Upland Software Reports $63.7M Revenue in Q1 2025, Net Loss Improves to $25.8M

Upland Software, Inc. reported a total revenue of $63.7 million for the first quarter of 2025, a decrease of 10% compared to $70.7 million in the same period of 2024. The decline was primarily attributed to a reduction in subscription and support revenue, which fell to $60.2 million from $67.1 million, largely due to the expected decrease from divested product lines and Sunset Assets. The company also experienced a drop in professional services revenue, which decreased to $1.9 million from $2.2 million. Despite the overall revenue decline, perpetual license revenue increased slightly to $1.6 million from $1.5 million.

In terms of profitability, Upland reported a net loss of $25.8 million for the first quarter of 2025, a significant improvement from the net loss of $96.1 million in the prior year. This improvement was driven by a reduction in operating expenses, which totaled $46.7 million compared to $141.3 million in the previous year, primarily due to the absence of goodwill impairment charges that had impacted the prior year's results. The company also incurred $1.7 million in divestiture-related expenses during the quarter, reflecting its ongoing strategic realignment.

Upland's operational metrics showed a decrease in customer engagement, with total accounts receivable dropping to $26.1 million from $38.6 million at the end of 2024. The company reported a working capital deficit of $17.1 million as of March 31, 2025, compared to a deficit of $2.0 million at the end of the previous year. The company’s cash and cash equivalents decreased to $33.7 million from $56.4 million, primarily due to significant debt repayments totaling $34.2 million during the quarter.

Strategically, Upland has been focusing on divesting non-core product lines, completing divestitures that generated $5.5 million in cash proceeds, with potential additional earn-outs of up to $4.0 million over the next two years. The company is also actively pursuing acquisitions to enhance its product offerings and expand its market reach. Upland's management indicated that they are committed to improving operational efficiency and are optimistic about future growth, despite the current challenges in revenue generation.

Looking ahead, Upland anticipates continued pressure on revenue from divested assets but expects to stabilize its financial performance through strategic acquisitions and improved operational efficiencies. The company aims to leverage its existing customer base and expand its product offerings to drive future growth, while also managing its debt obligations effectively.