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Highlights
- Cognyte reported Q3 FYE26 revenue of USD 100.7 million, marking a year-over-year increase of about 13.2%.
- The company generated USD 25.0 million in net cash from operating activities in the quarter, up from USD 12.3 million last year.
- Fiscal 2026 revenue guidance was raised to USD 400 million, with expected Adjusted EBITDA of about USD 47 million.
Cognyte Software Ltd. (NASDAQ:CGNT), a provider of investigative analytics technology, released its financial results for the third quarter and first nine months ended October 31, 2025. The company reported higher revenue, expanded margins, and improved operating income, prompting an increased outlook for its fiscal year ending January 31, 2026.
Q3 Revenue Growth and Operating Trends
Cognyte’s third-quarter revenue reached USD 100.7 million, up roughly 13.2% from the same quarter a year earlier. GAAP operating income for the period was USD 3.2 million, compared with a loss of USD 2.2 million last year. On a non-GAAP basis, operating income rose to USD 9.0 million, up from USD 3.4 million.
The company reported a GAAP net loss of USD 3.4 million, compared with a USD 2.6 million loss in the prior-year quarter, primarily due to higher tax expenses and foreign-exchange impacts. Adjusted EBITDA increased to USD 11.9 million, nearly doubling the figure from the prior year.
Year-to-Date Performance Shows Significant Improvement
For the nine-month period, revenue rose to USD 293.8 million, an increase of around 14.7% compared with last year. GAAP operating income improved to USD 8.1 million, reversing an operating loss of USD 5.8 million a year earlier. Non-GAAP operating income grew to USD 24.6 million, nearly triple the prior-year total.
Year-to-date GAAP net loss narrowed to USD 0.5 million, down from USD 7.0 million, while Adjusted EBITDA reached USD 33.2 million, up from USD 19.9 million.
Cash Position, Share Repurchases, and Operating Cash Flow
Cognyte continued its share repurchase activity during the quarter, buying approximately 152,000 ordinary shares at a total cost of about USD 1.3 million. The company ended Q3 with USD 106.6 million in cash and no debt.
Operating cash flow increased sharply, with USD 25.0 million generated in the quarter compared with USD 12.3 million in the same period last year.
Updated Fiscal 2026 Outlook
Cognyte raised its full-year guidance, now expecting USD 400 million in revenue, with a variance of plus or minus 1%. The company projects Adjusted EBITDA of approximately USD 47 million and non-GAAP diluted EPS of USD 0.24 at the midpoint of its expected range.
Software Revenue and Backlog Developments
Total software revenue—combining software and software services—rose by USD 13.5 million in the quarter and USD 30.8 million year-to-date. Standalone software revenue increased by 39.6% in Q3 and 31.1% year-to-date, driven by higher demand for the company’s solutions. Software services revenue also expanded, while professional services revenue reflected timing-related factors.
Recurring revenue rose to USD 47.5 million, representing 47.1% of total quarterly revenue. Non-GAAP gross profit increased to USD 73.6 million, while non-GAAP gross margin reached 73.1%.
Cognyte closed the quarter with a total backlog of USD 458.7 million, and total remaining performance obligations of USD 576.6 million, offering visibility into revenue over the coming year.
