NICE Delivers Double-Digit EPS Growth and Accelerates AI Momentum in Q3 2025
AI-Focused Strategy Drives Standout Q3 Performance
NICE's third quarter of 2025 showcased clear benefits from its AI-first strategy, reporting cloud revenue growth of 13% year-over-year and raising its full-year 2025 guidance. The company's integration of Cognigy—a leader in conversational and agentic AI—added to the momentum, particularly in driving annual recurring revenue from AI-powered customer experience solutions.
Financial Highlights Underscore Operating Leverage
NICE achieved solid results across several financial metrics. Here are the headline numbers for Q3 2025:
| Metric | GAAP | Non-GAAP | Y/Y Growth |
|---|---|---|---|
| Total Revenue | $732.0M | $732.0M | 6% |
| Cloud Revenue | $562.9M | $562.9M | 13% |
| Operating Income | $160.8M | $230.9M | 14% (GAAP) / 5% (Non-GAAP) |
| Diluted EPS | $2.29 | $3.18 | 23% (GAAP) / 10% (Non-GAAP) |
| Operating Margin | 22.0% | 31.5% | +1.5 ppt (GAAP) |
| Net Cash from Ops | $190.5M | — | 20% |
AI Annual Recurring Revenue Growth Hits 49%
NICE's AI-powered customer experience solutions are seeing dramatic traction. The company's AI annual recurring revenue surged 49% year-over-year (43% excluding the Cognigy acquisition), highlighting the strong demand for AI-driven platforms in enterprise settings. Notably, AI features were part of every new seven-figure customer experience (CX) deal signed during the quarter, reinforcing the strategic importance of AI integration in NICE’s offering.
Guidance Raised as Execution Remains Strong
The company has raised its full-year 2025 non-GAAP revenue guidance to between $2.93 billion and $2.95 billion—implying about 7% year-over-year growth. NICE is also expecting non-GAAP fully diluted EPS to be in the $12.18–$12.32 range, or approximately 10% growth at the midpoint versus last year. These updates reflect both the strength of current performance and management’s confidence in ongoing integration efforts and innovation, particularly around AI-driven CX.
| 2025 Full-Year Guidance (Non-GAAP) | Prior | Updated | Y/Y Growth (Midpoint) |
|---|---|---|---|
| Total Revenue | ~$2.93B | $2.93–$2.95B | 7% |
| EPS | ~$12.18 | $12.18–$12.32 | 10% |
Cash Flow Remains Robust with Debt Fully Repaid
During the quarter, NICE generated $190.5 million in operating cash flow, representing 20% growth year-over-year. The company also used $40.6 million for share repurchases and fully settled its outstanding debt, ending with $455.9 million in net cash and investments. This positions NICE well for continued investment and shareholder returns.
Takeaway: Strong AI Execution Positions NICE for Continued Industry Leadership
With robust double-digit growth in key earnings metrics, strong cash flow, a clean balance sheet, and leadership in AI-powered CX, NICE continues to set the pace for digital transformation in enterprise software. The integration of Cognigy and acceleration in AI-related ARR highlight both the success of NICE’s current strategy and its position for future industry growth.
For investors and industry watchers, the company’s increased guidance and focus on expanding AI in its customer experience platform will be key themes to follow as 2025 unfolds. With a solid financial foundation and rapidly scaling AI adoption, NICE appears well-equipped to capitalize on the evolving demands of the enterprise cloud and AI marketplace.
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