Varonis Systems, Inc. is the subject of a securities fraud investigation filed by the Law Offices of Frank R. Cruz following the company’s Q3 2025 earnings release.
The Q3 2025 results showed revenue of $161.58 million, below the consensus estimate of $166.47 million. Term‑license subscription revenue fell 63.9% year‑over‑year, while SaaS revenue grew 117.6% year‑over‑year, representing 76% of total annual recurring revenue.
Management lowered the full‑year ARR guidance to $730 million–$738 million from the prior $748 million–$754 million range. The guidance cut was attributed to weaker‑than‑expected renewals in federal and non‑federal on‑prem subscription businesses, with sales process issues cited as a contributing factor.
Varonis continues to accelerate its transition to a subscription‑based model, having acquired SlashNext for email security and launched new AI‑powered security products. The company also announced a 5% workforce reduction to improve cost discipline and authorized a $150 million share repurchase program to support long‑term value.
The investigation alleges potential violations of federal securities laws related to the earnings disclosure. Investors who incurred losses may seek claims through the law firm’s representation.
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