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II

Informatica Inc. (INFA)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 2025 was solid on core cloud metrics and profitability: GAAP revenue rose to $439.2M (+3.9% y/y) and non-GAAP operating margin expanded to 36.8% while GAAP operating income reached $60.9M .
  • Results beat S&P Global consensus: revenue $439.2M vs $435.9M estimate*, non-GAAP EPS $0.37 vs $0.34 estimate*; however, EBITDA came in below consensus (actual $89.3M vs $158.6M estimate*) .
  • Cloud Subscription ARR accelerated to $968.6M (+29.5% y/y); Total ARR reached $1.748B (+3.9% y/y); Cloud NRR was 120% (down from 126% y/y) .
  • No earnings call or guidance due to the pending Salesforce acquisition; closing targeted for Salesforce FY26 Q4 or early FY27, subject to regulatory clearances—a key near‑term stock narrative catalyst .

Values retrieved from S&P Global*

What Went Well and What Went Wrong

What Went Well

  • Cloud momentum and mix: Cloud Subscription ARR reached $968.6M, up 29.5% y/y; GAAP cloud subscription revenue grew 31.0% y/y to $230.4M .
  • Margin strength and cash generation: Non-GAAP operating income was $161.4M with a 36.8% non-GAAP operating margin; operating cash flow was $148.7M and adjusted unlevered free cash flow margin was 41% .
  • Product innovation for AI/agentic workflows: Management launched the first CLAIRE Agents, enhanced CLAIRE GPT and Copilot, AI Governance, and partnerships (Oracle OCI, Databricks, Google, AWS) to power agentic AI use cases. “We delivered another strong quarter… Customers continue to choose Informatica to scale their agentic AI initiatives…” — CEO Amit Walia .

What Went Wrong

  • Legacy declines: Maintenance revenue fell to $100.3M from $115.3M y/y; self-managed subscription support and license revenue continued to decline as the company transitions to cloud .
  • Cloud NRR moderation: Cloud NRR at the global parent level was 120%, down from 126% a year ago, reflecting modernization cohort mix and expansion dynamics .
  • GAAP net income remained modest: Despite strong operations, GAAP net income was $4.0M as income tax expense rose to $45.1M, tempering bottom-line optics .

Financial Results

Core Metrics vs Prior Periods and Estimates

MetricQ1 2025Q2 2025Q3 2025Q3 2025 Consensus*
Total Revenue ($USD Millions)$403.9 $407.3 $439.2 $435.9*
GAAP Diluted EPS ($)$0.00 $(0.02) $0.01 —
Non-GAAP Diluted EPS ($)$0.22 $0.18 $0.37 $0.34*
GAAP Operating Margin (%)8.4% 0.0% 13.9% —
Non-GAAP Operating Margin (%)30.1% 26.9% 36.8% —
EBITDA ($USD Millions)$124.9 $112.7 $164.8 (Adj.) $158.6*

Values retrieved from S&P Global*
Note: Company reports Adjusted EBITDA ($164.8M) ; S&P Global “EBITDA” actual ($89.3M*) may reflect a standardized/GAAP definition differing from company-adjusted reporting.

Revenue Disaggregation (mix)

Revenue Component ($USD Millions)Q3 2024Q2 2025Q3 2025
Cloud Subscription (over time)$175.8 $209.9 $230.4
Self-Managed Subscription Support & Other (over time)$46.6 $41.0 $38.8
Maintenance (over time)$115.3 $102.9 $100.3
Self-Managed Subscription License (point-in-time)$66.0 $36.1 $51.4
Professional Services (as provided)$19.2 $17.4 $18.2
Total Revenue$422.5 $407.3 $439.2

KPIs and ARR Trajectory

KPIQ1 2025Q2 2025Q3 2025
Cloud Subscription ARR ($USD Millions)$848.4 $901.0 $968.6
Total ARR ($USD Millions)$1,703.6 $1,719.7 $1,747.8
Cloud Subscription NRR (%)120% 120% 120%
Cloud Transactions per Month (Trillions)119.3 128.2 143.3
Cloud ARR Customers (Count)2,475 2,509 2,545

Guidance Changes

MetricPeriodPrevious Guidance (Q1 2025 issued 5/7/25)Current (Q3 2025)Change
GAAP Total RevenuesFY 2025$1.670B–$1.720B Not provided Withheld
Total ARRFY 2025$1.755B–$1.795B Not provided Withheld
Cloud Subscription ARRFY 2025$1.019B–$1.051B Not provided Withheld
Non-GAAP Operating IncomeFY 2025$546M–$566M Not provided Withheld
Adjusted Unlevered FCF (after-tax)FY 2025$540M–$580M Not provided Withheld
Cash Paid for InterestFY 2025≈$116M (modeling) Not provided Withheld
Non-GAAP Tax RateFY 2025~23% (modeling) Not provided Withheld
Shares (Basic/Diluted)FY 2025~304.3M / ~309.2M (modeling) Not provided Withheld
GAAP Total RevenuesQ2 2025$391M–$411M N/A (already reported) N/A

Note: Informatica did not host an earnings call or provide guidance in Q2 and Q3 due to the pending Salesforce transaction .

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1 2025)Previous Mentions (Q2 2025)Current Period (Q3 2025)Trend
AI/Technology InitiativesManagement emphasized IDMC for GenAI, growth in GenAI use cases and agentic workflows; details on CLAIRE, Copilot previews Press highlighted AI Agent Engineering, CLAIRE Agents previews, expanded hyperscaler integrations Launch of first CLAIRE Agents; enhanced CLAIRE GPT; AI Governance workflows; agent hub/engineering; Oracle OCI expansion Momentum building; productization in Q3
Cloud ModernizationCFO discussed uplift multiples and modernization mix; pipeline healthy No call; press reiterates cloud focus and growth Cloud ARR +29.5% y/y; NRR 120%; modernization continues; legacy roll-offs Ongoing transition, legacy declines
Macro/TariffsNo material change in buying behavior; essential workloads; FX headwinds noted FX mentioned in press impacts FX tailwinds on revenue vs constant currency; tax expense impacted GAAP net Mixed FX; tax optics
Partner EcosystemDatabricks, Google, Azure, SAP; GSIs scaling practices Expanded partnerships: AWS, Databricks, Microsoft, NVIDIA, Oracle, Salesforce, Snowflake Oracle OCI blueprint; OCI dedicated regions; Databricks/Snowflake/Microsoft enhancements Deepening integrations
Regulatory/Legal (M&A)NonePending Salesforce acquisition noted; no call/guidance Pending Salesforce acquisition; close targeted in Salesforce FY26 Q4/early FY27 M&A drives disclosure stance
R&D/ExecutionGross margin 82%; disciplined cost focus; non-GAAP margin expansion Non-GAAP op margin 26.9% Non-GAAP op margin 36.8% Operating leverage improving

Management Commentary

  • “We delivered another strong quarter with 29.5% year-over-year growth in Cloud Subscription ARR… Customers continue to choose Informatica to scale their agentic AI initiatives… building on IDMC powered for CLAIRE AI…” — Amit Walia, CEO .
  • “In light of the pending transaction with Salesforce, Informatica will not be hosting an earnings conference call… or providing financial guidance in conjunction with this press release.” .
  • Product scope: First CLAIRE Agents (Data Exploration, Enterprise Discovery, ELT, Product Help, Data Quality, Product Experience), enhanced CLAIRE GPT, Copilot for MDM, AI Governance, AI Agent Engineering/Hub, OCI expansions .

Q&A Highlights

  • No Q3 earnings call was hosted due to the pending Salesforce transaction . For context on themes earlier in 2025:
    • Cloud modernization uplift ratios guided to 1.5–1.7 in 2025; lifetime value attractive; more million‑plus cloud customers emerging .
    • Net retention variability and modernization cohort mix explained; stronger net new can offset lower NRR .
    • Confidence in cloud ARR trajectory for 2H driven by modernization and new workloads; potential AI workload contribution as projects move to production .

Estimates Context

  • Q3 beats vs consensus on revenue and non-GAAP EPS; miss on standardized EBITDA per S&P Global methodology:
    • Revenue: $439.2M actual vs $435.9M estimate* — bold beat .
    • EPS (Non-GAAP diluted): $0.37 actual vs $0.34 estimate* — bold beat .
    • EBITDA: $89.3M actual* vs $158.6M estimate*; company-reported Adjusted EBITDA $164.8M (methodology difference) .

Values retrieved from S&P Global*

Actual vs Consensus (Q3 2025)

MetricActualConsensus*Delta
Revenue ($USD Millions)$439.2 $435.9*+$3.3M (beat)
EPS Normalized ($)$0.37 $0.34*+$0.03 (beat)
EBITDA ($USD Millions)$89.3*$158.6*−$69.3M (miss)
Non-GAAP Operating Margin (%)36.8% ——

Values retrieved from S&P Global*

Key Takeaways for Investors

  • Cloud flywheel intact: Cloud Subscription ARR +29.5% y/y to $968.6M and cloud revenue +31% y/y signal durable demand for IDMC and agentic AI capabilities .
  • Operating leverage step-up: Non-GAAP operating margin expanded to 36.8%; adjusted unlevered FCF margin reached 41%, highlighting improving efficiency and cash generation .
  • Legacy headwinds fading but present: Maintenance and self‑managed revenues continue to decline as modernization progresses; NRR stable at 120% but moderated y/y .
  • Disclosure vacuum near term: No call and no guidance while the Salesforce deal proceeds; stock narrative likely tied to M&A milestones and regulatory clearances .
  • Estimate frameworks should reconcile EBITDA definitions: Company’s Adjusted EBITDA ($164.8M) diverges from standardized EBITDA ($89.3M*); adjust models accordingly .
  • Strengthening partner ecosystem: Expanded OCI, Databricks, Snowflake, Microsoft integrations position Informatica at the core of enterprise AI/data architectures .
  • Watch tax optics: Elevated income tax expense compressed GAAP net income despite robust operations; monitor sustainability of tax rate drivers .

Values retrieved from S&P Global*