NICE Q3 Earnings Beat Estimates on Strong Cloud Revenues, Shares Down

Nice NICE reported adjusted earnings of $3.18 per share in the third quarter of 2025, beating the Zacks Consensus Estimate by 0.32% and increasing 10% year over year.

Non-GAAP revenues of $732 million surpassed the consensus mark by 0.56% and rose 6% year over year. The uptick was primarily driven by the continued strength of its cloud business and the ongoing expansion of its customer base.

Revenues in the Americas were $618 million, up 5% year over year. The same in EMEA was $74 million in the reported quarter, up 7% year over year. APAC revenues increased 19% year over year to $40 million.

NICE shares have lost 3.35% in the pre-market trading.

Nice Price, Consensus and EPS Surprise

Nice price-consensus-eps-surprise-chart | Nice Quote

NICE’s Top-Line Details

Cloud revenues (76.9% of revenues) of $562.9 million beat the Zacks Consensus Estimate by 0.64% and rose 13% year over year.

Strong cloud revenue growth fueled a solid year-over-year increase in total revenues, driven by growth in the adoption of CXone Mpower by customers. 

Service revenues (18.9% of revenues) of $138.7 million missed the consensus mark by 0.40% and declined 7.4% year over year.

Product revenues (4.1% of revenues) of $30.4 million beat the consensus mark by 3.55% but decreased 24.1% year over year.

Both Service and Product revenues declined as large enterprises continued transitioning from on-premise to the cloud platform.

NICE is driving growth through its focus on cloud, especially with the CXone Mpower platform. Its agentic AI boosts efficiency and improves customer experiences, strengthening NICE’s position in the CX market.

NICE Operating Details

On a non-GAAP basis, the gross margin contracted 120 basis points (bps) to 69.9% in the reported quarter. 

Research and development expenses, as a percentage of revenues, were down 90 bps year over year to 12.4%. Sales and marketing expenses, as a percentage of revenues, were in line year over year at 22.1%.

General and administrative expenses, as a percentage of revenues, decreased 40 bps year over year to 10.4%.

On a non-GAAP basis, operating expenses, as a percentage of revenues, contracted 70 bps year over year to 38.4%.

The non-GAAP operating margin contracted 50 bps on a year-over-year basis to 31.5%.

The non-GAAP EBITDA margin contracted 40 bps to 34.7%.

NICE Balance Sheet & Cash Flow Statement

As of Sept. 30, 2025, NICE had cash and cash equivalents (including short-term investments) of $455.9 million compared with $1.63 billion as of June 30, 2025.

In the third quarter of 2025, all outstanding debt was fully settled in cash.

The company’s cash flow from operations in the third quarter was $190.5 million compared with $61.32 million in the prior quarter.

In the third quarter of 2025, $40.6 million was allocated for the repurchase of shares.

NICE Provides Full-Year 2025 Guidance

NICE projects non-GAAP revenues between $2.93 billion and $2.94 billion, implying 7% year-over-year growth at the midpoint.

Non-GAAP earnings are estimated to be $12.18-12.32 per share, suggesting 10% year-over-year growth at the midpoint.

NICE Zacks Rank & Stocks to Consider

Currently, NICE has a Zacks Rank #3 (Hold).

NVIDIA NVDA, Bullish BLSH, and Dell Technologies DELL are some better-ranked stocks that investors can consider in the broader sector. Each stock presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

NVIDIA shares have risen 39.1% year to date. NVDA is scheduled to report third-quarter fiscal 2026 results on Nov. 19. 

Shares of Bullish have declined 39.7% year to date. BLSH is set to report third-quarter 2025 results on Nov. 19.

Shares of Dell Technologies have gained 16.2% year to date. DELL is set to report third-quarter fiscal 2026 results on Nov. 25.

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This article originally published on Zacks Investment Research (zacks.com).

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