Revenue growth remains largely stagnant at 0.8% in 2026Q3, while operating margins have struggled to break out of a narrow 16% to 23% range over the last ten quarters.
| Metric | TTM | Jun'25 | Jun'24 | Jun'23 | Jun'22 | Jun'21 | Jun'20 | Jun'19 | Jun'18 | Jun'17 | Jun'16 | Jun'15 | Jun'14 | Jun'13 | Jun'12 | Jun'11 | Jun'10 | Jun'09 | Jun'08 | Jun'07 | Jun'06 | Jun'05 | Jun'04 | Jun'03 | Jun'02 | Jun'01 | Jun'00 | Jun'99 | Jun'98 | Jun'97 |
|---|
| Sales/Revenue | 5.19B | 5.17B | 5.71B | 4.53B | 3.43B | 3.51B | 3.07B | 2.91B | 2.72B | 2.34B | 1.86B | 1.74B | 1.63B | 1.3B | 1.19B | 1.07B | 906.17M | 788.31M | 722.54M | 634.1M | 428.48M | 423.49M | 291.06M | 177.72M | 152.48M | 147.7M | 112.94M | 92.5M | 45.3M | 22.6M |
| Revenue Growth % | -0.57% | -9.53% | 26.04% | 31.97% | -2.1% | 14.45% | 5.49% | 6.9% | 16.16% | 25.62% | 7.12% | 6.55% | 25.72% | 9.21% | 10.84% | 18.37% | 14.95% | 9.1% | 13.95% | 47.99% | 1.18% | 45.5% | 63.77% | 16.56% | 3.23% | 30.77% | 22.1% | 104.19% | 100.44% | - |
| Cost of Goods Sold | 1.5B | 1.43B | 2.12B | 1.77B | 1.34B | 1.38B | 1.29B | 1.23B | 1.18B | 998.5M | 757.86M | 714.56M | 630.84M | 551.54M | 485.35M | 417.42M | 347.65M | 298.11M | 274.37M | 255.47M | 170.29M | 164.81M | 78.4M | 45.2M | 39.22M | 38.48M | 32.24M | 16.3M | -16.3M | 7.5M |
| COGS % of Revenue | - | 27.75% | 37.14% | 39.04% | 39.14% | 39.46% | 42.22% | 42.47% | 43.41% | 42.67% | 40.68% | 41.09% | 38.65% | 42.48% | 40.82% | 38.91% | 38.36% | 37.82% | 37.97% | 40.29% | 39.74% | 38.92% | 26.94% | 25.43% | 25.72% | 26.05% | 28.55% | 17.62% | -35.98% | 33.19% |
| Gross Profit | 3.69B | 3.73B | 3.59B | 2.76B | 2.09B | 2.12B | 1.77B | 1.67B | 1.54B | 1.34B | 1.11B | 1.02B | 1B | 746.81M | 703.55M | 655.24M | 558.52M | 490.2M | 448.17M | 378.63M | 258.19M | 258.68M | 212.66M | 132.53M | 113.26M | 109.22M | 80.7M | 76.2M | 61.6M | 15.1M |
| Gross Margin % | 71.16% | 72.25% | 62.86% | 60.96% | 60.86% | 60.54% | 57.78% | 57.53% | 56.59% | 57.33% | 59.32% | 58.91% | 61.35% | 57.52% | 59.18% | 61.09% | 61.64% | 62.18% | 62.03% | 59.71% | 60.26% | 61.08% | 73.06% | 74.57% | 74.28% | 73.95% | 71.45% | 82.38% | 135.98% | 66.81% |
| Gross Profit Growth % | - | 3.98% | 29.97% | 32.2% | -1.58% | 19.9% | 5.95% | 8.68% | 14.66% | 21.41% | 7.86% | 2.31% | 34.09% | 6.15% | 7.37% | 17.32% | 13.94% | 9.38% | 18.36% | 46.65% | -0.19% | 21.64% | 60.46% | 17.02% | 3.69% | 35.34% | 5.91% | 23.7% | 307.95% | - |
| Operating Expenses | 2.6B | 2.7B | 2.58B | 2.07B | 1.41B | 1.36B | 1.17B | 1.06B | 1.02B | 915.92M | 688.97M | 677.71M | 663.58M | 537.6M | 531.96M | 488.39M | 408.25M | 377.81M | 348.62M | 310.68M | 217.25M | 230.52M | 172.18M | 105.61M | 99.75M | 99.46M | 88.44M | 63.7M | 62.4M | 44.5M |
| OpEx % of Revenue | - | 52.16% | 45.12% | 45.6% | 41.05% | 38.74% | 38.32% | 36.45% | 37.62% | 39.14% | 36.98% | 38.97% | 40.65% | 41.41% | 44.74% | 45.53% | 45.05% | 47.93% | 48.25% | 49% | 50.7% | 54.43% | 59.16% | 59.42% | 65.42% | 67.34% | 78.31% | 68.86% | 137.75% | 196.9% |
| Selling, General & Admin | 1.53B | 1.49B | 1.69B | 1.38B | 976.79M | 922.29M | 809.49M | 733.27M | 710.89M | 628.2M | 490.8M | 493.19M | 485.92M | 381.41M | 365.52M | 336.84M | 279.7M | 261.25M | 243.16M | 226.51M | 156.08M | 164.02M | 110.16M | 68.04M | 63.58M | 64.51M | 62.76M | 42.4M | 26.5M | 21.5M |
| SG&A % of Revenue | - | 28.78% | 29.63% | 30.42% | 28.44% | 26.29% | 26.41% | 25.23% | 26.15% | 26.84% | 26.35% | 28.36% | 29.77% | 29.38% | 30.74% | 31.4% | 30.87% | 33.14% | 33.65% | 35.72% | 36.43% | 38.73% | 37.85% | 38.28% | 41.7% | 43.68% | 55.57% | 45.84% | 58.5% | 95.13% |
| Research & Development | 681.54M | 755.94M | 885.12M | 687.79M | 432.95M | 436.64M | 365.11M | 326M | 311.8M | 287.72M | 198.17M | 184.52M | 177.65M | 156.19M | 166.44M | 151.55M | 128.55M | 116.55M | 105.46M | 84.16M | 61.17M | 66.5M | 43.62M | 29.32M | 24.07M | 24.31M | 17.74M | 11.4M | 7.9M | 6.6M |
| R&D % of Revenue | - | 14.63% | 15.49% | 15.17% | 12.61% | 12.45% | 11.91% | 11.22% | 11.47% | 12.29% | 10.64% | 10.61% | 10.88% | 12.03% | 14% | 14.13% | 14.19% | 14.79% | 14.6% | 13.27% | 14.28% | 15.7% | 14.99% | 16.5% | 15.79% | 16.46% | 15.71% | 12.32% | 17.44% | 29.2% |
| Other Operating Expenses | 3M | 452.46M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 18.41M | 8.24M | 12.09M | 10.64M | 7.94M | 9.9M | 28M | 16.4M |
| Operating Income | 1.09B | 1.04B | 1.01B | 696.44M | 680.37M | 764.8M | 596.64M | 612.58M | 515.69M | 425.74M | 416.06M | 346.8M | 337.81M | 209.21M | 171.59M | 166.85M | 150.28M | 112.39M | 99.55M | 67.95M | 40.94M | 28.16M | 30.47M | 26.92M | 13.51M | 9.77M | -7.74M | 12.5M | -800K | -29.4M |
| Operating Margin % | 21.09% | 20.09% | 17.74% | 15.37% | 19.81% | 21.8% | 19.46% | 21.08% | 18.97% | 18.19% | 22.33% | 19.94% | 20.7% | 16.11% | 14.43% | 15.55% | 16.58% | 14.26% | 13.78% | 10.72% | 9.55% | 6.65% | 10.47% | 15.15% | 8.86% | 6.61% | -6.85% | 13.51% | -1.77% | -130.09% |
| Operating Income Growth % | - | 2.46% | 45.54% | 2.36% | -11.04% | 28.18% | -2.6% | 18.79% | 21.13% | 2.32% | 19.97% | 2.66% | 61.47% | 21.92% | 2.84% | 11.03% | 33.7% | 12.9% | 46.5% | 65.98% | 45.38% | -7.58% | 13.19% | 99.25% | 38.32% | 226.16% | -161.94% | 1662.5% | 97.28% | - |
| EBITDA | 1.71B | 1.68B | 1.81B | 1.36B | 1.18B | 1.3B | 1.1B | 1.09B | 956.89M | 778.86M | 663.57M | 572.31M | 524.85M | 387.15M | 328.63M | 300.9M | 263.38M | 205.71M | 183.49M | 147.41M | 81.95M | 64.35M | 48.88M | 35.16M | 25.6M | 20.41M | 200K | 22.4M | 27.2M | -13M |
| EBITDA Margin % | 33.03% | 32.5% | 31.75% | 30.02% | 34.23% | 37.18% | 36.02% | 37.5% | 35.2% | 33.28% | 35.62% | 32.91% | 32.16% | 29.82% | 27.64% | 28.05% | 29.07% | 26.1% | 25.4% | 23.25% | 19.13% | 15.2% | 16.79% | 19.79% | 16.79% | 13.82% | 0.18% | 24.22% | 60.04% | -57.52% |
| EBITDA Growth % | 5.17% | -7.37% | 33.28% | 15.73% | -9.85% | 18.13% | 1.32% | 13.87% | 22.86% | 17.37% | 15.94% | 9.04% | 35.57% | 17.81% | 9.22% | 14.24% | 28.03% | 12.11% | 24.48% | 79.87% | 27.36% | 31.65% | 39% | 37.34% | 25.47% | 10102.5% | -99.11% | -17.65% | 309.23% | - |
| D&A (Non-Cash Add-back) | 619.7M | 641.24M | 799.96M | 664.3M | 495.38M | 539.37M | 507.37M | 477.02M | 441.21M | 353.13M | 247.5M | 225.51M | 187.04M | 177.94M | 157.03M | 134.05M | 113.11M | 93.32M | 83.94M | 79.45M | 41.01M | 36.19M | 18.41M | 8.24M | 12.09M | 10.64M | 7.94M | 9.9M | 28M | 16.4M |
| EBIT | 957.62M | 859.46M | 1.29B | 614.19M | 598.52M | 759.96M | 478.76M | 585.53M | 500.67M | 376.58M | 374.92M | 301.12M | 305.88M | 185.89M | 150.56M | 150.01M | 98.59M | 94.71M | 98.95M | 56.07M | 10.1M | 28.14M | 40.47M | 26.92M | 13.51M | 9.77M | -7.74M | 12.5M | -1.2M | -29.4M |
| Net Interest Income | -308.02M | -327.83M | -516.18M | -329.43M | -157.88M | -151.57M | -146.38M | -131.15M | -124.93M | -120.89M | -76.36M | -54.62M | -27.93M | -16.98M | -15.56M | -8.45M | -8.8M | -13.62M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Interest Income | 42.7M | 49.56M | 49.14M | 53.49M | 4.64M | 3.86M | 11.77M | 8.12M | 2.9M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Interest Expense | 350.72M | 377.39M | 565.32M | 382.91M | 162.52M | 155.42M | 158.15M | 139.26M | 127.83M | 120.89M | 76.36M | 54.62M | 27.93M | 16.98M | 15.56M | 11.84M | 10.37M | 13.62M | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Other Income/Expense | -477.8M | -556.51M | -291.5M | -472.77M | -173.14M | -90.57M | -256.37M | -166.31M | -142.84M | -170.84M | -119.13M | -96.97M | -59.99M | -39.5M | -36.36M | -29.12M | -61.98M | -31.35M | -23.37M | -33.48M | -30.84M | -15.31K | 1.43M | 4.02M | 3.45M | 2.26M | 53.24M | -900K | -6.08M | 1.3M |
| Pretax Income | 616.76M | 482.07M | 722.11M | 223.67M | 507.23M | 674.23M | 340.27M | 446.27M | 372.84M | 254.9M | 296.94M | 249.83M | 277.82M | 169.72M | 135.23M | 137.72M | 88.29M | 81.05M | 76.18M | 34.48M | 10.1M | 28.14M | 31.9M | 30.93M | 16.96M | 12.03M | 45.5M | 11.6M | -24.5M | -28.1M |
| Pretax Margin % | 11.88% | 9.33% | 12.64% | 4.93% | 14.77% | 19.22% | 11.1% | 15.36% | 13.72% | 10.89% | 15.94% | 14.37% | 17.02% | 13.07% | 11.37% | 12.84% | 9.74% | 10.28% | 10.54% | 5.44% | 2.36% | 6.65% | 10.96% | 17.41% | 11.12% | 8.14% | 40.29% | 12.54% | -54.08% | -124.34% |
| Income Tax | 102.73M | 46.01M | 261.41M | 71.52M | 116.73M | 352.16M | 109.25M | 156.94M | 138.88M | -793M | 6.42M | 29.71M | 58.73M | 28.27M | 11.98M | 9.83M | 1.3M | 23.87M | 22.9M | 11M | 4.28M | 7.1M | 7.27M | 3.18M | 289K | 1.23M | 20.42M | -8.6M | -1M | -1.2M |
| Effective Tax Rate % | 16.66% | 9.54% | 36.2% | 31.97% | 23.01% | 52.23% | 32.11% | 35.17% | 37.25% | -311.1% | 2.16% | 11.89% | 21.14% | 16.66% | 8.86% | 7.14% | 1.48% | 29.45% | 30.06% | 31.91% | 42.41% | 25.24% | 22.79% | 10.27% | 1.7% | 10.22% | 44.88% | -74.14% | 4.08% | 4.27% |
| Net Income | 513.8M | 435.87M | 460.5M | 151.97M | 390.33M | 321.87M | 230.87M | 289.19M | 233.89M | 1.05B | 290.51M | 220.05M | 219.14M | 141.44M | 123.25M | 127.9M | 86.99M | 57.13M | 52.79M | 23.06M | 5.21M | 20.78M | 23.3M | 27.76M | 16.67M | 10.8M | 25.08M | 20.2M | -23.5M | -28.2M |
| Net Margin % | 9.9% | 8.43% | 8.06% | 3.35% | 11.37% | 9.17% | 7.53% | 9.95% | 8.6% | 44.77% | 15.59% | 12.65% | 13.43% | 10.89% | 10.37% | 11.92% | 9.6% | 7.25% | 7.31% | 3.64% | 1.22% | 4.91% | 8% | 15.62% | 10.93% | 7.31% | 22.2% | 21.84% | -51.88% | -124.78% |
| Net Income Growth % | -21.58% | -5.35% | 203.02% | -61.07% | 21.27% | 39.41% | -20.17% | 23.64% | -77.67% | 260.63% | 32.02% | 0.42% | 54.93% | 14.76% | -3.63% | 47.02% | 52.27% | 8.23% | 128.93% | 342.74% | -74.94% | -10.79% | -16.06% | 66.5% | 54.42% | -56.95% | 24.15% | 185.96% | 16.67% | - |
| Net Income (Continuing) | 514.03M | 436.07M | 460.7M | 152.16M | 390.5M | 322.07M | 231.02M | 289.33M | 233.96M | 1.05B | 290.52M | 220.12M | 219.08M | 141.44M | 123.25M | 127.9M | 86.99M | 57.18M | 53.28M | 23.48M | 5.81M | 21.04M | 23.3M | 27.76M | 16.67M | 10.8M | 25.08M | 20.2M | -6.28M | -28.2M |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | -835.67K | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 1.91M | 1.72M | 1.52M | 1.33M | 1.14M | 1.51M | 1.32M | 1.22M | 1.04M | 961K | 541K | 523K | 301K | 0 | 0 | 0 | 0 | 0 | 8.67M | 6.97M | 5.8M | 4.43M | 10.05M | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| EPS (Diluted) | 2.07 | 1.65 | 1.71 | 0.56 | 1.44 | 1.18 | 0.85 | 1.06 | 0.91 | 4.01 | 1.17 | 0.95 | 0.91 | 0.63 | 0.54 | 0.53 | 0.39 | 0.27 | 0.25 | 0.11 | 0.03 | 0.10 | 0.12 | 0.17 | 0.10 | 0.06 | 0.13 | 0.11 | -0.16 | -0.21 |
| EPS Growth % | -16.73% | -3.51% | 205.36% | -61.11% | 22.03% | 38.82% | -19.81% | 16.48% | -77.31% | 242.74% | 23.16% | 4.4% | 44.44% | 16.67% | 1.89% | 35.9% | 44.44% | 8% | 127.27% | 340% | -74.36% | -18.75% | -29.41% | 74.36% | 56% | -51.92% | 18.18% | 168.75% | 23.81% | - |
| EPS (Basic) | - | 1.66 | 1.71 | 0.56 | 1.44 | 1.18 | 0.85 | 1.06 | 0.91 | 4.04 | 1.17 | 0.96 | 0.91 | 0.64 | 0.54 | 0.54 | 0.40 | 0.27 | 0.26 | 0.11 | 0.03 | 0.10 | 0.13 | 0.18 | 0.10 | 0.07 | 0.14 | 0.12 | -0.16 | -0.21 |
| Diluted Shares Outstanding | 247.96M | 263.65M | 272.59M | 270.45M | 271.91M | 273.48M | 271.82M | 269.91M | 267.49M | 255.81M | 244.08M | 245.91M | 241.15M | 236.25M | 234.94M | 233.04M | 229.54M | 213.08M | 210.42M | 203.63M | 199.8M | 208.37M | 189.09M | 165.57M | 169.91M | 171.73M | 195.37M | 189.83M | 142.61M | 134.15M |
| Basic Shares Outstanding | 247.84M | 263.27M | 271.55M | 270.3M | 271.27M | 272.53M | 270.85M | 268.78M | 266.08M | 253.88M | 242.93M | 244.18M | 239.35M | 234.42M | 231.56M | 228.31M | 225.12M | 208.12M | 203.12M | 197.57M | 194.66M | 199.67M | 174.97M | 156.2M | 159.83M | 160.26M | 178.79M | 167.31M | 142.61M | 134.15M |
| Dividend Payout Ratio | - | 62.29% | 58.06% | 170.79% | 60.89% | 65.45% | 81.74% | 58.39% | 62.26% | 11.51% | 34.17% | 39.82% | 34.09% | 12.52% | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
M&A integration execution risk
Based on reported financial data, OpenText has struggled to maintain consistent top-line expansion, with recent quarterly revenue growth hovering near 0.8% as of 2026Q3, reflecting the ongoing challenges of integrating large-scale acquisitions while managing the natural decay of legacy on-premise licensing revenue streams.
The company's revenue trajectory appears heavily influenced by its serial acquisition strategy, which often masks underlying organic performance. Investors should monitor whether the shift toward cloud-based subscriptions can eventually offset the persistent contraction in legacy maintenance and licensing segments.
As reported in financial statements, OpenText's gross margins have fluctuated significantly, ranging from a low of 63.0% in 2024Q4 to a peak of 74.0% in 2026Q2, suggesting that the product mix between high-margin software and lower-margin professional services remains highly sensitive to acquisition timing.
The variability in gross margins indicates that the company's transition to a cloud-first model is not yet yielding the consistent margin expansion typically expected from SaaS-heavy peers. This volatility warrants further investigation into the cost-to-serve for its cloud infrastructure versus legacy maintenance contracts.
According to recent SEC filings, OpenText's operating income has failed to scale linearly with gross profit, as evidenced by operating margins that have remained largely range-bound between 16% and 23% over the last ten quarters despite significant shifts in the underlying revenue base.
The inability to meaningfully expand operating margins suggests that the company's SG&A and R&D expenses remain elevated, likely due to the continuous need to integrate and support disparate legacy software platforms. This indicates that the 'OpenText Playbook' of stripping redundant costs may be reaching a point of diminishing returns.
Based on the provided income statement data, OpenText's net income exhibits extreme volatility, with margins swinging from 2.2% in 2025Q4 to 18.2% in 2024Q4, largely driven by non-operating items and the heavy amortization of intangible assets resulting from its aggressive acquisition-led growth model.
The discrepancy between GAAP net income and operational cash flow suggests that reported earnings may not accurately reflect the company's true economic profitability. Analysts should focus on adjusted metrics that account for purchase price accounting adjustments to better gauge the underlying health of the business.
As indicated by the recent -9.53% revenue growth trend, there is a significant risk that OpenText's reliance on debt-funded acquisitions to drive top-line results is becoming unsustainable, potentially leaving the company vulnerable to interest rate headwinds and the exhaustion of viable, accretive M&A targets.
Short-sellers may focus on the company's stagnant organic growth and the potential for margin compression if synergy targets from the Micro Focus integration are not fully realized. The market's skepticism regarding the company's 'legacy' label may be justified if the firm cannot demonstrate a clear path to organic innovation.
Quick answers to the most common questions about buying OTEX stock.
For fiscal year 2025, Open Text Corporation (OTEX) reported total revenue of $5.17B. This represents a 22769.0% increase compared to $22.6M in 1997.
Open Text Corporation (OTEX) is profitable, generating $435.9M in net income for the fiscal year ending 2025 with a net profit margin of 8.4%.
Open Text Corporation (OTEX) reported an operating income of $1.04B, resulting in an operating profit margin of 20.1%. This margin reflects the operational efficiency of the business before interest and taxes.
Open Text Corporation (OTEX) generated $3.73B in gross profit for the year, representing a gross profit margin of 72.3%. This demonstrates the company's core pricing power and production efficiency.