EGAN · eGain Corporation

eGain delivered solid Q3 FY2026 results with total revenue of $22.5 million, up 7% year-over-year, in line with expectations. The company reported GAAP net income of $2.4 million ($0.09 per diluted share), a significant improvement from $66,000 ($0.00 per share) in the prior year quarter, driven by higher gross margins and operating leverage. Non-GAAP net income was $3.2 million ($0.11 per diluted share), compared to $765,000 ($0.03 per share) a year ago. Adjusted EBITDA more than doubled to $3.2 million, representing a 14% margin versus 6% in Q3 FY2025. Gross margins expanded notably: GAAP gross margin improved to 73% from 68%, and non-GAAP gross margin rose to 74% from 69%, reflecting a favorable mix shift toward higher-margin SaaS revenue and cost discipline. AI Knowledge Hub annual recurring revenue grew 26% year-over-year to $48.0 million, now representing 64% of total SaaS ARR, underscoring strong demand for AI-powered knowledge management solutions. Management highlighted increased RFP activity and customer expansions, driven by growing awareness of the 'garbage in, garbage out' knowledge problem in AI deployments. For Q4 FY2026, eGain guided total revenue between $21.5 million and $22.0 million, GAAP net loss of $300,000 to net income of $400,000, and non-GAAP net income of $600,000 to $1.3 million. For the full fiscal year 2026, the company updated guidance to total revenue of $90.5 million to $91.0 million, GAAP net income of $7.0 million to $7.8 million, and non-GAAP net income of $11.3 million to $12.1 million. The balance sheet remains strong with $80.5 million in cash and equivalents, up from $68.7 million a year ago.