nCino (NASDAQ: $NCNO), a cloud banking platform that helps financial firms modernize, and streamline their operations, released its Q4 fiscal 2025 results, on April 1, 2025, after markets closed. Here is a deep dive in the results.
nCino Releases Q425 Results
For the fourth quarter of fiscal 2025, nCino reported revenue of $141.4 million, a 14% YoY increase. Beating estimates of $140.62 million. Q4 EPS came in at $0.12, missing estimates of $0.18, on a non-GAAP net income of $13.9 million, compared to $23.8 million the previous year.
Non-GAAP operating income for Q4 was $24.4 million, compared to $19.3 million the previous year, a 26% YoY increase. The company reported a 16% YoY increase in Q4 subscription revenue to $125 million.
Q4 non-GAAP gross margin was 66%, same as last year, while the non-GAAP operating margin was 17%, compared to 16% the previous year. nCino ended the quarter with free cash flow of negative $10.37 million, compared to positive free cash flow of $7.72 million the previous year.
At the end of Q4, it had $121.3 million in cash, cash equivalents, and restricted cash, and $166 million under its revolving credit facility.
Full-Year Highlights
nCino reported revenue of $540.7 million in fiscal 2025, a 13% YoY increase, while subscription revenue increased 15% YoY to $469.2 million.
Full-year non-GAAP operating income increased 56% YoY to $96.2 million, while the FY25 non-GAAP net income came in at $76.1 million, compared to $58.0 million the previous year. It reported a non-GAAP EPS of $0.65, compared to $0.50 the previous year.
The non-GAAP gross margin was 66%, same as last year, while the non-GAAP gross operating margin was 18%, compared to 13% the previous year. nCino ended the quarter with free cash flow of $53.38 million, compared to $53.77 million the previous year.
nCino reported an Annual Contract Value (ACV) of $516.4 million at the end of the fiscal year, a 13% YoY increase. According to nCino, ACV is the highest annualized subscription fee obligation under customer contracts at the end of a specified reporting period.
nCino Guidance
For the first quarter of fiscal 2026, nCino expects revenue of $138.75 million to $140.75 million, below estimates of $145.59 million. It is expecting a non-GAAP EPS of $0.15 to $0.16, below estimates of $0.21. The company expects subscription revenue of $121.75 million to $123.75 million, and a non-GAAP operating income of $22.5 million to $24.5 million.
For the full year, it expects revenue of $574.5 million to $578.5 million, below estimates of $616.92 million. Non-GAAP EPS is expected to be $0.66 to $0.69, below estimates of $0.87. nCino forecasts FY26 subscription revenue of $503 million to $507 million, and a non-GAAP operating income of $107 million to $11 million. It expects an Annual Contract Value (ACV) of $564 million to $567 million.
Earnings Call Highlights
Commenting on the results, Sena Desmond, nCino CEO emphasized the company’s commitment to AI, stating, “We are marshaling the energy of the company to capitalize on the vertical AI opportunity.” Greg Orenstein, the CFO stated that, “revenue growth is a lagging indicator of bookings,” which signals confidence in the company’s future results.
NCNO Market Performance
Following the mixed Q4 results, and guidance miss, NCNO shares nosedived 32.75% to $18.91 in premarket trading on April 2, 2025 as of 8:00 AM in New York.
Based on the last closing price of $28.12, NCNO shares are down 16.26% YTD, and 9.61% in the past six months. Over the past year, the stock has dipped 20.45%. Its last closing price is below both its 50, and 200-day moving average of $31.20, and $33.41, respectively. Short sellers hold 20.60% of the float, and 9.75% of the shares outstanding.
Analysts are cautiously optimistic, giving the stock a moderate buy rating. They forecast an average price target of $40.75, which is a 44.91% upside based on the last closing price of $28.12. The analysts provide a wide range of forecasts, with a high of $45, and a low of $35.
Is NCNO A Buy In 2025?
nCino’s recent earnings report has gotten many investors scared. However, looking at a bigger picture, nCino represents a great entry point into the budding AI industry, thanks to its relatively small market cap compared to other mature stocks in the sector. nCino’s management has made a commitment to AI, which could lead to some positive impact on its stock in the long term. Consequently, NCNO could potentially present a low entry point for investors looking for AI exposure.
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