Onestream, Inc. Class A ((OS)) has held its Q1 earnings call. Read on for the main highlights of the call.
Confident Investing Starts Here:
- Easily unpack a company's performance with TipRanks' new KPI Data for smart investment decisions
- Receive undervalued, market resilient stocks straight to you inbox with TipRanks' Smart Value Newsletter
In the latest earnings call, Onestream, Inc. Class A conveyed a predominantly positive sentiment, underscored by substantial revenue growth, an expanding customer base, and robust international market performance. The company also celebrated new product launches and industry accolades. Despite these achievements, challenges such as a decline in license revenue and macroeconomic uncertainties were acknowledged. Nevertheless, the positive developments, particularly in revenue growth and product adoption, were emphasized as outweighing the negatives.
Strong Revenue Growth
The company reported a remarkable 24% year-over-year increase in total revenue, reaching $136 million. Subscription revenue was a significant contributor, rising by 31% to $125 million, showcasing the company’s successful shift towards a subscription-based model.
Free Cash Flow Achievement
Onestream achieved a record-breaking quarter in terms of free cash flow, generating $36 million. This achievement represents a 26% free cash flow margin, highlighting the company’s efficient cash management and operational success.
International Business Performance
The international segment of Onestream’s business demonstrated impressive growth, with a 40% year-over-year revenue increase. This segment now accounts for over 30% of the company’s total revenue, reflecting its successful global expansion strategy.
Recognition and Product Launches
Onestream received recognition as a leader in Financial Close and Consolidation Solutions by Gartner and BARC. The company also launched new solutions, including CPM Express and ESG Reporting & Planning, further solidifying its position in the market.
SensibleAI Forecast Growth
The SensibleAI Forecast product experienced over 50% year-over-year growth in bookings, gaining significant traction among both new and existing customers. This growth highlights the increasing demand for AI-driven forecasting solutions.
Customer Base Expansion
The company’s customer base expanded by 16% year-over-year, reaching a total of 1,646 customers. Notably, 60% of the business was generated from new customers, indicating strong market penetration and appeal.
License Revenue Decline
Despite overall growth, Onestream faced a 40% decline in license revenue compared to the previous year. This decline was attributed to the transition of customers to SaaS models, reflecting a broader industry trend.
Macroeconomic Uncertainty
The company acknowledged ongoing macroeconomic uncertainties, which may lead to deal headwinds and potential downsells as customer budgets tighten. This cautious outlook underscores the challenges in the current economic environment.
Forward-Looking Guidance
Looking ahead, Onestream provided optimistic guidance for the upcoming periods. For the second quarter of 2025, the company anticipates total revenue between $140 million and $142 million, with a non-GAAP operating margin ranging from 2% to 0%. For the full year 2025, Onestream maintained its revenue growth guidance of 20% and slightly increased its profitability outlook, projecting total revenue between $583 million and $587 million with a non-GAAP operating margin of 0% to 2%.
In summary, Onestream’s latest earnings call painted a predominantly positive picture, with strong revenue growth and international expansion leading the highlights. While challenges such as license revenue decline and economic uncertainties were noted, the company’s forward-looking guidance remains optimistic, projecting continued growth and profitability.