OneSpan Inc.

Q2 revenue was $60.5 million, up 1% year over year. Subscription revenue grew 11% to $47 million and made up 77% of total revenue, while ARR increased 6.7% to $189.7 million and NRR was 103%. Gross margin was 73.6% versus 73.5% last year. GAAP operating income was $8.7 million versus $10.5 million, GAAP EPS was $0.18 versus $0.21, non-GAAP EPS was $0.30 versus $0.34, and adjusted EBITDA was $16.9 million, or 27.9%, versus $17.6 million, or 29.5%. For full-year 2026, management raised revenue guidance to $248 million to $252 million from $244 million to $249 million, software and services revenue to $202 million to $204 million, hardware revenue to $46 million to $48 million from $43 million to $45 million, ARR to $194 million to $198 million, and adjusted EBITDA to $67 million to $71 million from $64 million to $68 million.

Victor Limongelli emphasized that DigipassONE is a major milestone in OneSpan’s shift toward a unified platform that combines authentication, verification, app protection and analytics. He framed agent-driven banking as an emerging channel that should complement, not replace, existing digital channels, and said OneSpan is positioning itself to help banks authenticate customers and verify intent across those workflows. His tone was constructive and forward-looking, with repeated references to cross-sell opportunities, customer relationships and long-term growth.

Jorge Martell highlighted the quarter’s operating performance and the improved outlook. He cited ARR of $189.7 million, revenue of $60.5 million, gross margin of 73.6%, GAAP operating income of $8.7 million, and adjusted EBITDA of $16.9 million, then explained that the year-over-year pressure on operating income came from acquisition-related costs and other organic investments. On the balance sheet, he said OneSpan ended Q2 with $43.3 million in cash and cash equivalents and $5 million outstanding on its credit facility, after $4.8 million of dividends, $2.9 million of share repurchases and $3 million of capitalized software development costs. He also noted the company returned almost $8 million to shareholders in Q2 and more than $40 million over the last four quarters.

Analysts pressed management on how growth can improve as hardware becomes a smaller part of the business, and Victor said the path is mostly through software growth plus cross-selling to the existing customer base, especially DigipassONE Protect and DigipassONE Verify. Questions also focused on the early pipeline for DigipassONE Verify, where Victor said the company released an early version in June and is running POCs in the second half of the year, with regulatory drivers in Europe becoming more meaningful in 2027. On Digital Agreements overages, Jorge said the strong quarter came from a couple of customers, that overages were about year-over-year higher by $2-and-change million, and that they are a leading indicator for future ARR and revenue. On hardware, management said better bookings in the first half support the raised full-year outlook and that FIDO2 security keys are promising, especially in corporate banking.