• First quarter operating income increased 22% year-over-year to $17.2 million
• First quarter revenue decreased 2% year-over-year to $63.4 million
• First quarter subscription revenue increased 9% year-over-year to $43.6 million
• Annual Recurring Revenue (ARR) increased 9% year-over-year to $168.4 million1
• Net Retention Rate (NRR) of 107%2

BOSTON: OneSpan Inc. (NASDAQ: OSPN) today reported financial results for the first quarter ended March 31, 2025.

“We reported another solid quarter that resulted in record high operating income and strong cash generation,” stated OneSpan CEO, Victor Limongelli. “The OneSpan team has done a great job in continuing to optimize our cost structure as we build for the future. We will continue to focus on operational excellence as we look to drive efficient revenue growth and profitability over the long-term.”

First Quarter 2025 Financial Highlights

• Total revenue was $63.4 million, a decrease of 2% compared to $64.8 million for the same quarter of 2024. Security Solutions revenue was $47.7 million, a decrease of 5% year-over-year. Digital Agreements revenue was $15.7 million, an increase of 9% year-over-year.
• ARR increased 9% year-over-year to $168.4 million.
• Gross profit was $47.1 million, or 74% gross margin, compared to $47.4 million, or 73% in the same period last year.
• Operating income was $17.2 million, compared to operating income of $14.1 million in the same period last year.
• Net income was $14.5 million, or $0.37 per diluted share, compared to net income of $13.5 million, or $0.35 per diluted share, in the same period last year. Non-GAAP net income was $17.7 million, or $0.45 per diluted share, compared to non-GAAP net income of $15.2 million, or $0.39 per diluted share in the same period last year.3
• Adjusted EBITDA was $23.0 million, compared to $20.2 million in the same period last year.3
• Cash and cash equivalents were $105.2 million at March 31, 2025 compared to $83.2 million at December 31, 2024.

Changes in Presentation of Non-GAAP Measures

Effective January 1, 2025, the beginning of our fiscal year ending December 31, 2025, we began including employer payroll taxes related to employee stock-based award transactions in the GAAP to non-GAAP reconciliation for our Non-GAAP Financial Measures discussed below, which include Adjusted EBITDA, Non-GAAP Net Income and Non-GAAP Net Income Per Diluted Share. We are excluding these payroll taxes from our non-GAAP results since they are tied to the timing and size of the vesting of the underlying stock-based awards and the price of our common stock at the time of vesting, which may vary from period to period independent of the operating performance of the Company. Employer payroll taxes related to employee stock-based award transactions amounted to $0.5 million in the first quarter of 2025 and $0.9 million for the full year 2024.

Also effective January 1, 2025, we began using a long-term projected non-GAAP tax rate of 20% for the purpose of determining our Non-GAAP Net Income and Non-GAAP Net Income Per Diluted Share to provide better consistency across interim reporting periods in fiscal 2025 and beyond. Given the significant growth of our Non-GAAP Net Income before income taxes in 2024, we believe this change is necessary to better reflect the performance of our business. We will continue to assess the appropriate non-GAAP tax rate on a regular basis, which could be subject to change for a variety of reasons, including the rapidly evolving global tax environment, significant changes in our geographic earnings mix, or other changes to our strategy or business operations.

Prior period amounts have been adjusted to reflect these changes.

Financial Outlook

For the Full Year 2025, OneSpan expects:

• Revenue to be in the range of $245 million to $251 million.
• ARR to be in the range of $180 million to $186 million.
• Adjusted EBITDA to be in the range of $72 million to $76 million.

Quarterly Cash Dividend

OneSpan’s Board of Directors has declared a quarterly cash dividend of $0.12 per share as part of the Company's recurring quarterly dividend program initiated in December 2024. This dividend will be paid on June 6, 2025 to shareholders of record as of the close of business on May 16, 2025. The declaration and payment of future dividends is subject to the sole discretion of the Board of Directors.

Conference Call Details

In conjunction with this announcement, OneSpan Inc. will host a conference call today, May 1, 2025, at 4:30 p.m. EDT. During the conference call, Mr. Victor Limongelli, CEO, and Mr. Jorge Martell, CFO, will discuss OneSpan’s results for the first quarter 2025.

For investors and analysts accessing the conference call by phone, please refer to the press release dated April 10, 2025, announcing the date of OneSpan’s first quarter 2025 earnings release. It can be found on the OneSpan investor relations website at investors.onespan.com.

The conference call is also available in listen-only mode at investors.onespan.com. Shortly after the conclusion of the call, a replay of the webcast will be available on the same website for approximately one year.

____________________________________________

About OneSpan

OneSpan provides secure authentication, identity, electronic signature and digital workflow solutions that protect and facilitate digital transactions and agreements. The Company delivers products and services that automate and secure customer-facing and revenue-generating business processes for use cases ranging from simple transactions to workflows that are complex or require higher levels of security. Trusted by global blue-chip enterprises, including more than 60% of the world’s 100 largest banks, OneSpan processes millions of digital agreements and billions of multi-factor authentication transactions in 100+ countries annually.

For more information, go to www.onespan.com. You can also follow @OneSpan on X (Twitter) or visit us on LinkedIn and Facebook.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of applicable U.S. securities laws, including statements regarding our 2025 financial guidance; our plans to continue our focus on operational excellence and drive efficient revenue growth and profitability over the long-term; and our general expectations regarding our operational or financial performance in the future. Forward-looking statements may be identified by words such as "seek", "believe", "plan", "estimate", "anticipate", “expect", "intend", "continue", "outlook", "may", "will", "should", "could", or "might", and other similar expressions. These forward-looking statements involve risks and uncertainties, as well as assumptions that, if they do not fully materialize or prove incorrect, could cause our results to differ materially from those expressed or implied by such forward-looking statements. Factors that could materially affect our business and financial results include, but are not limited to: our ability to attract new customers and retain and expand sales to existing customers; our ability to successfully develop and market new product offerings and product enhancements; changes in customer requirements; the potential effects of technological changes; the loss of one or more large customers; difficulties enhancing and maintaining our brand recognition; competition; lengthy sales cycles; unintended costs and consequences of our cost reduction and restructuring actions, including higher than anticipated restructuring charges, disruption to our operations, litigation or regulatory actions, or employee turnover; challenges retaining key employees and successfully hiring and training qualified new employees; security breaches or cyber-attacks; real or perceived malfunctions or errors in our products; interruptions or delays in the performance of our products and solutions; reliance on third parties for certain products and data center services; our ability to effectively manage third party partnerships, acquisitions, divestitures, alliances, or joint ventures; economic recession, inflation, tariffs or trade disputes, and political instability; claims that we have infringed the intellectual property rights of others; changing laws, government regulations or policies; pressures on price levels; component shortages; delays and disruption in global transportation and supply chains; impairment of goodwill or amortizable intangible assets causing a significant charge to earnings; actions of activist stockholders; and exposure to increased economic and operational uncertainties from operating a global business, as well as other factors described in the “Risk Factors” section of our most recent Annual Report on Form 10-K, as updated by the “Risk Factors” section of our subsequent Quarterly Reports on Form 10-Q (if any). Our filings with the Securities and Exchange Commission (the “SEC”) and other important information can be found in the Investor Relations section of our website at investors.onespan.com. We do not have any intent, and disclaim any obligation, to update the forward-looking information to reflect events that occur, circumstances that exist or changes in our expectations after the date of this press release, except as required by law.

Unless otherwise noted, references in this press release to “OneSpan”, “Company”, “we”, “our”, and “us” refer to OneSpan Inc. and its subsidiaries.

OneSpan Inc.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, unaudited)
	March 31,				December 31,
		2025				2024
ASSETS
Current assets
Cash and cash equivalents	$	105,211			$	83,160
Accounts receivable, net of allowances of $1,147 at March 31, 2025 and $1,600 at December 31, 2024		29,595				56,229
Inventories, net		11,028				10,792
Prepaid expenses		6,327				6,547
Contract assets		10,587				8,687
Other current assets		7,811				9,479
Total current assets		170,559				174,894
Property and equipment, net		21,105				20,966
Operating lease right-of-use assets		7,865				7,725
Goodwill		94,200				92,365
Intangible assets, net of accumulated amortization		6,923				7,481
Deferred income taxes		20,573				20,516
Other assets		12,585				14,787
Total assets	$	333,810			$	338,734
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
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