EPS of $-1.12 increased by 49.1% from previous year
Gross margin of 49.9%
Net income of -346.91M
""It is clear to me that clients choose E2open Parent Holdings, Inc. for solutions not only for their current supply chain needs but also for the opportunity to grow with us." - Andrew Appel, CEO" - Andrew Appel
In Q3 2025, E2open Parent Holdings Inc (ETWO) reported total revenue of $151.7 million, a year-over-year decline of 3.7%. Although subscription revenue faced a modest year-over-year decrease of 0.6%, it marked a significant improvement compared to prior declines, indicating a stabilization in customer retention and satisfaction efforts. Management highlighted successful cross-selling initiatives and a focus on strategic partnerships as key drivers for growth in the coming quarters. A noteworthy element was the recognition of a non-cash goodwill impairment charge of $369.1 million, reflecting adjustments in response to share price volatility. Looking forward, strategic investments in technology and leadership changes aim to enhance operational efficiency and customer engagement, setting the stage for potential revenue recovery.
Key Performance Indicators
Revenue
151.66M
QoQ: -0.35% | YoY:-3.71%
Gross Profit
75.74M
49.94% margin
QoQ: 1.47% | YoY:-3.61%
Operating Income
-374.78M
QoQ: -2 381.79% | YoY:48.76%
Net Income
-346.91M
QoQ: -1 061.67% | YoY:48.03%
EPS
-1.12
QoQ: -1 055.83% | YoY:49.09%
Revenue Trend
Margin Analysis
Key Insights
**Total Revenue:** $151.7 million (YoY: -3.7%, QoQ: -0.35%)
**Subscription Revenue:** $132.0 million (YoY: -0.6%, QoQ: +0.6% improvement seen)
**Gross Profit:** $75.7 million (Gross Margin: 49.9%)
**Net Income:** -$381.6 million (incl. $369.1 million impairment, YoY: +48.03% improvement)
**EPS:** -$1.12
Financial Highlights
- Total Revenue: $151.7 million (YoY: -3.7%, QoQ: -0.35%)
- Subscription Revenue: $132.0 million (YoY: -0.6%, QoQ: +0.6% improvement seen)
- Gross Profit: $75.7 million (Gross Margin: 49.9%)
- Net Income: -$381.6 million (incl. $369.1 million impairment, YoY: +48.03% improvement)
- EPS: -$1.12
- Cash Flow from Operations: $21.1 million, with cash balance up to $151.2 million at period end.
- Current Ratio: 1.08, indicating adequate short-term liquidity.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
151.66M
-3.71%
-0.35%
Gross Profit
75.74M
-3.61%
1.47%
Operating Income
-374.78M
48.76%
-2 381.79%
Net Income
-346.91M
48.03%
-1 061.67%
EPS
-1.12
49.09%
-1 055.83%
Key Financial Ratios
currentRatio
1.08
grossProfitMargin
49.9%
operatingProfitMargin
-247%
netProfitMargin
-229%
returnOnAssets
-13.2%
returnOnEquity
-31.8%
debtEquityRatio
0.98
operatingCashFlowPerShare
$0.06
freeCashFlowPerShare
$0.04
priceToBookRatio
0.86
priceEarningsRatio
-0.68
Net Income vs. Revenue
Expense Breakdown
Management Commentary
Revenue Growth Strategies
Andrew Appel stated, "While subscription revenue still declined year over year, the rate of decline improved as compared to the four previous quarters."
Management is optimistic about positive changes in client retention, as Appel remarked, "I remain confident that we are past peak churn, which occurred in Q1 of this fiscal year." Leadership Changes for Growth
Appel announced, "Pawan Joshi will now oversee our strategy going forward, looking to deepen client relationships and enhance innovation." Engagement with Clients
Greg Randolph emphasized the importance of client satisfaction, noting, "Our sales team is partnering very closely with professional services to drive higher customer satisfaction and maximize renewals."
"It is clear to me that clients choose E2open Parent Holdings, Inc. for solutions not only for their current supply chain needs but also for the opportunity to grow with us." - Andrew Appel, CEO
â Andrew Appel
"We expect to see some sequential PS revenue uplift in the fourth quarter as we catch up on closing deals that were pushed out of Q3." - Marje Armstrong, CFO},
â Marje Armstrong
Forward Guidance
For Q4 FY25, management forecasts subscription revenue to range between $131 million and $134 million, anticipating a continuation of the negative year-over-year growth trend but signs of recovery. E2open is revising full-year guidance down to $526 to $529 million in subscription revenue, suggesting potential headwinds due to recent currency fluctuations and ongoing challenges in professional services revenue. Management notes, "Bookings have picked up in both Q2 and Q3 compared to the low points we saw in Q1," indicating a cautiously optimistic outlook for growth in 2025.
Competitive Position
Company
Gross Margin
Operating Margin
Return on Equity
P/E Ratio
ETWO Focus
49.94%
-2.47%
-31.80%
-67.70%
BLKB
55.50%
15.30%
3.77%
51.95%
ENFN
68.10%
5.83%
2.02%
155.77%
MODN
57.20%
4.60%
2.72%
120.08%
CVT
60.90%
-9.70%
-1.15%
-34.81%
Gross Profit Margin
Operating Profit Margin
Return on Equity
P/E Ratio Comparison
Investment Outlook
The investment outlook for E2open Parent Holdings Inc (ETWO) remains cautious but presents opportunities for recovery. With the company exhibiting stabilization in subscription revenue declines, the strategic focus on customer retention, innovative product offerings, and new leadership initiatives suggest a path toward better performance. However, the significant goodwill impairment indicates vulnerability that investors must monitor. Stakeholders are advised to watch closely for further developments around client renewals and any shifts in macroeconomic conditions that could affect operational performance.
Key Investment Factors
Growth Potential
E2open's growth potential lies in the demand for sophisticated supply chain solutions, underscored by their focus on client retention and strategic partnerships. Recent leadership changes and innovations in AI-driven solutions may provide competitive advantages.
Profitability Risk
The company's exposure to impairment risks due to fluctuating share prices and reliance on large client contracts poses significant risks. Additionally, the prolonged sales cycles for large deals can impact revenue predictability.
Financial Position
Despite a turbulent period marked by a large goodwill impairment charge, E2open retains a solid cash position, closing the quarter with $151.2 million in cash and cash equivalents, signaling resilience in operations.
SWOT Analysis
Strengths
Strong brand reputation in supply chain management software
Broad product portfolio with advanced AI capabilities