Upland Software, Inc.

Q4 2025 revenue was described as roughly as expected, with gross margin improved from earlier in 2025; adjusted EBITDA was $15.3 million and adjusted EBITDA margin was 31%, up from 22% in Q4 2024. Q4 GAAP operating cash flow was $7.3 million and free cash flow was $7.2 million; full-year 2025 free cash flow was $24.4 million, above the $20 million target. Net debt at year-end was approximately $290 million, including about $29 million of cash, and net debt leverage was 3.6x trailing adjusted EBITDA. For Q1 2026, management guided revenue of $47.0 million to $50.0 million, adjusted EBITDA of $11.9 million to $13.4 million, and adjusted EBITDA margin of 26% at the midpoint. For full-year 2026, guidance was revenue of $194.2 million to $206.2 million, adjusted EBITDA of $52.6 million to $58.6 million, and adjusted EBITDA margin of 28% at the midpoint. Management said the reported revenue decline versus 2025 is primarily due to divestitures completed in Q1 2025.

Jack McDonald framed the quarter as evidence that the business has become more focused and operationally stronger, with an emphasis on AI-enabled products rather than acquisition-driven growth. He said Sean Nathaniel is the right CEO for the next phase because he is product-centric and AI-focused, and has deep familiarity with the company’s products, customers, and operating model. Jack also said the company has cleared the decks with divestitures and refinancing, and now wants to support execution in a changing enterprise SaaS market shaped by AI.

Michael D. Hill said Q4 revenue was in line after accounting for divestitures, and that gross margin improved as expected because of higher margins on ongoing product lines. He highlighted the 31% Q4 adjusted EBITDA margin versus 22% a year ago, and said free cash flow of $7.2 million in Q4 and $24.4 million for 2025 both exceeded expectations. On the balance sheet, he cited about $290 million of net debt and $29 million of cash, with leverage at 3.6x trailing adjusted EBITDA, better than target. He also explained that 2026 margin guidance is shaped by typical seasonal expense patterns, with Q1 and Q2 usually the lowest-margin periods.

Analysts pressed on softer customer metrics, including flat new customer adds and lower majors/expansions, and management said Q4 bookings were a bit disappointing, though the 2026 pipeline looks decent, especially in core knowledge management products with a healthier pipeline of larger deals. Questions on the CEO transition and timing were answered by Jack saying the business has changed and needs a product-centric, AI-focused leader. Management also discussed the revenue mix and AI durability, saying roughly two-thirds to three-quarters of revenue comes from growth products, most of which are AI-enabled, and that systems of record and infrastructure/enabling-layer products should be the most defensible in an AI-driven market.