Approximately $448 million is the full-year revenue figure Cognyte Software Ltd. set at its Q2 2027 earnings call, narrowing the prior range as management cited 85% of that figure already secured through contracted commitments, expected renewals, and post-quarter signings. Software revenue grew 21% year-over-year, outpacing total company revenue growth, while profitability expanded at more than four times the revenue growth rate.
The operating leverage reflects a deliberate mix shift toward software. Management attributed demand strength to governments prioritizing national security, border security, and public safety. The company's positioning around what it calls sovereign AI, where agencies retain full control over data and infrastructure rather than relying on general-purpose models it characterizes as black-box systems, is cited as the primary competitive differentiator.
| Metric | Detail | Label |
|---|---|---|
| Full-year revenue guidance | ~$448M | Projected |
| Software revenue growth | 21% YoY | Reported |
| Profitability vs. revenue growth | >4x faster | Reported |
| 12-month revenue coverage | 85% | Reported |
| U.S. signed-deal target | $20M | Projected |
| FY2028 revenue target | $500M | Projected |
RPO mechanics and subscription timing
Reported remaining performance obligation figures declined, reflecting $30 million of large multi-year support contract consumption in the quarter plus the exclusion of $42 million in cancelable subscription portions. Management was explicit: the headline RPO understates forward coverage. Including expected renewals and post-quarter signings, the 85% coverage figure is management's preferred measure of forward demand.
The subscription mix is accelerating faster than management anticipated. Had the perpetual-versus-subscription split held constant year-over-year, reported growth would have been several percentage points higher.
U.S. traction and new commercial leadership
The U.S. segment is targeting $20 million in signed deals for the current fiscal year, drawing on both federal and state/local agency expansions. Several federal opportunities have moved into procurement following successful proof-of-concept demonstrations, with management expecting awards within the fiscal year. Adam Philpott was appointed Chief Revenue Officer to lead global commercial operations.
On cash flow, management stepped back from a specific $45 million target in favor of a "significant positive" outlook. The reason: a deliberate inventory build to guard against supply chain lead times and rising hardware costs tied to on-premise deployments. Management said it remains on track toward the fiscal 2028 revenue target of $500 million.
Foreign exchange headwinds from the weaker U.S. dollar against the Israeli shekel totaled approximately $7 million in operating expenses through the first half.