10-K: OneStream's 2025 10-K: Strong SaaS Growth Amidst Hg Acquisition

OneStream, Inc. reports robust 23% revenue growth in 2025, driven by SaaS expansion, while navigating a pending $6.4 billion all-cash acquisition by Hg affiliates.

Summary

• Total revenue increased by 23% to $601.9 million for the year ended December 31, 2025, compared to $489.4 million in 2024.
• Subscription revenue grew by 28% to $549.97 million in 2025, now representing 91% of total revenue.
• Annual Recurring Revenue (ARR) increased by 23% to $698.9 million as of December 31, 2025.
• The customer base expanded by 13% to 1,805 customers as of December 31, 2025.
• Net loss significantly decreased to $67.66 million in 2025 from $306.66 million in 2024.
• Non-GAAP operating income improved to $27.09 million in 2025 from $1.22 million in 2024.
• Free cash flow increased to $95.63 million in 2025 from $58.53 million in 2024.
• A definitive agreement was signed on January 6, 2026, for OneStream to be acquired by affiliates of Hg for approximately $6.4 billion in an all-cash transaction, with Class A and D common stock shareholders receiving $24.00 per share.
• The Tax Receivable Agreement (TRA) will automatically terminate upon the consummation of the Mergers, eliminating future payment obligations under it.
• William Koefoed transitioned from Chief Financial Officer to Senior Advisor, effective January 1, 2026, with John Kinzer appointed Interim Chief Financial Officer on the same date.

Sentiment

Score: 8

Explanation: StockSavvy.ai views this as a highly positive filing for current shareholders, as the definitive merger agreement offers a substantial cash premium ($24.00 per share) over the company's implied year-end market price and IPO price, providing a clear and favorable exit, alongside strong operational improvements.

Positives

• Strong total revenue growth of 23% year-over-year to $601.9 million.
• Significant growth in subscription revenue (28% increase) and its increasing proportion of total revenue (91%).
• Healthy Annual Recurring Revenue (ARR) growth of 23% to $698.9 million as of December 31, 2025.
• Customer base expanded by 13% to 1,805 customers, indicating continued market penetration.
• Substantial reduction in net loss from $306.66 million in 2024 to $67.66 million in 2025, showing improved financial performance.
• Achieved positive non-GAAP operating income of $27.09 million in 2025, up from $1.22 million in 2024.
• Increased free cash flow to $95.63 million in 2025 from $58.53 million in 2024, demonstrating strong cash generation.
• Pending acquisition by Hg for $6.4 billion, offering a clear cash exit for shareholders at $24.00 per share, which is a premium over the implied year-end market price and IPO price.
• Termination of the Tax Receivable Agreement (TRA) upon merger closing, eliminating a significant potential future liability.
• Management concluded that internal control over financial reporting was effective as of December 31, 2025, with an unqualified opinion from independent auditors.

Negatives

• License revenue decreased by 44% to $17.8 million in 2025, reflecting a decline in this revenue stream despite the strategic shift to SaaS.
• Continued operating losses, though reduced, indicate the company remains in an investment phase.
• The pendency of the Mergers creates business uncertainty, potential disruption to customer and partner relationships, and diversion of management attention.
• Risk of the Mergers not closing, which could adversely affect the stock price and potentially incur a $207 million termination fee.
• Ongoing litigation related to the Mergers and a stockholder derivative action could be costly and divert management resources.
• The Class A common stock performance graph shows a decline from its IPO reference point (July 24, 2024) to December 31, 2025, indicating a decrease in market value for early investors.
• The company has a history of operating losses and expects to continue incurring net losses for the foreseeable future.
• Faces intense competition from larger, more established players like Oracle and SAP, as well as specialized point solution providers.
• Reliance on a limited number of third-party data centers (Microsoft Azure) for cloud-based platform delivery poses a risk of service disruption.
• Concentration of voting control with KKR and the co-founder/CEO (approximately 94% as of February 23, 2026) limits the influence of other Class A common stockholders.

Risks

• The pendency of the Mergers could adversely affect business, operating results, and financial condition, and failure to complete them could harm the business and stock price.
• Contractual restrictions during the merger pendency could impair decision-making and ability to respond to business pressures.
• Litigation in connection with the Mergers could be costly, prevent consummation, and divert management's attention.
• Rapid growth may not be sustainable or indicative of future growth, and failure to manage operations to support growth could harm the business.
• History of operating losses and may not achieve or sustain profitability in the future.
• Intense competition could lead to loss of market share, affecting business, operating results, and financial condition.
• Industry not developing as anticipated or potential customers not adopting the platform could harm sales growth.
• Platform or applications containing serious errors or defects could lead to lost revenue, reputational harm, and product liability claims.
• Business depends substantially on customer renewals and expansion; failure to do so adversely affects financial condition.
• Long and unpredictable sales cycles, particularly for large enterprises, require considerable time and expense.
• Revenue growth depends on successful strategic relationships with third parties; failure to maintain them could adversely affect the business.
• Revenue recognition from SaaS subscriptions over terms means new sales increases/decreases may not be immediately reflected.
• Continued transition to a SaaS-based model could cause operating results to fluctuate.
• Changes in pricing model could harm business, operating results, and financial condition.
• Quarterly results might fluctuate, and failure to meet expectations could cause stock price decline.
• Long-term success depends on international expansion, susceptible to risks of international sales and operations.
• Security breaches or unauthorized access to data could lead to perceived insecurity, customer loss, and significant liabilities.
• Privacy, data protection, and cybersecurity concerns and regulations may limit platform use and adoption.
• Principal asset is interest in OneStream Software LLC; dependence on its operating results, cash flows, and distributions.
• If Mergers do not close, may be required to pay TRA Members for tax benefits, and payments could be substantial.
• Organizational structure, including TRA, confers benefits to TRA Members (including KKR) not equally benefiting Class A common stockholders, and imposes additional costs.
• Class C and D common stock (10 votes/share) concentrate voting control with KKR and co-founder/CEO, limiting other stockholders' influence.
• Certificate of incorporation renounces interest in certain corporate opportunities presented to KKR or its affiliates, potentially creating conflicts of interest.
• Stock price might be volatile or decline regardless of operating performance.
• Substantial future sales of Class A common stock, or perception of such sales, could cause price decline.
• If securities or industry analysts do not publish research or downgrade stock, price and trading volume could decline.
• No intention to pay dividends to Class A common stockholders for the foreseeable future.
• Anti-takeover provisions in governing documents could make acquisition difficult, limit stockholder attempts to replace management, and depress stock price.
• Bylaws designate the Delaware Court of Chancery as the exclusive forum for most disputes, and federal district courts for Securities Act claims, potentially limiting stockholders' choice of forum.
• Metrics and estimates used to evaluate performance are subject to inherent measurement challenges, and inaccuracies may harm reputation.
• Failure to introduce and successfully implement enhancements, new features, or applications could harm the business.
• Inability to successfully develop, implement, and offer AI-enabled solutions or use AI technology could harm the business.
• Interruptions or performance problems with platform and technology might harm business, operating results, financial condition, and reputation.
• Failure to meet service level commitments could lead to refunds, credits, or contract termination.
• Reliance on limited third-party data centers (Microsoft) means disruption could harm business.
• Failure to ensure platform interoperates with third-party software applications could reduce competitiveness.
• Incorrect or improper implementation or use of platform could result in customer dissatisfaction.
• Failure to offer high-quality support could harm customer relationships and financial results.
• Dependence on executive officers and other key employees; loss could adversely affect business.
• Failure to attract and retain qualified personnel or maintain company culture could harm business.
• Substantial dependence on direct sales force; failure to expand could harm business.
• Unfavorable macroeconomic conditions could adversely affect business.
• Need for additional capital; no certainty of availability on favorable terms.
• Acquisitions or investments could divert management attention, dilute stockholders, and disrupt operations.
• Legal proceedings, regulatory disputes, and government investigations could incur significant expenses.
• Indemnification obligations and limitations of D&O insurance may have adverse effect.
• Governmental export and import controls could impair international competition.
• Subject to FCPA and similar anti-corruption/anti-bribery laws; non-compliance can lead to liability.
• Exposure to foreign currency exchange rate fluctuations.
• Operating results may be harmed if required to collect taxes in new jurisdictions.
• International operations subject to potentially adverse tax consequences.
• Changes in laws and regulations related to Internet and cloud computing might diminish demand.
• Requirements of being a public company might strain resources and divert management.

Future Outlook

OneStream expects revenue from SaaS contracts to contribute an increasing portion of total revenue over time. The company intends to continue investing significantly in scaling across organizational functions to grow operations, both domestically and internationally. Plans include increasing investment in research and development, particularly in AI and machine learning solutions, and expanding the OneStream Solution Exchange. The Mergers with Hg affiliates are expected to close in the first half of 2026, subject to regulatory approvals and customary closing conditions. The company also expects to accelerate all unrecognized equity-based compensation related to the Employee Stock Purchase Plan (ESPP) in the first quarter of 2026 due to the cancellation of future purchase and offering periods beyond the current one.

Management Comments

• "We believe that our market opportunity is large, and we will continue to invest significantly in scaling across organizational functions to grow our operations, both domestically and internationally."
• "Our continued growth will depend, in part, on our ability to grow a productive workforce across all departments of our organization to support our expanding operations, and, in part, on our ability to successfully introduce new and enhanced core solutions and applications on our platform."
• "We therefore intend to continue to invest efficiently in growing our business to take advantage of our expansive market opportunity, while remaining focused on positive cash flow."
• "Our goal is 100% customer success and it drives everything we do."

Industry Context

StockSavvy.ai notes that OneStream's strong growth in SaaS revenue and customer base aligns with the broader industry trend of digital transformation in the Office of the CFO, particularly the increasing demand for AI-enabled, unified platforms that replace disparate legacy systems. The pending acquisition by Hg, a leading investor in software, services, and data businesses, further validates the strategic importance and market value of such specialized financial technology solutions.

Comparison to Industry Standards

• OneStream competes with legacy players such as Oracle and SAP, and point product providers including Anaplan, Blackline, Wolters Kluwer, and Workday.
• OneStream's platform is designed to eliminate the need for customers to use multiple disparate legacy products, applications, and modules, offering a unified approach that contrasts with fragmented legacy systems.
• The company's focus on native AI and machine learning capabilities specifically for Finance differentiates it from competitors, aiming to provide market-leading automated planning and forecasting.
• The extensible architecture and Solution Exchange foster a developer ecosystem, accelerating innovation and expanding use cases beyond what traditional Enterprise Performance Management (EPM) vendors typically offer.

Management Changes

Corporate Governance

Legal Proceedings

• A stockholder derivative action, Ayers v. Shea, et al., Case No. 2025-1071-PAF, was filed on September 19, 2025, in the Delaware Court of Chancery against certain officers, directors, and KKR affiliates, alleging breach of fiduciary duties and unjust enrichment related to stock sales in the November 2024 secondary offering and non-dilutive secondary transaction.
• A motion to dismiss all claims in the Ayers v. Shea, et al. action was filed on January 8, 2026.
• A lawsuit, Sonal Rana v. OneStream, Inc. et al., was filed on February 20, 2026, in the U.S. District Court for the Northern District of Illinois, asserting claims against the company and its board for violations of Sections 14(a) and 20(a) of the Securities Exchange Act of 1934 and SEC Rule 14c-6, alleging false and misleading disclosures in the information statement for the Mergers.
• The company intends to dispute the claims brought by the plaintiff in the Sonal Rana lawsuit.
• Additional lawsuits may be filed before the consummation of the Mergers.

Related Party Transactions

• Prior to its acquisition on May 1, 2024, DataSense LLC had consulting and software development services agreements with OneStream. Thomas Shea (OneStream's co-founder, chairman, and CEO) is the father of Andrew Shea (DataSense's CEO and equity holder).
• OneStream paid $1.9 million to DataSense in 2024 (through acquisition date) and $3.5 million in 2023 for these services, recorded as research and development expenses.
• OneStream acquired the remaining equity interests of DataSense from DataSense Holdings LLC (a related party) on May 1, 2024, for $7.7 million in cash and 1,023,720 common units of OneStream Software LLC (reclassified to LLC Units and Class C common stock).
• KKR is both a Former Member and a Continuing Member, holding a majority of voting power and having significant influence over the company.
• The Tax Receivable Agreement (TRA) involves KKR and other Continuing/Former Members, with potential substantial payments if the Hg merger does not close.
• The stockholders agreement with KKR Dream Holdings LLC grants KKR significant rights, including director nomination and consent rights for certain transactions.
• The certificate of incorporation contains provisions renouncing OneStream's interest in certain corporate opportunities presented to KKR or its affiliates.

Stakeholder Impact

• Shareholders: The pending all-cash acquisition by Hg at $24.00 per share offers a clear exit value, representing a premium over the implied year-end market price and IPO price. However, the concentration of voting power with KKR and the CEO limits influence for other Class A common stockholders, and ongoing litigation related to the merger could create uncertainty and costs.
• Employees: The Executive Change in Control and Severance Policy provides protections upon involuntary termination. Management changes, such as the CFO transition, and the cancellation of future ESPP periods could impact employee morale and equity participation.
• Customers: Continued investment in AI-enabled solutions and platform enhancements aims to improve service and value. However, potential disruptions from the pending merger or security incidents could affect customer satisfaction.
• Partners: The company's strategic focus on growing its partner ecosystem is expected to provide continued lead generation and implementation support.
• Creditors: The company maintains a $150 million revolving credit facility with no outstanding borrowings, indicating strong liquidity. The termination of the TRA upon merger closing removes a significant potential liability.

Next Steps

• Closing of the Mergers with Hg affiliates, expected in the first half of 2026.
• Continued investment in research and development, including AI and machine learning technologies.
• Expansion of the OneStream Solution Exchange with new applications.
• Further expansion of international footprint.
• Growth of the partner ecosystem.
• Extension of platform use cases beyond the Office of the CFO into broader operations.
• Acceleration of unrecognized equity-based compensation related to the Employee Stock Purchase Plan (ESPP) in Q1 2026 due to plan cancellation.

Key Dates

Recommendation

The definitive merger agreement to be acquired by Hg for $24.00 per share in cash provides a clear exit value for shareholders. Given the implied market price of approximately $13.69 as of December 31, 2025 (based on the stock performance graph relative to IPO), this represents a substantial premium, making it an attractive arbitrage opportunity for investors to buy shares below $24.00 to capture the merger consideration.

Keywords

Financial Software, SaaS, Cloud Platform, Digital Finance Cloud, EPM, AI, Machine Learning, Corporate Performance Management, Financial Consolidation, Planning and Analysis, SEC Filing, 10-K, OneStream, Hg Acquisition, KKR, Corporate Governance, Risk Management, Executive Compensation