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Rimini Street Inc (RMNI)
NASDAQ:RMNI
Top Page
Rimini Street
(NASDAQ:RMNI)
56Neutral
Positive Factors
Financial Performance
The adjustment in the net debt level from $54m to -$4m indicates a healthier financial position for Rimini Street.
Legal Developments
The Appeals Court vacated the district court’s prior opinion which ruled broadly against RMNI, marking a significant legal win for Rimini Street.
Product and Market Strategy
Management cited strong traction with its new VMware product and is encouraged by early signs around it.
Negative Factors
Business Model Challenges
The timing around the PeopleSoft wind-down and subsequent pressure on the model remains opaque.
Cash Flow Impact
A $58m payment to ORCL for attorney's fees was made, which will drive a significant free cash flow drawdown in the fourth quarter.
Rimini Street (RMNI) vs. S&P 500 (SPY)
Market Cap
$328.67M
Dividend YieldN/A
Average Volume (3M)364.36K
Price to Earnings (P/E)―
Beta (1Y)1.13
Revenue Growth-0.64%
EPS Growth-236.71%
CountryUS
Employees2,120
SectorTechnology
Sector Strength46
IndustrySoftware
Share Statistics
EPS (TTM)-0.40
Shares Outstanding91,296,000
10 Day Avg. Volume306,532
30 Day Avg. Volume364,360
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.83
Price to Cash Flow (P/CF)-2.40
P/FCF Ratio0.00
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$4.88Price Target Upside35.56% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering5
Rimini Street Business Overview & Revenue Model
Company DescriptionRimini Street, Inc. provides enterprise software products, services, and support for various industries. The company offers software support services for Oracle and SAP enterprise software products. It sells its solutions primarily through direct sales organizations in North America, Latin America, Europe, Africa, the Middle East, Asia, and the Asia-Pacific. Rimini Street, Inc. was incorporated in 2005 and is headquartered in Las Vegas, Nevada.
How the Company Makes MoneyRimini Street makes money primarily through its subscription-based support services for enterprise software. The company's revenue model revolves around offering annual contracts for its support services, which are typically priced at a significant discount compared to the software vendors' own support offerings. Key revenue streams for Rimini Street include support services for Oracle, SAP, and other enterprise software platforms. The company also benefits from long-term client relationships and a growing base of customers who seek to cut costs while maintaining robust software support. Rimini Street's earnings are further bolstered by its focus on expanding its service offerings and geographical reach, ensuring a continuous influx of new business opportunities.
Rimini Street Financial Statement Overview
Summary
Rimini Street's financial health is concerning, with declining revenues, profitability issues, and cash flow constraints, alongside a precarious equity position. The income statement, balance sheet, and cash flow metrics highlight significant financial instability.Income Statement
Rimini Street has shown volatility in its revenue and profit margins. The gross profit margin is relatively healthy at around 60%, but the company has faced declining net income with a negative net profit margin in the latest period. Revenue growth has been inconsistent, and the company reported a significant EBIT loss in the most recent year.45
Neutral
Balance Sheet
The balance sheet reveals financial instability with negative stockholders' equity, indicating potential solvency issues. The company has a manageable debt load relative to equity, but the negative equity ratio suggests financial distress. Asset levels have been consistent, but liabilities exceed assets significantly.30
Negative
Cash Flow
Cash flows have been under pressure, with negative free cash flow in the latest period. The operating cash flow has fluctuated, and the free cash flow to net income ratio is unfavorable. While there was a positive trend in past years, recent figures indicate cash flow challenges.40
Negative
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 428.75M | 431.50M | 409.66M | 374.43M | 326.78M | Gross Profit |
| 261.02M | 268.98M | 257.28M | 237.97M | 200.57M | EBIT |
| -32.13M | 53.60M | 30.84M | 26.77M | 25.34M | EBITDA |
| -22.18M | 50.42M | 10.58M | 23.39M | 18.05M | Net Income Common Stockholders |
| -36.27M | 26.06M | -2.48M | 75.22M | 11.59M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 88.79M | 125.25M | 129.12M | 119.57M | 87.58M | Total Assets |
| 369.06M | 393.80M | 391.04M | 391.26M | 279.94M | Total Debt |
| 14.12M | 81.66M | 88.11M | 100.06M | 19.93M | Net Debt |
| -74.67M | -33.76M | -20.90M | -19.51M | -67.64M | Total Liabilities |
| 438.51M | 433.29M | 468.21M | 471.65M | 480.87M | Stockholders Equity |
| -69.44M | -39.50M | -77.17M | -80.39M | -200.94M |
| Cash Flow | Free Cash Flow | |||
| -42.23M | 5.25M | 30.57M | 64.84M | 40.62M | Operating Cash Flow |
| -38.85M | 12.47M | 34.90M | 66.94M | 42.10M | Investing Cash Flow |
| 6.45M | 3.08M | -24.45M | -2.11M | -1.48M | Financing Cash Flow |
| 14.02M | -6.89M | -13.57M | -26.57M | 6.38M |
Rimini Street Technical Analysis
Neutral
3.60
Price Trends
3.33
Positive
2.79
Positive
2.50
Positive
Market Momentum
0.13
Positive
48.28
Neutral
10.40
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For RMNI, the sentiment is Neutral. The current price of 3.6 is below the 20-day moving average (MA) of 3.81, above the 50-day MA of 3.33, and above the 200-day MA of 2.50, indicating a neutral trend. The MACD of 0.13 indicates Positive momentum. The RSI at 48.28 is Neutral, neither overbought nor oversold. The STOCH value of 10.40 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for RMNI.
Rimini Street Risk Analysis
Rimini Street disclosed 48 risk factors in its most recent earnings report. Rimini Street reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Rimini Street Peers Comparison
Overall Rating
UnderperformOutperform
Sector (58)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $2.90T | 31.41 | 34.29% | 0.81% | 15.04% | 12.38% | |
75 Outperform | $172.28B | 26.09 | 47.28% | ― | 10.65% | 44.84% | |
72 Outperform | $314.05B | 92.47 | 7.12% | 0.65% | 9.55% | -2.28% | |
72 Outperform | $171.51B | 121.01 | 16.53% | ― | 22.44% | -18.31% | |
67 Neutral | $408.80B | 34.73 | 108.79% | 1.08% | 6.23% | 12.37% | |
58 Neutral | $21.67B | 10.60 | -18.43% | 2.42% | 4.66% | -24.45% | |
56 Neutral | $328.67M | ― | 43.74% | ― | -0.64% | -236.71% |
* Technology Sector Average
Performance Comparison
RMNI
Rimini Street
3.60
0.34
10.43%
ADBE
Adobe
396.15
-108.45
-21.49%
MSFT
Microsoft
390.58
-26.95
-6.45%
ORCL
Oracle
145.78
21.51
17.31%
SAP
SAP AG
268.15
74.87
38.74%
NOW
ServiceNow
827.74
65.34
8.57%
Rimini Street Earnings Call Summary
Earnings Call Date: Feb 27, 2025 | % Change Since: 18.03% | Next Earnings Date: Apr 30, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted positive developments in terms of billings growth, client satisfaction, and strategic partnerships, particularly with ServiceNow. However, these were offset by revenue declines, decreased annualized recurring revenue, significant litigation costs, and cash flow challenges. The litigation success provides a potential positive outlook, but financial challenges persist.Highlights
Positive Billings Growth
Billings for the fourth quarter were $172.1 million, up 7.1% year-over-year, and full-year 2024 billings increased by 1.1%.
Strong Client Satisfaction
Global service delivery achieved a support client case satisfaction average rating over 4.9 out of 5.0.
Success in Litigation
The U.S. Ninth Circuit Court of Appeals vacated much of the U.S. District Court's trial rulings against Rimini Street in the Rimini II case.
Strategic Partnerships
New partnership with ServiceNow to offer ERP licensees a modernization solution without costly upgrades.
Gross Margin Improvement
Gross margin was 63.7% of revenue for the fourth quarter, compared to 61% in the prior year fourth quarter.
Lowlights
Revenue Decline
Revenue for the full-year 2024 was $428.8 million, a decrease of 0.6% year-over-year.
Decreased Annualized Recurring Revenue (ARR)
ARR was $414.8 million for the fourth quarter, a year-over-year decrease of 4.1%.
Litigation Costs
Litigation settlement expense was $58.5 million for full-year 2024, significantly impacting net income.
Cash Flow Challenges
Operating cash flow decreased by $38.8 million for full-year 2024 compared to the prior year.
Company Guidance
During the Rimini Street Q4 2024 earnings call, the company highlighted substantial metrics indicating growth and strategic initiatives. They reported Q4 revenue of $114.2 million, marking a 1.9% increase year-over-year, and full-year revenue of $428.8 million, a slight decrease of 0.6%. Billings rose 7.1% year-over-year to $172.1 million in Q4, with full-year billings at $423 million, up 1.1%. The company's gross margin for Q4 was 63.7%, and 60.9% for the full year, with non-GAAP gross margins slightly higher. Operating expenses were addressed, noting a cost optimization plan aiming for $35 million in annual reductions, with $18 million achieved by Q4's end. Sales and marketing expenses accounted for 32.8% of revenue in Q4. The company also noted a litigation payment of $58.5 million to Oracle, which impacted cash flow and net income figures. Looking ahead, Rimini Street is focusing on accelerating growth through strategic sales model changes, expanding services, and leveraging partnerships, such as with ServiceNow, to drive future revenue and profitability improvements. They anticipate returning to providing financial guidance in 2025 as litigation uncertainties decrease.Rimini Street Corporate Events
Business Operations and StrategyFinancial Disclosures
Rimini Street Reports Q4 2024 Financial Results
Neutral
Feb 27, 2025
Rimini Street announced its financial results for the fourth quarter and full year of 2024, reporting a slight increase in quarterly revenue to $114.2 million, up 1.9% year-over-year, but a decrease in annual revenue to $428.8 million, down 0.6% from 2023. The company highlighted new client acquisitions and expansions, including partnerships with Gunung Raja Paksi and Bumhan Mecatec, and announced collaborations with ServiceNow and expansions in their database security and interoperability solutions. Despite a decrease in net income and cash reserves, Rimini Street continues to focus on innovation and client satisfaction, achieving a high client satisfaction rating and closing numerous support cases globally.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.