OpenText closed fiscal 2025 with a strong fourth quarter, reporting total revenues of $1.31 billion and cloud revenue of $475 million (up 2.1% year-over-year), marking 18 consecutive quarters of cloud organic growth. Q4 enterprise cloud bookings surged 32.3% year-over-year to $238 million, and license revenue grew 77% ex-AMC to $173 million, with Q4 being the first full quarter of the new Titanium X platform in market. For the full year, total revenues were $5.17 billion and cloud revenues were $1.86 billion (up 2%), though management acknowledged disappointment that the full year posted negative growth, an exception to a long track record. Led by CEO Mark Barrenechea, the company laid out a confident fiscal 2026 growth outlook (total revenue growth of 1%-2%, cloud growth of 3%-4%, adjusted EBITDA margin expansion of 50-100 bps, free cash flow growth of 17%-20%) plus a 5% dividend raise, a new $300 million buyback, a return to M&A, and a medium-term Rule of 40 business model anchored on sovereign cloud, AI, and security.
Thank you, Rocco, and good morning, everyone. Welcome to OpenText Fourth Quarter and Fiscal Year 2025 Earnings Call. With me on the call today are OpenText Chief Executive Officer and Chief Technology Officer, Mark J. Barrenechea, together with Chadwick Westlake, our Executive Vice President and Chief Financial Officer. We have Todd Cione, our President of Worldwide Sales. We have Paul Duggan, our President and Chief Customer Officer. Also joining, we have Cosmin Balota, who's our Senior Vice President and Chief Accounting Officer. Today's call is being webcast and recorded with replay available shortly thereafter. All of this information and all of the presentations today are available on the Investor Relations website at OpenText, and that's investors.opentext.com. On today's webcast, we'll have our prepared remarks coordinated with slides on the Q4 financial presentation. This presentation is available, of course, on the website.
Please note that if you're logged into the live webcast, you're already set up for the slideshow. I'll also point out that there are two presentations on our website, the Q4 Fiscal 25 IR Results that we'll be using during the call, and the investor presentation that we use for investor meetings. Turning to the safe harbor statement. During this call, we'll make forward-looking statements relating to future performance of OpenText. These statements are based on current expectations, assumptions, and other material factors that are subject to risks and uncertainties, and actual results could differ materially from the forward-looking statements that are made today.
Additional information about the material factors that could cause actual results to differ materially from such forward-looking statements, as well as the risk factors that may impact future performance results of OpenText, are contained in our recent Forms 10-K and 10-Q, as well as the press release that was distributed yesterday afternoon, which may be found, of course, on our website. We undertake no obligation to update these forward-looking statements unless required to do so by law. In addition, our conference call may include discussions of certain non-GAAP financial measures, and reconciliations of any non-GAAP financial measures to their most directly comparable GAAP measures may be found in our public filings and other materials, which again are available on the investor section of our website. With that, I'll turn the call over to Mark.
Thank you, Greg, and welcome everyone to the start of our new fiscal 2026, and a big welcome from Waterloo. As you know, every fiscal year has its journey. For OpenText in fiscal 2025, that included completing a material divestiture of our mainframe business, a large business optimization program, the acceleration of our margin opportunity, significant new AI cloud and security innovations, and our strongest year of capital return.
As you'll hear today, fiscal 2026 is a completely different year, led by growth in a strong product cycle and a strong financial outlook that includes total revenue growth of 1%-2%, cloud growth of 3%-4%, adjusted EBITDA expansion of 50-100 basis points, free cash flow expansion of 17%-20%, and continued strong capital allocation with a dividend raise of 5% and a new $30 million share repurchase program, as well as a return to M&A. Let's get into the call. Our priorities for building a stronger and more competitive OpenText remain clear and consistent. To expand our competitive advantage through our business AI, our business clouds, and business security, our new MyAviator will bring business AI to every OpenText end user.
Deliver total revenue growth through compelling solutions, great distribution, and transformative customer success, led by our cloud growth and increasing contributions from business AI and security, as well as upper quartile operating excellence, which means continued margins and free cash flow expansion and value-creating capital allocation. Our previously announced business optimization has accelerated our margin opportunity, and our medium-term business model is about approaching the rule of 40. You are seeing the results of these clear and consistent priorities. Q4 was the first full quarter of Titanium X in the market, and we ended fiscal 2025 with strong performance, as you saw in the numbers we published yesterday. Total revenues of $1.31 billion, and we grew organically year-over-year, excluding the impact of AMC, IP rights, and DXC. Our cloud bookings surged to $238 million, or 32% year-over-year growth, all of which flows directly into cloud RPO.
Cloud revenue of $475 million, or 2% growth. License revenue of $173 million, or 77% growth, ex-AMC. Adjusted EBITDA dollars of $444 million, or 34% margin up strongly, ex-AMC. We had amazing cloud wins this quarter across banking, automotive, healthcare, biotechnology, and retail, including 43 cloud deals over $1 million. Todd will speak about these in a little more detail in a moment. For the full fiscal year 2025, total revenues of $5.17 billion, less AMC, down 3%, and less IP rights and DXC, down approximately 1%. You can see in our investor presentation a three-year trend at slide, on a reported basis to help illustrate the magnitude of the total revenues, cloud revenues, and cloud growth rates for our business. The new insights are all singularly focused on our cloud business. Cloud revenues were $1.86 billion for the year, up 2%.
I would also like to add some further color to our cloud business and revenue performance by business area. On an approximate basis, year-over-year, Cybersecurity is 30% of our cloud revenues, BN is 30%, Content 25%, OSM and DevOps 10%, and the others make up the remaining 5%. Content, OSM, and DevOps each grew faster than 10% year-over-year. BN remains constant. Cybersecurity was -4%, which we expect to return to growth this fiscal year. Please note we have rebranded our ITOM business to Observability and Service Management, or OSM, and we have renamed Application Automation, which is now DevOps. Cloud bookings were $773 million, up 10% and right in our outlook range. Total RPO up 9%. Total cloud RPO was up 13%. The total cloud position in the current cloud portion was up 8%, while the long-term portion up 17%.
Our cloud renewal rate was 96% ending Q4. Just an amazing amount of cloud expansion. Adjusted EBITDA dollars of $1.8 billion, or 34.5%, up strongly, ex-AMC. Adjusted EPS of $3.82, up strongly, ex-AMC, and free cash flows of $687 million above the high end of our range, and ending cash of $1.156 billion. For the year, we allocated a record amount of our cash, or $683 million to capital return, where we returned $272 million via dividends, and we purchased $411 million of our stock, canceling 14.5 million shares at an average price of $28.29. Let me close our fiscal 2025 with a few final thoughts. In addition to all the strength and accomplishments, and we had many, fiscal 2025 was also one of challenges. There was, of course, the unprecedented and unpredictable trade and territorial in the markets and the geopolitical forces the industry traversed.
It was also an extraordinary year of a large and global mainframe business divestiture for us and transitioning that business to the buyer, which has teamed it flawlessly. We built a lot of corporate muscle through that process. We were focused on rebuilding our margin post-divestiture, modernizing the Micro Focus platform, executing a large and strategic business optimization, delivering Titanium X, and creating an AI foundation for the future. Make no mistake, we are disappointed that the full fiscal year had negative growth. As you can see on slide 10, it is a clear exception for a very long track record of growth. We thank you for your feedback throughout this past year. We'll continue to be better communicators, and I will continue to increase the business insights we share so investors can see both the challenges and our opportunities equally, like we are doing today. Time to look forward.
Looking ahead, I am confident in the trajectory of the business. Fiscal 2026 is a different year, a different outlook, and an important period of growth that the company is entering into. Our priorities for building a stronger, more competitive OpenText remain clear, and as noted earlier, we're excited about the next wave of innovation. For business AI, with MyAviator and Aviator Studio, an agentic user platform for building digital workers, and with MyAviator, a personal digital worker for every knowledge worker to be used everywhere for anything. For our business clouds, we'll core content SaaS, new verticals like insurance, OSM and corporate help desk for employee experience. On the business technology side, our focus is on threat detection and response, SaaS identity and access management, and our new go-to-market partnership with Microsoft.
We're a portfolio company, and we expect all our businesses to perform. We can see immediate paths for outperformance this year in content security and observability and service management. Our M&A pipeline across our core BUs is building again. To reiterate, we'll consider divestitures as and when they make strategic sense to drive overall higher growth rates, optimize our business, or to return investor dollars for better returns. The organization has momentum in its focus. Let me discuss the key elements in our fiscal 2026 outlook and reported dollars in the year-over-year terms. On the macro, global customers are investing, and they are taking control of their platforms and capabilities via sovereign clouds. They are also de-risking their businesses from tariffs and trade volatilities. Customers are investing in AI, cloud, and security. Fiscal 2025 taught us to expect the unexpected curveball on tariffs and trade.
It drives you to focus on managing exceptionally well that which you control, and it's prudent to be conservative given the geopolitical and public sector trends. With that macro backdrop, our fiscal 2026 outlook with year-over-year compares to the following: total revenue growth of 1%-2% and growth in constant currency. Total cloud revenue growth of 3%-4% supported by our strong current RPO backlog. New cloud bookings growth of 12%-16%. Adjusted EBITDA margin growth of 50-100 basis points. Free cash flow growth of 17%-20%. We plan to grow our annual dividend by 5%, and further, we plan to repurchase and to purchase and retire $300 million of our stock this fiscal year. There are a few more comments I'd like to provide on our outlook.
First, cloud revenue, ARR, and cloud CRPO truly lead the future of our business and our outlook. We expect ARR to return to growth in 2026, and within that, cloud growth will outpace the maintenance business. Second, we'll make strong progress on our customer support business and expect to cut the rate of decline in half from -4% ex-AMC in fiscal 2025 to -2% in fiscal 2026, and return the business back to growth in fiscal 2027, the moment Paul will speak to our support business and the opportunity. Third, AI, SaaS, and security are well positioned to contribute more to our revenues, and we see security being a positive contributor to our growth rate this year. Todd will speak more about this in a moment. Lastly, our outlook positions the company to exceed expectations based on stronger demand, stronger adoption, stronger execution, and less macro unpredictability.
As for Q1 estimates, please remember our business is an annual business. We plan, operate, and make key decisions within the context of our annual plan. Our quarterly estimates are meant to provide short-term insights, and our quarterly estimates will vary within our annual plan. For Q1, our estimates include total revenue growth of constant to 1% and adjusted EBITDA of 35%-35.5%. I'd also like to introduce today our thoughts on where we are driving our business model over the next three years, which we call our medium-term business model. Our medium-term business model looks like this: Rule of 40 growth, delivering the combination of total revenue growth plus adjusted EBITDA margin percent to approach 40. Efficiency, continuous year-over-year improvements on margin while landing adjusted EBITDA in the mid to high 30s and balancing margin expansion with the growth investment opportunities that we see.
Thank you, Mark. It is clear that we have momentum coming out of Q4 and entering fiscal 2026. We're experiencing Mark's demand. Our worldwide commercial team is executing. Our partner ecosystem is more impactful than ever, and our pipeline is strong and growing. Mark referenced the very dynamic global economic environment. This environment is driving enterprises to double down on clear and measurable business justification before proceeding with technology investments. This environment aligns well to the specialized capabilities of our worldwide commercial team to guide our customers effectively.
We're successfully translating OpenText's Titanium X platform in a quantifiable business case value for existing and new customers, and customers are increasingly depending on us. In Q4, we had some great customer wins, including BMO, Clarins Group, HARGASSNER, Rightmove, and I'd like to walk you through several strategic wins in our business clouds to give you a sense of how we're winning against the competition. First, the OpenText Content Management Cloud. One of Europe's largest healthcare and life sciences companies chose OpenText as a key part of their SAP cloud migration project, benefiting clearly from our SAP cloud-first partnership. A large Canadian financial services firm utilized OpenText's Content Management Cloud to power its unstructured data vault in support of mission-critical business systems. One of the largest and nationally ranked U.S. hospital networks chose OpenText Observability and Service Management (OSM) in direct competition with ServiceNow.
This is a really tremendous new logo win for us. A Fortune 100 pharmaceutical and biotechnical company chose OpenText DevOps Cloud and e-signature solution over the competition to reduce regulatory and compliance risk, while also supporting their move to cloud and AI initiatives. This win continues our momentum, helping large, highly regulated enterprises build, deploy, and manage compliant applications. One of Europe's leading forensic research institutions selected OpenText's Fortify application security platform to strengthen the security of its business-critical software. This very highly competitive new logo win underscores our growing leadership in enabling secure development within high trust, high compliance public sector environments. Lastly, a top five global automotive manufacturer further scaled their dependence on OpenText Business Network Cloud to manage their treasury management and global supply chain. Many of these customer wins relied heavily on OpenText partnerships.
Our existing and new partnerships are playing an increasingly major role in our growing commercial momentum. The SAP partnership, as an example, remains strategic and continues to accelerate across co-selling, reselling, and joint engineering. The impact is contributing meaningfully to our content management cloud growth. We're excited in Q1, we've expanded this partnership to our Experience Cloud to also be resold by SAP. Our Microsoft partnership is growing, and we're now live with a launched cybersecurity threat detection and response offering. We refer to it as TDR. It's being actively sold now with and through Microsoft's ecosystem, and it integrates seamlessly with Microsoft Defender, Microsoft Entra ID, and is part of the Microsoft Security Copilot ecosystem. Our GSI partnerships are contributing to growth with larger and more strategic deals.
For example, with Capgemini, we've just launched a digital government solution to serve government agencies across our OpenText content, Experience, and Security clouds. We're also collaborating with HPE to deploy database management and information governance solutions on HPE GreenLake. For our technology and ISV partnerships, they're enabling us to bring differentiated vertical industry solutions to market. As an example, with Guidewire, we've introduced a joint solution actively targeting the worldwide insurance marketplace. We're going to continue to invest to scale further into the financial services sector with ISV ecosystem partnerships. As you've heard Mark mention, we're doubling down on sovereign cloud and sovereign AI. We're super excited to have announced our partnership recently with TELUS, offering the Canadian market a secure private cloud for information management with a trusted Canadian infrastructure provider. We continue to see growing demand and execution through our overall channel partner ecosystem.
It's helping us scale OpenText's distribution into the SMB segment, into public sector, and into emerging markets globally. Lastly, our sales marketing and partner execution, it's created a solid and growing full-year pipeline. In fact, our pipeline for license is up over 10% over prior year, and our pipeline for cloud is up nearly 30% year-over-year. We're seeing pipeline conversion rates improve, and in Q4, we delivered the highest account executive productivity we've seen in the last eight quarters. We're adding even more sales capacity now to convert our growing pipeline. Now, to summarize, I'm really, really proud and thankful for our worldwide commercial team's Q4 performance. In early July, we launched the new year with a fast start at our worldwide company and sales kickoff here in Waterloo. Our team has a ton of energy fueling fiscal 2026 execution ongoing right now.
Our partnerships are contributing substantially with growing impact, and we built a strong pipeline with a growing conversion rate, and we're adding sales capacity to start fast in fiscal 2026. Paul, over to you.
All right, thank you, Todd. It's great to be here with you and Mark and the rest of the team here in Waterloo. Today, I'll speak briefly about three areas: the highlights of the prior quarter as we close out fiscal 2025, where our team is focused to bring a stronger outcome to fiscal 2026, and what to expect for our maintenance business in the year ahead. Let's jump right in. First, Q4 was a solid quarter for the business. The OpenText renewals flywheel continues to be stable and predictable with a net renewal rate of 96% for cloud and 91% for off-cloud, improving 100 basis points quarter-over-quarter. Our core operating metrics across our recurring revenue business are positive. Past due is down, on-time renewals is up, and APA, or our annual price adjustment, is up.
In fact, we set all-time records in several of these areas and finished the year well ahead of our plan on bookings, including some very large early renewals on the cloud side as customers work to lock in pricing over the next several years. That all adds energy to the flywheel and creates momentum into fiscal 2026. Growth remains job number one for the team, and that drives a single overriding mission for the business: customer centricity. At its core, customer centricity is a business mindset and an operating model where every decision starts from a deep understanding of what creates value for the customer. It's not just about good service; it's about anticipating customer needs. It's not solving problems; it's doing this proactively and shaping our offerings to deliver outcomes. We're focused on three areas in fiscal 2026. Number one, the performance of our maintenance business through lifetime value.
Number two, expanding post-sales offerings. Number three, customer success through our love model, land, operate, value, expand. Just a few examples. For lifetime value, we reorganized our PS sales team by practice area and have them focused on Titanium X upgrades, targeting off-cloud customers several releases back to bring them current to the latest version of the products. For our love model, or land, operate, value, expand, we are in year two of our new cloud customer success offering rollout, which added incremental bookings to fiscal 2025 and contributes to cloud ARR. For post-sale, this quarter we launched advanced customer support, or ACS, which expands our portfolio of support subscription offerings and puts a new and dedicated sales team behind it to build new inflows to maintenance revenues. These are just a few of the new programs that will contribute to growth in fiscal 2026.
The customer is at the center of all this, and growth is the result for doing that consistently and doing that well. That brings me to my last point, which is what to expect for maintenance in fiscal 2026. Let me just start by reaffirming our messages from last year. We see strength and stability in the core operating metrics of our maintenance business. Excluding AMC, we ended fiscal 2025 at a decline rate of 4%. Our Q4 decline rate was 3%, a large improvement from Q3. Our outlook for fiscal 2026 is a decline of 2%, cutting that decline in half year on year. Further, and this is a key point, we expect ARR to return to growth in fiscal 2026, and within that, cloud growth will outpace the maintenance business.
We can see clearly the momentum we have in returning the maintenance business back to growth, which we expect by fiscal 2027. Our operational metrics are bright green. We have growth programs adding new revenue channels to maintenance, and as we sell new licenses, that will also add incremental maintenance revenues. Looking out further, as cloud continues to grow, it'll be an opportunity to expand this business discussion to focus more on ARR, RPO, and CRPO, inclusive of maintenance. In summary, our confidence grows stronger with our Q4 results. I see momentum in the business, and there is a lot to be excited about in the year ahead. With that, I'll hand the call over to Chad.
Thank you, Paul, and good morning. I will briefly touch on more context for Q4 results and OpenText's growth momentum into fiscal 2026. It was a great outcome at $238 million of enterprise cloud bookings in Q4, up 32.3% year-over-year, closing out fiscal 2025 within our annual target range at 10.1% total growth. Our results include full-year RPO and CRPO with year-over-year comparisons. This captures the strength of our cloud backlog. When looking at our cloud business, we think about four core metrics: cloud revenue growth, enterprise cloud bookings expansion, cloud renewal rates, as well as new cloud bookings. Cloud CRPO is a subcomponent of RPO, and it provides visibility into the current portion of cloud RPO that is committed over the next 12 months. This includes all our cloud product groups, enterprise and SMBC, new and renew, and provides greater visibility into our cloud business.
With the bookings progress for Q4 and fiscal 2026 expectations, OpenText is positioned for growth. We reported solid annual recurring revenue of approximately 81% in Q4, up approximately 20 basis points year-over-year. As you see in the table on slide 22 for Q4, cloud revenues were $475 million, up 2.1% year-over-year, representing about 36.2% of total revenue. Q4 marks 18 quarters of cloud organic growth, driven by AI readiness and strong demand for our Content Cloud. Non-GAAP cloud gross margin increased approximately 40 basis points to 63.2% year-over-year. Customer support or maintenance revenue was $581 million, and the full year closed at $2.334 billion, coming in slightly above our expectations. We are making progress here, and Q4 non-GAAP maintenance gross margin remains strong at 89.2%, up 20 basis points year-over-year. Overall, non-GAAP gross margin for Q4 was 76.2%.
We added some additional disclosures to offer deeper context to where our cloud revenue growth outperformed in fiscal 2025, particularly in content, DevOps, and Observability and Service Management. Moving towards the bottom line, we achieved a strong quarter in an overall fiscal 2025 adjusted EBITDA margin of 34.5%, 50 basis points above the top end of our target range of 33 to 34%. This was achieved with the benefit of business optimization progress, as well as higher revenue in the quarter. Last quarter, we expanded our business optimization plan. When fully implemented, we expect to generate total annualized savings of approximately $490 million-$550 million. We successfully realized approximately 35% of these savings during fiscal 2025. Our fiscal 2026 outlook captures an additional 35% of these benefits, and after reinvestment, we expect continued adjusted EBITDA margin expansion.
We've spent approximately $128 million to date, and the plan is expected to be substantially completed by the second quarter of F27, up to a total spend of approximately $260 million. In Q4, we generated $687 million of free cash flow, $37 million above our target range. In the quarter, our interest expense declined year-over-year, and again, you see the benefit of the business optimization savings here. The resilience of the OpenText operating model, revenue growth, ARR durability, and expanding margin of free cash flow provide us the flexibility to strategically deploy our capital across M&A, dividends, and share buybacks. The board of directors has approved a cash dividend of $0.275 per share for the first quarter of fiscal 2026, with a record date of September 5, 2025, payable on September 19th, 2025. We will remain strategic and flexible in our capital allocation.
Adjusted EPS was strong again in Q4 at $0.97 diluted. Reported that it's down 1% year-over-year, but adjusted EPS increased year-over-year after normalizing for the impact of the AMC divestiture. Contributing to this outcome was the benefit of repurchasing and canceling 14.5 million shares in fiscal 2025. This momentum will continue with our announcement of a new $300 million share buyback program in fiscal 2026. In closing, I'll echo my sentiment from last quarter. As an investor, this is a good time to hold and buy OpenText stock. We are leaders in information management with a large install base, loyal customers, strong core businesses and earnings profile, plus a clear return of capital strategy. I am confident in OpenText's ability to reinvest strategically in outperforming products while generating meaningful returns for investors.
I would like to thank Mark and all my OpenText colleagues for the opportunity to work with such an extraordinary group. This is an iconic Canadian company, and it's been a privilege to serve our stakeholders. With that, Rocco, can you please open the line to our equity analysts for Q&A?