Oct 29, 2026 earnings call — DigipassONE launch and Q3 results
Q3 revenue was $63.9 million, up 12%, with subscription revenue growing 16% to $51.5 million.
Revenue $0.1B (est $0.1B) · EPS $0.35 (est $0.24) · Next-quarter revenue outlook $0.3B–$0.3B
Key quotes
"In July, we launched the DigipassONE platform in our Cybersecurity business."
"During the third quarter, a major banking customer of our Digital Agreements business meaningfully expanded its contract in both term and in size, moving from overages under the previous contract into a multiyear contract that will support their continued growth and utilization of OneSpan Sign."
"Since the beginning of last year, we have returned $55 million or just under $1.50 per share to our shareholders through dividends and share repurchases."
Analyst Q&A 5
hardware demand and FIDO2 tokens
Q (Erik Suppiger · B. Riley): He asked whether hardware sales are now sustainable and if FIDO2 tokens can offset declines in legacy hardware.
A: Management said the hardware business looks more sustainable and guidance implies being down just a few percent from last year. They expect FIDO2 security keys to contribute increasingly in '27 and after. They also said FIDO2 is picking up speed, but through the first 3 quarters business was still mostly older banking tokens.
"So we used to talk about hardware saying if we could just offset the decline and be flattish, it would really improve our business." — Victor Limongelli (CEO)
cybersecurity business and DigipassONE timing
Q (Gray Powell · U.S. Bank BTIG): He asked if the cybersecurity business is now in a good spot and whether Q3's improvement should persist going forward.
A: They said they feel better about the cybersecurity business than 6 or 12 months ago, but they will not give 2027 guidance yet. The DigipassONE launch helps customer conversations and GRR, but 2 of 4 components are not released yet; Verify is expected in Q1 and Insights later, so there is opportunity to drive faster growth.
"So the -- again, we're not going to give 2027 guidance, but we do feel better about the business than we did 6 months ago, 12 months ago." — Victor Limongelli (CEO)
net new ARR drivers and outlook
Q (Rudy Kessinger · D.A. Davidson): He wanted detail on how broad the net new ARR was, what products drove it, mix of new logos vs expansions, and whether $5M+ net new ARR quarters can become the norm (e.g., in 2027).
A: They said the $5.8 million net new ARR was largely driven by existing, legacy products (licenses, on-prem, OCA) with a small contribution from new partners like Build38 and ThreatFabric. ARR growth primarily came from expansion of existing customers across regions, and bookings were strong across many geographies. On 2027, they declined to give guidance, noted new products take time to drive revenue because large-bank sales cycles are long, but they feel the trajectory is positive.
"So no, look, I think we're very proud of the metric going back to 8.5% of ARR and net new ARR to your point, $5.8 million for this quarter." — Jorge Martell (CFO)
Q4 ARR and source of growth
Q (Anja Soderstrom · Sidoti): She asked if the slower ARR growth in Q4 reflects seasonality and asked to split growth between existing customers and new logos.
A: They said the guide midpoint of 199 implies 6.5% year-over-year growth and that two large churns from before the acquisition will continue to affect results for the next couple quarters and are already factored into guidance. Most ARR growth still comes from expansion of existing customers, especially in security, while Digital Agreements gets a higher new-logo mix (about 20% to 30% of ARR growth) and they are running initiatives to increase new-logo contribution.
"So when you look at the guide that we put in, so 199 at the midpoint, so that implies a 6.5% year-over-year growth." — Victor Limongelli (CEO)
passkeys vs hardware and AI feature pricing
Q (Catharine Trebnick · Rosenblatt Securities): She asked if passkeys will cannibalize Digipass hardware or if a hybrid model preserves revenue, and whether AI features in Digital Agreements are priced separately.
A: They said customers will use a mix of methods: passkeys are modern, safe and convenient, but hardware authentication remains common in corporate use and varies by geography. Hardware is much more prevalent in Europe and APAC and less so in North America. For Digital Agreements, they've bundled AI capabilities to date to differentiate the product and said future pricing for enhancements is TBD.
"Hardware is much more prevalent in Europe and in APAC and much less so in North America, for example." — Victor Limongelli (CEO)