eGain reports Q4 profit surge on tax benefit, expands buyback program

SUNNYVALE - AI knowledge management platform provider eGain Corp (NASDAQ:EGAN), currently trading at a P/E ratio of 61.9x, reported fourth-quarter net income of $30.9 million on Thursday, a substantial increase from $1.5 million a year earlier, primarily due to a $29 million tax benefit from the release of a valuation allowance. According to InvestingPro data, the company maintains strong financial health with a "Fair" overall score of 2.35 out of 5.

The company posted total revenue of $23.2 million for the quarter ended June 30, up 3% year-over-year and 11% sequentially. SaaS revenue, which constitutes the bulk of eGain’s business, increased 6% to $21.7 million. InvestingPro analysis reveals two key strengths: the company holds more cash than debt on its balance sheet and has maintained a high shareholder yield. Subscribers can access 10 additional ProTips and comprehensive financial metrics through the platform’s detailed research reports.

Adjusted EBITDA for the quarter reached $4.5 million, representing a 19% margin compared to $2.4 million and an 11% margin in the same period last year.

For the full fiscal year 2025, eGain reported total revenue of $88.4 million, down 5% from the previous year, while net income rose to $32.3 million from $7.8 million.

"We are pleased to close fiscal 2025 with solid bookings and strong profitability," said Ashu Roy, eGain’s CEO. "With one of our largest deals ever signed this quarter and healthy demand in the pipeline, we are well-positioned to capture the compelling opportunity in AI CX automation powered by trusted knowledge."

The company’s board approved a $20 million increase to its stock repurchase program, raising the total authorization from $40 million to $60 million. During fiscal 2025, eGain repurchased approximately 2.6 million shares at an average price of $6.03 per share, totaling $15.8 million. The company’s strong balance sheet, with a current ratio of 1.72, provides ample liquidity to support these shareholder-friendly initiatives.

For fiscal 2026, eGain forecasts total revenue between $90.5 million and $92 million, with GAAP net income of $3.5 million to $5 million, or $0.13 to $0.18 per share.

The company ended the quarter with $62.9 million in cash and cash equivalents, down from $70 million a year earlier, reflecting the impact of share repurchases. With total debt of just $3.8 million and a debt-to-equity ratio of 0.07, eGain maintains a strong financial position. For detailed analysis of eGain’s financial metrics and future prospects, investors can access the comprehensive Pro Research Report available on InvestingPro.

According to the press release statement, eGain expects adjusted EBITDA of $10.4 million to $11.9 million for fiscal 2026, representing a margin of 11% to 13%.

In other recent news, eGain Corporation disclosed that it issued a warrant to JPMC Strategic Investments I Corporation. This warrant allows JPMC to acquire up to 500,000 shares of eGain’s common stock at an exercise price of $7.10 per share. The transaction occurred last week, as stated in the company’s press release. The offer and issuance of the warrant are expected to be exempt from registration under the Securities Act of 1933, according to Section 4(a)(2) of the Act. JPMC Strategic Investments I Corporation has represented to eGain that it qualifies as an accredited investor under Regulation D. The corporation is acquiring the warrant strictly for investment purposes. These developments highlight eGain’s recent strategic financial activities.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.