- **Revenue recovery**: Q1 subscription revenue growth of 1.1% YoY marks return to growth after multi-year decline.
- **AI innovation driving differentiation**: Generative AI tools for transportation/logistics highlight strategic investment in next-gen capabilities.
- **Strategic acquisition**: Pending WiseTech merger positions E2open to become part of global supply chain OS, with closing expected by end-2025.
- **Financial stability**: Strong cash generation ($48M Q1) and cautious FY '26 guidance reflecting cautious outlook despite acquisition.

**【CEO Summary Section】**
- **Return to growth**: Achieved first year-over-year subscription revenue growth since mid-FY '24, driven by improved client retention and product innovation.
- **Client retention focus**: Shifted from short-term gains to long-term partnerships, stabilizing the business.
- **AI and product innovation**: Launched generative AI tools for transportation and trade solutions, with more products planned for FY '26.
- **Pending WiseTech acquisition**: Expected to close by end-2025, combining E2open's supply chain suite with WiseTech's logistics expertise. New entity will serve full value chain from sourcing to end customer.
- **Employee and customer value**: WiseTech acquiring E2open for its product suite, employee expertise, and customer base; E2open team remains focused on execution until close.

**【CFO Financial Commentary】**
- **Q1 FY '26 Results**:
  - Subscription revenue: $132.9M (+1.1% YoY), above guidance range
  - Total revenue: $152.6M (+1.0% YoY)
  - Adjusted EBITDA: $52.2M (34.2% margin, +0.6ppt YoY)
  - Cash flow: $48.0M, ending Q1 with $230.2M cash
- **Gross margin**: 67.1% (-0.7ppt YoY) due to lower PS margins, but expects improvement in FY '26
- **Full Year FY '26 Guidance**:
  - Subscription revenue: $525-535M (-1.0% to +1.0% YoY)
  - Total revenue: $600-618M (-1.3% to +1.7% YoY)
  - Gross margin: 68.0-68.5%
  - Adjusted EBITDA: $200-210M (33-34% margin)
  - Cash flow as % of EBITDA: ~FY '25 levels

E2open Parent Holdings, Inc. (ETWO) Q1 2026 Earnings Call Transcript

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