieve significant growth in key areas such as cloud revenues. The forward-looking strategies, including enhanced dividends and share repurchase programs, reflect the company's strong commitment to maintaining shareholder value.