Yahoo Finance OneSpan Inc. (OSPN) Surpasses Q1 2024 Earnings and Revenue Expectations
Revenue: $64.8 million, up 13% year-over-year, surpassing estimates of $56.40 million.
Net Income: $13.5 million, a significant increase from a net loss of $8.4 million in the same period last year, exceeding estimates of $6.36 million.
Earnings Per Share (EPS): $0.35 per diluted share, a turnaround from a loss of $0.21 per diluted share last year, significantly above the estimated $0.17.
Gross Margin: Improved to 73% from 68% year-over-year.
Annual Recurring Revenue (ARR): Increased by 9% to $154.6 million year-over-year.
Net Retention Rate (NRR): Reported at 107%, indicating strong customer retention and potential for revenue growth.
Cash and Cash Equivalents: Ended the quarter at $63.9 million, up from $42.5 million at the end of the previous quarter.
On May 2, 2024, OneSpan Inc. (NASDAQ:OSPN), a leader in digital agreements security, released its financial results for the first quarter ended March 31, 2024, through its 8-K filing. The company reported a significant improvement in both top-line revenue and bottom-line earnings, surpassing analyst expectations for the quarter.
Fiscal Summary
OneSpan reported a total revenue of $64.8 million for the quarter, a 13% increase year-over-year, which exceeded the estimated $56.40 million. Notably, subscription revenue saw a robust growth of 34% year-over-year, reaching $40.0 million. The company's net income dramatically improved to $13.5 million, or $0.35 per diluted share, compared to a net loss of $8.4 million, or $0.21 per diluted share, in the same period last year. This performance significantly outstripped the analysts' estimated earnings per share of $0.17.
Company Overview
OneSpan Inc. is renowned for its comprehensive IT security solutions tailored for the banking, financial services, and application security markets. The company's innovative offerings, including multifactor authentication and virtual private network access capabilities, are crucial for securing and managing digital assets and protecting online transactions. A significant portion of OneSpan's revenue is derived from Europe, the Middle East, and Africa, with substantial contributions from the United States and Asia-Pacific regions.
Operational Highlights and Strategic Initiatives
OneSpan's impressive quarter was highlighted by a gross profit of $47.4 million, achieving a gross margin of 73%, up from 68% in the prior year. The company also reported an operating income of $14.1 million, a significant turnaround from an operating loss of $8.1 million in Q1 2023. According to Victor Limongelli, interim CEO, the company's strong performance and operational efficiencies have led to cost savings of approximately $10 million on an annualized basis. These factors contribute to the company's optimistic outlook, expecting to exceed its previously communicated Adjusted EBITDA guidance.
Financial Health and Future Outlook
OneSpan's balance sheet remains robust with cash and cash equivalents of $63.9 million as of March 31, 2024, up from $42.5 million at the end of 2023. Looking forward, the company forecasts full-year 2024 revenue to be in the range of $238 million to $246 million and anticipates its Annual Recurring Revenue (ARR) to conclude the year between $160 million and $168 million. Adjusted EBITDA is projected to be between $51 million and $55 million, marking an increase from previous guidance.
Conclusion
The first quarter of 2024 has set a positive trajectory for OneSpan Inc., reflecting strong financial and operational performance. With strategic cost management and continued focus on innovation and market expansion, OneSpan is well-positioned to sustain growth and profitability, offering promising prospects for investors and stakeholders.
For more detailed information and analysis, interested parties are encouraged to access the full earnings report and listen to the earnings call, details of which can be found on the OneSpan investor relations website.
Explore the complete 8-K earnings release (here) from OneSpan Inc for further details.
This article first appeared on GuruFocus.
