Open Text Corp. Q3 FY2026 earnings call

Eamon mentioned four priorities: listening to clients, partners, etc.; learning about the business and portfolio; assessing business to improve; building a sustainable organic growth plan. James noted Q3 solid total revenue performance, cloud growth 6.6%, content business 44% of total revenue, Q3 growth 6%, cloud content revenue growth 22%, Q3 cloud revenue $493M record, Q3 core cloud business up 12%, Q3 adjusted EPS $1.01 record, year-to-date adjusted EPS $3.19 tied with highest, year-to-date enterprise cloud bookings $651M record, 41 cloud deals >$1M in Q3. Client cases like Michelin, Hargassner, HPE Aruba Networking, ATEM Energy. Product news: enterprise data and AI solutions on AWS Sovereign Cloud, data AI platform launched. Steve shared Q3 total revenue $1.28B, 21 consecutive quarters organic cloud growth, cloud net renewal rate 95%, customer support revenue $565M, customer support net renewal rate 93%, annual recurring revenue $1.06B, GAAP and non-GAAP gross margins, adjusted EBITDA, F26 revenue target 1%-2% growth, cloud revenue growth range adjusted, enterprise cloud bookings and free cash flow growth ranges adjusted, cloud RPO growth. Tom mentioned Eamon joining, focus on board chair role, achieved milestones, core businesses as enterprise AI foundation, Vertica divestiture near, non-core businesses contribute to margin and cash flow

Total revenues were $1.28 billion. Cloud revenue was $493 million, up 6.6% year-on-year. Content business, accounting for 44% of total revenues, grew 6% year-on-year in Q3, with cloud content revenue up 22% year-on-year. Q3 cloud revenue of $493 million was the highest in company history. Q3 core cloud business up 12% year-on-year. Customer support revenue was $565 million, down 0.4% year-on-year. Customer support net renewal rate was 93%, up 3% year-on-year. Annual recurring revenue was $1.06 billion, up 2.7% year-on-year, representing 82% of total revenue. GAAP gross margin was 73.1%, non-GAAP gross margin was 76.7%. Adjusted EBITDA was $438 million, margin 34.1%. GAAP net income was $173 million, up 86% year-on-year. Non-GAAP net income was $250 million, up 15.9% year-on-year. Q3 GAAP diluted EPS was $0.70, up 100%. Non-GAAP diluted EPS was $1.01, up 23.2%. Free cash flow was $305 million, down 18.4%. Year-to-date total revenue up 1%, cloud revenue up 5.3%, license revenue up 2.4%, customer support down 1.1%, professional services down 9.3%. Year-to-date adjusted EBITDA margin 35.8%, up 110 basis points. Non-GAAP diluted EPS $3.19, up 11.9%. Free cash flow $686 million, up from $563 million same period last year

F26 total revenue growth target 1%-2% year-on-year, adjusted for $30M anticipated revenue from divestitures. Cloud revenue growth range for F26 adjusted from 3%-4% to 4%-5% year-on-year. Enterprise cloud bookings growth range adjusted from 12%-16% to 16%-20% year-on-year. Free cash flow growth range adjusted from 17%-20% to 22%-25% year-on-year

Currently geopolitical and macro uncertainty created a more selective buyer environment. As disciplined sellers, OpenText will not sell assets at the wrong moment to the wrong buyer and will wait for improved market stability while non-core businesses continue to contribute to margin and cash flow

Q: Richard C. asked Eamon about initial observations on growth opportunities.

A: Eamon mentioned client-focused culture, strength of core portfolio, enhancing engagement with ecosystem partners, strengthening disciplined execution across operating model.

Q: Kevin Krishnaradne asked about competitive positioning.

A: Eamon said OpenText's long history in data management, diversification of client portfolio across industries, geographies and sizes, and the three dimensions of data are underestimated advantages.

Q: Stephanie Price asked about cloud bookings conversion and free cash flow.

A: James said cloud bookings conversion and revenue recognition is a multi-year process, Steve said free cash flow improved due to cost savings and business optimizations.

Q: Thanos Moscapolis asked about sales environment and buyer behavior.

A: Eamon said no material slowdown in client decisions around AI, clients even talked about accelerating.

Q: Paul Treiber asked about capital allocation priorities.

A: Eamon mentioned debt reduction, dividend payout, share repurchase, organic growth investments.

Q: George Kurosawa asked about content cloud business and AI strategy.

A: James said content business has growth opportunity, clients are moving to cloud, Iman mentioned clients transitioning from use case discussions to platform discussions.

Q: David Kwan asked about regional impacts and asset sales.

A: Eamon said need balanced execution across geography and portfolio, Tom said asset sales are disciplined and waiting for improved market conditions