Key Highlights

  • Revenue rose 12% to $63.9 million in the third quarter, from $57.1 million a year earlier.
  • Net income was $7.8 million, or $0.20 per diluted share, compared with $6.5 million, or $0.17.
  • Gross Margin reached 76%, up from 74% in the prior year quarter.
  • Annual recurring Revenue was $195.5 million at September 30, 2026, up 9% year over year.
  • Cash and cash equivalents were $51.4 million, and a $5.0 million revolver balance was repaid on October 6, 2026.

Revenue growth of 12% comes from both segments

OneSpan (NASDAQ:OSPN) sells identity, authentication and mobile app security products alongside electronic signature and identity verification tools, and says more than 60% of the world's 100 largest banks use its offerings. It disclosed third quarter 2026 results in its Quarterly Report for the period ended September 30, 2026.

Total revenue increased by $6.8 million, or 12%, to $63.9 million. Cybersecurity revenue rose about 11% to $44.9 million, while Digital Agreements revenue rose 14% to $19.0 million, helped by overage usage fees, customer expansions and new logos.

Subscription mix and a shift to multi-year contracts shape Cybersecurity

Cybersecurity subscription revenue rose to $32.5 million from $27.7 million, driven by customer expansions, new logos, revenue from the Build38 Acquisition and past-due renewal catch-up.

Perpetual maintenance and services revenue in the segment fell to $1.9 million from $2.9 million as contracts moved to term arrangements. A shift of certain customers from single-year to multi-year on-premises term contracts added $2.3 million to year over year revenue, because license revenue is generally recognized upfront.

Annual Recurring Revenue was $195.5 million, against $180.2 million a year earlier, and net retention rate was 105%, up from 103%.

Gross margin widens to 76% and Operating Income reaches $9.2 million

Gross profit rose $6.7 million, or 16%, to $48.7 million. Product and license gross margin improved to 81% from 75%, while services and other margin eased to 72% from 73%.

Operating income was $9.2 million, compared with $8.2 million.

Adjusted EBITDA, a non-GAAP measure the company reconciles in the filing, was $19.3 million versus $17.5 million, which is a margin of about 30.1% on a calculated basis.

Nine-month results show a slower year to date picture

For the nine months ended September 30, 2026, revenue increased 6% to $190.3 million from $180.3 million. Net Income was $26.1 million, or $0.68 per diluted share, compared with $29.4 million, or $0.76, a year earlier, and adjusted EBITDA was $57.2 million versus $58.2 million.

Digital Agreements revenue rose 17% to $55.9 million over the period, while Cybersecurity revenue rose about 2% to $134.4 million. The company completed its acquisition of Build38 in February 2026, and said both segments were profitable for the three and nine month periods.

Cash, Buybacks and the Dividend frame the Capital position

Cash and cash equivalents were $51.4 million at September 30, 2026, down from $70.5 million at December 31, 2025. Operating Cash Flow for the nine months was $44.6 million, compared with $46.9 million.

OneSpan paid a quarterly dividend of $0.13 per share during the quarter. Under a repurchase program adopted in May 2026, it bought back 0.2 million shares for $2.9 million, with about $47.1 million remaining available as of September 30, 2026.

Readers tracking the name will likely follow whether subscription growth and annual recurring revenue keep compounding, how Build38 contributes, and whether the multi-year contract shift continues to lift reported revenue.