OpenText Corporation reported its financial results for the three months ended September 30, 2024, revealing a decline in total revenues to $1,269.0 million, down 11.0% from $1,425.4 million in the same period of 2023. This decrease was attributed to the exclusion of revenue contributions from the Application Modernization and Connectivity (AMC) business, which was divested on May 1, 2024, for $2.275 billion. The AMC business had contributed approximately $132.8 million to total revenues in Q1 Fiscal 2024. Additionally, unfavorable foreign exchange rate changes impacted revenues by $4.2 million.
Despite the revenue decline, OpenText reported a net income attributable to the company of $84.4 million, an increase from $80.9 million in the prior year. Earnings per share (EPS) on a GAAP basis rose to $0.32 from $0.30. However, non-GAAP EPS decreased to $0.93 from $1.01, reflecting the impact of the AMC divestiture and other operational changes.
The company’s gross profit for the quarter was $910.4 million, down from $1,018.4 million in Q1 Fiscal 2024, with a gross margin of 71.7%. Operating income also saw a slight decrease to $206.2 million from $212.9 million year-over-year. Total operating expenses decreased significantly to $704.1 million, down from $805.5 million, primarily due to reductions in research and development, sales and marketing, and general and administrative expenses.
OpenText's cash and cash equivalents as of September 30, 2024, totaled $1,000.2 million, a decrease from $1,280.7 million at the end of June 2024. The company reported cash used in operating activities of $(77.8) million, a significant decline from $47.1 million in the same period last year, largely due to changes in working capital related to tax payments from the AMC divestiture.
Strategically, OpenText has made several acquisitions, including KineMatik Ltd. in August 2023 and Pillr in May 2024, although these acquisitions are not considered material to the overall business. The company also implemented a Business Optimization Plan, incurring special charges of $42.5 million during the quarter.
As of September 30, 2024, OpenText's total assets were $13.8 billion, with total shareholders' equity at $4.1 billion. The effective tax rate for the quarter was notably low at 2.2%, down from 11.3% in the previous year, due to various tax benefits. The company continues to navigate challenges related to foreign currency risks and ongoing tax disputes with the Canada Revenue Agency.
About OPEN TEXT CORP
About 10-Q Filings
A 10-Q form is an important financial report that public companies in the United States must submit every three months. It gives a clear picture of a company's financial health and recent performance.
Key points about the 10-Q:
- Frequency: Companies file it three times a year, covering the first three quarters. The fourth quarter is covered in a more comprehensive annual report.
-
Content: It includes:
- Financial statements showing the company's current financial position
- Updates from management on the performance and projections of the business
- Information about potential risks the company faces
- Details on how the company is run internally
- Deadline: Must be filed within 40 or 45 days after the quarter ends, depending on the size of the company.
Our Methodology
AssetRoom is committed to providing timely summaries of news from public companies. We use AI to generate these summaries quickly, but they are not reviewed by human experts.
Our method:
- Data Collection: We continuously monitor for new filings (currently limited to US-listed stocks).
- AI-Powered Analysis: Our advanced AI system processes each filing, identifying key information and extracting relevant data.
- Summary Generation: The AI creates a concise, easy-to-understand summary of the filing, highlighting the most important points.
- Publication: The summary is immediately published on our platform, allowing users instant access to the latest information.
- Email users: We distribute round-up emails according to our users preferences, keeping them in the loop with the companies they follow.
Feedback & Corrections
Spot an error or have a suggestion? Contact us.