<div id="readability-page-1"><p>Kaltura, Inc. ((KLTR)) has held its Q1 earnings call. Read on for the main highlights of the call.</p><h3>Claim 55% Off TipRanks</h3><ul><li>Unlock  hedge fund-level data  and  powerful investing tools  for smarter, sharper decisions  </li><li> Discover top-performing stock ideas and upgrade to a portfolio of market leaders with  Smart Investor Picks  </li></ul> <p>Kaltura’s latest earnings call painted a cautiously upbeat picture, as management highlighted better‑than‑expected profitability and cash generation while acknowledging ongoing revenue pressure and customer churn. Executives struck a constructive tone around new AI products and acquisitions, but tempered enthusiasm with modest growth forecasts and clear recognition of headwinds in media, telecom and retention metrics.</p> <h2>Beat Guidance Across Key Metrics</h2> <p>Kaltura outperformed its own targets in the quarter, delivering total revenue of $44.6 million, surpassing the high end of guidance alongside subscription revenue of $43.2 million. Adjusted EBITDA reached $5.7 million, also above the guided range, underscoring disciplined execution despite a challenging demand backdrop and softness in certain segments.</p> <h2>Improved Profitability and Margins</h2> <p>Profitability moved in the right direction, with adjusted EBITDA climbing 37% year over year to $5.7 million and margin improving to 13%, up 400 basis points. GAAP gross margin advanced to 72%, an improvement of 200 basis points, while subscription gross margin held steady at a solid 77%, reflecting a resilient core SaaS model.</p> <h2>First-Ever Positive Q1 Operating Cash Flow</h2> <p>For the first time, Kaltura generated positive operating cash flow in a first quarter, posting $0.7 million versus an outflow of $1.0 million a year ago. That performance helped lift the cash balance to $61.8 million, reinforcing the company’s liquidity and offering more flexibility to invest in growth initiatives and integration efforts.</p> <h2>Product and AI Momentum</h2> <p>Management emphasized growing traction in AI and video innovation, moving its conversational Avatar technology and Avatar Video Production Studio from beta to general availability. The company also expanded its Content Lab and Genie offerings and secured ISO certification for its AI management systems, aiming to differentiate on compliance and enterprise‑grade capabilities.</p> <h2>Strategic Acquisitions and Integration Progress</h2> <p>Kaltura continued to lean on M&amp;A to build out its platform, closing the PathFactory acquisition at the start of April and advancing integration of both eSelf.ai and PathFactory. Executives cited early joint go‑to‑market activity and encouraging initial customer engagements, suggesting that cross‑sell and upsell opportunities could gradually support growth and product depth.</p> <h2>Healthy Deal Quality and New Wins</h2> <p>While top‑line growth is muted, deal quality appeared strong, with new subscription bookings including one seven‑digit contract and 14 six‑digit deals. New customer wins spanned a global content‑delivery network, a leading health system, two U.S. universities and a major Asia‑Pacific broadcaster, alongside three new AI‑related deals that highlight growing interest in the company’s newer capabilities.</p> <h2>Raised and Narrowed Full-Year Guidance</h2> <p>Reflecting improved confidence, management raised and tightened its full‑year outlook, now targeting subscription revenue growth of 1% to 3% to between $174.5 million and $176.7 million. Total revenue is projected to rise 1% to 2% to $182.6 million to $184.8 million, with adjusted EBITDA expected between $13.8 million and $15.2 million as profitability continues to build.</p> <h2>Year-over-Year Revenue Decline</h2> <p>Despite the guidance raise, current results show pressure, as total revenue fell 5% year over year to $44.6 million and slipped 2% sequentially. Subscription revenue also declined 4% from a year ago to $43.2 million, though it grew 1% from the prior quarter, signaling a tentative stabilization but not yet a clear growth inflection.</p> <h2>ARR and Retention Pressure</h2> <p>Annualized recurring revenue stood at $168.8 million, down 3% versus last year and flat sequentially, highlighting the drag from churn and slower expansion. Net dollar retention weakened to 95%, down sharply from 107% a year ago, with management pointing to the lagging impact of elevated churn in media and telecom customers as a key challenge.</p> <h2>Media &amp; Telecom Segment Weakness</h2> <p>The media and telecom segment remains a sore spot, with total revenue of $10.5 million down 17% year over year and subscription revenue off 16%. Executives warned that this segment is likely to keep declining in 2026 due to churn that already occurred in 2025, meaning investors should expect ongoing pressure from this legacy vertical.</p> <h2>Deliberate Decline in Professional Services</h2> <p>Professional services revenue dropped to $1.4 million, a steep 50% sequential decline and 31% year‑over‑year fall, as the company intentionally shifts away from lower‑margin work. While this move weighs on near‑term services revenue, it is designed to tilt the mix more toward recurring subscription income and improve margin quality over time.</p> <h2>GAAP Net Loss and Acquisition Costs</h2> <p>On a GAAP basis, net loss widened to $3.8 million, or $0.03 per diluted share, compared with a $1.1 million loss a year earlier, even as adjusted metrics improved. The deeper loss reflects noncash stock‑based compensation of $3.8 million and roughly $1.9 million of acquisition and strategic initiative expenses tied to the company’s expansion and integration agenda.</p> <h2>Modest Near-Term Profitability Guidance</h2> <p>Near‑term profitability guidance was more subdued, with Q2 adjusted EBITDA projected at $2 million to $3 million, notably below the strong $5.7 million achieved in Q1. Management flagged expected quarter‑to‑quarter variability and only modest full‑year revenue growth of 1% to 3%, underscoring that the transition to faster, sustainable growth will take time.</p> <h2>Headwinds from FX and Integration Costs</h2> <p>The company also pointed to incremental operating costs from the eSelf acquisition, PathFactory integration and ongoing foreign‑exchange headwinds as drags on results. These factors are expected to pressure operating expenses in the near term, even as management argues that the investments are necessary to unlock future cross‑platform synergies and AI‑driven opportunities.</p> <h2>Outlook and Forward-Looking Guidance</h2> <p>Kaltura’s updated outlook calls for Q2 subscription revenue of $43.3 million to $44.1 million, up 2% to 4% year on year, and total revenue of $45.2 million to $46.0 million, up 2% to 3%. For 2026 as a whole, management expects gradual acceleration through the year and sees new product revenue beginning to contribute in the second half, with more meaningful impact anticipated in 2027.</p> <p>Kaltura’s earnings call offered a blend of encouraging operational progress and lingering top‑line challenges that investors will watch closely. Margin gains, positive cash flow and AI‑driven product advances point to a healthier foundation, but subdued growth, weaker retention and media‑telecom headwinds mean the company still has work to do before a clear growth reacceleration story takes hold.</p></div>

KLTR

<p>Kaltura, Inc. reported its Q1 earnings, highlighting improved profitability with adjusted EBITDA up 37% to $5.7 million, despite a 5% year-over-year revenue decline to $44.6 million. The company generated positive operating cash flow for the first time in Q1, reaching $0.7 million. Kaltura raised its full-year guidance for subscription revenue growth to 1-3%, while acknowledging challenges in the media and telecom segments, which saw significant revenue drops. The company is focusing on AI innovations and strategic acquisitions to drive future growth, despite ongoing customer churn and retention issues.</p>

Kaltura Earnings Call: Profitability Up, Growth Still Tame