OneStream (OS) Q3 2025: AI Bookings Surge 60% as Finance Modernization Accelerates
OneStream’s third quarter showcased robust execution, with AI-driven bookings up 60% and international momentum offsetting U.S. federal softness. The company’s multi-pronged product strategy and rapid SaaS adoption underpin its confidence in 2026 growth stabilization. As finance leaders accelerate digital transformation, OneStream’s unified platform and applied AI suite are driving both legacy replacement and new customer wins, positioning the company as a core enabler of the finance AI era.
Summary
- AI Monetization: AI bookings climbed sharply, validating strong customer demand for finance-specific automation and analytics.
- Legacy Replacement Cycle: Accelerated displacement of aging systems fueled EMEA growth and landmark vertical wins.
- 2026 Pipeline Visibility: Management signaled comfort with consensus growth targets, citing a robust, diversified pipeline.
Performance Analysis
OneStream delivered a standout Q3, with subscription revenue rising 27% year-over-year and total revenue up 19%, led by international expansion and rapid SaaS adoption. The company’s international segment, now 34% of total revenue, grew 37% year-over-year, driven by strong legacy system replacements in EMEA. U.S. federal business headwinds, including contract rationalization and agency restructuring, were offset by robust add-on activity and new product uptake in commercial sectors.
AI bookings surged 60% year-over-year, reflecting growing adoption of Sensible AI Forecast and early traction for agents and Studio offerings. Free cash flow exceeded expectations at $5 million for the quarter and $70 million for the year-to-date, up 107% year-over-year, underscoring operational leverage and disciplined expense scaling. Non-GAAP operating income rose 69% to $9.3 million, with margin expansion despite a modest dip in software gross margin due to lower license revenue.
- International Outperformance: EMEA delivered exceptional new business, including a landmark pharma win, as field coverage and product localization deepened regional traction.
- Federal Transition: SaaS conversions at major U.S. agencies reduced license revenue but set up future recurring growth; only one contract loss was due to agency discontinuation.
- Multi-Product Upsell: Add-on sales and expanded product portfolio drove net revenue retention, highlighting the effectiveness of the multi-product strategy.
Customer count reached 1,739, up 13% year-over-year, with strong expansion in both enterprise and commercial segments. The shift from license to SaaS is expected to continue, further stabilizing recurring revenue streams.
Executive Commentary
"As we usher in the finance AI era, we remain one of the most innovative vendors in the CPM space, and we're not stopping there. We are constantly pushing forward and anticipating the growing demands of the Office of the CFO."
Tom Shea, Co-founder, Chief Executive Officer and President
"Billings increased 20% year-over-year to $178 million, and 21% on a trailing 12-month basis, which we believe is the best indicator of our billing's momentum. This included roughly $4 million of accelerated billings from Q4 due to early renewals and add-ons."
Bill Kofed, Chief Financial Officer
Strategic Positioning
1. Finance AI as a Differentiator
OneStream’s purpose-built finance AI, including Sensible AI Forecast, Studio, and agentic capabilities, is emerging as a key competitive advantage. The platform’s embedded, contextualized AI delivers measurable ROI: customers reported up to 94% reduction in forecast generation time and notable accuracy gains, freeing thousands of labor hours and eliminating external tool dependencies. The company’s deliberate, finance-specific approach to AI—insisting on data quality and context—resonates with CFOs seeking actionable automation rather than generic solutions.
2. Legacy System Replacement Cycle
The replacement of aging financial systems, especially in EMEA, is accelerating, with OneStream capturing share from legacy CPM (corporate performance management) vendors like Hyperion and SAP. The company’s track record of successful migrations and its expanding rapid deployment offerings (such as CPM Express and IFRS Express) are enabling faster time-to-value for both large enterprises and mid-market customers. This dual-pronged approach broadens the addressable market—legacy displacement remains a core pillar, but productized solutions are unlocking greenfield opportunities.
3. Multi-Product Expansion and Verticalization
Expansion into adjacent finance workflows, including AI-powered ESG reporting and account reconciliations, is deepening customer relationships and increasing net revenue retention. The launch of AI agents that automate repetitive tasks and enhance analytics is expected to generate incremental, usage-based revenue. Early wins in pharma, healthcare, and real estate services signal successful verticalization, with tailored solutions meeting industry-specific needs. The product roadmap emphasizes both core finance and operational analytics, positioning OneStream as the de facto operating system for modern finance teams.
4. SaaS Migration and Recurring Revenue Model
The ongoing migration from license to SaaS contracts is a structural shift, reducing revenue volatility and enhancing long-term visibility. Management expects the majority of license revenue to phase out over the next few years, with subscription and professional services leading growth. This transition, while dampening license revenue in the near term, supports higher-margin, predictable revenue streams and aligns with broader industry trends.
5. Global Field Coverage and Sales Execution
Investment in international field teams and partner networks, especially in EMEA, is increasing deal velocity and improving sales productivity. The company’s scale-based approach ensures both legacy replacement and new product introductions are well supported, while a focus on use-case-driven selling is simplifying the sales cycle for productized offerings like CPM Express.
Key Considerations
OneStream’s Q3 reflects a business at the intersection of accelerating finance transformation and maturing AI adoption. The company’s strategy is to lead with innovation while executing on the fundamentals of SaaS growth and international expansion. Investors should weigh the following:
Key Considerations:
- AI Commercialization Trajectory: Sensible AI Forecast and agents are showing early monetization, but broad-based adoption and pricing models (usage-based for agents) will be critical to sustaining growth.
- Legacy Replacement as a Growth Engine: The pace of legacy system displacement, especially in EMEA, is a major revenue driver; continued execution here will determine medium-term growth rates.
- Product Portfolio Breadth: The ability to cross-sell new solutions and expand into adjacent workflows is supporting strong net revenue retention and multi-product adoption.
- Federal Business Stabilization: Recent SaaS conversions and agency renewals de-risk the U.S. federal segment, but ongoing government budget uncertainty and shutdown risk remain watchpoints.
- SaaS Transition Dynamics: The migration from license to recurring revenue is positive for long-term margins and predictability, but near-term license declines may obscure underlying growth.
Risks
Key risks include continued volatility in the U.S. federal segment, potential delays in broad AI adoption, and execution challenges in scaling new products and international markets. Government shutdowns and macroeconomic headwinds could impact deal timing, while the SaaS transition may temporarily mask underlying growth. Competitive pressure from legacy and cloud-native vendors remains a persistent threat, especially as the finance AI landscape evolves.
Forward Outlook
For Q4 2025, OneStream guided to:
- Total revenue of $156 million to $158 million
- Non-GAAP operating margin of 4% to 6%
- Non-GAAP net income per share of $0.04 to $0.07
For full-year 2025, management raised guidance to:
- Total revenue of $594 million to $596 million
- Non-GAAP operating margin of 2% to 3%
- Non-GAAP net income per share of $0.15 to $0.19
Management highlighted several factors that support 2026 confidence:
- Robust pipeline across regions and products, including recent large enterprise wins
- Strong early adoption of new AI offerings, with limited availability agents and Studio expanding addressable use cases
Takeaways
OneStream’s Q3 2025 results confirm its emergence as a leader in finance AI, with strong international momentum and a deepening product portfolio supporting growth into 2026.
- AI-Driven Expansion: The company’s applied AI suite is already delivering measurable productivity gains and is being rapidly adopted by both new and existing customers.
- Resilient Multi-Segment Growth: EMEA outperformance and commercial wins offset U.S. federal softness, while SaaS migration and add-on sales bolster recurring revenue visibility.
- 2026 Watchpoints: Investors should monitor the pace of AI agent monetization, legacy system displacement in EMEA, and stabilization in the U.S. federal segment as key determinants of next year’s performance.
Conclusion
OneStream’s Q3 underscores its strategic positioning at the forefront of finance transformation, with AI-driven products and a unified platform fueling robust growth across segments and geographies. Continued execution on SaaS migration, legacy replacement, and product innovation will be pivotal as the company targets sustained double-digit expansion into 2026.
Industry Read-Through
The rapid acceleration of finance-specific AI adoption seen at OneStream signals a broader shift across enterprise software, as CFOs prioritize modernization and automation of core financial workflows. The success of applied, contextualized AI over generic tools sets a precedent for other vendors targeting the Office of the CFO. The legacy replacement cycle, especially in EMEA, is intensifying, creating opportunities for cloud-native and best-of-breed providers. As usage-based AI pricing models emerge, software companies in adjacent domains should prepare for evolving monetization strategies and heightened competition around domain-specific intelligence and workflow integration.