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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

______________________

FORM 10-Q

______________________


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

For the quarterly period ended December 31, 2025


☐			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: 0-27544

______________________________________

OPEN TEXT CORPORATION

(Exact name of Registrant as specified in its charter)

______________________


Canada			98-0154400
(State or other jurisdiction of incorporation or organization)			(IRS Employer Identification No.)

275 Frank Tompa Drive,

N2L 0A1

Waterloo,

Ontario

Canada

(Address of principal executive offices)

(Zip code)

Registrant’s telephone number, including area code: (519) 888-7111

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


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock without par value	OTEX	NASDAQ Global Select Market

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 ☒ No ☐

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 ☒ No ☐

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 the 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 ☐ Smaller reporting company ☐ Emerging growth 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. ☐

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

At January 30, 2026, there were 250,602,777 outstanding Common Shares of the registrant.

OPEN TEXT CORPORATION

TABLE OF CONTENTS


		Page
Part I—Financial Information
Item 1.	Financial Statements
	Condensed Consolidated Balance Sheets	3
	Condensed Consolidated Statements of Income	4
	Condensed Consolidated Statements of Comprehensive Income	5
	Condensed Consolidated Statements of Shareholders’ Equity	6
	Condensed Consolidated Statements of Cash Flows	8
	Notes to Condensed Consolidated Financial Statements	10
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	41
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	71
Item 4.	Controls and Procedures	72
Part II—Other Information
Item 1A.	Risk Factors	73
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	73
Item 5.	Other Information	73
Item 6.	Exhibits	74
Signatures		75

Table of Contents

Part I - Financial Information

Item 1. Financial Statements

OPEN TEXT CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands of U.S. dollars, except share data)


	December 31, 2025		June 30, 2025
ASSETS	(Unaudited)
Cash and cash equivalents	$	1,271,374	$	1,156,496
Accounts receivable trade, net of allowance for credit losses of $15,116 as of December 31, 2025 and $14,258 as of June 30, 2025	665,617		659,675
Contract assets (Note 3)	73,965		77,920
Income taxes recoverable (Note 13)	38,583		108,792
Prepaid expenses and other current assets (Note 7)	186,383		198,575
Assets held for sale (Note 17)	116,105		—
Total current assets	2,352,027		2,201,458
Property and equipment, net of accumulated depreciation of $727,520 as of December 31, 2025 and $835,324 as of June 30, 2025	389,366		375,252
Operating lease right of use assets (Note 4)	156,402		197,977
Long-term contract assets (Note 3)	55,133		49,293
Goodwill (Note 5)	7,433,913		7,517,463
Acquired intangible assets (Note 6)	1,729,983		1,976,591
Deferred tax assets (Note 13)	1,071,236		1,080,575
Other assets (Note 7)	308,115		307,693
Long-term income taxes recoverable (Note 13)	73,987		67,762

Total assets	$	13,570,162	$	13,774,064
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable and accrued liabilities (Note 8)	$	929,508	$	1,026,583
Current portion of long-term debt (Note 9)	35,850		35,850
Operating lease liabilities (Note 4)	66,600		75,914
Deferred revenues (Note 3)	1,456,883		1,515,382
Income taxes payable (Note 13)	2,804		93,325
Liabilities held for sale (Note 17)	13,019		—
Total current liabilities	2,504,664		2,747,054
Long-term liabilities:
Accrued liabilities (Note 8)	41,214		42,312
Pension liability, net (Note 10)	132,511		132,215
Long-term debt (Note 9)	6,335,758		6,342,071
Long-term operating lease liabilities (Note 4)	155,217		189,949
Long-term deferred revenues (Note 3)	165,191		168,757
Long-term income taxes payable (Note 13)	68,654		79,604
Deferred tax liabilities (Note 13)	121,559		141,514

Total long-term liabilities	7,020,104		7,096,422
Shareholders’ equity:
Share capital and additional paid-in capital (Note 11)
251,676,295 and 254,784,391 Common Shares issued and outstanding at December 31, 2025 and June 30, 2025, respectively; authorized Common Shares: unlimited	2,183,939		2,193,985
Accumulated other comprehensive income (loss) (Note 19)	(38,432)		(67,067)
Retained earnings	1,971,950		1,940,113
Treasury stock, at cost (2,584,014 and 4,648,036 shares at December 31, 2025 and June 30, 2025, respectively)	(73,863)		(138,164)
Total OpenText shareholders’ equity	4,043,594		3,928,867
Non-controlling interests	1,800		1,721
Total shareholders’ equity	4,045,394		3,930,588
Total liabilities and shareholders’ equity	$	13,570,162	$	13,774,064

Guarantees and contingencies (Note 12)

Related party transactions (Note 23)

Subsequent events (Note 24)

See accompanying Notes to Condensed Consolidated Financial Statements.

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OPEN TEXT CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(In thousands of U.S. dollars and shares, except per share data)

(Unaudited)


	Three Months Ended December 31,				Six Months Ended December 31,
	2025		2024		2025		2024
Revenues (Note 3):
Cloud services and subscriptions	$	478,084	$	462,306	$	962,593	$	919,330
Customer support	581,921		590,595		1,168,766		1,186,085
License	184,227		188,923		318,775		314,736
Professional service and other	82,504		92,676		164,737		183,354
Total revenues	1,326,736		1,334,500		2,614,871		2,603,505
Cost of revenues:
Cloud services and subscriptions	170,252		172,288		342,469		347,545
Customer support	58,497		62,656		122,561		125,230
License	9,046		6,336		16,142		12,993
Professional service and other	62,537		68,041		125,575		134,956
Amortization of acquired technology-based intangible assets (Note 6)	44,204		47,203		88,408		94,447
Total cost of revenues	344,536		356,524		695,155		715,171
Gross profit	982,200		977,976		1,919,716		1,888,334
Operating expenses:
Research and development	158,309		180,727		327,437		371,420
Sales and marketing	287,995		273,929		545,050		519,811
General and administrative	110,111		99,356		215,874		206,086
Depreciation	35,267		31,879		71,188		64,050
Amortization of acquired customer-based intangible assets (Note 6)	78,645		81,048		158,206		162,552
Special charges (recoveries) (Note 16)	20,118		15,238		40,257		62,374
Total operating expenses	690,445		682,177		1,358,012		1,386,293
Income from operations	291,755		295,799		561,704		502,041
Other income (expense), net (Note 21)	2,932		68,615		(44)		32,960
Interest and other related expense, net	(79,227)		(83,615)		(160,341)		(167,897)
Income before income taxes	215,460		280,799		401,319		367,104
Provision for income taxes (Note 13)	47,334		50,893		86,533		52,776
Net income	$	168,126	$	229,906	$	314,786	$	314,328
Net (income) attributable to non-controlling interests	(35)		(44)		(79)		(98)
Net income attributable to OpenText	$	168,091	$	229,862	$	314,707	$	314,230
Earnings per share—basic attributable to OpenText (Note 22)	$	0.67	$	0.87	$	1.24	$	1.18
Earnings per share—diluted attributable to OpenText (Note 22)	$	0.66	$	0.87	$	1.24	$	1.18
Weighted average number of Common Shares outstanding—basic	251,983		265,099		252,814		266,252
Weighted average number of Common Shares outstanding—diluted	253,733		265,193		253,406		266,505

See accompanying Notes to Condensed Consolidated Financial Statements.

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OPEN TEXT CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands of U.S. dollars)

(Unaudited)


	Three Months Ended December 31,				Six Months Ended December 31,
	2025		2024		2025		2024
Net income	$	168,126	$	229,906	$	314,786	$	314,328
Other comprehensive income (loss)—net of tax:
Net foreign currency translation adjustments	6,843		1,167		29,020		(4,023)
Unrealized gain (loss) on cash flow hedges:
Unrealized gain (loss)—net of tax (1)	668		(4,188)		(1,007)		(3,534)
(Gain) loss reclassified into net income—net of tax (2)	45		1,010		(67)		1,272
Unrealized gain (loss) on available-for-sale financial assets:
Unrealized gain (loss)—net of tax (3)	510		436		671		684
Actuarial gain (loss) relating to defined benefit pension plans:
Actuarial gain (loss)—net of tax (4)	—		—		—		(1,045)
Amortization of actuarial (gain) loss into net income—net of tax (5)	13		252		18		486
Total other comprehensive income (loss), net	8,079		(1,323)		28,635		(6,160)
Total comprehensive income	176,205		228,583		343,421		308,168
Comprehensive income attributable to non-controlling interests	(35)		(44)		(79)		(98)
Total comprehensive income attributable to OpenText	$	176,170	$	228,539	$	343,342	$	308,070

______________________

(1)Net of tax expense (recovery) of $241 and $(1,510) for the three months ended December 31, 2025 and 2024, respectively; $(363) and $(1,274) for the six months ended December 31, 2025 and 2024, respectively.

(2)Net of tax expense (recovery) of $16 and $364 for the three months ended December 31, 2025 and 2024, respectively; $(25) and $458 for the six months ended December 31, 2025 and 2024, respectively.

(3)Net of tax expense (recovery) of $243 and $18 for the three months ended December 31, 2025 and 2024, respectively; $309 and $225 for the six months ended December 31, 2025 and 2024, respectively.

(4)Net of tax expense (recovery) of $— and $— for the three months ended December 31, 2025 and 2024, respectively; $— and $(43) for the six months ended December 31, 2025 and 2024, respectively.

(5)Net of tax expense (recovery) of $(21) and $92 for the three months ended December 31, 2025 and 2024, respectively; $(17) and $184 for the six months ended December 31, 2025 and 2024, respectively.

See accompanying Notes to Condensed Consolidated Financial Statements.

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OPEN TEXT CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

(In thousands of U.S. dollars and shares)

(Unaudited)


	Three Months Ended December 31, 2025
	Common Shares and Additional Paid in Capital			Treasury Stock			Retained Earnings		Accumulated Other Comprehensive Income		Non-Controlling Interests		Total
	Shares	Amount		Shares	Amount
Balance as of September 30, 2025	251,964	$	2,189,340	(4,452)	$	(130,561)	$	1,938,716	$	(46,511)	$	1,765	$	3,952,749
Issuance of Common Shares
Under employee stock option plans	857	26,746		—	—		—		—		—		26,746
Under employee stock purchase plans	245	7,826		—	—		—		—		—		7,826
Share-based compensation	—	21,119		—	—		—		—		—		21,119

Issuance of treasury stock	—	(51,375)		1,868	56,698		—		—		—		5,323
Repurchase of Common Shares	(1,390)	(9,717)		—	—		(65,455)		—		—		(75,172)
Dividends declared ($0.275 per Common Share)	—	—		—	—		(69,402)		—		—		(69,402)
Other comprehensive income (loss) - net	—	—		—	—		—		8,079		—		8,079

Net income for the period	—	—		—	—		168,091		—		35		168,126
Balance as of December 31, 2025	251,676	$	2,183,939	(2,584)	$	(73,863)	$	1,971,950	$	(38,432)	$	1,800	$	4,045,394


	Three Months Ended December 31, 2024
	Common Shares and Additional Paid in Capital			Treasury Stock			Retained Earnings		Accumulated Other Comprehensive Income		Non-Controlling Interests		Total
	Shares	Amount		Shares	Amount
Balance as of September 30, 2024	265,546	$	2,290,191	(3,900)	$	(145,646)	$	2,065,221	$	(74,456)	$	1,577	$	4,136,887
Issuance of Common Shares
Under employee stock option plans	65	1,739		—	—		—		—		—		1,739
Under employee stock purchase plans	330	9,308		—	—		—		—		—		9,308
Share-based compensation	—	30,355		—	—		—		—		—		30,355
Purchase of treasury stock	—	—		(1,363)	(40,013)		—		—		—		(40,013)
Issuance of treasury stock	—	(39,906)		1,037	41,227		—		—		—		1,321
Repurchase of Common Shares	(2,213)	(16,104)		—	—		(50,990)		—		—		(67,094)
Dividends declared ($0.2625 per Common Share)	—	—		—	—		(69,579)		—		—		(69,579)
Other comprehensive income (loss) - net	—	—		—	—		—		(1,323)		—		(1,323)
Net income for the period	—	—		—	—		229,862		—		44		229,906
Balance as of December 31, 2024	263,728	$	2,275,583	(4,226)	$	(144,432)	$	2,174,514	$	(75,779)	$	1,621	$	4,231,507

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OPEN TEXT CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

(In thousands of U.S. dollars and shares)

(unaudited)


	Six Months Ended December 31, 2025
	Common Shares and Additional Paid in Capital			Treasury Stock			Retained Earnings		Accumulated Other Comprehensive Income		Non-Controlling Interests		Total
	Shares	Amount		Shares	Amount
Balance as of June 30, 2025	254,784	$	2,193,985	(4,648)	$	(138,164)	$	1,940,113	$	(67,067)	$	1,721	$	3,930,588
Issuance of Common Shares
Under employee stock option plans	882	27,301		—	—		—		—		—		27,301
Under employee stock purchase plans	556	15,422		—	—		—		—		—		15,422
Share-based compensation	—	38,800		—	—		—		—		—		38,800

Issuance of treasury stock	—	(58,777)		2,064	64,301		—		—		—		5,524
Repurchase of Common Shares	(4,546)	(32,792)		—	—		(144,103)		—		—		(176,895)
Dividends declared ($0.55 per Common Share)	—	—		—	—		(138,767)		—		—		(138,767)
Other comprehensive income (loss) - net	—	—		—	—		—		28,635		—		28,635

Net income for the period	—	—		—	—		314,707		—		79		314,786
Balance as of December 31, 2025	251,676	$	2,183,939	(2,584)	$	(73,863)	$	1,971,950	$	(38,432)	$	1,800	$	4,045,394


	Six Months Ended December 31, 2024
	Common Shares and Additional Paid in Capital			Treasury Stock			Retained Earnings		Accumulated Other Comprehensive Income		Non-Controlling Interests		Total
	Shares	Amount		Shares	Amount
Balance as of June 30, 2024	267,801	$	2,271,886	(3,136)	$	(123,268)	$	2,119,159	$	(69,619)	$	1,523	$	4,199,681
Issuance of Common Shares
Under employee stock option plans	70	1,880		—	—		—		—		—		1,880
Under employee stock purchase plans	719	19,171		—	—		—		—		—		19,171
Share-based compensation	—	59,801		—	—		—		—		—		59,801
Purchase of treasury stock	—	—		(2,187)	(65,023)		—		—		—		(65,023)
Issuance of treasury stock	—	(41,836)		1,097	43,859		(702)		—		—		1,321
Repurchase of Common Shares	(4,862)	(35,319)		—	—		(118,256)		—		—		(153,575)
Dividends declared ($0.525 per Common Share)	—	—		—	—		(139,917)		—		—		(139,917)
Other comprehensive income (loss) - net	—	—		—	—		—		(6,160)		—		(6,160)

Net income for the period	—	—		—	—		314,230		—		98		314,328
Balance as of December 31, 2024	263,728	$	2,275,583	(4,226)	$	(144,432)	$	2,174,514	$	(75,779)	$	1,621	$	4,231,507

See accompanying Notes to Condensed Consolidated Financial Statements

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OPEN TEXT CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands of U.S. dollars)

(Unaudited)


	Six Months Ended December 31,
	2025		2024
Cash flows from operating activities:
Net income	$	314,786	$	314,328
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization of intangible assets	317,802		321,049
Share-based compensation expense	38,913		59,919
Pension expense	6,228		6,813
Amortization of debt discount and issuance costs	11,612		10,795
Write-off of right of use assets	7,844		1,385
Adjustment to gain on AMC Divestiture	—		4,175

Loss on sale and write down of property and equipment, net	2,823		439
Deferred taxes	(32,799)		(52,977)
Share in net (income) of equity investees	(7,633)		(1,993)
Changes in derivative instruments	(10,749)		(20,614)
Changes in operating assets and liabilities:
Accounts receivable	60,490		41,879
Contract assets	(69,678)		(59,946)
Prepaid expenses and other current assets	10,168		54,578
Income taxes	(32,664)		(196,727)
Accounts payable and accrued liabilities	(98,492)		(128,110)
Deferred revenue	(49,415)		(71,407)
Other assets	7,377		(1,436)
Operating lease assets and liabilities, net	(10,191)		(11,964)
Net cash provided by operating activities	466,422		270,186
Cash flows from investing activities:
Additions of property and equipment	(85,749)		(80,585)


Adjustment to proceeds from AMC Divestiture	—		(11,686)
Proceeds from interest on derivative instruments	870		2,519
Other investing activities	632		5,892
Net cash used in investing activities	(84,247)		(83,860)
Cash flows from financing activities:
Proceeds from issuance of Common Shares from exercise of stock options and ESPP	41,499		17,740

Repayment of long-term debt and Revolver	(17,926)		(17,926)
Net change in transition services agreement obligation	—		21,938

Debt issuance costs	—		(1,066)
Repurchase of Common Shares	(157,625)		(153,406)
Purchase of treasury stock	—		(65,023)

Payments of dividends to shareholders	(136,735)		(137,374)

Net cash used in financing activities	(270,787)		(335,117)
Foreign exchange gain (loss) on cash held in foreign currencies	3,503		(9,794)
Increase (decrease) in cash, cash equivalents and restricted cash during the period	114,891		(158,585)
Cash, cash equivalents and restricted cash at beginning of the period	1,158,106		1,282,793
Cash, cash equivalents and restricted cash at end of the period	$	1,272,997	$	1,124,208

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OPEN TEXT CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands of U.S. dollars)

(Unaudited)


Reconciliation of cash, cash equivalents and restricted cash:	December 31, 2025		December 31, 2024
Cash and cash equivalents	$	1,271,374	$	1,122,192
Restricted cash (1)	1,623		2,016
Total cash, cash equivalents and restricted cash	$	1,272,997	$	1,124,208

______________________

(1)Restricted cash is classified under the Prepaid expenses and other current assets and Other assets line items on the Condensed Consolidated Balance Sheets (Note 7).

Supplemental cash flow disclosures (Note 4 and Note 20)

See accompanying Notes to Condensed Consolidated Financial Statements.

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OPEN TEXT CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

For the Three and Six Months Ended December 31, 2025

(Unless otherwise noted, tabular amounts in thousands of U.S. dollars, except share and per share data)

(Unaudited)

NOTE 1—BASIS OF PRESENTATION

The accompanying Condensed Consolidated Financial Statements include the accounts of Open Text Corporation and our subsidiaries, collectively referred to as “OpenText” or the “Company.” We wholly own all of our subsidiaries with the exception of Open Text South Africa Proprietary Ltd., which as of December 31, 2025, was 70% owned by OpenText. All intercompany balances and transactions have been eliminated.

The Company’s fiscal year begins on July 1 and ends on June 30. Unless otherwise noted, any reference to a year preceded by the word “Fiscal” refers to the fiscal year ended June 30 of that year. For example, references to “Fiscal 2026” refer to the fiscal year ended June 30, 2026.

These Condensed Consolidated Financial Statements are expressed in U.S. dollars and are prepared in accordance with United States generally accepted accounting principles (U.S. GAAP). The information furnished reflects all adjustments necessary for a fair presentation of the results for the periods presented.

Use of estimates

The preparation of financial statements in conformity with U.S. GAAP requires us to make certain estimates, judgments and assumptions that affect the amounts reported in the Condensed Consolidated Financial Statements. These estimates, judgments and assumptions are evaluated on an ongoing basis. We base our estimates on historical experience and on various other assumptions that we believe are reasonable at that time, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from those estimates. In particular, key estimates, judgments and assumptions include those related to: (i) revenue recognition, (ii) accounting for income taxes, (iii) testing of goodwill for impairment, (iv) the valuation of acquired intangible assets, (v) the valuation of long-lived assets, (vi) the recognition of contingencies, (vii) restructuring accruals, (viii) acquisition accruals and pre-acquisition contingencies, (ix) the valuation of stock options granted and obligations related to share-based compensation, including the valuation of our long-term incentive plans, (x) the valuation of pension obligations and pension assets, (xi) the valuation of available-for-sale investments, (xii) the valuation of derivative instruments and (xiii) the accounting for disposals of assets and liabilities.

Long-lived Asset Reclassified to Held for Sale

During the second quarter of Fiscal 2026, the Company commenced a plan to sell an office building with a carrying value of $4.5 million as of December 31, 2025. Accordingly, the office building was reclassified from Property and equipment to Assets held for sale in our Condensed Consolidated Balance Sheets as of December 31, 2025.

NOTE 2—ACCOUNTING POLICIES AND RECENT ACCOUNTING PRONOUNCEMENTS

Accounting Pronouncements Adopted in Fiscal 2026

During Fiscal 2026, we have not adopted any accounting pronouncements that have had a material impact to our Condensed Consolidated Financial Statements or disclosures.

Accounting Pronouncements Not Yet Adopted in Fiscal 2026

Income Taxes

In December 2023, the FASB issued ASU 2023-09 “Income Taxes (Topic 740): Improvements to Income Tax Disclosures,” that addresses requests for improved annual income tax disclosures from investors that use the financial statements to make capital allocation decisions. Public entities must adopt the new guidance for annual reporting periods beginning after December 15, 2024. The amendments in this ASU may be applied on a prospective or retrospective basis, with early adoption permitted. The impact of our adoption of such guidance will be reflected in our 2026 annual consolidated financial statements.

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Disaggregation of Income Statement Expenses

In November 2024, the FASB issued ASU 2024-03 “Disaggregation of Income Statement Expenses (Subtopic 220-40),” which requires additional disclosures of specific expense categories included within income statement expense captions. The guidance will be effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. The amendments in this ASU may be applied on a prospective or retrospective basis, with early adoption permitted. We are currently evaluating the impact of the adoption of ASU 2024-03 on the Company’s financial disclosures.

Credit Losses

In July 2025, the FASB issued ASU 2025-05 “Financial Instruments - Credit Losses (Topic 326)”, which provides a practical expedient for estimating expected credit losses for current accounts receivable and current contract assets that arise from transactions accounted for under Topic 606, Revenue from Contracts with Customers. The guidance will be effective for fiscal years beginning after December 15, 2025, and interim reporting periods within those annual reporting periods. The amendments in this ASU may be applied on a prospective basis, with early adoption permitted. We are currently evaluating the impact of the adoption of ASU 2025-05 on the Company’s financial disclosures.

Internal-Use Software

In September 2025, the FASB issued ASU 2025-06 “Intangible - Goodwill and Other - Internal-Use Software (Subtopic 350-40),” which amends guidance related to the accounting for internal-use software development costs. The guidance will be effective for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods. The amendments in this ASU may be applied on a prospective, modified prospective or retrospective basis, with early adoption permitted. We are currently evaluating the impact of the adoption of ASU 2025-06 on the Company’s financial disclosures.

Derivatives and Hedging and Revenue from Contracts with Customers

In September 2025, the FASB issued ASU 2025-07 “Derivatives and Hedging (Topic 815) and Revenue from Contracts with Customers (Topic 606),” which clarifies the application of derivative accounting to contracts that have features based on the operations or activities of one of the parties to the contract and to reduce diversity in the accounting for share-based payments in revenue contracts. The guidance will be effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods within those annual reporting periods. The amendments in this ASU may be applied on a prospective or modified retrospective basis, with early adoption permitted. We do not expect ASU 2025-07 to have an impact on the Company’s financial disclosures.

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NOTE 3—REVENUES

Disaggregation of Revenue

We have four revenue streams: cloud services and subscriptions, customer support, license, and professional service and other. The following tables disaggregate our revenue by significant geographic area, based on the location of our direct end customer, by type of performance obligation and timing of revenue recognition for the periods indicated:


	Three Months Ended December 31,				Six Months Ended December 31,
	2025		2024		2025		2024
Total Revenues by Geography:
Americas (1)	$	708,440	$	765,857	$	1,442,016	$	1,494,100
EMEA (2)	496,726		449,068		935,528		868,299
Asia Pacific (3)	121,570		119,575		237,327		241,106
Total revenues	$	1,326,736	$	1,334,500	$	2,614,871	$	2,603,505

______________________

(1)Americas consists of countries in North, Central and South America.

(2)EMEA consists of countries in Europe, the Middle East and Africa.

(3)Asia Pacific primarily consists of Australia, Japan, Singapore, India and China.


	Three Months Ended December 31,				Six Months Ended December 31,
	2025		2024		2025		2024
Total Revenues by Type of Performance Obligation:
Recurring revenues (1)
Cloud services and subscriptions revenue	$	478,084	$	462,306	$	962,593	$	919,330
Customer support revenue	581,921		590,595		1,168,766		1,186,085
Total recurring revenues	$	1,060,005	$	1,052,901	$	2,131,359	$	2,105,415
License revenue (perpetual, term and subscriptions)	184,227		188,923		318,775		314,736
Professional service and other revenue	82,504		92,676		164,737		183,354
Total revenues	$	1,326,736	$	1,334,500	$	2,614,871	$	2,603,505

______________________

(1)Recurring revenue is defined as the sum of Cloud services and subscriptions revenue and Customer support revenue.


	Three Months Ended December 31,				Six Months Ended December 31,
	2025		2024		2025		2024
Total Revenues by Timing of Revenue Recognition:
Point in time	$	184,227	$	188,923	$	318,775	$	314,736
Over time (including professional service and other revenue)	1,142,509		1,145,577		2,296,096		2,288,769
Total revenues	$	1,326,736	$	1,334,500	$	2,614,871	$	2,603,505

Revenue by Product Categories

We have seven product categories (previously referred to as business clouds) as part of our Information Management solutions: Content, Business Network, IT Operations Management (ITOM, also known as Observability and Service Management (OSM)), Cybersecurity (Enterprise), Cybersecurity (Small and Medium-Sized Businesses (SMB) & Consumer), Application Delivery Management (ADM, also known as DevOps), and Analytics. The following table disaggregates total revenue and total cloud services and subscription revenue by product category for the periods indicated. The Company believes this presentation is useful as it provides additional information:

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	Three Months Ended December 31,				Six Months Ended December 31,
	2025		2024		2025		2024
Total Revenues by Product Categories
Content	$	573,335	$	548,656	$	1,096,799	$	1,055,547
Business Network	159,770		159,479		320,481		316,699
ITOM	113,262		114,095		226,706		234,304
Cybersecurity (Enterprise)	174,483		192,842		355,230		363,401
Cybersecurity (SMB & Consumer)	127,646		135,183		259,373		273,583
ADM (1)	120,125		123,333		242,221		242,279
Analytics	58,115		60,912		114,061		117,692
Total revenues by product categories	$	1,326,736	$	1,334,500	$	2,614,871	$	2,603,505

Total Cloud Services and Subscriptions Revenue by Product Categories
Content	$	137,907	$	116,626	$	273,519	$	228,916
Business Network	151,379		150,036		303,578		297,604
ITOM	7,843		4,709		14,606		8,979
Cybersecurity (Enterprise)	17,939		21,047		38,956		42,344
Cybersecurity (SMB & Consumer)	117,337		123,853		238,658		251,082
ADM (1)	27,933		26,810		59,100		51,813
Analytics	17,746		19,225		34,176		38,592
Total cloud services and subscriptions revenues by product categories	$	478,084	$	462,306	$	962,593	$	919,330

______________________

(1)ADM was previously named Application Automation.

Contract Balances

A contract asset, net of allowance for credit losses, will be recorded if we have recognized revenue but do not have an unconditional right to the related consideration from the customer. For example, this will be the case if implementation services offered in a cloud arrangement are identified as a separate performance obligation and are provided to a customer prior to us being able to bill the customer. In addition, a contract asset may arise in relation to subscription licenses if the license revenue that is recognized upfront exceeds the amount that we are able to invoice the customer at that time. Contract assets are reclassified to accounts receivable when the rights become unconditional.

The balance for our contract assets and contract liabilities (i.e. deferred revenues) for the periods indicated below were as follows:


	As of December 31, 2025		As of June 30, 2025
Short-term contract assets	$	73,965	$	77,920
Long-term contract assets	55,133		49,293
Short-term deferred revenues (1)	1,456,883		1,515,382
Long-term deferred revenues (1)	165,191		168,757

______________________

(1)Excludes $11.8 million of short-term deferred revenues and $0.2 million of long-term deferred revenues that have been reclassified to Liabilities held for sale as of December 31, 2025, related to the divestiture of the eDOCS business that closed on January 12, 2026. See Note 17 “Acquisitions and Divestitures” and Note 24 “Subsequent Events” for more details.

The difference in the opening and closing balances of our contract assets and deferred revenues primarily results from the timing difference between our performance and customer payments. We fulfill our obligations under a contract with a customer by transferring products and services in exchange for consideration from the customer. During the six months ended December 31, 2025, we reclassified $67.8 million (six months ended December 31, 2024 — $57.3 million) of contract assets to receivables as a result of the right to the transaction consideration becoming unconditional. During the three and six months ended December 31, 2025 and 2024, respectively, there was no significant impairment loss recognized related to contract assets.

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We recognize deferred revenue when we have received consideration or an amount of consideration is due from the customer for future obligations to transfer products or services. Our deferred revenues primarily relate to cloud services and customer support agreements which have been paid for by customers prior to the performance of those services. The amount of revenue that was recognized during the six months ended December 31, 2025 that was included in the deferred revenue balances at June 30, 2025 was $1,128 million (six months ended December 31, 2024—$1,131 million).

Incremental Costs of Obtaining a Contract with a Customer

Incremental costs of obtaining a contract include only those costs that we incur to obtain a contract that we would not have incurred if the contract had not been obtained, such as sales commissions. The following table summarizes the changes in total capitalized costs to obtain a contract, since June 30, 2025:


Capitalized costs to obtain a contract as of June 30, 2025	$	129,026
New capitalized costs incurred	33,223
Amortization of capitalized costs	(25,188)
Impact of foreign exchange rate changes	437

Capitalized costs to obtain a contract as of December 31, 2025	$	137,498

During the three and six months ended December 31, 2025 and 2024, respectively, there was no significant impairment loss recognized related to capitalized costs to obtain a contract. Refer to Note 7 “Prepaid Expenses and Other Assets” for additional information on incremental costs of obtaining a contract.

Remaining Performance Obligations

Remaining performance obligations (RPO) represent contracted revenue that has not yet been recognized. They include amounts recognized as deferred revenue and amounts that are contracted but will be billed and recognized as revenue in future periods.

The following table provides RPO information as of December 31, 2025. The 12-month periods noted below are as of the dates presented, with the remaining balances recognized substantially over the next three years thereafter.


($ in billions)	As of December 31, 2025
Total RPO (1)	$	4.5
% recognized as revenue over the following 12 months	60%
Cloud services and subscriptions RPO	$	2.6
% recognized as revenue over the following 12 months	48%
Customer support and other RPO (2)	$	1.9
% recognized as revenue over the following 12 months	76%

______________________

(1)RPO amounts presented may be impacted by certain estimates including currency fluctuations, estimates of customers’ deployment of contracted solutions, changes in the scope or termination of contracts, among other factors, and are therefore subject to change.

(2)Customer support and other RPO is primarily comprised of obligations related to customer support revenues, and to a lesser extent license, professional services and other revenues.

The table above includes RPO related to the divestiture of the eDOCS business, which are reported within Liabilities held for sale. As of December 31, 2025, the total RPO above includes $16.5 million of revenue from remaining performance obligations on existing contracts related to eDOCS, of which $15.9 million relates to Customer support. Approximately 97% of the total RPO related to eDOCS is expected to be recognized over the next 12 months.

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NOTE 4—LEASES

We enter into operating leases, both domestically and internationally, for certain facilities, automobiles, data centers and equipment for use in the ordinary course of business. The duration of the majority of these leases generally ranges from 1 to 10 years, some of which include options to extend for an additional 3 to 5 years after the initial term. Additionally, the land upon which our headquarters in Waterloo, Ontario, Canada is located is leased from the University of Waterloo for a period of 49 years beginning in December 2005, with an option to renew for an additional term of 49 years. We also have finance lease liabilities comprised of equipment lease arrangements with an average duration of 4 to 5 years, of which all are currently being sublet. Leases with an initial term of 12 months or less are not recorded on our Condensed Consolidated Balance Sheets.

The following illustrates the Condensed Consolidated Balance Sheets information related to leases:


	Balance Sheet Location	As of December 31, 2025		As of June 30, 2025
Operating Leases
Operating lease right of use assets	Operating lease right of use assets	$	156,402	$	197,977

Operating lease liabilities (current)	Operating lease liabilities	$	66,600	$	75,914
Operating lease liabilities (non-current)	Long-term operating lease liabilities	155,217		189,949
Total operating lease liabilities		$	221,817	$	265,863

Finance Leases
Finance lease receivables (current)	Prepaid expenses and other current assets	$	1,540	$	1,867
Finance lease receivables (non-current)	Other assets	—		457
Total finance lease receivables		$	1,540	$	2,324

Finance lease liabilities (current)	Accounts payable and accrued liabilities	$	1,381	$	1,877
Finance lease liabilities (non-current)	Accrued liabilities	—		457
Total finance lease liabilities		$	1,381	$	2,334

The weighted average remaining lease term and discount rate for the periods indicated below were as follows:


	As of December 31, 2025		As of June 30, 2025
Weighted-average remaining lease term
Operating leases	4.49 years		4.59 years
Finance leases	0.76 years		1.23 years
Weighted-average discount rate
Operating leases	4.97	%	4.92	%
Finance leases	5.32	%	5.33	%

Lease Costs and Other Information

The following illustrates the various components of lease costs for the period indicated:


	Three Months Ended December 31,				Six Months Ended December 31,
	2025		2024		2025		2024
Operating lease cost	$	18,252	$	20,643	$	37,956	$	41,748
Short-term lease cost	207		639		424		978
Variable lease cost	834		836		1,810		1,891
Sublease income	(2,836)		(2,692)		(4,868)		(5,466)
Total lease cost	$	16,457	$	19,426	$	35,322	$	39,151

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Supplemental Cash Flow Information

The following table presents supplemental information relating to cash flows arising from lease transactions. Cash payments made for variable lease costs and short-term leases are not included in the measurement of lease liabilities, and, as such, are excluded from the amounts below:


	Six Months Ended December 31,
	2025		2024
Cash paid for amounts included in the measurement of lease liabilities:
Operating leases	$	45,713	$	52,044
Finance leases	$	1,000	$	1,952
Right of use assets obtained in exchange for new lease liabilities, net of terminations:
Operating leases (1)	$	(4,734)	$	30,211

______________________

(1)During the six months ended December 31, 2025, we modified certain lease agreements, resulting in a net reduction of our right of use assets and related lease liabilities, of which $13.7 million was attributable to a facility in the Americas.

Maturity of Lease Liabilities

The following table presents the future minimum lease payments under our lease liabilities as of December 31, 2025:


Fiscal years ending June 30,	Operating Leases		Finance Leases
2026 (six months ended)	$	40,587	$	947
2027	67,001		459
2028	50,187		—
2029	34,831		—
2030	20,709		—
Thereafter	31,637		—
Total lease payments	$	244,952	$	1,406
Less: Imputed interest	(23,135)		(25)
Total	$	221,817	$	1,381

Operating lease maturity amounts included in the table above do not include sublease income expected to be received under our various sublease agreements with third parties. Under the agreements initiated with third parties, we expect to receive sublease income of $4.4 million over the remainder of Fiscal 2026 and $0.9 million thereafter.

NOTE 5—GOODWILL

Goodwill is recorded when the consideration paid for an acquisition of a business exceeds the fair value of identifiable net tangible and intangible assets. The following table summarizes the changes in goodwill since June 30, 2025:


Balance as of June 30, 2025	$	7,517,463
Reclassification to Assets held for sale (1)	(92,190)
Impact of foreign exchange rate changes	8,640
Balance as of December 31, 2025	$	7,433,913

______________________

(1)Adjustment to reclassify Goodwill to Assets held for sale related to the divestiture of our eDOCS business. See Note 17 “Acquisitions and Divestitures” and Note 24 “Subsequent Events” for more details.

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NOTE 6—ACQUIRED INTANGIBLE ASSETS


	As of December 31, 2025
	Cost		Accumulated Amortization		Net
Technology assets	$	1,064,433	$	(530,136)	$	534,297
Customer assets	2,305,987		(1,110,301)		1,195,686
Total	$	3,370,420	$	(1,640,437)	$	1,729,983

	As of June 30, 2025
	Cost		Accumulated Amortization		Net
Technology assets	$	1,064,400	$	(441,705)	$	622,695
Customer assets	2,635,686		(1,281,790)		1,353,896
Total	$	3,700,086	$	(1,723,495)	$	1,976,591

Where applicable, the above balances as of December 31, 2025 have been reduced to reflect the impact of intangible assets where the gross cost became fully amortized during the six months ended December 31, 2025. This impact resulted in reductions to the cost and accumulated amortization of customer assets of $330.4 million. The weighted average amortization periods for acquired technology and customer intangible assets are approximately six years and nine years, respectively.

The following table shows the estimated future amortization expense for the fiscal years indicated. This calculation assumes no future adjustments to acquired intangible assets:


Fiscal years ending June 30,
2026 (six months ended)	$	220,903
2027	396,747
2028	379,767
2029	283,041
2030	209,515
2031 and Thereafter	240,010
Total	$	1,729,983

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NOTE 7—PREPAID EXPENSES AND OTHER ASSETS

Prepaid expenses and other current assets:


	As of December 31, 2025		As of June 30, 2025
Deposits and restricted cash	$	5,099	$	2,456
Capitalized costs to obtain a contract	44,211		44,311
Short-term prepaid expenses and other current assets (1)	136,294		148,824
Derivative asset (2)	779		2,984
Total	$	186,383	$	198,575

______________________

(1)Excludes prepaid expenses and other current assets that have been reclassified to Assets held for sale as of December 31, 2025, related to the divestiture of the eDOCS business. See Note 17 “Acquisitions and Divestitures” and Note 24 “Subsequent Events” for more details.

(2)Represents the asset related to our derivative instrument activity. See Note 15 “Derivative Instruments and Hedging Activities” for more details.

Other assets:


	As of December 31, 2025		As of June 30, 2025
Deposits and restricted cash	$	17,188	$	22,720
Capitalized costs to obtain a contract	93,287		84,715

Investments	123,704		116,704
Available-for-sale financial assets	46,775		45,074
Long-term prepaid expenses and other long-term assets	27,161		38,480
Total	$	308,115	$	307,693

Deposits and restricted cash primarily relate to security deposits provided to landlords in accordance with facility lease agreements and cash restricted per the terms of certain contractual-based agreements.

Capitalized costs to obtain a contract relate to incremental costs of obtaining a contract, such as sales commissions, which are eligible for capitalization on contracts to the extent that such costs are expected to be recovered (see Note 3 “Revenues”).

Investments relate to certain investment funds in which we are a limited partner. Our interests in each of these investees range from 4% to below 20%. These investments are accounted for using the equity method. Our share of net income or losses based on our interest in these investments, which approximates fair value and is subject to volatility based on market trends and business conditions, is recorded as a component of Other income (expense), net in our Condensed Consolidated Statements of Income (see Note 21 “Other Income (Expense), Net”). During the three and six months ended December 31, 2025, our share of income (loss) from these investments was $5.2 million and $7.6 million, respectively (three and six months ended December 31, 2024—$1.5 million and $2.0 million, respectively).

A portion of the available-for-sale financial assets relate to contractual arrangements under insurance policies held by the Company with guaranteed interest rates that are utilized to meet certain pension and post-retirement obligations but do not meet the definition of a plan asset. The remaining portion of available-for-sale financial assets are primarily comprised of various debt and equity funds, which are valued utilizing market quotes provided by our third-party custodian. These arrangements are treated as available-for-sale financial assets measured at fair value quarterly (see Note 14 “Fair Value Measurement”) with unrealized gains and losses recorded within Other comprehensive income (loss), net (see Note 19 “Accumulated Other Comprehensive Income (Loss)”).

Prepaid expenses and other assets, both short-term and long-term, include advance payments on licenses that are being amortized over the applicable terms of the licenses and other miscellaneous assets.

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NOTE 8—ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

Accounts payable and accrued liabilities:


	As of December 31, 2025		As of June 30, 2025
Accounts payable—trade (1)	$	130,614	$	136,204
Accrued salaries, incentives and commissions (1)	213,433		254,230
Accrued liabilities	228,751		229,070
Accrued sales and other tax liabilities	36,516		32,964
Derivative liability (2)	248,597		275,810
Accrued interest on long-term debt	37,729		37,729
Amounts payable in respect of restructuring and other special charges	24,964		53,771
Asset retirement obligations	8,904		6,805
Total	$	929,508	$	1,026,583

______________________

(1)Excludes $0.8 million of Accounts payable and accrued liabilities that have been reclassified to Liabilities held for sale as of December 31, 2025, related to the divestiture of the eDOCS business. See Note 17 “Acquisitions and Divestitures” and Note 24 “Subsequent Events” for more details.

(2)Represents the liability related to our derivative instrument activity (see Note 15 “Derivative Instruments and Hedging Activities” for more details).

Long-term accrued liabilities:


	As of December 31, 2025		As of June 30, 2025
Amounts payable in respect of restructuring and other special charges	$	9,566	$	8,591
Other accrued liabilities	11,193		10,801
Asset retirement obligations	20,455		22,920
Total	$	41,214	$	42,312

Asset retirement obligations

We are required to return certain of our leased facilities to their original state at the conclusion of our lease. As of December 31, 2025, the present value of this obligation was $29.4 million (June 30, 2025—$29.7 million), with an undiscounted value of $31.5 million (June 30, 2025—$32.2 million).

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NOTE 9—LONG-TERM DEBT


	As of December 31, 2025		As of June 30, 2025
Total debt
Senior Notes 2031	$	650,000	$	650,000
Senior Notes 2030	900,000		900,000
Senior Notes 2029	850,000		850,000
Senior Notes 2028	900,000		900,000
Senior Secured Notes 2027	1,000,000		1,000,000


Acquisition Term Loan	2,167,450		2,185,375

Total principal payments due	6,467,450		6,485,375

Unamortized debt discount and issuance costs	(95,842)		(107,454)
Total amount outstanding	6,371,608		6,377,921
Less:
Current portion of long-term debt

Acquisition Term Loan	35,850		35,850

Total current portion of long-term debt	35,850		35,850

Non-current portion of long-term debt	$	6,335,758	$	6,342,071

Senior Unsecured Fixed Rate Notes

Senior Notes 2031

On November 24, 2021, a subsidiary of the Company issued $650 million in aggregate principal amount of 4.125% senior notes due 2031 guaranteed by the Company (Senior Notes 2031) in an unregistered offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (Securities Act), and to certain non-U.S. persons in offshore transactions pursuant to Regulation S under the Securities Act. Senior Notes 2031 bear interest at a rate of 4.125% per annum, payable semi-annually in arrears on June 1 and December 1, commencing on June 1, 2022. Senior Notes 2031 will mature on December 1, 2031, unless earlier redeemed, in accordance with their terms, or repurchased.

For the three and six months ended December 31, 2025, we recorded interest expense of $6.7 million and $13.4 million, respectively, relating to Senior Notes 2031 (three and six months ended December 31, 2024—$6.7 million and $13.4 million, respectively).

Senior Notes 2030

On February 18, 2020, a subsidiary of the Company issued $900 million in aggregate principal amount of 4.125% senior notes due 2030 guaranteed by the Company (Senior Notes 2030) in an unregistered offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act and to certain non-U.S. persons in offshore transactions pursuant to Regulation S under the Securities Act. Senior Notes 2030 bear interest at a rate of 4.125% per annum, payable semi-annually in arrears on February 15 and August 15, commencing on August 15, 2020. Senior Notes 2030 will mature on February 15, 2030, unless earlier redeemed, in accordance with their terms, or repurchased.

For the three and six months ended December 31, 2025, we recorded interest expense of $9.3 million and $18.6 million, respectively, relating to Senior Notes 2030 (three and six months ended December 31, 2024—$9.3 million and $18.6 million, respectively).

Senior Notes 2029

On November 24, 2021, the Company issued $850 million in aggregate principal amount of 3.875% senior notes due 2029 (Senior Notes 2029) in an unregistered offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act and to certain non-U.S. persons in offshore transactions pursuant to Regulation S under the Securities Act. Senior Notes 2029 bear interest at a rate of 3.875% per annum, payable semi-annually in arrears on June 1 and December 1, commencing on June

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1, 2022. Senior Notes 2029 will mature on December 1, 2029, unless earlier redeemed, in accordance with their terms, or repurchased.

For the three and six months ended December 31, 2025, we recorded interest expense of $8.2 million and $16.4 million, respectively, relating to Senior Notes 2029 (three and six months ended December 31, 2024—$8.2 million and $16.4 million, respectively).

Senior Notes 2028

On February 18, 2020, the Company issued $900 million in aggregate principal amount of 3.875% senior notes due 2028 (Senior Notes 2028) in an unregistered offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act and to certain non-U.S. persons in offshore transactions pursuant to Regulation S under the Securities Act. Senior Notes 2028 bear interest at a rate of 3.875% per annum, payable semi-annually in arrears on February 15 and August 15, commencing on August 15, 2020. Senior Notes 2028 will mature on February 15, 2028, unless earlier redeemed, in accordance with their terms, or repurchased.

For the three and six months ended December 31, 2025, we recorded interest expense of $8.7 million and $17.4 million, respectively, relating to Senior Notes 2028 (three and six months ended December 31, 2024—$8.7 million and $17.4 million, respectively).

Senior Secured Fixed Rate Notes

Senior Secured Notes 2027

On December 1, 2022, the Company issued $1.0 billion in aggregate principal amount of senior secured notes due 2027 (Senior Secured Notes 2027, and together with the Senior Notes 2031, Senior Notes 2030, Senior Notes 2029, and Senior Notes 2028, the Senior Notes) in connection with the financing of the acquisition of Micro Focus International Limited, formerly Micro Focus International plc, and its subsidiaries (Micro Focus) (the Micro Focus Acquisition) in an unregistered offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act and to certain non-U.S. persons in offshore transactions pursuant to Regulation S under the Securities Act. Senior Secured Notes 2027 bear interest at a rate of 6.90% per annum, payable semi-annually in arrears on June 1 and December 1, commencing on June 1, 2023. Senior Secured Notes 2027 will mature on December 1, 2027, unless earlier redeemed, in accordance with their terms, or repurchased.

The Senior Secured Notes 2027 are guaranteed on a senior secured basis by certain of the Company’s subsidiaries and are secured with the same priority as the Company’s senior credit facilities. The Senior Secured Notes 2027 and the related guarantees are effectively senior to all of the Company’s and the guarantors’ senior unsecured debt to the extent of the value of the Collateral (as defined in the indenture to the Senior Secured Notes 2027) and are structurally subordinated to all existing and future liabilities of each of the Company’s existing and future subsidiaries that do not guarantee the Senior Secured Notes 2027. As of December 31, 2025, the Senior Secured Notes 2027 bear an effective interest rate of 7.39%. The effective interest rate includes interest expense of $34.6 million and amortization of debt discount and issuance costs of $1.5 million.

For the three and six months ended December 31, 2025, we recorded interest expense of $17.3 million and $34.6 million, respectively, relating to Senior Secured Notes 2027 (three and six months ended December 31, 2024—$17.3 million and $34.6 million, respectively).

Revolver

On December 19, 2023, we amended our committed revolving credit facility (the Revolver) to, among other things, extend the maturity to December 19, 2028. Borrowings under the Revolver are secured by a first charge over substantially all of our assets, on a pari passu basis with the Acquisition Term Loan (as defined below) and Senior Secured Notes 2027.

The Revolver has no fixed repayment date prior to the end of the term. Borrowings under the Revolver bear interest per annum at a floating rate of interest equal to Term SOFR (as defined in the Revolver) and a fixed margin dependent on our consolidated net leverage ratio ranging from 1.25% to 1.75%.

Under the Revolver, we must maintain a “consolidated net leverage” ratio of no more than 4.50:1.00 at the end of each financial quarter. Consolidated net leverage ratio is defined for this purpose as the proportion of our total debt reduced by unrestricted cash, including guarantees and letters of credit, over our trailing twelve months net income before interest, taxes, depreciation, amortization, restructuring, share-based compensation and other miscellaneous charges. As of December 31, 2025, our consolidated net leverage ratio, as calculated in accordance with the Revolver, was 3.35:1.00.

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The Revolver requires us to pay a facility fee on unused commitments based on the consolidated net leverage ratio. As of December 31, 2025, the facility fee under the Revolver was 0.30%. For the three and six months ended December 31, 2025, we recorded $0.5 million and $1.1 million, respectively, of facility fees in Interest and other related expense, net, in our Condensed Consolidated Statements of Income (three and six months ended December 31, 2024 —$0.6 million and $1.2 million, respectively).

As of December 31, 2025, we had no outstanding balance under the Revolver (June 30, 2025—nil). For the three and six months ended December 31, 2025, we did not record any interest expense relating to the Revolver (three and six months ended December 31, 2024—nil and nil, respectively).

Acquisition Term Loan

On December 1, 2022, we amended our first lien term loan facility (the Acquisition Term Loan), dated as of August 25, 2022, to increase the aggregate commitments under the senior secured delayed-draw term loan facility from an aggregate principal amount of $2.585 billion to an aggregate principal amount of $3.585 billion. On August 14, 2023, we entered into the second amendment to the Acquisition Term Loan to reduce the applicable interest rate margin by 0.75% over the remaining term of the Acquisition Term Loan. On May 15, 2024, we entered into the third amendment to the Acquisition Term Loan to reduce the applicable interest rate margin by 0.5% and remove the 10-basis point credit spread adjustment for loans bearing interest based on the Secured Overnight Financing Rate (SOFR). On November 27, 2024, we entered into the fourth amendment to the Acquisition Term Loan to reduce the applicable interest rate margin by 0.5% over the remaining term of the Acquisition Term Loan. The reductions in interest rate margin on the Acquisition Term Loan resulting from the amendments were all accounted for by the Company as debt modifications.

The Acquisition Term Loan has a seven-year term from the date of funding, and repayments under the Acquisition Term Loan are equal to 0.25% of the principal amount in equal quarterly installments for the life of the Acquisition Term Loan, with the remainder due at maturity. Borrowings under the Acquisition Term Loan currently bear a floating rate of interest equal to Term SOFR (as defined in the Acquisition Term Loan) plus an applicable margin of 1.75%. As of December 31, 2025, the outstanding balance on the Acquisition Term Loan bears an interest rate of 5.67%. As of December 31, 2025, the Acquisition Term Loan bears an effective interest rate of 6.70%. The effective interest rate includes interest expense of $66.1 million and amortization of debt discount and issuance costs of $7.8 million.

The Acquisition Term Loan has incremental facility capacity of (i) $250 million plus (ii) additional amounts, subject to meeting a “consolidated senior secured net leverage” ratio not exceeding 2.75:1.00, in each case subject to certain conditions. Consolidated senior secured net leverage ratio is defined for this purpose as the proportion of the Company’s total debt reduced by unrestricted cash, including guarantees and letters of credit, that is secured by the Company’s or any of the Company’s subsidiaries’ assets, over the Company’s trailing four financial quarter net income before interest, taxes, depreciation, amortization, restructuring, share-based compensation and other miscellaneous charges. Under the Acquisition Term Loan, we must maintain a “consolidated net leverage” ratio of no more than 4.50:1.00 at the end of each financial quarter. Consolidated net leverage ratio is defined for this purpose as the proportion of the Company’s total debt reduced by unrestricted cash, including guarantees and letters of credit, over the Company’s trailing four financial quarter net income before interest, taxes, depreciation, amortization, restructuring, share-based compensation and other miscellaneous charges as defined in the Acquisition Term Loan. As of December 31, 2025, our consolidated net leverage ratio, as calculated in accordance with the applicable agreement, was 3.35:1:00.

The Acquisition Term Loan is unconditionally guaranteed by certain subsidiary guarantors, as defined in the Acquisition Term Loan, and is secured by a first charge on substantially all of the assets of the Company and the subsidiary guarantors on a pari passu basis with the Revolver and the Senior Secured Notes 2027.

For the three and six months ended December 31, 2025, we recorded interest expense of $32.1 million and $66.1 million, respectively, relating to the Acquisition Term Loan (three and six months ended December 31, 2024—$38.2 million and $81.1 million, respectively).

On January 15, 2026, we used the net proceeds from the eDOCS divestiture to prepay $163.0 million of our aggregate outstanding principal balance on the Acquisition Term Loan. See Note 24 “Subsequent Events” for more details.

Debt Discount and Issuance Costs

Debt discount and issuance costs relate primarily to costs incurred for the purpose of obtaining or amending our credit facilities and issuing our Senior Notes and are being amortized through interest expense over the respective terms of the Senior Notes and Acquisition Term Loan using the effective interest method and straight-line method for the Revolver.

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NOTE 10—PENSION PLANS AND OTHER POST-RETIREMENT BENEFITS

Defined Benefit and Other Post-Retirement Benefit Plans

The Company has 45 pension and other post-retirement plans in multiple countries. All of our pension and other post-retirement plans are located outside of Canada and the United States. The plans are primarily located in Germany, which, as of December 31, 2025, make up approximately 48% of the total net benefit pension obligations.

Our defined benefit pension plans include a mix of final salary type plans which provide for retirement, old age, disability and survivor’s benefits. Final salary type pension plans provide benefits to members either in the form of a lump sum payment or a guaranteed level of pension payable for life in the case of retirement, disability and death. Benefits under our final salary type plans are generally based on the participant’s age, compensation and years of service as well as the social security ceiling and other factors. Many of these plans are closed to new members. The net periodic costs of these plans are determined using the projected unit credit method and several actuarial assumptions, the most significant of which are the discount rate and estimated service costs.

Other post-retirement plans include statutory plans that offer termination, indemnity or other end of service benefits. Many of these plans were assumed through our acquisitions or are required by local regulatory and statutory requirements. All of our defined benefit and other post-retirement plans are included in the aggregate projected benefit obligation within Pension liability, net on our Condensed Consolidated Balance Sheets.

The following are details of net pension expense relating to the defined benefit pension plans:


	Three Months Ended December 31,				Six Months Ended December 31,
	2025		2024		2025		2024
Pension expense:
Service cost	$	2,887	$	2,714	$	5,796	$	5,542
Interest cost	3,520		3,148		7,040		6,485
Expected return of plan assets	(3,313)		(2,842)		(6,609)		(5,871)
Amortization of actuarial (gains) losses	(7)		330		1		657
Net pension expense	$	3,087	$	3,350	$	6,228	$	6,813

Service-related net periodic pension costs are recorded within operating expense and all other non-service related net periodic pension costs are classified under Interest and other related expense, net on our Condensed Consolidated Statements of Income.

NOTE 11—EQUITY AND SHARE-BASED COMPENSATION

Equity

Cash Dividends

For the three and six months ended December 31, 2025, pursuant to the Company’s dividend policy, we declared total non-cumulative dividends of $0.275 and $0.55 per Common Share, respectively, in the aggregate amount of $68.5 million and $136.7 million, respectively, which we paid during the same periods (three and six months ended December 31, 2024—$0.2625 and $0.525 per Common Share, respectively, in the aggregate amount of $68.3 million and $137.4 million, respectively).

Share Capital

Our authorized share capital includes an unlimited number of Common Shares and an unlimited number of Preference Shares. No Preference Shares have been issued.

Treasury Stock

From time to time we may provide funds to a third-party agent to facilitate repurchases of our Common Shares in connection with the settlement of awards under the Long-Term Incentive Plans (LTIP) or other plans.

During the three and six months ended December 31, 2025, we did not repurchase Common Shares on the open market for potential settlement of awards under our LTIP or other plans as described below (three and six months ended December 31, 2024—1,362,721 and 2,187,135 Common Shares were purchased, respectively, at a cost of $40.0 million and $65.0 million, respectively).

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During the three and six months ended December 31, 2025, we delivered to eligible participants 1,868,005 and 2,064,022 Common Shares, respectively, at a cost of $56.7 million and $64.3 million, respectively, that were purchased in the open market in connection with the settlement of awards under our LTIP and other plans (three and six months ended December 31, 2024—1,036,378 and 1,097,265 Common Shares, respectively, at a cost of $41.2 million and $43.8 million, respectively).

Employee Stock Purchase Plan (ESPP)

Our ESPP offers employees the opportunity to purchase our Common Shares at a purchase price discount of 15%. During the three and six months ended December 31, 2025, 233,007 and 477,457 Common Shares, respectively, were eligible for issuance to employees enrolled in the ESPP (three and six months ended December 31, 2024—213,432 and 602,734 Common Shares, respectively). During the three and six months ended December 31, 2025, cash in the amount of $6.6 million and $14.4 million, respectively, was received from employees relating to the ESPP (three and six months ended December 31, 2024—$6.0 million and $15.9 million, respectively).

Share Repurchase Plan

On April 30, 2024, the Company’s Board of Directors (the Board) authorized a share repurchase plan (the Fiscal 2024 Repurchase Plan) pursuant to which we were authorized to purchase for cancellation, in open market transactions from time to time over the 12-month period commencing on May 7, 2024 until May 6, 2025, up to an aggregate of $250 million of our Common Shares.

On July 31, 2024, in order to align our share repurchase plan to our fiscal year, the Board approved the early termination of the Fiscal 2024 Repurchase Plan and authorized a share repurchase plan (the Fiscal 2025 Repurchase Plan), pursuant to which we were authorized to purchase for cancellation, from time to time over the 12-month period commencing on August 7, 2024 until August 6, 2025, if considered advisable, up to an aggregate of $300 million of our Common Shares. On March 13, 2025, the Company increased the authorized limit of the Fiscal 2025 Repurchase Plan by $150 million to $450 million.

On August 6, 2025, the Company renewed its share repurchase plan, pursuant to which we may purchase for cancellation in open market transactions, from time to time over the 12 month period commencing on August 12, 2025 until August 11, 2026, if considered advisable, up to an aggregate of $300 million of our Common Shares on the Toronto Stock Exchange (TSX) as part of a normal course issuer bid renewed by the Company on August 6, 2025 (the Fiscal 2026 NCIB), the NASDAQ and/or alternative trading systems in Canada and/or the United States, if eligible, subject to applicable law and stock exchange rules (the Fiscal 2026 Repurchase Plan). The price that we are authorized to pay for Common Shares in open market transactions is the market price at the time of purchase or such other price as is permitted by applicable law or stock exchange rules. The Fiscal 2026 Repurchase Plan will be effected in accordance with Rule 10b-18 under the U.S. Securities Exchange Act of 1934, as amended (the Exchange Act) and includes a normal course issuer bid to provide means to execute purchases over the TSX. Further, as part of the renewal of the Fiscal 2026 NCIB, the Company established an automatic share purchase plan (ASPP) with its broker to facilitate repurchases of Common Shares.

During the three and six months ended December 31, 2025, we repurchased and cancelled 1,389,600 and 4,545,923 Common Shares for $50.2 million and $152.2 million, respectively, inclusive of 2% Canadian excise taxes recorded (three and six months ended December 31, 2024, 2,212,971 and 4,862,102 Common Shares for $67.1 million and $153.6 million, respectively, inclusive of 2% Canadian excise taxes recorded).

Additionally, as of December 31, 2025, we recorded an accrual within Accounts payable and accrued liabilities and a corresponding charge to Retained earnings of $50.0 million, representing the estimated value of Common Shares expected to be repurchased following the fiscal quarter ended December 31, 2025 pursuant to the ASPP.

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Share-Based Compensation

Share-based compensation expense for the periods indicated below is detailed as follows:


	Three Months Ended December 31,				Six Months Ended December 31,
	2025		2024		2025		2024
Stock Options (issued under Stock Option Plans)	$	2,475	$	3,841	$	3,481	$	6,577
Performance Share Units (issued under LTIP)	4,885		5,510		8,270		12,698
Restricted Share Units (issued under LTIP)	3,675		4,546		7,246		8,313
Restricted Share Units (other)	7,826		13,436		15,291		26,721
Deferred Share Units (directors)	992		1,387		1,906		2,232
Employee Stock Purchase Plan	1,379		1,641		2,719		3,378
Total share-based compensation expense	$	21,232	$	30,361	$	38,913	$	59,919

A summary of unrecognized compensation cost for unvested share-based compensation awards is as follows:


	As of December 31, 2025
	Unrecognized Compensation Cost		Weighted Average Recognition Period (years)
Stock Options (issued under Stock Option Plans)	$	30,200	2.37
Performance Share Units (issued under LTIP)	56,616		2.25
Restricted Share Units (issued under LTIP)	21,997		1.52
Restricted Share Units (other)	43,494		1.81
Total unrecognized share-based compensation cost	$	152,307

Stock Option Plans

A summary of activity under our stock option plans for the six months ended December 31, 2025 is as follows:


	Options	Weighted-Average Exercise Price		Weighted- Average Remaining Contractual Term (years)	Aggregate Intrinsic Value ($’000's)
Outstanding at June 30, 2025	12,306,554	$	36.73	3.93	$	5,942
Granted	857,750	33.83
Exercised	(881,705)	30.96
Forfeited or expired	(4,624,040)	38.15
Outstanding at December 31, 2025	7,658,559	$	36.21	4.01	$	13,555
Exercisable at December 31, 2025	4,101,353	$	39.65	2.67	$	4,902

As of December 31, 2025, 8,546,838 options to purchase Common Shares were available for issuance under our stock option plans.

We estimate the fair value of stock options using the Black-Scholes option-pricing model consistent with the provisions of ASC Topic 718, “Compensation—Stock Compensation” (Topic 718) and SEC Staff Accounting Bulletin No. 107. The option-pricing models require input of subjective assumptions, including the estimated life of the option and the expected volatility of the underlying stock over the estimated life of the option. We use historical volatility as a basis for projecting the expected volatility of the underlying stock and estimate the expected life of our stock options based upon historical data.

We believe that the valuation techniques and the approach utilized to develop the underlying assumptions are appropriate in calculating the fair value of our stock option grants. Estimates of fair value are not intended, however, to predict actual future events or the value ultimately realized by employees who receive equity awards.

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For the periods indicated, the weighted-average fair value of options and weighted-average assumptions estimated under the Black-Scholes option-pricing model were as follows:


	Three Months Ended December 31,						Six Months Ended December 31,
	2025			2024			2025			2024
Weighted–average fair value of options granted	$	8.49		$	6.43		$	7.83		$	5.89
Weighted-average assumptions used:
Expected volatility	31.61		%	28.98		%	31.38		%	28.66		%
Risk–free interest rate	3.71		%	4.14		%	3.73		%	3.74		%
Expected dividend yield	2.99		%	3.42		%	3.19		%	3.49		%
Expected life (in years)	4.31			4.32			4.33			4.31
Forfeiture rate (based on historical rates)	7		%	7		%	7		%	7		%
Average exercise share price	$	30.99		$	29.97		$	30.96		$	28.75

Long-Term Incentive Plans

We incentivize certain eligible employees, in part, with long-term compensation pursuant to our LTIP. The LTIP is a rolling three-year program that grants eligible employees a certain number of target Performance Share Units (PSUs) and/or Restricted Share Units (RSUs). Target PSUs become vested upon the achievement of certain financial and/or operational performance criteria (the Performance Conditions) that are determined at the time of the grant. The Performance Conditions for vesting of the outstanding PSUs are based on market conditions or performance-based revenue conditions. RSUs are employee service-based awards and vest subject to an eligible employee’s continued employment throughout the applicable vesting period.

PSUs and RSUs granted under the LTIP have been measured at fair value as of the effective date, consistent with ASC Topic 718, and will be charged to share-based compensation expense over the remaining life of the plan. We estimate the fair value of PSUs with market-based conditions using the Monte Carlo pricing model and RSUs have been valued based upon their grant date fair value. Beginning in Fiscal 2023, certain PSU and RSU grants were eligible to receive dividend equivalent units that vest under the same conditions as the underlying grants.

Performance Share Units (Issued Under LTIP)

PSUs (issued under the LTIP) vest after three years from the respective date of grants and upon the achievement of Performance Conditions determined at the time of the grant.

A summary of activity under our PSUs issued under the LTIP for the six months ended December 31, 2025 is as follows:


	Units	Weighted-Average Grant Date Fair Value		Weighted- Average Remaining Contractual Term (years)	Aggregate Intrinsic Value ($’000's)
Outstanding at June 30, 2025	1,972,941	$	49.87	1.52	$	51,956
Granted (1)	979,851	49.66
Vested (1)	(325,768)	51.19
Forfeited or expired	(773,706)	47.19
Outstanding at December 31, 2025	1,853,318	$	50.65	2.20	$	60,381

______________________

(1)PSUs are earned based on market or performance conditions and the actual number of PSUs earned, if any, is dependent upon performance and may range from 0 to 200 percent.

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For the periods indicated, the weighted-average fair value of market-based PSUs issued under the LTIP, and weighted-average assumptions estimated under the Monte Carlo pricing model were as follows:


	Six Months Ended December 31,
	2025			2024
Weighted–average fair value of performance share units granted	$	50.18		$	47.96
Weighted-average assumptions used:
Expected volatility	32.40%			30.26%
Risk–free interest rate	3.66%			3.67%
Expected dividend yield	—		%	—		%
Expected life (in years)	3.09			3.11

Restricted Share Units (Issued Under LTIP)

Beginning in Fiscal 2025, grants of RSUs (issued under the LTIP) vest on a straight-line basis over three years from the respective date of grants. Grants of RSUs (issued under the LTIP) prior to Fiscal 2025 vest after three years from the respective date of grants.

A summary of activity under our RSUs issued under the LTIP for the six months ended December 31, 2025 is as follows:


	Units	Weighted-Average Grant Date Fair Value		Weighted- Average Remaining Contractual Term (years)	Aggregate Intrinsic Value ($’000's)
Outstanding at June 30, 2025	1,272,015	$	33.11	1.70	$	37,143
Granted	793,715	30.12
Vested	(499,783)	34.42
Forfeited or expired	(241,690)	30.22
Outstanding at December 31, 2025	1,324,257	$	31.35	2.26	$	43,144

Restricted Share Units (Other)

In addition to the grants made in connection with the LTIP discussed above, from time to time, we may grant RSUs to certain employees in accordance with employment and other non-LTIP related agreements. RSUs (other) vest over a specified contract date, typically two to four years from the respective date of grants.

A summary of activity under our RSUs (other) issued for the six months ended December 31, 2025 is as follows:


	Units	Weighted-Average Grant Date Fair Value		Weighted- Average Remaining Contractual Term (years)	Aggregate Intrinsic Value ($’000's)
Outstanding at June 30, 2025	2,639,883	$	33.11	2.00	$	77,084
Granted	768,888	35.98
Vested	(1,237,728)	33.82
Forfeited or expired	(63,812)	33.94
Outstanding at December 31, 2025	2,107,231	$	33.71	2.36	$	68,654

Deferred Share Units (DSUs)

The DSUs are granted to certain non-employee directors. DSUs are issued under our Deferred Share Unit Plan. DSUs granted as compensation for director fees vest immediately, whereas all other DSUs granted vest at our next annual general meeting following the granting of the DSUs. No DSUs are payable by us until the director ceases to be a member of the Board.

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A summary of activity under our DSUs issued for the six months ended December 31, 2025 is as follows:


	Units	Weighted-Average Price		Weighted- Average Remaining Contractual Term (years)	Aggregate Intrinsic Value ($’000's)
Outstanding at June 30, 2025 (1)	903,970	$	31.04	0.34	$	26,415
Granted	90,564	33.60

Outstanding at December 31, 2025 (2)	994,534	$	31.27	0.93	$	33,273

______________________

(1) Includes 62,177 unvested DSUs.

(2) Includes 66,419 unvested DSUs.

NOTE 12—GUARANTEES AND CONTINGENCIES

We have entered into the following contractual obligations with minimum payments for the indicated fiscal periods as follows:


	Payments due between
	Total		January 1, 2026 - June 30, 2026		July 1, 2026 - June 30, 2028		July 1, 2028 - June 30, 2030		July 1, 2030 and beyond
Long-term debt obligations (1)	$	7,645,094	$	179,914	$	2,582,388	$	4,192,573	$	690,219
Purchase obligations for contracts not accounted for as lease obligations (2)	231,465		129,386		102,079		—		—
Total	$	7,876,559	$	309,300	$	2,684,467	$	4,192,573	$	690,219

______________________

(1)Includes interest up to maturity and principal payments. See Note 9 “Long-Term Debt” for more details.

(2)For more details on contractual obligations relating to leases and purchase obligations accounted for under ASC Topic 842, see Note 4 “Leases.”

Guarantees and Indemnifications

We have entered into customer agreements which may include provisions to indemnify our customers against third-party claims that our software products or services infringe certain third-party intellectual property rights and for liabilities related to a breach of our confidentiality obligations. We have not made any material payments in relation to such indemnification provisions and have not accrued any liabilities related to these indemnification provisions in our Condensed Consolidated Financial Statements.

Occasionally, we enter into financial guarantees with third parties in the ordinary course of our business, including, among others, guarantees relating to taxes and letters of credit on behalf of parties with whom we conduct business. Such agreements have not had a material effect on our results of operations, financial position or cash flows.

Litigation

We are currently involved in various claims and legal proceedings.

Quarterly, we review the status of each significant legal matter and evaluate such matters to determine how they should be treated for accounting and disclosure purposes in accordance with the requirements of ASC Topic 450-20 “Loss Contingencies” (Topic 450-20). Specifically, this evaluation process includes the centralized tracking and itemization of the status of all our disputes and litigation items, discussing the nature of any litigation and claim, including any dispute or claim that is reasonably likely to result in litigation, with relevant internal and external counsel, and assessing the progress of each matter in light of its merits and our experience with similar proceedings under similar circumstances.

If the potential loss from any claim or legal proceeding is considered probable and the amount can be reasonably estimated, we accrue a liability for the estimated loss in accordance with Topic 450-20. As of the date of this Quarterly Report on Form 10-Q, the aggregate of such accrued liabilities was not material to our consolidated financial position or results of operations and we do not believe as of the date of this filing that it is reasonably possible that a loss exceeding the amounts already recognized will be incurred that would be material to our consolidated financial position or results of operations. As described more fully below, we are unable at this time to estimate a possible loss or range of losses in respect of certain disclosed matters.

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Contingencies

CRA Matter

As part of its ongoing audit of our Canadian tax returns, the Canada Revenue Agency (CRA) has disputed our transfer pricing methodology used for certain intercompany transactions with our international subsidiaries and has issued notices of reassessment for Fiscal 2012, Fiscal 2013, Fiscal 2014, Fiscal 2015 and Fiscal 2016. Assuming the utilization of available tax attributes (further described below), we estimate our potential aggregate liability, as of December 31, 2025, in connection with the CRA’s reassessments for Fiscal 2012, Fiscal 2013, Fiscal 2014, Fiscal 2015 and Fiscal 2016, to be limited to penalties, interest and provincial taxes that may be due of approximately $88.0 million. As of December 31, 2025, we have provisionally paid approximately $32.0 million in order to fully preserve our rights to object to the CRA’s audit positions, being the minimum payment required under Canadian legislation while the matter is in dispute. This amount is recorded within Long-term income taxes recoverable on the Condensed Consolidated Balance Sheets as of December 31, 2025.

The notices of reassessment for Fiscal 2012, Fiscal 2013, Fiscal 2014, Fiscal 2015 and Fiscal 2016 would, as drafted, increase our taxable income by approximately $90 million to $100 million for each of those years, as well as impose a 10% penalty on the proposed adjustment to income. Audits by the CRA of our tax returns for fiscal years prior to Fiscal 2012 have been completed with no reassessment of our income tax liability.

We strongly disagree with the CRA’s positions and believe the reassessments of Fiscal 2012, Fiscal 2013, Fiscal 2014, Fiscal 2015 and Fiscal 2016 (including any penalties) are without merit, and we are continuing to contest these reassessments. On June 30, 2022, we filed a notice of appeal with the Tax Court of Canada seeking to reverse all such reassessments (including penalties) in full and the customary court process is ongoing.

Even if we are unsuccessful in challenging the CRA’s reassessments to increase our taxable income for Fiscal 2012, Fiscal 2013, Fiscal 2014, Fiscal 2015 and Fiscal 2016, we have elective deductions available for those years (including carry-backs from later years) that would offset such increased amounts so that no additional cash tax would be payable, exclusive of any assessed penalties and interest, as described above.

The CRA has audited Fiscal 2017, Fiscal 2018, Fiscal 2019 and Fiscal 2020 on a basis that we strongly disagree with and are contesting. The focus of the CRA audit has been the valuation of certain intellectual property and goodwill when one of our subsidiaries continued into Canada from Luxembourg in July 2016. In accordance with applicable rules, these assets were recognized for tax purposes at fair market value as of that time, which value was supported by an expert valuation prepared by an independent leading accounting and advisory firm. CRA’s position for Fiscal 2017 through Fiscal 2020 relies in significant part on the application of its positions regarding our transfer pricing methodology that are the basis for its reassessment of our fiscal years 2012 to 2016 described above, and that we believe are without merit. Other aspects of CRA’s position for Fiscal 2017 through Fiscal 2020 conflict with the expert valuation prepared by the independent leading accounting and advisory firm that was used to support our original filing position. The CRA issued notices of reassessment in respect of Fiscal 2017 through Fiscal 2020 on a basis consistent with its proposal to reduce the available depreciable basis of assets in Canada. We have filed notices of objection to the reassessments for each of these years. If we are ultimately unsuccessful in defending our position, the estimated impact of the proposed adjustment could result in us recording an income tax expense, with no immediate cash payment, to reduce the stated value of our deferred tax assets of up to approximately $470 million. Any such income tax expense could also have a corresponding cash tax impact that would primarily occur over a period of several future years based upon annual income realization in Canada. We strongly disagree with the CRA’s position for Fiscal 2017 through Fiscal 2020 and intend to vigorously defend our original filing position. We are not required to provisionally pay any cash amounts to the CRA as a result of the reassessment in respect of Fiscal 2017 through Fiscal 2019 due to utilization of available tax attributes; however, for Fiscal 2020 and, to the extent the CRA reassesses subsequent fiscal years on a similar basis, we may make certain minimum payments required under Canadian legislation.

We will continue to vigorously contest the adjustments to our taxable income and any penalty and interest assessments, as well as any reduction to the basis of our depreciable property. We are confident that our original tax filing positions were appropriate. Accordingly, as of the date of this Quarterly Report on Form 10-Q, we have not recorded any accruals in respect of these reassessments or proposed reassessment in our Condensed Consolidated Financial Statements.

NOTE 13—INCOME TAXES

The Company’s effective tax rate for the six months ended December 31, 2025 was 21.6%. The Company’s effective tax rate differs from the Canadian federal and provincial statutory rate of 26.5% primarily due to tax benefits related to a net decrease in unrecognized tax benefits and research and development credits.

The Company’s effective tax rate for the six months ended December 31, 2024 was 14.4%. The Company’s effective tax rate differs from the Canadian federal and provincial statutory rate of 26.5% primarily due to tax benefits related to a net decrease in unrecognized tax benefits, research and development credits and a change in valuation allowance.

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On July 4, 2025, the One Big Beautiful Bill Act (OBBBA) was enacted in the U.S., introducing amendments to U.S. tax laws with various effective dates. Key income tax-related provisions of the OBBBA include provisions related to bonus depreciation, research and development expenditures, interest expense deductibility and revisions to international tax regimes. The changes had an immaterial impact to the Company’s effective tax rate for the three and six months ended December 31, 2025.

As of December 31, 2025, the gross amount of unrecognized tax benefits accrued was $126.9 million (June 30, 2025 — $139.8 million), which is inclusive of interest and penalties accrued of $13.5 million (June 30, 2025 — $16.8 million). We believe that it is reasonably possible that the gross unrecognized tax benefits could decrease by $30.8 million in the next 12 months, relating primarily to the expiration of competent authority relief and tax years becoming statute barred for purposes of future tax examinations by local taxing jurisdictions.

NOTE 14—FAIR VALUE MEASUREMENT

ASC Topic 820 “Fair Value Measurement” (Topic 820) defines fair value, establishes a framework for measuring fair value, and addresses disclosure requirements for fair value measurements. Fair value is the price that would be received upon sale of an asset or paid upon transfer of a liability in an orderly transaction between market participants at the measurement date and in the principal or most advantageous market for that asset or liability. The fair value, in this context, should be calculated based on assumptions that market participants would use in pricing the asset or liability, not on assumptions specific to the entity. In addition, the fair value of liabilities should include consideration of non-performance risk, including our own credit risk.

In addition to defining fair value and addressing disclosure requirements, Topic 820 establishes a fair value hierarchy for valuation inputs. The hierarchy prioritizes the inputs into three levels based on the extent to which inputs used in measuring fair value are observable in the market. Each fair value measurement is reported in one of the three levels which are determined by the lowest level input that is significant to the fair value measurement in its entirety. These levels are:

•Level 1—inputs are based upon unadjusted quoted prices for identical instruments traded in active markets.

•Level 2—inputs are based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities.

•Level 3—inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques that include option pricing models, discounted cash flow models and similar techniques.

Financial Assets and Liabilities Measured at Fair Value

Our cash and cash equivalents, along with our accounts receivable and accounts payable and accrued liabilities balances, are measured and recognized in our Condensed Consolidated Financial Statements at an amount that approximates the fair value (a Level 2 measurement) due to their short maturities. The carrying value of our other long-term debt facilities approximates the fair value since the interest rate is at market. See Note 9 “Long-Term Debt” for further details.

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The following table summarizes the fair value of the Company’s financial instruments as of December 31, 2025 and June 30, 2025:


		Fair Value
	Fair Value Hierarchy	December 31, 2025		June 30, 2025
Assets:
Available-for-sale financial assets (Note 7)	Level 2	$	18,353	$	17,721
Available-for-sale financial assets (Note 7)	Level 3	28,422		27,353
Derivative asset (Note 15)	Level 2	779		2,984


Liabilities:
Derivative liability (Note 15)	Level 2	$	(248,597)	$	(275,810)

Senior Notes (Note 9) (1)	Level 2	(4,200,445)		(4,158,921)

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(1)Senior Notes are presented within the Condensed Consolidated Balance Sheets at amortized cost. See Note 9 “Long-Term Debt” for further details.

Changes in Level 3 Fair Value Measurements

The following table provides a reconciliation of changes in the fair value of our Level 3 available-for-sale financial assets between June 30, 2025 and December 31, 2025.


	Available-for-sale financial assets
Balance as of June 30, 2025	$	27,353
Gain recognized in income	1,069


Balance as of December 31, 2025	$	28,422

Our derivative liabilities and our derivative assets are classified as Level 2 and are comprised of swap contracts. Our valuation techniques used to measure the fair values of the derivative instruments, the counterparties to which have high credit ratings, were derived from pricing models including discounted cash flow techniques, with all significant inputs derived from or corroborated by observable market data, as no quoted market prices exist for these instruments. Our discounted cash flow techniques use observable market inputs, such as, where applicable, foreign currency spot and forward rates.

Our available-for-sale financial assets are classified as either Level 2 or Level 3. Our Level 2 available-for-sale financial assets are comprised primarily of various debt and equity funds, which are valued utilizing market quotes provided by our third-party custodian. Our Level 3 available-for-sale financial assets are comprised of insurance contracts which are valued by an external insurance expert by applying a discount rate to the future cash flows and taking into account the fixed interest rate, mortality rates and term of the insurance contracts. See Note 7 “Prepaid Expenses and Other Assets” for further details.

If applicable, we will recognize transfers between levels within the fair value hierarchy at the end of the reporting period in which the actual event or change in circumstance occurs. During the three and six months ended December 31, 2025 and 2024, respectively, we did not have any transfers between Level 1, Level 2 or Level 3.

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

We measure certain assets and liabilities at fair value on a nonrecurring basis. These assets and liabilities are recognized at fair value when they are deemed to be other-than-temporarily impaired. During the three and six months ended December 31, 2025 and 2024, respectively, no indications of impairments were identified and therefore no fair value measurements were required.

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NOTE 15—DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

Cross Currency Swaps

In connection with the Micro Focus Acquisition, in August 2022, we entered into EUR/USD cross currency swaps, which are comprised of 5-year EUR/USD cross currency swaps with a notional amount of €690 million and 7-year EUR/USD cross currency swaps with a notional amount of €690 million. In January 2025, we terminated certain of our outstanding 5-year EUR/USD cross currency swaps with an aggregate notional amount of €138 million and made a termination payment of approximately $10.4 million. The 5-year EUR/USD cross currency swaps are non-designated and are measured at fair value with changes to fair value being recognized in the Condensed Consolidated Statements of Income within Other income (expense), net.

Net Investment Hedge

In connection with the closing of the Micro Focus Acquisition, we designated the €690 million of 7-year EUR/USD cross currency swaps as net investment hedges in accordance with “Derivatives and Hedging” (Topic 815). The Company utilizes the designated cross currency swaps to protect our EUR-denominated operations against exchange rate fluctuations.

The Company assesses the hedge effectiveness of its net investment hedges on a quarterly basis utilizing a method based on the changes in spot price. As such, for derivative instruments designated as net investment hedges, changes in fair value of the designated hedging instruments attributable to fluctuations in the foreign currency spot exchange rates are initially recorded as a component of currency translation adjustments included within Condensed Consolidated Statements of Comprehensive Income until the hedged foreign operations are either sold or substantially liquidated.

In accordance with Topic 815 certain components of the designated cross currency swaps relating to counterparty credit risk and forward exchange rates were excluded from the above effectiveness assessment. The fair value of these excluded components will be amortized over the life of the hedging instruments within Interest and other related expense, net within the Condensed Consolidated Statements of Income. Additionally, we will record the cash flows related to the periodic interest settlements on the 7-year EUR/USD cross currency swaps within the investing activities section of the Condensed Consolidated Statements of Cash Flows. Any gains or losses recognized upon settlement of the cross currency swaps will be recorded within the investing activities section of the Condensed Consolidated Statements of Cash Flows.

Cash Flow Hedge

We are engaged in hedging programs with various banks to limit the potential foreign exchange fluctuations incurred on future cash flows relating to a portion of our Canadian dollar payroll expenses. We operate internationally and are therefore exposed to foreign currency exchange rate fluctuations in the normal course of our business, in particular to changes in the Canadian dollar on account of large costs that are incurred from our centralized Canadian operations, which are denominated in Canadian dollars. As part of our risk management strategy, we use foreign currency forward contracts to hedge portions of our payroll exposure with typical maturities of between one and twelve months. We do not use foreign currency forward contracts for speculative purposes.

We have designated these transactions as cash flow hedges of forecasted transactions under Topic 815. As the critical terms of the hedging instrument and of the entire hedged forecasted transaction are the same, in accordance with Topic 815, we have been able to conclude that changes in fair value or cash flows attributable to the risk being hedged are expected to completely offset at inception and on an ongoing basis. Accordingly, quarterly unrealized gains or losses on the effective portion of these forward contracts have been included within Other comprehensive income (loss), net within the Condensed Consolidated Statements of Comprehensive Income. As of December 31, 2025, the fair value of the contracts is recorded within Prepaid expenses and other current assets within the Condensed Consolidated Balance Sheets and represents the net gain before tax effect that is expected to be reclassified from accumulated other comprehensive income (loss) into earnings within the next twelve months.

As of December 31, 2025, the notional amount of forward contracts we held to sell U.S. dollars in exchange for Canadian dollars was $94.2 million (June 30, 2025—$93.5 million).

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Fair Value of Derivative Instruments and Effect of Derivative Instruments on Financial Performance

The fair values of outstanding derivative instruments are as follows:


		As of December 31, 2025				As of June 30, 2025
Instrument	Balance Sheet Location	Asset		Liability		Asset		Liability
Derivatives designated as hedges:
Cash flow hedge	Prepaid expenses and other current assets	$	607	$	—	$	2,068	$	—
Net investment hedge	Prepaid expenses and other current assets (Accounts payable and accrued liabilities)	—		(144,841)		124		(161,304)
Total derivatives designated as hedges		607		(144,841)		2,192		(161,304)

Derivatives not designated as hedges:
Cross currency swap contracts	Prepaid expenses and other current assets (Accounts payable and accrued liabilities)	172		(103,756)		792		(114,506)
Total derivatives not designated as hedges		172		(103,756)		792		(114,506)
Total derivatives		$	779	$	(248,597)	$	2,984	$	(275,810)

The effects of gains (losses) from derivative instruments on our Condensed Consolidated Statements of Income is as follows:


		Three Months Ended December 31,				Six Months Ended December 31,
Instrument	Income Statement Location	2025		2024		2025		2024
Derivatives designated as hedges:
Cash flow hedge	Operating expenses	$	(61)	$	(1,374)	$	92	$	(1,730)
Net investment hedge	Interest and other related expense, net	113		1,119		237		1,846

Derivatives not designated as hedges:


Cross currency swap contracts	Other income (expense), net	2,906		45,549		10,749		20,614
Cross currency swap contracts	Interest and other related expense, net	128		1,031		264		1,712
Total		$	3,086	$	46,325	$	11,342	$	22,442

The effects of the cash flow and net investment hedges on our Condensed Consolidated Statements of Comprehensive Income:


	Condensed Consolidated Statements of Income and Condensed Consolidated Statements of Comprehensive Income Location	Three Months Ended December 31,				Six Months Ended December 31,
		2025		2024		2025		2024
Gain (loss) recognized in OCI (loss) on cash flow hedge (effective portion)	Unrealized gain (loss) on cash flow hedge	$	909	$	(5,698)	$	(1,370)	$	(4,808)
Gain (loss) recognized in OCI (loss) on net investment hedge (effective portion)	Net foreign currency translation adjustment	$	5,767	$	42,553	$	17,210	$	16,476
Gain (loss) reclassified from AOCI into income (effective portion) - cash flow hedge	Operating expenses	$	(61)	$	(1,374)	$	92	$	(1,730)
Gain (loss) reclassified from AOCI into income (excluded from effectiveness testing) - net investment hedge	Interest and other related expense, net	$	561	$	561	$	1,122	$	1,122

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NOTE 16—SPECIAL CHARGES (RECOVERIES)

Special charges (recoveries) include costs and recoveries that relate to certain restructuring initiatives that we have undertaken from time to time under our various restructuring plans, as well as acquisition and divestiture-related costs and other similar charges.


	Three Months Ended December 31,				Six Months Ended December 31,
	2025		2024		2025		2024
Business Optimization Plan	$	14,248	$	12,347	$	26,517	$	54,850
Other historical restructuring plans	1,098		71		508		(1,849)
Divestiture-related costs	3,079		49		4,020		4,209
Acquisition-related costs	—		(44)		12		692
Other charges	1,693		2,815		9,200		4,472
Total	$	20,118	$	15,238	$	40,257	$	62,374

Business Optimization Plan

During the first quarter of Fiscal 2025, we made a strategic decision to align the Company’s workforce to support its growth and innovation plans (the Business Optimization Plan). The Business Optimization Plan charges relate to facility costs and workforce reductions. During the fourth quarter of Fiscal 2025, the Board approved an expansion of the Business Optimization Plan to complete strategic initiatives, integration and simplification following the Micro Focus Acquisition, the divestiture of our Application Modernization and Connectivity (AMC) business (the AMC Divestiture) to Rocket Software Inc. (Rocket Software) and other growth and innovation plans including the deployment of AI and automation. This expansion includes costs associated with workforce reduction due to automation, centralization and simplification, and corresponding facility costs related to a reduction of our real estate footprint globally. These charges require management to make certain judgments and estimates regarding the amount and timing of restructuring charges or recoveries. Our estimated liability could change subsequent to its recognition, requiring adjustments to the expense and the liability recorded. On a quarterly basis, we conduct an evaluation of the related liabilities and expenses and revise our assumptions and estimates as appropriate.

As of December 31, 2025, we expect total costs to be incurred in connection with the Business Optimization Plan to be approximately $260.0 million, of which $154.4 million has been recorded to date. For the three and six months ended December 31, 2025, $14.2 million and $26.5 million, respectively, have been recorded within Special charges (recoveries) within the Condensed Consolidated Statements of Income. The entire Business Optimization Plan is expected to be substantially completed by the second quarter of Fiscal 2027.

A reconciliation of the beginning and ending restructuring liability for the Business Optimization Plan, which is included within Accounts payable and accrued liabilities in our Condensed Consolidated Balance Sheets, for the six months ended December 31, 2025 is shown below.


Business Optimization Plan	Workforce reduction		Facility charges		Total
Balance payable as of June 30, 2025	$	48,283	$	2,846	$	51,129
Accruals and adjustments	15,732		5,356		21,088
Cash payments	(45,960)		(599)		(46,559)
Foreign exchange and other non-cash adjustments	820		(1,403)		(583)
Balance payable as of December 31, 2025	$	18,875	$	6,200	$	25,075

Divestiture-related costs

Divestiture-related costs, recorded within Special charges (recoveries), include direct costs of potential and completed divestitures.

Acquisition-related costs

Acquisition-related costs, recorded within Special charges (recoveries), include direct costs of potential and completed acquisitions.

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Other charges (recoveries)

For the three and six months ended December 31, 2025, Other charges (recoveries) include $1.7 million and $9.2 million, respectively, of expenses related to severance and other miscellaneous charges.

For the three and six months ended December 31, 2024, Other charges include $2.8 million and $4.4 million, respectively, of other miscellaneous charges, primarily related to the Micro Focus Acquisition.

NOTE 17—ACQUISITIONS AND DIVESTITURES

Divestiture of eDOCS Business

On October 2, 2025, the Company entered into an agreement to divest an on-premise solutions (eDOCS), as a part of its Analytics product category, to NetDocuments Software, Inc. (NetDocuments), for $163.0 million in cash before taxes, fees and other adjustments. The transaction was completed on January 12, 2026. Refer to Note 24 “Subsequent Events” for more details.

As of December 31, 2025, the Company determined that the assets and liabilities of the eDOCS business met the criteria for held for sale classification and the respective assets and liabilities have been reclassified to Assets held for sale and Liabilities held for sale reported in our Condensed Consolidated Balance Sheets. The Company has determined that the eDOCS business does not constitute as a component, as its operations and cash flows cannot be clearly distinguished from the rest of the Company’s operations and cash flows due to significant shared costs, therefore, the transaction does not meet the discontinued operations criteria, and the results of operations from the eDOCS business are presented within Income from operations in our Condensed Consolidated Statements of Income. The sale proceeds less costs to sell exceeded the carrying value of the net assets for the eDOCS business. The carrying value is subject to change based on developments leading up to the closing date.

The following are classified as held for sale in the Condensed Consolidated Balance Sheets, which are related to the divestiture of our eDOCS business. The following balances incorporate the use of management estimates and are subject to the changes based on developments leading up to the closing date of the transaction.


	As of December 31, 2025
Assets held for sale
Accounts receivable trade, net of allowance for credit losses	$	1,653
Prepaid expenses and other current assets	21
Goodwill	92,190
Long-term deferred tax assets	17,735
Total Assets held for sale	$	111,599

Liabilities held for sale
Accounts payable and accrued liabilities	$	849
Deferred revenues	11,838
Pension liability, net	105
Long-term deferred revenues	227
Total Liabilities held for sale	$	13,019

Beginning in Fiscal 2026, the Company presents deferred tax assets and liabilities associated with transactions structured as share sales within Assets held for sale or Liabilities held for sale.

Divestiture of AMC Business

On May 1, 2024, the Company completed the AMC Divestiture. In connection with the AMC Divestiture, the Company entered into a transition services agreement (TSA) with Rocket Software, for which transition service costs were reimbursable by Rocket Software. For the three and six months ended December 31, 2024, the Company billed Rocket Software $12.7 million and $27.2 million, respectively, under the TSA. All transition services pursuant to the TSA were completed as of June 30, 2025.

NOTE 18—SEGMENT INFORMATION

ASC Topic 280, “Segment Reporting” (Topic 280), establishes standards for reporting, by public business enterprises, information about operating segments, products and services, geographic areas and major customers. The method of

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determining what information, under Topic 280, to report is based on the way that an entity organizes operating segments for making operational decisions and how the entity’s management and the chief operating decision maker (CODM) assess an entity’s financial performance.

The Company’s CODM is its Interim Chief Executive Officer. Our operations are analyzed by the CODM as being part of a single industry segment: the design, development, marketing and sale of Information Management software and solutions. As such, segment revenues and significant segment expenses are as presented in the Condensed Consolidated Statements of Income. The CODM uses Net income attributable to OpenText and Adjusted EBITDA (as defined below), a non-GAAP measure, on a consolidated Company basis to evaluate and measure financial performance and to make key decisions, including those that involve the preparation of financial projections, strategic decisions and allocation of resources. Adjusted EBITDA is defined and calculated as GAAP-based net income, attributable to OpenText, excluding interest income (expense), provision for (recovery of) income taxes, depreciation and amortization of acquired intangible assets, other income (expense), share-based compensation and special charges (recoveries).

The following tables present Total revenue, significant segment expenses and Adjusted EBITDA for the periods presented:


	Three Months Ended December 31,				Six Months Ended December 31,
	2025		2024		2025		2024
Total revenues	$	1,326,736	$	1,334,500	$	2,614,871	$	2,603,505
Adjusted cost of revenues (1)	296,826		304,113		599,940		610,674
Adjusted gross profit (1)	1,029,910		1,030,387		2,014,931		1,992,831
Less:
Adjusted Research and development (2)	153,470		173,071		318,989		355,597
Adjusted Sales and marketing (2)	280,158		262,706		530,317		499,273
Adjusted General and administrative (2)	105,061		93,082		206,949		192,578
Add:
Net (income) attributable to non-controlling interests	(35)		(44)		(79)		(98)
Adjusted EBITDA	491,186		501,484		958,597		945,285
Less:
Reconciling items (3)	323,095		271,622		643,890		631,055
Net income attributable to OpenText	$	168,091	$	229,862	$	314,707	$	314,230

______________________

(1)Total Adjusted cost of revenues excludes Amortization of acquired technology-based intangible assets and share-based compensation expense, which are costs that are excluded from the CODM’s evaluation of segment performance.

(2)Adjusted operating expenses exclude share-based compensation expense, which are costs that are excluded from the CODM’s evaluation of segment performance.

(3)The following adjustments are made to reconcile Adjusted EBITDA to Net income attributable to OpenText:


	Three Months Ended December 31,				Six Months Ended December 31,
	2025		2024		2025		2024
Provision for (recovery of) income taxes	$	47,334	$	50,893	$	86,533	$	52,776
Interest and other related expense, net	79,227		83,615		160,341		167,897
Amortization of acquired technology-based intangible assets	44,204		47,203		88,408		94,447
Amortization of acquired customer-based intangible assets	78,645		81,048		158,206		162,552
Depreciation	35,267		31,879		71,188		64,050
Share-based compensation	21,232		30,361		38,913		59,919
Special charges (recoveries)	20,118		15,238		40,257		62,374
Other (income) expense, net	(2,932)		(68,615)		44		(32,960)
Total reconciling items	$	323,095	$	271,622	$	643,890	$	631,055

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NOTE 19—ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)


	Three Months Ended December 31, 2025
	Foreign Currency Translation Adjustments (1)		Cash Flow Hedges		Available-for-Sale Financial Assets		Defined Benefit Pension Plans		Accumulated Other Comprehensive Income (Loss)
Balance as of September 30, 2025	$	(41,131)	$	(267)	$	918	$	(6,031)	$	(46,511)
Other comprehensive income (loss) before reclassifications, net of tax	6,843		668		510		—		8,021
Amounts reclassified into net income, net of tax	—		45		—		13		58
Total other comprehensive income (loss), net for the period	6,843		713		510		13		8,079
Balance as of December 31, 2025	$	(34,288)	$	446	$	1,428	$	(6,018)	$	(38,432)


	Six Months Ended December 31, 2025
	Foreign Currency Translation Adjustments (1)		Cash Flow Hedges		Available-for-Sale Financial Assets		Defined Benefit Pension Plans		Accumulated Other Comprehensive Income (Loss)
Balance as of June 30, 2025	$	(63,308)	$	1,520	$	757	$	(6,036)	$	(67,067)
Other comprehensive income (loss) before reclassifications, net of tax	29,020		(1,007)		671		—		28,684
Amounts reclassified into net income, net of tax	—		(67)		—		18		(49)
Total other comprehensive income (loss), net for the period	29,020		(1,074)		671		18		28,635
Balance as of December 31, 2025	$	(34,288)	$	446	$	1,428	$	(6,018)	$	(38,432)

______________________

(1)The amount of foreign currency translation recognized in other comprehensive income during the three and six months ended December 31, 2025 included net gains (losses) relating to our net investment hedge of $5.8 million and $17.2 million, respectively, as further discussed in Note 15 “Derivative Instruments and Hedging Activities.”


	Three Months Ended December 31, 2024
	Foreign Currency Translation Adjustments (1)		Cash Flow Hedges		Available-for-Sale Investments		Defined Benefit Pension Plans		Accumulated Other Comprehensive Income (Loss)
Balance as of September 30, 2024	$	(64,950)	$	308	$	(126)	$	(9,688)	$	(74,456)
Other comprehensive income (loss) before reclassifications, net of tax	1,167		(4,188)		436		—		(2,585)
Amounts reclassified into net income, net of tax	—		1,010		—		252		1,262
Total other comprehensive income (loss), net for the period	1,167		(3,178)		436		252		(1,323)
Balance as of December 31, 2024	$	(63,783)	$	(2,870)	$	310	$	(9,436)	$	(75,779)

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	Six Months Ended December 31, 2024
	Foreign Currency Translation Adjustments (1)		Cash Flow Hedges		Available-for-Sale Investments		Defined Benefit Pension Plans		Accumulated Other Comprehensive Income (Loss)
Balance as of June 30, 2024	$	(59,760)	$	(608)	$	(374)	$	(8,877)	$	(69,619)
Other comprehensive income (loss) before reclassifications, net of tax	(4,023)		(3,534)		684		(1,045)		(7,918)
Amounts reclassified into net income, net of tax	—		1,272		—		486		1,758
Total other comprehensive income (loss), net for the period	(4,023)		(2,262)		684		(559)		(6,160)
Balance as of December 31, 2024	$	(63,783)	$	(2,870)	$	310	$	(9,436)	$	(75,779)

______________________

(1)The amount of foreign currency translation recognized in other comprehensive income during the three and six months ended December 31, 2024 included net gains (losses) relating to our net investment hedge of $42.6 million and $16.5 million, respectively, as further discussed in Note 15 “Derivative Instruments and Hedging Activities.”

NOTE 20—SUPPLEMENTAL CASH FLOW DISCLOSURES


	Six Months Ended December 31,
	2025		2024
Cash paid during the period for interest	$	167,539	$	183,698
Cash received during the period for interest	21,141		24,563
Cash paid during the period for income taxes	158,756		299,404

NOTE 21—OTHER INCOME (EXPENSE), NET


	Three Months Ended December 31,				Six Months Ended December 31,
	2025		2024		2025		2024
Foreign exchange gains (losses)	$	(6,752)	$	25,539	$	(19,907)	$	14,160
Unrealized gains on derivatives not designated as hedges (1)	2,906		45,549		10,749		20,614

OpenText share in net income of equity investees (2)	5,216		1,538		7,633		1,993
Adjustment to gain on AMC Divestiture (3)	—		(4,175)		—		(4,175)

Other miscellaneous income	1,562		164		1,481		368
Total other income (expense), net	$	2,932	$	68,615	$	(44)	$	32,960

______________________

(1)Represents the unrealized gains (losses) on our derivatives not designated as hedges (see Note 15 “Derivative Instruments and Hedging Activities” for more details).

(2)Represents our share in net income (loss) of equity investees, which approximates fair value and subject to volatility based on market trends and business conditions, based on our interest in certain investment funds in which we are a limited partner. Our interests in each of these investees range from 4% to below 20% and these investments are accounted for using the equity method (see Note 7 “Prepaid Expenses and Other Assets” for more details).

(3)Represents final settlement of working capital and other adjustments related to the AMC Divestiture (see Note 17 “Acquisitions and Divestitures” for more details).

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NOTE 22—EARNINGS PER SHARE

Basic earnings per share are computed by dividing net income attributable to OpenText by the weighted average number of Common Shares outstanding during the period. Diluted earnings per share are computed by dividing net income attributable to OpenText by the shares used in the calculation of basic earnings per share plus the dilutive effect of Common Share equivalents, such as stock options, using the treasury stock method. Common Share equivalents are excluded from the computation of diluted earnings per share if their effect is anti-dilutive.


	Three Months Ended December 31,				Six Months Ended December 31,
	2025		2024		2025		2024
Basic earnings per share
Net income attributable to OpenText	$	168,091	$	229,862	$	314,707	$	314,230
Basic earnings per share attributable to OpenText	$	0.67	$	0.87	$	1.24	$	1.18
Diluted earnings per share
Net income attributable to OpenText	$	168,091	$	229,862	$	314,707	$	314,230
Diluted earnings per share attributable to OpenText	$	0.66	$	0.87	$	1.24	$	1.18
Weighted-average number of shares outstanding (in ‘000’s)
Basic	251,983		265,099		252,814		266,252
Effect of dilutive securities	1,750		94		592		253
Diluted	253,733		265,193		253,406		266,505
Excluded as anti-dilutive (1)	5,142		11,338		6,647		10,982

______________________

(1)Represents options to purchase Common Shares excluded from the calculation of diluted earnings per share because the exercise price of the stock options was greater than or equal to the average price of the Common Shares during the period.

NOTE 23—RELATED PARTY TRANSACTIONS

Our procedure regarding the approval of any related party transaction requires that the material facts of such transaction be reviewed by the independent members of the Audit Committee and the transaction be approved by a majority of the independent members of the Audit Committee. The Audit Committee reviews all transactions in which we are, or will be, a participant and any related party has or will have a direct or indirect interest in the transaction. In determining whether to approve a related party transaction, the Audit Committee generally takes into account, among other facts it deems appropriate, whether the transaction is on terms no less favourable than terms generally available to an unaffiliated third-party under the same or similar circumstances; the extent and nature of the related person’s interest in the transaction; the benefits to the Company of the proposed transaction; if applicable, the effects on a director’s independence; and if applicable, the availability of other sources of comparable services or products.

During the six months ended December 31, 2025, Mr. Stephen Sadler earned immaterial consulting fees from OpenText for assistance with acquisition-related business activities. Mr. Sadler did not participate in any Board deliberations relating to matters for which he could potentially receive consulting fees. Mr. Sadler ceased to be a member of the Board as of December 9, 2025.

During the six months ended December 31, 2025, Mr. P. Thomas Jenkins earned approximately $1.6 million in consulting fees as Chief Strategy Officer, for which such payments are approved by the Audit Committee of the Board in accordance with its policies and practices.

NOTE 24—SUBSEQUENT EVENTS

Cash Dividends

As part of our quarterly, non-cumulative cash dividend program, we declared, on February 4, 2026, a dividend of $0.275 per Common Share. The record date for this dividend is March 6, 2026 and the payment date is March 20, 2026. Future declarations of dividends and the establishment of future record and payment dates are subject to the final determination and discretion of our Board.

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Divestiture of eDOCS Business

On January 12, 2026, the Company completed the previously announced divestiture of an on-premise solution, eDOCS, a part of its Analytics product category, to NetDocuments, for $163.0 million in cash before taxes, fees and other adjustments. The Company used the net proceeds from the transaction to prepay a portion of the outstanding principal balance of the Acquisition Term Loan, as further described below under “Debt Prepayment.”

Debt Prepayment

On January 15, 2026, we used the proceeds from the eDOCS divestiture to prepay $163.0 million of our aggregate outstanding principal balance on the Acquisition Term Loan. Following this prepayment, the remaining balance of the Acquisition Term Loan is $2.004 billion. Refer to Note 9 “Long-Term Debt” for more information.

Proposed Divestiture of Vertica

On February 2, 2026, the Company reached a definitive agreement to divest Vertica, a part of its Analytics product category, to Rocket Software Inc. for $150.0 million in cash, before taxes, fees and other adjustments. The Company intends to use the proceeds from the divestiture to reduce outstanding debt. The transaction remains subject to customary approvals and closing conditions and is expected to close during fiscal year 2026.

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

This Quarterly Report on Form 10-Q, including this Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A), contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 21E of the U.S. Securities Exchange Act of 1934, as amended (the Exchange Act), and Section 27A of the U.S. Securities Act of 1933, as amended (the Securities Act), and is subject to the safe harbors created by those sections. All statements other than statements of historical facts are statements that could be deemed forward-looking statements.

When used in this report, the words “anticipates”, “expects”, “intends”, “plans”, “believes”, “seeks”, “estimates”, “may”, “could”, “would”, “might”, “will” and other similar language, as they relate to Open Text Corporation (OpenText or the Company), are intended to identify forward-looking statements under applicable securities laws. Specific forward-looking statements in this report include, but are not limited to, statements regarding: (i) our focus in the fiscal years beginning July 1, 2025 and ending June 30, 2026 (Fiscal 2026) and July 1, 2026 and ending June 30, 2027 (Fiscal 2027) on growth in earnings and cash flows; (ii) creating value through investments in broader Information Management capabilities; (iii) our future business plans and operations, strategic goals and business planning process, including the Company’s business optimization plan announced in July 2024 (the Business Optimization Plan) and the potential redeployment of capital from non-core assets to enhance focus on our core Information Management for Artificial Intelligence (AI) business and support long-term shareholder returns; (iv) business trends; (v) distribution; (vi) the Company’s presence in the cloud and in growth markets; (vii) product and solution developments, enhancements and releases, the timing thereof and the customers targeted; (viii) the Company’s financial condition, results of operations and earnings; (ix) the basis for any future growth, including organic and inorganic growth, and for our financial performance; (x) declaration of quarterly dividends; (xi) future tax rates, including Canada and United Kingdom’s newly enacted global minimum tax acts; (xii) the changing regulatory environment; (xiii) annual recurring revenues; (xiv) research and development and related expenditures; (xv) our building, development and consolidation of our network infrastructure; (xvi) competition and changes in the competitive landscape; (xvii) our management and protection of intellectual property and other proprietary rights; (xviii) existing and foreign sales and exchange rate fluctuations; (xix) cyclical or seasonal aspects of our business; (xx) capital expenditures; (xxi) potential legal and/or regulatory proceedings; (xxii) acquisitions and their expected impact, including our ability to realize the benefits expected from the acquisitions and to successfully integrate the assets we acquire or utilize such assets to their full capacity (see Note 17 “Acquisitions and Divestitures” to our Condensed Consolidated Financial Statements for more details); (xxiii) tax audits; (xxiv) the expected impact of the Russia-Ukraine and Middle East conflicts and other geopolitical disputes on our business;(xxv) expected costs of the restructuring and business optimization plans; (xxvi) initiatives we establish and targets that we set related to corporate citizenship-related activities; (xvii) divestitures and their expected impact; (xxviii) the implementation of or changes to global tariff regimes or other trade policies and the resulting uncertainty to the macroeconomic environment; (xxix) the expected impact of our share repurchase plan on our overall strategic capital allocation; and (xxx) other matters.

In addition, any statements or information that refer to expectations, beliefs, plans, projections, objectives, performance or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking, and based on our current expectations, forecasts and projections about the operating environment, economies and markets in which we operate. Forward-looking statements reflect our current estimates, beliefs and assumptions, which are based on management’s perception of historic trends, current conditions and expected future developments, as well as other factors it believes are appropriate in the circumstances. The forward-looking statements contained in this report are based on certain assumptions including the following: (i) countries continuing to implement and enforce existing and additional customs and security regulations relating to the provision of electronic information for imports and exports; (ii) our continued operation of a secure and reliable business network; (iii) the stability of general political, economic and market conditions; (iv) our ability to manage inflation, including increased labour costs associated with attracting and retaining employees, and volatile interest rates; (v) our continued ability to manage certain foreign currency risk through hedging; (vi) equity and debt markets continuing to provide us with access to capital; (vii) our continued ability to identify, source and finance attractive and executable business combination opportunities; (viii) our continued ability to avoid infringing third-party intellectual property rights; and (ix) our ability to successfully implement our restructuring plans. Management’s estimates, beliefs and assumptions are inherently subject to significant business, economic, competitive and other uncertainties and contingencies regarding future events and, as such, are subject to change. We can give no assurance that such estimates, beliefs and assumptions will prove to be correct.

Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to differ materially from the anticipated results, performance or achievements expressed or implied by such forward-looking statements. The risks and uncertainties that may affect forward-looking statements include, but are not limited to: (i) our inability to realize successfully any anticipated synergy benefits from acquisitions; (ii) the actual and potential impacts of the use of cash and incurrence of indebtedness, including the granting of security interests related to such debt; (iii) the change in scope and size of our operations as a result of acquisitions or divestitures and risks relating to any

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such acquisitions or divestitures and the impact of divestitures on our remaining business, including the divestiture of eDOCS and the proposed divestiture of Vertica; (iv) the uncertainty around expectations related to the business prospects from potential acquisitions; (v) integration of acquisitions and related restructuring efforts, including the quantum of restructuring charges and the timing thereof; (vi) the possibility that we may be unable to successfully integrate the assets we acquire or fail to utilize such assets to their full capacity and not realize the benefits we expect from our acquired portfolios and businesses; (vii) the potential for the incurrence of or assumption of debt in connection with acquisitions, its impact on future operations and on the ratings or outlooks of rating agencies on our outstanding debt securities, the possibility of not being able to generate sufficient cash to service all indebtedness, and our ability to reduce our outstanding debt; (viii) the possibility that the Company may be unable to meet its future reporting requirements under the Exchange Act, and the rules promulgated thereunder, or applicable Canadian securities regulation; (ix) the risks associated with bringing new products and services to market; (x) fluctuations in currency exchange rates (including as a result of the impact of any policy changes resulting from trade and tariff disputes) and the impact of mark-to-market valuation relating to associated derivatives; (xi) delays in the purchasing decisions of the Company’s customers; (xii) competition the Company faces in its industry and/or marketplace; (xiii) the final determination of litigation, tax audits (including tax examinations in Canada, the United States or elsewhere) and other legal proceedings; (xiv) potential exposure to greater than anticipated tax liabilities or expenses, including with respect to changes in Canadian, United States or international tax regimes; (xv) the possibility of technical, logistical or planning issues in connection with the deployment of the Company’s products or services; (xvi) the continuous commitment of the Company’s customers; (xvii) demand for the Company’s products and services; (xviii) increase in exposure to international business risks including the impact of geopolitical instability, political unrest, war and other global conflicts, and other geopolitical tensions, including the Russia-Ukraine and Middle East conflicts, as we continue to increase our international operations; (xix) adverse macroeconomic conditions, such as potential increases or changes in global tariff policies and structures and the timing thereof, the effects of global relations, including escalating tensions, imposition of tariffs, retaliatory measures, restrictive regulations or boycotts, and other trade policies, inflation, disruptions in global supply chains and increased labour costs; (xx) inability to raise capital at all or on not unfavourable terms in the future; (xxi) downward pressure on our share price and the dilutive effect of future sales or issuances of equity securities (including in connection with future acquisitions); and (xxii) potential changes in ratings or outlooks of rating agencies on our outstanding debt securities. Other factors that may affect forward-looking statements include, but are not limited to: (i) the future performance, financial and otherwise, of the Company; (ii) the ability of the Company to bring new products and services to market and to increase sales; (iii) the strength of the Company’s product development pipeline; (iv) failure to secure and protect patents, trademarks and other proprietary rights; (v) infringement of third-party proprietary rights triggering indemnification obligations and resulting in significant expenses or restrictions on our ability to provide our products or services; (vi) failure to comply with privacy laws and regulations that are extensive, open to various interpretations and complex to implement; (vii) the Company’s growth and other profitability prospects; (viii) the estimated size and growth prospects of the Information Management market; (ix) the Company’s competitive position in the Information Management market and its ability to take advantage of future opportunities in this market; (x) the benefits of the Company’s products and services to be realized by customers; (xi) the demand for the Company’s products and services and the extent of deployment of the Company’s products and services in the Information Management marketplace; (xii) the Company’s financial condition and capital requirements; (xiii) system or network failures or information security, cybersecurity or other data breaches in connection with the Company’s offerings or the information technology systems used by the Company generally, the risk of which may be increased during times of natural disaster or pandemic due to remote working arrangements; (xiv) the integration of AI and other machine learning into some of our products, systems or solutions; (xv) failure to achieve any corporate citizenship-related targets we set; (xvi) failure to attract and retain key personnel to develop and effectively manage the Company’s business; (xvii) the ability of the Company’s subsidiaries to make distributions to the Company; and (xviii) increased attention from shareholders, governments, customers and other key relationships regarding our corporate citizenship practices and increased regulatory scrutiny of such practices and related disclosures, which could impact our business activities, financial performance and reputation.

Readers should carefully review Part II, Item 1A “Risk Factors” herein and the Company's Annual Report on Form 10-K, including Part I, Item 1A “Risk Factors” therein, Quarterly Reports on Form 10-Q, including Item 1A therein and other documents we file from time to time with the Securities and Exchange Commission (SEC) and other securities regulators. A number of factors may materially affect our business, financial condition, operating results and prospects. These factors include but are not limited to those set forth in Part II, Item 1A “Risk Factors” and elsewhere in this Quarterly Report on Form 10-Q and in the Company's Annual Report on Form 10-K. Any one of these factors, and other factors that we are unaware of, or currently deem immaterial, may cause our actual results to differ materially from recent results or from our anticipated future results. Readers are cautioned not to place undue reliance upon any such forward-looking statements, which speak only as of the date made. Unless otherwise required by applicable securities laws, the Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

The following MD&A is intended to help readers understand our results of operations and financial condition, and is provided as a supplement to, and should be read in conjunction with, our Condensed Consolidated Financial Statements and

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the accompanying Notes to our Condensed Consolidated Financial Statements under Part I, Item 1 of this Quarterly Report on Form 10-Q.

All dollar and percentage comparisons made herein refer to the three and six months ended December 31, 2025, compared with the three and six months ended December 31, 2024, unless otherwise noted.

Where we say “we”, “us”, “our”, “OpenText” or “the Company”, we mean Open Text Corporation or Open Text Corporation and its subsidiaries, as applicable.

EXECUTIVE OVERVIEW

At OpenText, we believe information and knowledge make business and people better. We are an Information Management company that provides software and services that empower digital businesses of all sizes to become more intelligent, connected, secure and responsible. Our innovations maximize the strategic benefits of data and content for our customers, strengthening their productivity, growth and competitive advantage.

Our comprehensive Information Management platform and services provide secure and scalable solutions for global companies, small and medium-sized businesses (SMBs), governments and consumers around the world. We have a complete and integrated portfolio of Information Management solutions delivered at scale in the OpenText Cloud, helping organizations master modern work, automate application delivery and modernization, and optimize their digital supply chains. To do this, we bring together our seven product categories (previously referred to as business clouds): Content, Business Network, IT Operations Management (ITOM, also known as Observability and Service Management), Cybersecurity (Enterprise), Cybersecurity (SMB & Consumer), Application Delivery Management (ADM, also known as DevOps and previously named as Application Automation) and Analytics. We also accelerate information modernization with intelligent tools and services for moving off paper, automating classification and building clean data lakes for AI, analytics and automation.

We are fundamentally integrated into the parts of our customers’ businesses that matter, so they can securely manage the complexity of information flow end to end. Through automation and AI, we connect, synthesize and deliver information where it is needed to drive new efficiencies, experiences and insights. We make information more valuable by connecting it to digital business processes, enriching it with analytics, protecting and securing it throughout its entire lifecycle, and leveraging it to create engaging experiences for employees, suppliers, developers, partners, and customers. Our solutions connect large digital supply chains, information technology (IT) service management ecosystems, application development and delivery workflows, and processes in many industries including manufacturing, healthcare and life sciences, energy, retail and financial services. Our solutions also enable organizations and consumers to secure their information so that they can collaborate with confidence, stay ahead of the regulatory technology curve and identify threats across their endpoints and networks. With a multi-layered security approach, we have a wide range of OpenText Cybersecurity solutions that power and protect at the data management layer, at the infrastructure and application layers, at the code, and at the edge, offering insights and threat intelligence across it all.

Our initial public offering was on the NASDAQ in 1996 and we were subsequently listed on the Toronto Stock Exchange (TSX) in 1998. Our ticker symbol on both the NASDAQ and the TSX is “OTEX.”

As of December 31, 2025, we employed a total of approximately 21,300 individuals. Of the total 21,300 individuals we employed as of December 31, 2025, approximately 7,300 or 34% are in the Americas, 4,800 or 23% are in EMEA and 9,200 or 43% are in Asia Pacific. Currently, we have employees in 42 countries enabling strong access to multiple talent pools while ensuring reach and proximity to our customers. See “Results of Operations” below for our definitions of geographic regions.

Quarterly Summary:

During the second quarter of Fiscal 2026, we saw the following activity as compared to the second quarter of Fiscal 2025:

•Total revenue was $1,326.7 million, down 0.6% compared to the same period in the prior fiscal year; down 2.6% after factoring in the favourable impact of $27.4 million of foreign exchange rate changes. Total revenue was down as increases in the Content and Business Network product categories were offset by decreases in the Cybersecurity (Enterprise), Cybsecurity (SMB & Consumer), ADM, ITOM and Analytics product categories.

•Total annual recurring revenue, which we define as the sum of cloud services and subscriptions revenue and customer support revenue, was $1,060.0 million, up 0.7% compared to the same period in the prior fiscal year; down 1.2% after factoring in the favourable impact of $20.2 million of foreign exchange rate changes.

•Cloud services and subscriptions revenue was $478.1 million, up 3.4% compared to the same period in the prior fiscal year; up 1.9% after factoring in the favourable impact of $7.0 million of foreign exchange rate changes.

•GAAP-based gross margin was 74.0% compared to 73.3% in the same period in the prior fiscal year.

•Non-GAAP-based gross margin was 77.6% compared to 77.2% in the same period in the prior fiscal year.

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•GAAP-based net income attributable to OpenText was $168.1 million compared to $229.9 million in the same period in the prior fiscal year.

•Non-GAAP-based net income attributable to OpenText was $286.3 million compared to $293.3 million in the same period in the prior fiscal year.

•GAAP-based earnings per share (EPS), diluted, was $0.66 compared to $0.87 in the same period in the prior fiscal year.

•Non-GAAP-based EPS, diluted, was $1.13 compared to $1.11 the same period in the prior fiscal year.

•Adjusted EBITDA, a non-GAAP measure, was $491.2 million compared to $501.5 million in the same period in the prior fiscal year.

•Operating cash flow was $466.4 million for the six months ended December 31, 2025 compared to $270.2 million in the same period in the prior fiscal year, up 72.6%.

•Cash and cash equivalents were $1,271.4 million as of December 31, 2025, compared to $1,156.5 million as of June 30, 2025.

•Enterprise cloud bookings were $294.9 million, compared to $249.9 million in the same period in the prior fiscal year. We define Enterprise cloud bookings as the total value from cloud services and subscriptions contracts entered into in the period that are new, committed and incremental to our existing contracts, entered into with our enterprise-based customers.

•During the three months ended December 31, 2025, we repurchased and cancelled 1,389,600 Common Shares for $50.2 million, inclusive of 2% Canadian excise taxes recorded (2,212,971 for $67.1 million in the three months ended December 31, 2024).

See “Use of Non-GAAP Financial Measures” below for definitions and reconciliations of GAAP-based measures to Non-GAAP-based measures. See “Acquisitions” below for the impact of acquisitions on the period-to-period comparability of results.

Business Update

Following the departure of the Company’s former Chief Financial Officer on August 15, 2025, Cosmin Balota, Senior Vice President and Chief Accounting Officer, assumed the responsibilities of interim Chief Financial Officer until October 6, 2025. Effective October 6, 2025, the Company appointed Steve Rai as Executive Vice President and Chief Financial Officer. Mr. Rai has more than 30 years of global finance experience and has held senior leadership positions within the technology industry, including serving as Chief Financial Officer of BlackBerry Limited, where he was responsible for overseeing the company’s financial transformation and operational restructuring.

On January 29, 2026, the Company announced the appointment of Ayman Antoun as Chief Executive Officer and a member of the Board, effective April 20, 2026. Mr. Antoun succeeds James McGourlay, who continues to serve as Interim Chief Executive Officer. Upon the transition, Mr. McGourlay will move to a role within the Executive Leadership Team at OpenText and P. Thomas Jenkins, currently serving as OpenText’s Executive Chair and Chief Strategy Officer, will return to the role of Chair of the Board.

Acquisitions and Divestitures

As a result of the continually changing marketplace in which we operate and our strategic objectives, we regularly evaluate acquisition and divestiture opportunities within our market and at any time may be in various stages of discussions with respect to such opportunities.

Divestiture of eDOCS

On October 2, 2025 the Company reached a definitive agreement to divest an on-premise solution (eDOCS), a part of its Analytics product category, to NetDocuments, for $163.0 million in cash before taxes, fees and other adjustments. The Company completed the divestiture on January 12, 2026. Refer to Note 17 “Acquisitions and Divestitures” and Note 24 “Subsequent Events” to our Condensed Consolidated Financial Statements for more information.

Proposed Divestiture of Vertica

On February 2, 2026, the Company reached a definitive agreement to divest Vertica, a part of its Analytics product category, to Rocket Software Inc. for $150 million in cash, before taxes, fees and other adjustments. The Company intends to use the proceeds from the divestiture to reduce outstanding debt. The transaction remains subject to customary approvals and closing conditions and is expected to close during fiscal year 2026.

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Impacts of Geopolitical Conflicts and Diplomatic Tensions

We continue to monitor the geopolitical conflicts and diplomatic tensions around the world, including the Russia-Ukraine and Middle East conflicts. We have ceased all direct business in Russia and Belarus. We continue to operate our Israeli-based business and support our employees in the region. While our operations within these locations are not material and we do not expect these geopolitical conflicts to have a material adverse effect on our overall business, results of operations or financial condition, it is not possible to predict the broader consequences or broader expansion of these conflicts, including adverse effects on the global economy, on our business and operations as well as those of our customers, partners and third-party service providers. See also “Outlook for Remainder of Fiscal 2026” for significant tariff and trade developments. For more information, see Part I, Item 1A “Risk Factors” and Part II, Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on Form 10-K for Fiscal 2025.

Outlook for Remainder of Fiscal 2026

Financial Outlook

As of February 5, 2026, the Company maintains its full year Fiscal 2026 outlook, which remains as follows:


Metrics						Fiscal 2026 Growth
Total Revenues (1)						1% to 2%
Total Cloud services and subscriptions revenues						3% to 4%
Adjusted EBITDA Margin						50 bps to 100 bps
Free Cash Flows						17% to 20%
Enterprise Cloud Bookings						12% to 16%

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(1)Our Fiscal 2026 growth metric for Total Revenues includes $15 million of lower revenues in the second half of Fiscal 2026, resulting from the divestiture of the eDOCS business, which contributed approximately $30 million of full year revenue during Fiscal 2025.

The forward-looking measures and the underlying assumptions involve significant known and unknown risks and uncertainties, and actual results may vary materially. The Company does not present a reconciliation of the forward-looking non-GAAP financial measure, Adjusted EBITDA (as defined below), to the most directly comparable GAAP financial measure because it is impractical to forecast certain items without unreasonable efforts due to the uncertainty and inherent difficulty of predicting, within a reasonable range, the occurrence and financial impact of and the periods in which such items may be recognized.

Refer to Part II, Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for Fiscal 2025 for the Company’s full year Fiscal 2026 outlook.

Strategic Priorities

We continue to focus on our three strategic priorities: expanding our competitive advantage, driving total revenue growth and achieving operational excelle

OPEN TEXT CORP 10-Q