OneSpan Inc. reported its financial results for the second quarter ended June 30, 2025, on August 5, 2025, demonstrating continued strong profitability. The company achieved Adjusted EBITDA of $17.6 million, representing 29.5% of revenue for the quarter. For the first half of 2025, Adjusted EBITDA reached a record $41 million, or 33% of revenue, reflecting successful cost reduction initiatives and a strategic shift towards software.
Total revenue for Q2 2025 was $59.84 million, a modest 2% decline year-over-year, primarily due to anticipated hardware revenue reductions. Despite this, gross profit increased by $3.60 million, or 9%, reaching $43.97 million, with a gross margin of 73%, up from 66% in Q2 2024. Subscription revenue, a key focus, grew 22% in Q2 2025, led by 39% growth in Security Solutions and 5% in Digital Agreements.
OneSpan increased its Annual Recurring Revenue (ARR) guidance for the full year 2025 to a range of $186 million to $192 million, up from the previous $180 million to $186 million. This upward revision is primarily attributed to the acquisition of Nok Nok Labs, which added $8 million to ARR, partially offset by $3 million in customer contractions. The company maintained its full-year 2025 revenue guidance of $245 million to $251 million and Adjusted EBITDA guidance of $72 million to $76 million.
The company's liquidity remains strong, with $92.9 million in cash and cash equivalents at the end of Q2 2025, and $36 million in operating cash flow generated in the first half of 2025. OneSpan also secured a new $100 million revolving credit facility in June 2025, with no outstanding borrowings, further bolstering its financial flexibility. A recurring quarterly dividend of $0.12 per share was declared for Q3 2025, underscoring its commitment to shareholder returns.
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