What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-11-05 compared with 2025-04-30 · 282 added, 506 removed, 636 unchanged (55% of the section changed)

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(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;

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(viii) the Company’s financial condition, results of operations and earnings;

(ix) the basis for any future growth and for our financial performance;

(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's newly enacted global minimum tax act;

(xi) future tax rates, including Canada and United Kingdom’s newly enacted global minimum tax acts;

(xii) the changing regulatory environment;

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(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, including in connection with the acquisition of Micro Focus International Limited, formerly Micro Focus International plc, and its subsidiaries (Micro Focus) (see Note 17 “Acquisitions and Divestitures” to our Condensed Consolidated Financial Statements for more details);

(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 on our business;(xxv) expected costs of the restructuring and business optimization plans;

(xxvi) targets regarding greenhouse gas emissions, waste diversion, energy consumption and Equity, Diversity and Inclusion (ED&I) initiatives;

(xvii) integration of Micro Focus, resulting synergies and timing thereof;

(xxviii) divestitures and their expected impact, including in connection with the divestiture of the Application, Modernization and Connectivity (AMC) business (the AMC Divestiture) and the accompanying transition services agreement (TSA) (see Note 17 “Acquisitions and Divestitures” to our Condensed Consolidated Financial Statements for more details);

(xxix) the implementation of or changes to global tariff regimes or other trade policies and the resulting uncertainty to the macroeconomic environment;

(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.

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(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 higher interest rates;

(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;

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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 the acquisition of Micro Focus (Micro Focus Acquisition);

(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 the Micro Focus Acquisition and the AMC Divestiture;

(iv) the uncertainty around expectations related to Micro Focus’ business prospects;

(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 our agreement to divest an on-premise solution (eDOCS);

(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, including the acquisition of Micro Focus;

(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, and the possibility of not being able to generate sufficient cash to service all indebtedness;

(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;

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(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 the Middle East conflicts, as we continue to increase our international operations;

(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 unfavorable terms in the future;

(xx) inability to raise capital at all or on not unfavourable terms in the future;

(xxi) downward pressure on our share price and dilutive effect of future sales or issuances of equity securities (including in connection with future acquisitions);

(xxii) potential changes in ratings or outlooks of rating agencies on our outstanding debt securities;

and (xxiii) risks related to the AMC Divestiture, TSA, and the impact of the divestiture on our remaining business.

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:

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(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) failure to achieve our environmental goals on energy consumption, waste diversion and greenhouse gas emissions or our targets relating to ED&I initiatives;

(xv) failure to attract and retain key personnel to develop and effectively manage the Company’s business;

and (xvi) the ability of the Company’s subsidiaries to make distributions to the Company.

(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, including the search for a permanent CEO;

(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.

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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 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 nine months ended March 31, 2025 compared with the three and nine months ended March 31, 2024, unless otherwise noted.

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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 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 months ended September 30, 2025, compared with the three months ended September 30, 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.

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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 Content Cloud, Cybersecurity Cloud, Business Network Cloud, IT Operations Management Cloud, Application Modernization Cloud and Analytics Cloud.

We also accelerate information modernization with intelligent tools and services for moving off paper, automating classification and building clean data lakes for Artificial Intelligence (AI), analytics and automation.

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.

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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 range from connecting large digital supply chains to managing HR processes to driving better IT service management in manufacturing, 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, identify threats on any endpoint or across their networks, enable privacy, leverage eDiscovery and digital forensics to defensibly investigate and collect evidence, and ensure business continuity in the event of a security incident.

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 March 31, 2025, we employed a total of approximately 21,700 individuals.

Of the total 21,700 individuals we employed as of March 31, 2025, 7,500 or 35% are in the Americas, 4,800 or 22% are in EMEA and 9,400 or 43% are in Asia Pacific.

As of September 30, 2025, we employed a total of approximately 21,200 individuals.

Of the total 21,200 individuals we employed as of September 30, 2025, approximately 7,300 or 34% are in the Americas, 4,800 or 23% are in EMEA and 9,100 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.

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Quarterly Summary:

During the third quarter of Fiscal 2025 we saw the following activity, as compared to the third quarter of Fiscal 2024, which includes the results of the AMC Business prior to the AMC Divestiture, which has an impact on period-over-period comparisons.

See “Divestiture of AMC Business” under “Results of Operations”, below for more details:

• Total revenue was $1,254.4 million, down 13.3% compared to the same period in the prior fiscal year;

down 11.9% after factoring in the unfavorable impact of $21.0 million of foreign exchange rate changes.

• Total annual recurring revenue, which we define as the sum of cloud services and subscriptions revenue and customer support revenue, was $1,030.0 million, down 10.1% compared to the same period in the prior fiscal year;

down 8.7% after factoring in the unfavorable impact of $16.2 million of foreign exchange rate changes.

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

• Total revenue was $1,288.1 million, up 1.5% compared to the same period in the prior fiscal year;

down 0.6% after factoring in the favourable impact of $27.3 million of foreign exchange rate changes.

Total revenue was up driven by increases in the Content, Business Network, Cybersecurity (Enterprise) and ADM product categories, partly offset by a decrease in the ITOM, Cybersecurity (SMB & Consumer), 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 $1,071.4 million, up 1.8% compared to the same period in the prior fiscal year;

down 0.3% after factoring in the favourable impact of $22.4 million of foreign exchange rate changes.

• Cloud services and subscriptions revenue was $484.5 million, up 6.0% compared to the same period in the prior fiscal year;

up 3.0% after factoring in the unfavorable impact of $5.4 million of foreign exchange rate changes.

up 4.2% after factoring in the favourable impact of $8.2 million of foreign exchange rate changes.

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• GAAP-based gross margin was 72.8% compared to 71.7% in the same period in the prior fiscal year.

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• Adjusted EBITDA, a non-GAAP measure, was $467.4 million compared to $443.8 million in the same period in the prior fiscal year.

• Operating cash flow was $672.4 million for the nine months ended March 31, 2025 compared to $782.5 million in the same period in the prior fiscal year, down 14.1%.

• Cash and cash equivalents were $1,278.0 million as of March 31, 2025, compared to $1,280.7 million as of June 30, 2024.

• Operating cash flow was $147.8 million for the three months ended September 30, 2025 compared to $(77.8) million in the same period in the prior fiscal year, up 289.9%.

• Cash and cash equivalents were $1,087.1 million as of September 30, 2025, compared to $1,156.5 million as of June 30, 2025.

• Enterprise cloud bookings were $160.4 million, compared to $133.5 million in the same period in the prior fiscal year.

We define Enterprise cloud bookings as the total value from cloud services and subscription contracts entered into in the period that is new, committed and incremental to our existing contracts, entered into with our enterprise-based customers.

• During the three months ended March 31, 2025, we repurchased and cancelled 4,350,716 Common Shares for $116.7 million, inclusive of 2% Canadian excise taxes recorded (nil in the three months ended March 31, 2024).

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 September 30, 2025, we repurchased and cancelled 3,156,323 Common Shares for $102.0 million, inclusive of 2% Canadian excise taxes recorded (2,649,131 for $86.5 million in the three months ended September 30, 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.

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

Divestiture of AMC Business

On May 1, 2024, the Company completed the AMC Divestiture for $2.275 billion in cash before taxes, fees and other adjustments.

Working capital adjustments were finalized during the quarter ended December 31, 2024.

For the three and nine months ended March 31, 2024, the results of the AMC business were recorded and presented within our Condensed Consolidated Financial Statements.

See Note 17 “Acquisitions and Divestitures” to our Condensed Consolidated Financial Statements for more details.

Business Update

On August 11, 2025, the Company appointed James McGourlay as Interim Chief Executive Officer (CEO).

McGourlay has been with the Company for more than 25 years and has held senior roles in sales, customer operations, IT, technical support, product support and special projects.

To support the executive leadership team during the transition period, the Company established an Executive Committee chaired by P.

Thomas Jenkins, Executive Chair and Chief Strategy Officer.

The Committee includes Mr.

McGourlay, Interim CEO, Paul Duggan, President & Chief Customer Officer, Todd Cione, President, Worldwide Sales, Cosmin Balota, Chief Accounting Officer and Michael Acedo, Executive Vice President, Chief Legal Officer and Corporate Secretary.

As of November 5, 2025, the Board’s CEO Search Committee continues to search to identify a permanent chief executive officer.

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.

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.

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.

Proposed 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 transaction remains subject to customary approvals and closing conditions and is expected to close by early calendar year 2026.

Refer to Note 17 “Acquisitions and Divestitures” to our Condensed Consolidated Financial Statements for more information.

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Impacts of Geopolitical Conflicts and Diplomatic Tensions

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Outlook for Remainder of Fiscal 2026

As an organization, we are committed to “Total Growth,” meaning we strive towards delivering value through organic initiatives and innovations and acquisitions.

With an emphasis on increasing recurring revenues and expanding profitability, we believe our Total Growth strategy will ultimately drive cash flow growth, thus helping to fuel our innovation, broaden our go-to-market distribution and identify and execute strategic acquisitions.

We are well positioned to optimize our product portfolio and improve our ability to innovate and grow organically, which helps us to meet our long-term growth targets.

Our Total Growth strategy is a durable model that we believe will create both near and long-term shareholder value through organic and acquired growth, capital efficiency and profitability.

We are committed to continuous innovation.

Our investments in research and development (R&D) push product innovation, increasing the value of our offerings to our existing customer base and new customers, which includes Global 10,000 companies (G10K), SMBs and consumers.

The G10K are the world’s largest companies, ranked by estimated total revenues, as well as the world’s largest governments and global organizations.

More valuable products, coupled with our established global partner program, lead to greater distribution and cross-selling opportunities which further help us to achieve organic growth.

On a fiscal year-to-date basis, we have invested $568.8 million or 14.7% of revenue in R&D expense, which is in line with our target spend for R&D expense this fiscal year.

Looking ahead, the destination for innovation is cloud.

Businesses of all sizes rely on a combination of public and private clouds, managed services and off-cloud solutions.

As a result, we are committed to continue to modernize our technology infrastructure and leverage our existing investments in the OpenText Cloud and programs to help customers off-cloud.

The combination of OpenText cloud-native applications and managed services, together with the scalability and performance of our partner public cloud providers, offer more secure, reliable and compliant solutions to customers wanting to deploy cloud-based Information Management applications.

The OpenText Cloud is designed to build additional flexibility and scalability for our customers:

becoming cloud-native, connecting anything, and extending capabilities quickly with multi-tenant SaaS applications and services.

Our growth strategy includes embedding AI in our products to empower knowledge workers to significantly raise their productivity through our offerings such as Titanium X.

Financial Outlook

As of November 5, 2025, the Company maintains its full year Fiscal 2026 outlook, which remains as follows:

Fiscal 2026 Growth

Total Revenues

Total Cloud services and subscriptions revenues

Adjusted EBITDA Margin 50 bps to 100 bps

Free Cash Flows

Enterprise Cloud Bookings 12% to 16%

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 excellence.

To expand our competitive advantage, we continue to advance our AI-first Information Management offerings, which are well positioned for Agentic AI, through ongoing investment and cloud-native innovations which will further enhance our products.

In pursuing total revenue growth, we remain committed to organic initiatives and programmatic approach to growth through tuck-in acquisitions and divestitures to best align capital with the highest return opportunities.

As part of this effort, we are reviewing portfolio-shaping opportunities, including potential redeployment of capital from non-core assets to enhance focus on our core Information Management for AI Business and support long-term shareholder returns.

On operational excellence, we are focused on expanding profitability, free cash flows and capital return to support our innovation and capital allocation priorities.

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 additional information.

Business Optimization Plan

As previously announced, our Business Optimization Plan was designed to support strategic initiatives, integration and simplification efforts following the acquisition of Micro Focus International Limited (the Micro Focus Acquisition), the sale of the Company’s Application Modernization and Connectivity (AMC) business (the AMC Divestiture) and AI-first innovation and growth plans.

As of September 30, 2025, we have incurred $140.2 million of the total expected costs of up to approximately $260.0 million.

These costs primarily related to workforce reduction driven by automation, centralization, and simplification, as well as associated real estate footprint reductions globally.

The Business Optimization Plan along with other savings initiatives, when fully implemented, is expected to generate total annualized savings of approximately $490.0 million to $550.0 million.

The Company has realized approximately 35% of these savings during Fiscal 2025 and expects to realize an additional 35% in Fiscal 2026, with the balance thereafter.

The entire business optimization plan is expected to be substantially completed by the second quarter of Fiscal 2027.

See Part I, Item 1A, “Risk Factors” in our Annual Report on Form 10-K for Fiscal 2025.

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Additional Considerations

We conduct business globally and are subject to a complex and evolving international trade environment.

Recent trade tensions among major economies, including the United States, Canada, China, the European Union and others, have led to the imposition of tariffs and other restrictive measures.

These tariffs do not currently include software, services, intangibles, and other digital services;

however, we cannot predict future trade policy or tariffs, including the impact or timing thereof, or whether such services will be subject to any form of tariffs or other restrictions in the future.

We also cannot predict the impact that such tariffs and other restrictive measures will have on the macroeconomic environment or to our customers, which could impact our business and our results of operations.

We will continue to closely monitor the potential impacts of inflation with respect to wages, services and goods, concerns regarding any potential recession, higher interest rates, potential increases or changes in global tariff policies and structures and other trade policies, financial market volatility, the Russia-Ukraine and Middle East conflicts and other geopolitical disputes on our business.

Recent trade tensions among major economies, including the United States, Canada, China, the European Union and others, have led to the dissolution of trade agreements and the imposition of tariffs and other restrictive measures.

These tariffs and other restrictive measures do not currently target digital goods and services, including software, services, intangibles or other digital services;

however, we cannot predict future trade policy or tariffs, including whether such digital goods and services will be subject to any form of tariffs or other restrictions in the future, or the timing of any impacts thereof.

We also cannot predict the impact that such tariffs and other restrictive measures will have on the macroeconomic environment or our customers, which could adversely impact our business and our results of operations.

We will continue to closely monitor the potential impacts of changes in global tariff policies and structures and other trade policies, or related impacts on the global economy arising from the current geopolitical climate, such as inflation with respect to wages, services and goods, concerns regarding any potential recession, volatile interest rates, financial market volatility, or other impacts from the Russia-Ukraine and Middle East conflicts and other geopolitical disputes on our business.

See Part II, Item 1A “Risk Factors” herein and Part I, Item 1A, “Risk Factors” in our Annual Report on Form 10-K for Fiscal 2025.

Further, on April 29, 2025, the Board approved an expansion of our previously announced Business Optimization Plan to complete strategic initiatives, integration and simplification following the Micro Focus acquisition, AMC Divestiture and other growth and innovation plans including the deployment of AI and automation.

We expect up to approximately $200.0 million of additional costs to be incurred to complete this final phase of the Business Optimization Plan, bringing the combined plan up to approximately $260.0 million.

As of March 31, 2025, $57.1 million of the original $60.0 million has been recorded within Special charges (recoveries) within the Condensed Consolidated Statements of Income to date.

The entire Business Optimization Plan is expected to be substantially completed by the second quarter of Fiscal 2027.

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.

On an overall basis, the expansion is expected to result in a total net reduction of approximately 2,000 positions, an increase of approximately 1,600 positions from the previously announced plan.

Facility costs include the accelerated amortization associated with the abandonment of right of use assets, the write-off of fixed assets, and other related variable lease and exit costs.

The expanded Business Optimization Plan along with other savings initiatives, when fully implemented, is expected to generate total annualized savings of approximately $490.0 million to $550.0 million, an increase of $340.0 million to $400.0 million on an annualized basis.

Of this, approximately 50% will be realized in Fiscal 2026, with the remaining annualized benefit to be realized in Fiscal 2027.

See Note 23 “Subsequent Events” to our Condensed Consolidated Financial Statements for additional details on the expansion of the Business Optimization Plan.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

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The policies listed below are areas that may contain key components of our results of operations and are based on complex rules requiring us to make judgments and estimates and consequently, we consider these to be our critical accounting policies.

Some of these

accounting policies involve complex situations and require a higher degree of judgment, either in the application and interpretation of existing accounting literature or in the development of estimates that affect our financial statements.

Some of these accounting policies involve complex situations and require a higher degree of judgment, either in the application and interpretation of existing accounting literature or in the development of estimates that affect our financial statements.

The critical accounting policies which we believe are the most important to aid in fully understanding and evaluating our reported financial results include the following:

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See “Use of Non-GAAP Financial Measures” below for a reconciliation of GAAP-based measures to Non-GAAP-based measures.

Divestiture of AMC Business

On May 1, 2024, the Company completed the sale of its AMC business to Rocket Software.

The AMC business was comprised of the legacy OpenText connectivity business and the legacy Micro Focus AMC business.

The comparability of our operating results for the three and nine months ended March 31, 2025 as compared to the three and nine months ended March 31, 2024 was impacted by the recent divestiture of our AMC business, the results of which were excluded from those of OpenText beginning May 1, 2024.

As such, AMC business operating results were included in the consolidated operating results for the three and nine months ended March 31, 2024, but were not included in the consolidated operating results for the three and nine months ended March 31, 2025.

Our total revenues decreased by $192.8 million and $549.6 million, primarily across license and customer support product types in the three and nine months ended March 31, 2025, respectively, relative to the three and nine months ended March 31, 2024, primarily due to the exclusion of revenue contributions from the AMC business, and the unfavorable impact of $21.0 million and $15.4 million, respectively, of foreign exchange rate changes.

The following table illustrates the revenues contributed by the AMC business during the three and nine months ended March 31, 2024,

(In thousands) Three Months Ended

March 31, 2024 Nine Months Ended

March 31, 2024

Cloud services and subscriptions $ — $ —

Customer support 85,767 253,982

License 42,032 127,923

Professional service and other 5,697 15,663

Total revenues $ 133,496 $ 397,568

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Transition Services Agreement

In connection with the AMC Divestiture, we entered into a TSA with Rocket Software, whereby we agreed to provide certain transition services to Rocket Software for up to 24 months from May 1, 2024.

These transition service costs are reimbursable by Rocket Software.

During the three and nine months ended March 31, 2025, we billed Rocket Software $4.2 million and $31.4 million, respectively, under the TSA.

The following table illustrates the financial statement impact of these TSA reimbursements, which have been recorded as an offset to the respective costs incurred, within our Condensed Consolidated Statements of Income.

Substantially all of the transition services pursuant to the TSA were completed as of the quarter ended March 31, 2025.

(In thousands) Three Months Ended

March 31, 2025 Nine Months Ended

March 31, 2025

On May 1, 2024, the Company completed the sale of its AMC business to Rocket Software, Inc.

(Rocket Software).

The AMC business was comprised of the legacy OpenText connectivity business and the legacy Micro Focus AMC business.

In connection with the AMC Divestiture, we entered into a Transition Services Agreement (TSA) with Rocket Software, whereby we agreed to provide certain transition services to Rocket Software for up to 24 months from the closing date.

These transition service costs were reimbursable by Rocket Software.

The following table illustrates the financial statement impact of these TSA reimbursements for the three months ended September 30, 2024 which were recorded as an offset to the respective costs incurred, within our Condensed Consolidated Statements of Income.

All transition services pursuant to the TSA were completed as of June 30, 2025.

Three Months Ended September 30,

(In thousands) 2024

Professional service and other cost of revenue $ 168

4 unchanged sentences

Total $ 14,518

Table o f Contents

Summary of Results of Operations

Three Months Ended March 31, Nine Months Ended March 31,

Three Months Ended September 30,

(In thousands) 2025 Change

increase (decrease) 2024 2025 Change

increase (decrease) 2024

37 unchanged sentences

Asia Pacific (4)

9.1 % 9.4 % 9.2 % 9.5 %

Other Metrics:

14 unchanged sentences

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

(4) Asia Pacific primarily consists of Japan, Australia, China, Korea, Philippines, Singapore, India and New Zealand.

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

(5) See “Use of Non-GAAP Financial Measures” (discussed later in this MD&A) for definitions and reconciliations of GAAP-based measures to Non-GAAP-based measures.

Table o f Contents

Revenues, Cost of Revenues and Gross Margin by Product Type

3 unchanged sentences

Our cloud arrangements can be broadly categorized as platform as a service, software as a service, cloud subscriptions and managed services.

Beginning with the quarter ended September 30, 2024, we have disclosed the cloud renewal rate on a net basis (cloud net renewal rate).

This rate includes increases and decreases in renewed contract values driven by product mix, volume and consumption, and changes for price adjustments relating to renewed contract values, which were not part of the historical calculation of the cloud renewal rate.

For the quarter ended March 31, 2025, our cloud net renewal rate, excluding the impact of Carbonite Inc.

and Zix Corporation, was 96%.

For the quarter ended September 30, 2025, our cloud net renewal rate, excluding the impact of Carbonite Inc.

and Zix Corporation, increased to 96%, compared to 94% for the quarter ended September 30, 2024.

Cost of Cloud services and subscriptions revenues is comprised primarily of third-party network usage fees, maintenance of in-house data hardware centers, technical support personnel-related costs and some third party royalty costs.

Three Months Ended March 31, Nine Months Ended March 31,

Three Months Ended September 30,

(In thousands) 2025 Change

increase (decrease) 2024 2025 Change

increase (decrease) 2024

11 unchanged sentences

Asia Pacific 6.0 % 6.3 %

Three Months Ended March 31, 2025 Compared to Three Months Ended March 31, 2024

Cloud services and subscriptions revenues increased by $8.1 million or 1.8% during the three months ended March 31, 2025 as compared to the same period in the prior fiscal year;

up 3.0% after factoring in the unfavorable impact of $5.4 million of foreign exchange rate changes.

Geographically, the overall change was attributable to an increase in EMEA of $11.0 million partially offset by a decrease in Americas of $2.9 million.

There were 32 cloud services contracts greater than $1.0 million that closed during the third quarter of Fiscal 2025, compared to 28 contracts during the third quarter of Fiscal 2024.

Cost of Cloud services and subscriptions revenues decreased by $12.2 million during the three months ended March 31, 2025 as compared to the same period in the prior fiscal year.

This was primarily due to a decrease in third-party network usage fees of $7.3 million and a decrease in labour-related costs of $5.1 million.

Overall, the gross margin percentage on Cloud services and subscriptions revenues increased to 62% from 59%.

Nine Months Ended March 31, 2025 Compared to Nine Months Ended March 31, 2024

Cloud services and subscriptions revenues increased by $26.3 million or 1.9% during the nine months ended March 31, 2025 as compared to the same period in the prior fiscal year;

up 2.3% after factoring in the unfavorable impact of $4.7 million of foreign exchange rate changes.

Geographically, the overall change was attributable to an increase in EMEA of $24.8 million, an increase in Americas of $1.9 million, partially offset by a decrease in Asia Pacific of $0.5 million.

There were 106 cloud services contracts greater than $1.0 million that closed during the first nine months of Fiscal 2025, compared to 97 contracts during the first nine months of Fiscal 2024.

Cost of Cloud services and subscriptions revenues decreased by $16.2 million during the nine months ended March 31, 2025 as compared to the same period in the prior fiscal year.

This was due to a decrease in labour-related costs of $15.0 million, and a decrease in third-party network usage fees of $1.8 million.

Three Months Ended September 30, 2025 Compared to Three Months Ended September 30, 2024

Cloud services and subscriptions revenues increased by $27.5 million or 6.0% during the three months ended September 30, 2025, as compared to the same period in the prior fiscal year;

up 4.2% after factoring in the favourable impact of $8.2 million of foreign exchange rate changes.

The change was primarily driven by increases in the Content, Business Network, ADM and ITOM product categories, partly offset by a decrease in the Cybersecurity (SMB & Consumer) and Analytics product categories.

Geographically, the overall change was attributable to an increase in EMEA of $19.1 million, an increase in Americas of $8.5 million, and a decrease in Asia Pacific of $0.1 million.

There were 33 cloud services contracts greater than $1.0 million that closed during the first quarter of Fiscal 2026, compared to 23 contracts during the first quarter of Fiscal 2025.

Cost of Cloud services and subscriptions revenues decreased by $3.0 million during the three months ended September 30, 2025, as compared to the same period in the prior fiscal year.

This was primarily due to a decrease in labour-related costs of $4.4 million, partially offset by an increase in third-party network usage fees of $2.0 million.

Overall, the gross margin percentage on Cloud services and subscriptions revenues increased to 64% from 62%.

6 unchanged sentences

Our management reviews our customer support renewal rates on a quarterly basis, and we use these rates as a method of monitoring our customer service performance.

Beginning with the quarter ended September 30, 2024, we have disclosed the customer support renewal rate on a net basis (customer support net renewal rate).

This rate includes increases in renewed contract values driven by volume and consumption, and excludes reductions driven by shifts from customer support renewals where customers migrate to other product types, which were not part of the historical calculation of the customer support renewal rate.

For the quarter ended March 31, 2025, our customer support net renewal rate was 90%.

For the quarter ended September 30, 2025, our customer support net renewal rate remained stable at 91% as compared to the quarter ended September 30, 2024.

Table o f Contents

Cost of Customer support revenues is comprised primarily of technical support personnel and related costs, as well as third party royalty costs.

Three Months Ended March 31, Nine Months Ended March 31,

Three Months Ended September 30,

(In thousands) 2025 Change

increase (decrease) 2024 2025 Change

increase (decrease) 2024

11 unchanged sentences

Asia Pacific 9.5 % 9.9 %

Three Months Ended March 31, 2025 Compared to Three Months Ended March 31, 2024

Customer support revenues decreased by $124.1 million or 17.9% during the three months ended March 31, 2025 as compared to the same period in the prior fiscal year;

down 16.4% after factoring in the unfavorable impact of $10.8 million of foreign exchange rate changes.

The decrease was primarily due to the exclusion of customer support revenue contributions as a result of the AMC Divestiture.

Geographically, the overall change was attributable to a decrease in Americas of $63.8 million, a decrease in EMEA of $42.8 million and a decrease in Asia Pacific of $17.5 million.

Cost of Customer support revenues decreased by $12.9 million during the three months ended March 31, 2025 as compared to the same period in the prior fiscal year.

This was primarily due to a decrease in labour-related costs of $11.5

million over the comparative period.

Overall, the gross margin percentage on Customer support revenues remained stable at 89%.

Nine Months Ended March 31, 2025 Compared to Nine Months Ended March 31, 2024

Customer support revenues decreased by $331.5 million or 15.9% during the nine months ended March 31, 2025 as compared to the same period in the prior fiscal year;

down 15.5% after factoring in the unfavorable impact of $7.9 million of foreign exchange rate changes.

The decrease was primarily due to the exclusion of customer support revenue contributions as a result of the AMC Divestiture.

Geographically, the overall change was attributable to a decrease in Americas of $213.6 million, a decrease in EMEA of $84.7 million and a decrease in Asia Pacific of $33.2 million.

Cost of Customer support revenues decreased by $36.1 million during the nine months ended March 31, 2025 as compared to the same period in the prior fiscal year.

This was primarily due to a decrease in labour-related costs of $33.8 million over the comparative period.

Three Months Ended September 30, 2025 Compared to Three Months Ended September 30, 2024

Customer support revenues decreased by $8.6 million or 1.5% during the three months ended September 30, 2025 as compared to the same period in the prior fiscal year;

down 3.8% after factoring in the favourable impact of $14.2 million of foreign exchange rate changes.

Geographically, the overall change was attributable to a decrease in Americas of $16.3 million and a decrease in Asia Pacific of $2.9 million, partially offset by an increase in EMEA of $10.5 million.

Cost of Customer support revenues increased by $1.5 million during the three months ended September 30, 2025 as compared to the same period in the prior fiscal year.

This was primarily due to an increase in labour-related costs of $2.4 million, partially offset by a decrease in third-party network usage fees of $0.8 million, as compared to the same period in the prior fiscal year.

Overall, the gross margin percentage on Customer support revenues remained stable at 89%.

2 unchanged sentences

Cost of License revenues consists primarily of royalties payable to third parties.

Three Months Ended March 31, Nine Months Ended March 31,

Three Months Ended September 30,

(In thousands) 2025 Change

increase (decrease) 2024 2025 Change

increase (decrease) 2024

11 unchanged sentences

Asia Pacific 13.8 % 17.3 %

Three Months Ended March 31, 2025 Compared to Three Months Ended March 31, 2024

License revenues decreased by $62.0 million or 30.9% during the three months ended March 31, 2025 as compared to the same period in the prior fiscal year;

down 29.6% after factoring in the unfavorable impact of $2.7 million of foreign exchange rate changes.

The decrease was primarily driven by the exclusion of license revenue contributions as a result of the AMC Divestiture and license revenues in the prior fiscal year relating to the grant of certain IP rights.

Geographically, the overall change was attributable to a decrease in Americas of $35.5 million, a decrease in EMEA of $22.1 million and a decrease in Asia Pacific of $4.4 million.

During the third quarter of Fiscal 2025, we closed 51 license contracts greater than $0.5 million, of which 19 contracts were greater than $1.0 million, contributing $52.2 million of License revenues.

This was compared to 55 license contracts greater than $0.5 million during the third quarter of Fiscal 2024, of which 23 contracts were greater than $1.0 million, contributing $92.3 million of License revenues.

Cost of License revenues increased by $0.7 million during the three months ended March 31, 2025 as compared to the same period in the prior fiscal year.

Overall, the gross margin percentage on License revenues decreased to 95% from 97%.

Nine Months Ended March 31, 2025 Compared to Nine Months Ended March 31, 2024

License revenues decreased by $209.5 million or 31.6% during the nine months ended March 31, 2025 as compared to the same period in the prior fiscal year;

down 31.3% after factoring in the unfavorable impact of $2.2 million of foreign exchange rate changes.

Geographically, the overall change was attributable to a decrease in Americas of $111.8 million, a decrease in EMEA of $70.1 million and a decrease in Asia Pacific of $27.6 million.

During the first nine months of Fiscal 2025, we closed 150 license contracts greater than $0.5 million, of which 58 contracts were greater than $1.0 million, contributing $163.2 million of License revenues.

This was compared to 189 license contracts greater than $0.5 million during the first nine months of Fiscal 2024, of which 79 contracts were greater than $1.0 million, contributing $303.9 million of License revenues.

Cost of License revenues increased by $3.9 million during the nine months ended March 31, 2025 as compared to the same period in the prior fiscal year.

Overall, the gross margin percentage on License revenues decreased to 95% from 97%.

Three Months Ended September 30, 2025 Compared to Three Months Ended September 30, 2024

License revenues increased by $8.7 million or 6.9% during the three months ended September 30, 2025 as compared to the same period in the prior fiscal year;

up 5.2% after factoring in the favourable impact of $2.2 million of foreign exchange rate changes.

Geographically, the overall change was attributable to an increase in Americas of $20.5 million, partially offset by a decrease in EMEA of $8.7 million, and a decrease in Asia Pacific of $3.1 million.

Table o f Contents

During the first quarter of Fiscal 2026, we closed 40 license contracts greater than $0.5 million, of which 9 contracts were greater than $1.0 million, contributing $56.1 million of License revenues.

This was compared to 39 license contracts greater than $0.5 million during the first quarter of Fiscal 2025, of which 15 contracts were greater than $1.0 million, contributing $39.6 million of License revenues.

Cost of License revenues increased by $0.4 million during the three months ended September 30, 2025 as compared to the same period in the prior fiscal year.

Overall, the gross margin percentage on License revenues remained stable at 95%.

4) Professional Service and Other:

5 unchanged sentences

The most significant components of these costs are personnel-related expenses, travel costs and third-party subcontracting.

Three Months Ended March 31, Nine Months Ended March 31,

Three Months Ended September 30,

(In thousands) 2025 Change

increase (decrease) 2024 2025 Change

increase (decrease) 2024

11 unchanged sentences

Asia Pacific 14.9 % 13.2 %

Three Months Ended March 31, 2025 Compared to Three Months Ended March 31, 2024

Professional service and other revenues decreased by $14.8 million or 14.7% during the three months ended March 31, 2025 as compared to the same period in the prior fiscal year;

down 12.6% after factoring in the unfavorable impact of foreign exchange rate changes.

The decrease was primarily due to the exclusion of professional services revenue contributions as a result of the AMC Divestiture.

Geographically, the overall change was attributable to a decrease in Americas of $6.9 million, a decrease in EMEA of $7.1 million and a decrease in Asia Pacific of $0.8 million.

Cost of Professional service and other revenues decreased by $10.0 million during the three months ended March 31, 2025 as compared to the same period in the prior fiscal year.

Three Months Ended September 30, 2025 Compared to Three Months Ended September 30, 2024

Professional service and other revenues decreased by $8.4 million or 9.3% during the three months ended September 30, 2025 as compared to the same period in the prior fiscal year;

down 12.2% after factoring in the favourable impact of foreign exchange rate changes.

Geographically, the overall change was attributable to a decrease in Americas of $7.4 million and a decrease in EMEA of $1.3 million, partially offset by an increase in Asia Pacific of $0.3 million.

Cost of Professional service and other revenues decreased by $3.9 million during the three months ended September 30, 2025 as compared to the same period in the prior fiscal year.

This was primarily due to a decrease in labour-related costs of $4.3 million.

Overall, the gross margin percentage on Professional service and other revenues decreased to 23% from 26%.

Nine Months Ended March 31, 2025 Compared to Nine Months Ended March 31, 2024

Professional service and other revenues decreased by $34.9 million or 11.5% during the nine months ended March 31, 2025 as compared to the same period in the prior fiscal year;

down 11.3% after factoring in the unfavorable impact of foreign exchange rate changes.

The decrease was partially due to the exclusion of professional services revenue contributions as a result of the AMC Divestiture over the comparative period.

Geographically, the overall change was attributable to a decrease in Americas of $21.0 million, a decrease in EMEA of $13.1 million and a decrease in Asia Pacific of $0.8 million

Cost of Professional service and other revenues decreased by $30.4 million during the nine months ended March 31, 2025 as compared to the same period in the prior fiscal year.

This was primarily due to a decrease in labour-related costs of $30.8 million.

Overall, the gross margin percentage on Professional service and other revenues increased to 26% from 24%.

Amortization of Acquired Technology-based Intangible Assets

Three Months Ended March 31, Nine Months Ended March 31,

Three Months Ended September 30,

(In thousands) 2025 Change

increase (decrease) 2024 2025 Change

increase (decrease) 2024

Amortization of acquired technology-based intangible assets $ 44,204 $ (3,040) $ 47,244

Amortization of acquired technology-based intangible assets decreased during the three months ended March 31, 2025 by $0.9 million as compared to the same period in the prior fiscal year.

Amortization of acquired technology-based intangible assets decreased during the three months ended September 30, 2025 by $3.0 million as compared to the same period in the prior fiscal year.

This was primarily due to a reduction in amortization related to technology-based intangible assets from previous acquisitions becoming fully amortized.

Amortization of acquired technology-based intangible assets decreased during the nine months ended March 31, 2025 by $54.1 million as compared to the same period in the prior fiscal year.

This was primarily due to a reduction in amortization related to the AMC Divestiture and reduced amortization related to technology-based intangible assets from previous acquisitions becoming fully amortized.

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Operating Expenses

Three Months Ended March 31, Nine Months Ended March 31,

Three Months Ended September 30,

(In thousands) 2025 Change

increase (decrease) 2024 2025 Change

increase (decrease) 2024

15 unchanged sentences

Special charges (recoveries) 1.6 % 3.7 %

__________________________

(1) Beginning in the first quarter of Fiscal 2025, the Company reclassified certain expenses previously included within Research and development to Sales and marketing in the Condensed Consolidated Statements of Income to provide a better representation of the function of the expenses and reclassified prior period information to conform to the current presentation.

Research and development expenses consist primarily of payroll and payroll-related benefits expenses, contracted research and development expenses, and facility costs.

1 unchanged sentence

The primary drivers are typically software upgrades and development.

Change between

Three Months Ended

March 31, 2025 and 2024

Change between

Nine Months Ended

March 31, 2025 and 2024

Change between Three Months Ended

September 30, 2025 and 2024

(In thousands)

increase (decrease) increase (decrease)

increase (decrease)

Payroll and payroll-related benefits $ (13,189)

5 unchanged sentences

Total change in research and development expenses $ (21,565)

Research and development expenses decreased by $29.2 million during the three months ended March 31, 2025 as compared to the same period in the prior fiscal year.

Payroll and payroll-related benefits, which is comprised of salaries, benefits and variable short-term incentives, decreased by $11.8 million, facility-related expenses decreased by $6.1 million, share-based compensation expense decreased by $5.0 million and contract labour and consulting expense decreased by $3.5 million.

Overall, our research and development expenses, as a percentage of total revenues, remained stable at 16% as compared to the same period in the prior fiscal year.

Research and development expenses decreased by $96.9 million during the nine months ended March 31, 2025 as compared to the same period in the prior fiscal year.

Payroll and payroll-related benefits, which is comprised of salaries, benefits and variable short-term incentives, decreased by $50.5 million, facility-related expenses decreased by $15.0 million, share-based compensation expense decreased by $13.1 million and contract labour and consulting decreased by $11.6 million.

Overall, our research and development expenses, as a percentage of total revenues, remained stable at 15% compared to the same period in the prior fiscal year.

Our research and development labour resources decreased by 608 employees, from 7,980 employees at March 31, 2024 to 7,372 employees at March 31, 2025.

Research and development expenses decreased by $21.6 million during the three months ended September 30, 2025 as compared to the same period in the prior fiscal year, primarily from restructuring and other cost savings initiatives.

Payroll and payroll-related benefits, which is comprised of salaries, benefits and variable short-term incentives, decreased by $13.2 million, share-based compensation expense decreased by $4.6 million, and contract labour and consulting expense decreased by $3.8 million.

Overall, our research and development expenses, as a percentage of total revenues, decreased to 13% down from 15% in the same period in the prior fiscal year.

Our research and development labour resources decreased by 397 employees, from 7,426 employees at September 30, 2024 to 7,029 employees at September 30, 2025.

Table o f Contents

Sales and marketing expenses consist primarily of personnel expenses and costs associated with advertising, marketing events and trade shows.

Change between

Three Months Ended

March 31, 2025 and 2024

Change between

Nine Months Ended

March 31, 2025 and 2024

(In thousands) increase (decrease) increase (decrease)

Change between Three Months Ended

September 30, 2025 and 2024

(In thousands) increase (decrease)

Payroll and payroll-related benefits $ 11,130

5 unchanged sentences

Facilities (459)

Credit loss expense

(2,151) 3,454

Credit loss expense (recovery) (236)

Other miscellaneous (304)

Total change in sales and marketing expenses $ 11,173

Sales and marketing expenses decreased by $43.6 million during the three months ended March 31, 2025 as compared to the same period in the prior fiscal year.

Payroll and payroll-related benefits, which is comprised of salaries, benefits and variable short-term incentives, decreased by $21.4 million, commissions decreased by $8.8 million, share-based compensation expense decreased by $4.1 million, and facility-related expenses decreased by $2.3 million.

Overall, our sales and marketing expenses, as a percentage of total revenues, remained stable at 21% compared to the same period in the prior fiscal year.

Sales and marketing expenses decreased by $91.5 million during the nine months ended March 31, 2025 as compared to the same period in the prior fiscal year.

Payroll and payroll-related benefits, which is comprised of salaries, benefits and variable short-term incentives, decreased by $63.2 million, share-based compensation expense decreased by $9.1 million, commissions decreased by $6.3 million, facility-related expenses decreased by $5.6 million, and contract labour and consulting

expenses decreased by $4.4 million.

Overall, our sales and marketing expenses, as a percentage of total revenues, remained stable at 20% compared to the same period in the prior fiscal year.

Our sales and marketing labour resources decreased by 486 employees, from 4,520 employees at March 31, 2024 to 4,034 employees at March 31, 2025.

Sales and marketing expenses increased by $11.2 million during the three months ended September 30, 2025 as compared to the same period in the prior fiscal year, primarily from higher sales and marketing headcount.

Payroll and payroll-related benefits, which is comprised of salaries, benefits and variable short-term incentives, increased by $11.1 million, commissions increased by $2.3 million and travel and communication expenses increased by $1.8 million.

These increases were partially offset by decreases in share-based compensation expense of $2.4 million and marketing expenses of $0.8 million.

Overall, our sales and marketing expenses, as a percentage of total revenues, increased to 20% from 19%.

Our sales and marketing labour resources increased by 154 employees, from 3,922 employees at September 30, 2024 to 4,076 employees at September 30, 2025.

General and administrative expenses consist primarily of payroll and payroll related benefits expenses, related overhead, audit fees, other professional fees, contract labour and consulting expenses and public company costs.

Change between

Three Months Ended

March 31, 2025 and 2024

Change between

Nine Months Ended

March 31, 2025 and 2024

(In thousands) increase (decrease) increase (decrease)

Change between Three Months Ended

September 30, 2025 and 2024

(In thousands) increase (decrease)

Payroll and payroll-related benefits $ (5,188)

5 unchanged sentences

Total change in general and administrative expenses $ (967)

General and administrative expenses decreased by $30.2 million during the three months ended March 31, 2025 as compared to the same period in the prior fiscal year.

Other miscellaneous costs, which include professional fees such as legal, audit and tax related expenses, decreased by $16.6 million primarily driven by a reduction in costs related to IP, including the grant of certain IP rights and the resolution of certain historical IP related matters in the prior fiscal year, and reductions in other professional fees.

Additionally, payroll and payroll-related benefits, which is comprised of salaries, benefits and variable short-term incentives, decreased by $7.6 million and contract labour and consulting expenses decreased by $5.1 million.

Overall, general and administrative expenses, as a percentage of total revenues, decreased to 9% compared to 10% for the same period in the prior fiscal year.

General and administrative expenses decreased by $128.6 million during the nine months ended March 31, 2025 as compared to the same period in the prior fiscal year.

Other miscellaneous costs, which include professional fees such as legal, audit and tax related expenses, decreased by $64.8 million primarily driven by a reduction in costs related to IP, including the grant of certain IP rights and the resolution of certain historical IP related matters in the prior fiscal year, and reductions in other professional fees.

Additionally, payroll and payroll-related benefits, which is comprised of salaries, benefits and variable short-term incentives, decreased by $29.0 million, contract labour and consulting expenses decreased by $25.8 million and travel and communication expenses decreased by $7.6 million.

Overall, general and administrative expenses, as a percentage of total revenues, decreased to 8% compared to 10% for the same period in the prior fiscal year.

Our general and administrative labour resources decreased by 507 employees, from 3,514 employees at March 31, 2024 to 3,007 employees at March 31, 2025.

General and administrative expenses decreased by $1.0 million during the three months ended September 30, 2025 as compared to the same period in the prior fiscal year primarily from restructuring and other cost savings initiatives.

Payroll-related benefits, which is comprised of salaries, benefits and variable short-term incentives, decreased by $5.2 million and share-based compensation decreased by $3.4 million, partially offset by increases in contract labour and consulting expenses of $4.1 million and facility-related expenses of $3.6 million.

Overall, general and administrative expenses, as a percentage of total revenues, remained stable at 8% compared to same period in the prior fiscal year.

Our general and administrative labour resources decreased by 446 employees, from 3,242 employees at September 30, 2024 to 2,796 employees at September 30, 2025.

Depreciation expenses:

Three Months Ended March 31, Nine Months Ended March 31,

Three Months Ended September 30,

(In thousands) 2025 Change

increase (decrease) 2024 2025 Change

increase (decrease) 2024

Depreciation $ 35,921 $ 3,750 $ 32,171

Depreciation expenses increased during the three months ended March 31, 2025 by $0.4 million as compared to the same period in the prior fiscal year.

Depreciation expenses, as a percentage of total revenue, increased for the three months ended March 31, 2025 to approximately 3% as compared to 2% for the same period in the prior fiscal year.

Depreciation expenses decreased during the nine months ended March 31, 2025 by $3.1 million compared to the same period in the prior fiscal year.

Depreciation expenses, as a percentage of total revenue, remained stable for the nine months ended March 31, 2025 at 3% as compared to the same period in the prior fiscal year.

Depreciation expenses increased during the three months ended September 30, 2025 by $3.8 million compared to the same period in the prior fiscal year.

Depreciation expenses, as a percentage of total revenues, remained stable for the three months ended September 30, 2025 at 3% as compared to the same period in the prior fiscal year.

Table o f Contents

Amortization of acquired customer-based intangible assets:

Three Months Ended March 31, Nine Months Ended March 31,

Three Months Ended September 30,

(In thousands) 2025 Change

increase (decrease) 2024 2025 Change

increase (decrease) 2024

Amortization of acquired customer-based intangible assets $ 79,561 $ (1,943) $ 81,504

Amortization of acquired customer-based intangible assets decreased during the three months ended March 31, 2025 by $21.2 million, as compared to the same period in the prior fiscal year.

This was primarily due to a reduction in amortization related to customer-based intangible assets from previous acquisitions becoming fully amortized.

Amortization of acquired customer-based intangible assets decreased during the nine months ended March 31, 2025 by $92.7 million, as compared to the same period in the prior fiscal year.

This was primarily due to a reduction in amortization related to the AMC Divestiture and reduced amortization related to customer-based intangible assets from previous acquisitions becoming fully amortized.

Amortization of acquired customer-based intangible assets decreased during the three months ended September 30, 2025 by $1.9 million as compared to the same period in the prior fiscal year.

This was due to a reduction in amortization related to customer-based intangible assets from previous acquisitions becoming fully amortized.

Special charges (recoveries):

3 unchanged sentences

In certain limited situations, if the planned activity does not need to be implemented, or an expense lower than anticipated is paid out, we record a recovery of the originally recorded expense to Special charges (recoveries).

Three Months Ended March 31, Nine Months Ended March 31,

Three Months Ended September 30,

(In thousands) 2025 Change

increase (decrease) 2024 2025 Change

increase (decrease) 2024

Special charges (recoveries) $ 20,139 $ (26,997) $ 47,136

Special charges (recoveries) decreased by $15.7 million during the three months ended March 31, 2025 over the comparative period.

This was primarily due to a decrease in restructuring costs related to the Micro Focus Acquisition of $9.6 million and a decrease in divestiture costs of $6.9 million, partially offset by an increase related to the Business Optimization Plan of $2.3 million, as compared to the same period in the prior fiscal year.

Special charges (recoveries) decreased by $21.3 million during the nine months ended March 31, 2025 as compared to the same period in the prior fiscal year.

Restructuring costs related to the Micro Focus Acquisition decreased by $62.3 million, divestiture costs decreased by $9.7 million and other miscellaneous charges decreased by $4.9 million, partially offset by an increase in restructuring costs of $57.1 million related to the Business Optimization Plan, as compared to the same period in the prior fiscal year.

Special charges (recoveries) decreased by $27.0 million during the three months ended September 30, 2025 as compared to the same period in the prior fiscal year.

This was due to a decrease in restructuring costs of $28.9 million, primarily related to the timing of Business Optimization Plan initiatives, and a decrease in divestiture costs of $3.2 million, partially offset by an increase in other miscellaneous charges of $5.9 million, as compared to the same period in the prior fiscal year.

For more details on Special charges (recoveries), see Note 16 “Special Charges (Recoveries)” to our Condensed Consolidated Financial Statements.

1 unchanged sentence

The components of other income (expense), net were as follows:

Three Months Ended March 31, Nine Months Ended March 31,

Three Months Ended September 30,

(In thousands) 2025 Change

increase (decrease) 2024 2025 Change

increase (decrease) 2024

1 unchanged sentence

$ (13,155) $ (1,776) $ (11,379)

Unrealized gains (losses) on derivatives

not designated as hedges (1)

(9,836) (26,507) 16,671 10,778 14,329 (3,551)

Realized losses on derivatives

not designated as hedges (2)

Unrealized gains (losses) on derivatives not designated as hedges (1)

7,843 32,778 (24,935)

1 unchanged sentence

2,417 1,962 455

Adjustment to gain on AMC Divestiture (4)

— — — (4,175) (4,175) —

Loss on debt extinguishment (5)

— 10,803 (10,803) — 10,803 (10,803)

Other miscellaneous income (expense) (81) (285) 204

2 unchanged sentences

(1) Represents the unrealized gains (losses) on our derivatives not designated as hedges related to the Micro Focus Acquisition (see Note 15 “Derivative Instruments and Hedging Activities” to our Condensed Consolidated Financial Statements for more details).

(2) Represents the realized gains (losses) from the early termination of cross currency swaps on our derivatives not designated as hedges related to the Micro Focus Acquisition (see Note 15 “Derivative Instruments and Hedging Activities” for more details).

(3) 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.

(2) Represents our share in net income (loss) of equity investees, which approximates fair value and is 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” to our Condensed Consolidated Financial Statements for more details).

(4) Represents final settlement of working capital and other adjustments (see Note 17 “Acquisitions and Divestitures” to our Condensed Consolidated Financial Statements for more details).

(5) During the three and nine months ended March 31, 2024, we recognized a loss on debt extinguishment of $10.8 million related to the acceleration and recognition of unamortized debt discount and issuance costs resulting from the optional repayments of the Acquisition Term Loan in Fiscal 2024.

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Interest and Other Related Expense, Net

Interest and other related expense, net is primarily comprised of interest paid and accrued on our debt facilities, offset by interest income earned on our cash and cash equivalents.

Three Months Ended March 31, Nine Months Ended March 31,

Three Months Ended September 30,

(In thousands) 2025 Change

increase (decrease) 2024 2025 Change

increase (decrease) 2024

11 unchanged sentences

We operate in several tax jurisdictions and are exposed to various foreign tax rates.

Three Months Ended March 31, Nine Months Ended March 31,

Three Months Ended September 30,

(In thousands) 2025 Change

increase (decrease) 2024 2025 Change

increase (decrease) 2024

1 unchanged sentence

$ 39,199 $ 37,316 $ 1,883

The Company’s effective tax rate for the three months ended March 31, 2025 increased to a provision of 10.5% compared to a provision of 5.8% for the three months ended March 31, 2024.

The Company’s effective tax rate for the three months ended March 31, 2025 differs from the Canadian statutory rate of 26.5% primarily due to tax benefits related to foreign tax

credits, research and development credits, and the effect of foreign rate differences, partially offset by withholding taxes, foreign source income inclusion in the U.S.

and a net increase in unrecognized tax benefits.

The Company’s effective tax rate for the three months ended March 31, 2024 differs from the Canadian statutory rate primarily due to tax benefits related to change in valuation allowance, foreign tax credits, and research and development credits, partially offset by U.S.

Base Erosion and Anti-Abuse Tax (BEAT), withholding taxes, and an increase to uncertain tax positions.

The Company’s effective tax rate for the nine months ended March 31, 2025 increased to a provision of 13.5% compared to a provision of 10.1% for the nine months ended March 31, 2024.

The Company’s effective tax rate for the nine months ended March 31, 2025 differs from the Canadian statutory rate of 26.5% primarily due to tax benefits related to a net decrease in unrecognized tax benefits, foreign tax credits, research and development credits, partially offset by withholding taxes and foreign source income inclusion in the U.S.

The Company’s effective tax rate for the nine months ended March 31, 2024 differs from the Canadian statutory rate primarily due to tax benefits related to foreign tax credits, research and development credits, and a change in valuation allowance, partially offset by U.S.

BEAT and withholding taxes.

Numerous countries have agreed to a statement in support of the Organization for Economic Co-Operation and Development model rules that propose a global minimum tax rate of 15.0% for companies with revenue above €750.0 million, calculated on a country-by-country basis, and E.U.

member states have agreed to implement the global minimum tax.

On June 20, 2024, Canada enacted the new Global Minimum Tax Act, imposing a 15.0% global minimum tax on profits.

Certain other countries have enacted or are expected to enact similar legislation.

We are unable to predict when and how such rules in various jurisdictions will be enacted into law;

however, it is possible that the implementation of relevant legislation could impact our liability for taxes.

As of the three and nine months ended March 31, 2025, the impact of the global minimum tax is not material.

For information on certain potential tax contingencies, including the Canada Revenue Agency (CRA) matter, see Note 12 “Guarantees and Contingencies” and Note 13 “Income Taxes” to our Condensed Consolidated Financial Statements, as well as Part I, Item 1A, “Risk Factors” in our Annual Report on Form 10-K for Fiscal 2024.

The Company’s effective tax rate for the three months ended September 30, 2025 was 21.1%, compared to a provision of 2.2% for the three months ended September 30, 2024.

The Company’s effective tax rate for the three months ended September 30, 2025, differs from the Canadian federal and provincial statutory rate of 26.5% primarily due to tax benefits related to foreign tax credits, research and development credits, and changes in unrecognized tax benefits, partially offset by foreign source income inclusion in the U.S.

and withholding taxes.

The Company’s effective tax rate for the three months ended September 30, 2024 differs from the Canadian statutory rate primarily due to tax benefits related to foreign tax credits, research and development credits, changes in unrecognized tax benefits, and differences in tax filings from provision, partially offset by disallowed share based compensation deductions, foreign source income inclusion in the U.S., and withholding taxes.

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 tax provision for the period ended September 30, 2025.

For information on certain potential tax contingencies, including the CRA matter, see Note 12 “Guarantees and Contingencies” and Note 13 “Income Taxes” to our Condensed Consolidated Financial Statements, as well as Part I, Item 1A, “Risk Factors” in our Annual Report on Form 10-K for Fiscal 2025.

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Use of Non-GAAP Financial Measures

17 unchanged sentences

Non-GAAP-based income from operations is calculated as GAAP-based income from operations, excluding the amortization of acquired intangible assets, special charges (recoveries), and share-based compensation expense.

Adjusted earnings before interest, taxes, depreciation and amortization (Adjusted EBITDA) is consistently 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).

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).

Adjusted EBITDA margin is calculated as Adjusted EBITDA expressed as a percentage of total revenue.

Free cash flows is defined and calculated as GAAP-based cash flows provided by operating activities less capital expenditures.

The Company’s management believes that the presentation of the above defined Non-GAAP financial measures provides useful information to investors because they portray the financial results of the Company before the impact of certain non-operational charges.

2 unchanged sentences

The Company does not acquire businesses on a predictable cycle, and therefore believes that the presentation of Non-GAAP measures, which in certain cases adjust for the impact of amortization of intangible assets and the related tax effects that are primarily related to acquisitions, will provide readers of financial statements with a more consistent basis for comparison across accounting periods and be more useful in helping readers understand the Company’s operating results and underlying operational trends.

Additionally, the Company has engaged in various restructuring activities over the past several years, primarily due to acquisitions, that have resulted in costs associated with reductions in headcount, consolidation of leased facilities and related costs, all which are recorded under the Company’s Special charges (recoveries) caption on the Condensed Consolidated Statements of Income.

Additionally, the Company has engaged in various restructuring activities over the past several years, primarily due to acquisitions and most recently in response to our return to office planning, that have resulted in costs associated with reductions in headcount, consolidation of leased facilities and related costs, all which are recorded under the Company’s Special charges (recoveries) caption on the Condensed Consolidated Statements of Income.

Each restructuring activity is a discrete event based on a unique set of business objectives or circumstances, and each differs in terms of its operational implementation, business impact and scope, and the size of each restructuring plan can vary significantly from period to period.

Therefore, the Company believes that the exclusion of these special charges (recoveries) will also better aid readers of financial statements in the understanding and comparability of the Company’s operating results and underlying operational trends.

In summary, the Company believes the provision of supplemental Non-GAAP measures allow investors to evaluate the operational and financial performance of the Company's core business using the same evaluation measures that management uses, and is therefore a useful indication of OpenText's performance or expected performance of future operations and facilitates period-to-period comparison of operating performance (although prior performance is not necessarily indicative of future performance).

In summary, the Company believes the provision of supplemental Non-GAAP measures allow investors to evaluate the operational and financial performance of the Company’s core business using the same evaluation measures that management uses, and is therefore a useful indication of OpenText’s performance or expected performance of future operations and facilitates period-to-period comparison of operating performance (although prior performance is not necessarily indicative of

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future performance).

As a result, the Company considers it appropriate and reasonable to provide, in addition to U.S.

2 unchanged sentences

GAAP-based financial measures to Non-GAAP-based financial measures for the following periods presented.

The Micro Focus Acquisition significantly impacts period-over-period comparability.

Reconciliation of selected GAAP-based measures to Non-GAAP-based measures

for the three months ended March 31, 2025

for the three months ended September 30, 2025

(In thousands, except for per share data)

Three Months Ended March 31, 2025

Three Months Ended September 30, 2025

GAAP-based Measures GAAP-based Measures

40 unchanged sentences

In arriving at our Non-GAAP-based tax rate of approximately 24%, we analyzed the individual adjusted expenses and took into consideration the impact of statutory tax rates from local jurisdictions incurring the expense.

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(8) Reconciliation of GAAP-based net income to Non-GAAP-based net income:

Three Months Ended March 31, 2025

Three Months Ended September 30, 2025

Per share diluted

11 unchanged sentences

Reconciliation of Adjusted EBITDA

Three Months Ended March 31, 2025

Three Months Ended September 30, 2025

GAAP-based net income, attributable to OpenText

8 unchanged sentences

Adjusted EBITDA $ 467,411

GAAP-based net income margin 11.4 %

Adjusted EBITDA margin 36.3 %

Reconciliation of Free Cash Flows

Three Months Ended September 30, 2025

GAAP-based cash flows provided by operating activities $ 147,763

Capital expenditures (46,534)

Free cash flows

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Reconciliation of selected GAAP-based measures to Non-GAAP-based measures

for the three months ended March 31, 2024

for the three months ended September 30, 2024

(In thousands, except for per share data)

Three Months Ended March 31, 2024

Three Months Ended September 30, 2024

GAAP-based Measures GAAP-based Measures

38 unchanged sentences

Also excluded are tax benefits/expense items unrelated to current period income such as changes in reserves for tax uncertainties and valuation allowance reserves, and “book to return” adjustments for tax return filings and tax assessments.

Included is the amount of net tax benefits arising from the internal reorganization that occurred in Fiscal 2017 assumed to be allocable to the current period based on the forecasted utilization period.

In arriving at our Non-GAAP-based tax rate of approximately 14%, we analyzed the individual adjusted expenses and took into consideration the impact of statutory tax rates from local jurisdictions incurring the expense.

(8) Reconciliation of GAAP-based net income to Non-GAAP-based net income:

Three Months Ended March 31, 2024

Per share diluted

GAAP-based net income, attributable to OpenText

$ 98,285 $ 0.36

Amortization 148,935 0.55

Share-based compensation 36,042 0.13

Special charges (recoveries) 19,561 0.07

Other (income) expense, net (9,950) (0.04)

GAAP-based provision for income taxes

Non-GAAP-based provision for income taxes

(41,852) (0.15)

Non-GAAP-based net income, attributable to OpenText

$ 257,049 $ 0.94

Reconciliation of Adjusted EBITDA

Three Months Ended March 31, 2024

GAAP-based net income, attributable to OpenText

Provision for income taxes

Interest and other related expense, net 132,663

Amortization of acquired technology-based intangible assets 48,094

Amortization of acquired customer-based intangible assets 100,841

Depreciation 32,109

Share-based compensation 36,042

Special charges (recoveries) 19,561

Other (income) expense, net (9,950)

Adjusted EBITDA $ 463,673

Reconciliation of selected GAAP-based measures to Non-GAAP-based measures

for the nine months ended March 31, 2025

(In thousands, except for per share data)

Nine Months Ended March 31, 2025

GAAP-based Measures GAAP-based Measures

% of Total Revenue Adjustments Note Non-GAAP-based Measures Non-GAAP-based Measures

% of Total Revenue

Cost of revenues

Cloud services and subscriptions $ 521,731 $ (6,828) (1) $ 514,903

Customer support 186,963 (3,293) (1) 183,670

Professional service and other 200,443 (3,509) (1) 196,934

Amortization of acquired technology-based intangible assets 141,646 (141,646) (2) —

GAAP-based gross profit and gross margin (%) / Non-GAAP-based gross profit and gross margin (%) 2,786,588 72.2% 155,276 (3) 2,941,864 76.3%

Operating expenses

Research and development 568,753 (20,560) (1) 548,193

Sales and marketing 779,913 (27,380) (1) 752,533

General and administrative 321,804 (21,349) (1) 300,455

Amortization of acquired customer-based intangible assets 242,235 (242,235) (2) —

Special charges (recoveries) 66,228 (66,228) (4) —

GAAP-based income from operations / Non-GAAP-based income from operations

711,131 533,028 (5) 1,244,159

Other income (expense), net 6,382 (6,382) (6) —

Provision for income taxes

63,618 175,768 (7) 239,386

GAAP-based net income / Non-GAAP-based net income, attributable to OpenText

407,035 350,878 (8) 757,913

GAAP-based earnings per share / Non-GAAP-based earnings per share-diluted, attributable to OpenText $ 1.53 $ 1.32 (8) $ 2.85

______________________

(1) Adjustment relates to the exclusion of share-based compensation expense from our Non-GAAP-based operating expenses as this expense is excluded from our internal analysis of operating results.

(2) Adjustment relates to the exclusion of amortization expense from our Non-GAAP-based operating expenses as the timing and frequency of amortization expense is dependent on our acquisitions and is hence excluded from our internal analysis of operating results.

(3) GAAP-based and Non-GAAP-based gross profit stated in dollars and gross margin stated as a percentage of total revenue.

(4) Adjustment relates to the exclusion of special charges (recoveries) from our Non-GAAP-based operating expenses as special charges (recoveries) are generally incurred in the periods relevant to an acquisition and include certain charges or recoveries that are not indicative or related to continuing operations and are therefore excluded from our internal analysis of operating results.

See Note 16 “Special Charges (Recoveries)” to our Condensed Consolidated Financial Statements for more details.

(5) GAAP-based and Non-GAAP-based income from operations stated in dollars.

(6) Adjustment relates to the exclusion of other income (expense) from our Non-GAAP-based operating expenses as other income (expense) generally relates to the transactional impact of foreign exchange and is generally not indicative or related to continuing operations and is therefore excluded from our internal analysis of operating results.

Other income (expense) also includes our share of income (losses) from our holdings in investments as a limited partner.

We do not actively trade equity securities in these privately held companies nor do we plan our ongoing operations based around any anticipated fundings or distributions from these investments.

We exclude gains and losses on these investments as we do not believe they are reflective of our ongoing business and operating results.

Other income (expense) also includes unrealized and realized gains (losses) on our derivatives which are not designated as hedges.

We exclude gains and losses on these derivatives as we do not believe they are reflective on our ongoing business and operating results.

(7) Adjustment relates to differences between the GAAP-based tax provision rate of approximately 14% and a Non-GAAP-based tax rate of approximately 24%;

these rate differences are due to the income tax effects of items that are excluded for the purpose of calculating Non-GAAP-based net income.

Such excluded items include amortization, share-based compensation, special charges (recoveries) and other income (expense), net.

Also excluded are tax benefits/expense items unrelated to current period income such as changes in reserves for tax uncertainties and valuation allowance reserves and “book to return” adjustments for tax return filings and tax assessments.

Beginning in Fiscal 2025, net tax benefits arising from the internal reorganization that occurred in Fiscal 2017 have been fully utilized and are no longer included.

1 unchanged sentence

(8) Reconciliation of GAAP-based net income to Non-GAAP-based net income:

Nine Months Ended March 31, 2025

Per share diluted

GAAP-based net income, attributable to OpenText

$ 407,035 $ 1.53

Amortization 383,881 1.44

Share-based compensation 82,919 0.31

Special charges (recoveries) 66,228 0.25

Other (income) expense, net (6,382) (0.02)

GAAP-based provision for income taxes

Non-GAAP-based provision for income taxes

(239,386) (0.90)

Non-GAAP-based net income, attributable to OpenText

$ 757,913 $ 2.85

Reconciliation of Adjusted EBITDA

Nine Months Ended March 31, 2025

GAAP-based net income, attributable to OpenText

Provision for income taxes

Interest and other related expense, net 246,713

Amortization of acquired technology-based intangible assets 141,646

Amortization of acquired customer-based intangible assets 242,235

Depreciation 96,524

Share-based compensation 82,919

Special charges (recoveries) 66,228

Other (income) expense, net (6,382)

Adjusted EBITDA $ 1,340,536

Reconciliation of selected GAAP-based measures to Non-GAAP-based measures

for the nine months ended March 31, 2024

(In thousands, except for per share data)

Nine Months Ended March 31, 2024

GAAP-based Measures GAAP-based Measures

% of Total Revenue Adjustments Note Non-GAAP-based Measures Non-GAAP-based Measures

% of Total Revenue

Cost of revenues

Cloud services and subscriptions $ 537,960 $ (9,892) (1) $ 528,068

Customer support 223,027 (3,335) (1) 219,692

Professional service and other 230,836 (5,096) (1) 225,740

Amortization of acquired technology-based intangible assets 195,702 (195,702) (2) —

GAAP-based gross profit and gross margin (%) / Non-GAAP-based gross profit and gross margin (%) 3,203,312 72.7% 214,025 (3) 3,417,337 77.5%

Operating expenses

Research and development 665,608 (35,300) (1) 630,307

Sales and marketing 871,384 (37,294) (1) 834,091

General and administrative 450,399 (22,395) (1) 428,004

Amortization of acquired customer-based intangible assets 334,958 (334,958) (2) —

Special charges (recoveries) 87,521 (87,521) (4) —

GAAP-based income from operations / Non-GAAP-based income from operations

693,827 731,493 (5) 1,425,320

Other income (expense), net (38,664) 38,664 (6) —

Provision for income taxes

24,434 117,191 (7) 141,625

GAAP-based net income / Non-GAAP-based net income, attributable to OpenText

216,861 652,966 (8) 869,827

GAAP-based earnings per share / Non-GAAP-based earnings per share-diluted, attributable to OpenText $ 0.80 $ 2.39 (8) $ 3.19