Rimini Street’s Earnings Call: Mixed Sentiments and Strategic Shifts

Rimini Street ((RMNI)) has held its Q2 earnings call. Read on for the main highlights of the call.

Rimini Street’s recent earnings call presented a mixed sentiment, highlighting both positive strides and challenges. The company showcased strong sales momentum, successful litigation settlements, and new partnerships, yet faced reductions in recurring revenue and billings, alongside macro-economic challenges impacting their operations.

Strong Sales Momentum

Rimini Street reported a robust sales momentum, marked by new client sales with Total Contract Value (TCV) exceeding $1 million. The company also experienced a strong quarter for Annual Recurring Revenue (ARR) subscription renewals, indicating a healthy demand for their services.

Litigation Settlement with Oracle

A significant highlight of the call was the settlement agreement with Oracle, which resolved long-standing litigation issues. Rimini Street received $37.9 million from Oracle, covering attorney’s fees and costs, providing a financial boost and removing a major legal overhang.

Revenue Growth and Gross Margin Improvement

Rimini Street’s revenue for Q2 2025 reached $104.1 million, reflecting a 1% year-over-year increase. The company also improved its gross margin to 60.4%, up from 59.1% in the previous year, showcasing operational efficiency gains.

New Partnerships and Product Offerings

The company announced strategic partnerships with Merlin Cyber and Dayforce, expanding their service offerings. These partnerships, along with successful client engagements with ServiceNow, are expected to enhance their market position and service capabilities.

Decline in Annualized Recurring Revenue

Despite positive developments, Rimini Street faced a 1.3% year-over-year decline in annualized recurring revenue, totaling $394.1 million. This decline reflects challenges in maintaining consistent revenue streams.

Decrease in Billings

Billings for Q2 were reported at $110.6 million, a slight decrease of 0.9% year-over-year. However, when excluding PeopleSoft, adjusted billings showed a 3.9% increase, indicating underlying growth in other areas.

Impact of Macro-Economic Instability

The company acknowledged the impact of global market instability, including tariffs and deglobalization, which are affecting client industries and IT spending, posing challenges to their growth trajectory.

PeopleSoft Revenue Wind-Down

As part of the Oracle settlement, Rimini Street is winding down its PeopleSoft services, which will impact future revenue streams. This strategic shift is part of their broader realignment efforts.

Forward-Looking Guidance

Looking ahead, Rimini Street plans to reinitiate guidance during their Analyst Day in the fourth quarter. The company reported a net income of $30.3 million and ended the quarter with a cash balance of $101.3 million. Despite challenges, the company remains optimistic about future growth opportunities.

In conclusion, Rimini Street’s earnings call reflected a balanced narrative of achievements and challenges. While the company made significant strides in sales and legal resolutions, it continues to navigate revenue declines and macro-economic pressures. Investors will be keenly watching how Rimini Street leverages its new partnerships and strategic shifts to drive future growth.