eGain (NASDAQ:EGAN) Posts Earnings Results, Beats Estimates By $0.03 EPS

eGain (NASDAQ:EGAN) announced its earnings results on Thursday. The technology company reported $0.09 earnings per share for the quarter, topping the consensus estimate of $0.06 by $0.03, FiscalAI reports. The firm had revenue of $21.87 million for the quarter, compared to the consensus estimate of $21.11 million. eGain had a net margin of 9.74% and a return on equity of 11.75%.

Here are the key takeaways from eGain’s conference call:

• First-quarter revenue was $21.9 million, above guidance but down 7% year over year as legacy revenue declined. AI customer revenue rose 7% to $14.4 million, while AI customer ARR grew 11% to $54.5 million and reached 74% of SaaS ARR.
• Management highlighted eGain’s recognition as a leader in Gartner’s first Magic Quadrant for customer service knowledge management, and cited customer examples of improved accuracy, fewer escalations, and reduced misrouted contacts.
• The company reported new customer wins and expansions, while Gartner-related marketing and event-sourced leads increased. Management plans to invest more in marketing and sales development to convert that awareness into pipeline.
• Legacy business revenue fell about 28%, and management expects the legacy business to decline approximately 30% for the full year, with the runoff becoming more pronounced in Q2.
• eGain reiterated full-year guidance, including 8% to 10% growth in AI customer revenue and a target of approximately 20% AI customer ARR growth by year-end, but expects higher sales and marketing spending to reduce near-term profitability. Q2 adjusted EBITDA is forecast at break-even to $500,000.

eGain Price Performance

eGain stock traded up $0.05 during mid-day trading on Friday, reaching $5.95. The company had a trading volume of 120,211 shares, compared to its average volume of 194,522. The stock’s 50-day simple moving average is $5.79 and its 200-day simple moving average is $7.36. The company has a market capitalization of $150.59 million, a P/E ratio of 21.25 and a beta of 0.82. eGain has a 1 year low of $5.02 and a 1 year high of $15.95.

Wall Street Analyst Weigh In

A number of equities research analysts have commented on the stock. Weiss Ratings reissued a “hold (c)” rating on shares of eGain in a research report on Wednesday. B. Riley Financial reaffirmed a “neutral” rating on shares of eGain in a report on Tuesday, September 8th. Finally, Roth Capital cut eGain from a “buy” rating to a “neutral” rating and cut their target price for the stock from $21.00 to $7.00 in a research report on Tuesday, September 8th. Three analysts have rated the stock with a Hold rating. According to data from MarketBeat, eGain currently has a consensus rating of “Hold” and a consensus price target of $6.50.

eGain Company Profile

eGain Corporation develops cloud-based software for enterprise knowledge management and customer service operations. Its platform combines artificial intelligence (AI), knowledge management, workflow automation, and analytics to help organizations manage information and support customer interactions.

The company’s products and services include knowledge management systems, conversational AI, digital engagement tools, agent-assistance software, and customer service analytics.