Verint Systems shares soar as AI drives strong Q3 earnings and revenue growth

Verint Systems, a leader in customer experience automation, saw its shares surge by 28% to $33.12 in early trading after the company reported stellar third-quarter results. The rise reflects strong investor confidence in Verint’s AI-powered solutions, which played a pivotal role in exceeding Wall Street expectations.

Verint’s impressive Q3 performance

For the quarter ending October 31, Verint posted a profit of $24.7 million, or 39 cents per share, significantly higher than the $7.4 million, or 12 cents per share, reported in the same period last year. Adjusted earnings reached 54 cents per share, outperforming analyst estimates of 43 cents, as per FactSet data. Revenue climbed 3% year-over-year to $224.2 million, beating forecasts of $210.1 million. Adjusted for the sale of its quality-managed services business earlier this year, revenue growth was closer to 5%.

Chief Executive Dan Bodner attributed the results to strong demand for AI business outcomes and a growing reliance on bundled software-as-a-service (SaaS revenue growth) solutions, which saw 19% year-over-year growth. Bodner explained that Verint’s hybrid cloud platform and open platform capabilities allow businesses to implement AI-powered solutions effectively, resulting in rapid, tangible results.

AI innovation at the core

Verint has been steadily enhancing its portfolio of AI-powered solutions, which played a crucial role in driving its Q3 momentum. The latest addition, the CX/EX Scoring Bot, was designed to offer real-time insights into customer and employee experiences, replacing traditional survey-based metrics. By leveraging proprietary AI models, the tool provides actionable data that improves customer satisfaction improvement, reduces churn, and enhances contact center efficiency.

According to Josh Feast, general manager of Verint’s AI-powered coaching division, the new bot empowers organisations to measure and improve experiences in real time, a capability he described as a “game changer.” Early adopters in the hospitality sector have already reported significant customer satisfaction improvements and employee engagement, reinforcing Verint’s reputation as a leader in customer experience automation.

Steady outlook for fiscal 2025

Verint reaffirmed its fiscal 2025 guidance, forecasting revenue of approximately $933 million, representing a 5% year-over-year increase when adjusted for divestitures. Non-GAAP earnings are projected to hit $2.90 per share, a 6% improvement compared to last year.

CFO Grant Highlander highlighted that the company’s success stems from early renewal revenues, which contributed to its Q3 overperformance. Highlander noted that Verint’s focus on recurring revenue streams, particularly SaaS revenue growth, continues to drive gross margin expansion, which rose by 70 basis points year-over-year in the quarter.

Investor focus on AI and future growth

Looking ahead, Verint’s upcoming investor day on January 14, 2025, will shed more light on its long-term strategy for monetising AI. Bodner hinted that the event would showcase Verint’s differentiation in the AI market, featuring testimonials from customers who have achieved tangible AI business outcomes using the company’s technology.

The investor day will also include updates on Verint’s financial model and guidance for fiscal 2026, providing deeper insights into how the company plans to sustain its SaaS revenue growth and leverage AI-powered solutions for broader adoption.

Verint’s competitive edge in AI

As businesses increasingly prioritise AI-driven solutions, Verint’s investments in proprietary AI models and SaaS offerings position it strongly in a competitive landscape. Its ability to deliver measurable outcomes for clients underscores its relevance in the fast-evolving customer experience automation and hybrid cloud platform markets.