ospn-20250331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

_____________________________________

FORM 10-Q

_____________________________________

(Mark One)


x			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2025


o			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

FOR THE TRANSITION PERIOD FROM _______ TO

Commission file number 000-24389

_____________________________________

OneSpan Inc.

(Exact Name of Registrant as Specified in Its Charter)

_____________________________________


Delaware			36-4169320
(State or Other Jurisdiction of Incorporation or Organization)			(I.R.S. Employer Identification No.)

1 Marina Park Drive, Unit 1410

Boston, Massachusetts 02210

(Address of Principal Executive Offices) (Zip Code)

(312) 766-4001

(Registrant’s telephone number, including area code)

_____________________________________

Securities registered pursuant to Section 12(b) of the Act:

Title of each class:

Trading Symbol

Name of each exchange on which registered:

Common Stock, par value $0.001 per share

OSPN

Nasdaq

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer ,a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

Accelerated filer

Non-accelerated filer

Emerging growth company

Smaller reporting company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). o Yes x No

There were 38,230,467 shares of Common Stock, $0.001 par value per share, outstanding at April 24, 2025.

Table of Contents

OneSpan Inc.

Form 10-Q

For the Quarter Ended March 31, 2025

Table of Contents


PART I. FINANCIAL INFORMATION

Item 1.	Condensed Consolidated Financial Statements (Unaudited)

	Condensed Consolidated Balance Sheets as of March 3 1 , 202 5 and December 31, 202 4	3

	Condensed Consolidated Statements of Operations for the Three Months Ended March 31, 2025 and 2024	4

	Condensed Consolidated Statements of Comprehensive Income for the Three Months Ended March 3 1 , 202 5 and 202 4	5

	Condensed Consolidated Statements of Stockholders’ Equity for the Three Months Ended March 3 1 , 202 5 and 202 4	6

	Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 3 1 , 202 5 and 202 4	7

	Notes to Condensed Consolidated Financial Statements	8

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	33

Item 4.	Controls and Procedures	34

PART II. OTHER INFORMATION

Item 1.	Legal Proceedings	34

Item 1A.	Risk Factors	34

Item 2.	Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities	34

Item 6.	Exhibits	36

SIGNATURES		37

Table of Contents

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited)

OneSpan Inc.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except par value)

(Unaudited)


	March 31,		December 31,
	2025		2024
ASSETS
Current assets
Cash and cash equivalents	$	105,211	$	83,160

Accounts receivable, net of allowances of $1,147 at March 31, 2025 and $1,600 at December 31, 2024	29,595		56,229
Inventories, net	11,028		10,792
Prepaid expenses	6,327		6,547
Contract assets	10,587		8,687
Other current assets	7,811		9,479
Total current assets	170,559		174,894
Property and equipment, net	21,105		20,966
Operating lease right-of-use assets	7,865		7,725
Goodwill	94,200		92,365
Intangible assets, net of accumulated amortization	6,923		7,481
Deferred income taxes	20,573		20,516

Other assets	12,585		14,787
Total assets	$	333,810	$	338,734
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable	$	12,005	$	13,310
Deferred revenue	51,850		67,465
Accrued wages and payroll taxes	9,540		13,793
Short-term income taxes payable	6,166		4,403
Dividend payable	193		4,765
Other accrued expenses	7,263		6,339
Deferred compensation	19		200
Total current liabilities	87,036		110,275
Long-term deferred revenue	2,933		3,390
Long-term lease liabilities	6,908		6,932

Deferred income taxes	3,771		3,680
Other long-term liabilities	2,043		1,927
Total liabilities	102,691		126,204
Commitments and contingencies
Stockholders' equity
Preferred stock: 500 shares authorized, none issued and outstanding at March 31, 2025 and December 31, 2024	—		—
Common stock: $0.001 par value per share, 75,000 shares authorized; 41,881 and 41,782 shares issued; 38,157 and 38,058 shares outstanding at March 31, 2025 and December 31, 2024, respectively	38		38
Additional paid-in capital	123,983		122,534
Treasury stock, at cost: 3,724 shares outstanding at March 31, 2025 and December 31, 2024	(47,380)		(47,380)
Retained earnings	165,746		151,256
Accumulated other comprehensive loss	(11,268)		(13,918)
Total stockholders' equity	231,119		212,530
Total liabilities and stockholders' equity	$	333,810	$	338,734

See accompanying notes to condensed consolidated financial statements.

Table of Contents

OneSpan Inc.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

(Unaudited)


	Three Months Ended March 31,
	2025		2024
Revenue
Product and license	$	37,240	$	37,798
Services and other	26,126		27,045
Total revenue	63,366		64,843

Cost of goods sold
Product and license	8,718		9,706
Services and other	7,557		7,742
Total cost of goods sold	16,275		17,448

Gross profit	47,091		47,395

Operating costs
Sales and marketing	11,457		12,927
Research and development	7,928		8,259
General and administrative	9,547		10,007
Restructuring and other related charges	421		1,497
Amortization of intangible assets	556		595

Total operating costs	29,909		33,285

Operating income	17,182		14,110

Interest income, net	692		101
Other income (expense), net	(9)		291

Income before income taxes	17,865		14,502
Provision for income taxes	3,360		1,034

Net income	$	14,505	$	13,468

Net income per share
Basic	$	0.38	$	0.35
Diluted	$	0.37	$	0.35

Weighted average common shares outstanding
Basic	38,106		38,060
Diluted	39,027		38,463

See accompanying notes to condensed consolidated financial statements.

Table of Contents

OneSpan Inc.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands)

(Unaudited)


	Three Months Ended March 31,
	2025		2024
Net income	$	14,505	$	13,468
Other comprehensive income (loss)
Cumulative translation adjustment, net of tax	2,674		(1,655)
Pension adjustment, net of tax	(24)		(30)

Comprehensive income	$	17,155	$	11,783

See accompanying notes to condensed consolidated financial statements.

Table of Contents

OneSpan Inc.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(In thousands)

(Unaudited)

For the Three Months Ended March 31, 2025:


Description	Common Stock			Treasury - Common Stock			Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Total Stockholders' Equity
	Shares	Amount		Shares	Amount

























Balance at December 31, 2024	38,058	$	38	3,724	$	(47,380)	$	122,534	$	151,256	$	(13,918)	$	212,530
Net income	—	—		—	—		—		14,505		—		14,505
Foreign currency translation adjustment, net of tax	—	—		—	—		—		—		2,674		2,674
Stock-based compensation	—	—		—	—		2,776		—		—		2,776
Vesting of restricted stock awards	179	—		—	—		—		—		—		—
Tax payments for stock issuances	(80)	—		—	—		(1,327)		—		—		(1,327)


Dividends declared ($0.12 per share)	—	—		—	—		—		(15)		—		(15)
Pension adjustment, net of tax	—	—		—	—		—		—		(24)		(24)
Balance at March 31, 2025	38,157	$	38	3,724	$	(47,380)	$	123,983	$	165,746	$	(11,268)	$	231,119

For the Three Months Ended March 31, 2024:


Description	Common Stock			Treasury - Common Stock			Additional Paid-In Capital		Retained Earnings		Accumulated Other Comprehensive Income (Loss)		Total Stockholders' Equity
	Shares	Amount		Shares	Amount

























Balance at December 31, 2023	37,519	$	38	3,724	$	(47,377)	$	118,620	$	98,939	$	(11,079)	$	159,141
Net income	—	—		—	—		—		13,468		—		13,468
Foreign currency translation adjustment, net of tax	—	—		—	—		—		—		(1,655)		(1,655)
Stock-based compensation	—	—		—	—		1,540		—		—		1,540
Vesting of restricted stock awards	402	—		—	—		—		—		—		—
Tax payments for stock issuances	(153)	—		—	—		(1,595)		—		—		(1,595)


Pension adjustment, net of tax	—	—		—	—		—		—		(30)		(30)
Balance at March 31, 2024	37,768	$	38	3,724	$	(47,377)	$	118,565	$	112,407	$	(12,764)	$	170,869

See accompanying notes to condensed consolidated financial statements.

Table of Contents

OneSpan Inc.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)


	Three Months Ended March 31,
	2025		2024
Cash flows from operating activities:
Net income	$	14,505	$

SEC Form 10-Q filed by OneSpan Inc.