Varonis Systems Inc. (VRNS) experienced a significant 12.02% decline in after-hours trading following the release of its fourth-quarter 2025 financial results and forward guidance.
The data security company reported Q4 revenue of $173.4 million, exceeding analyst expectations. However, investor focus shifted to the company's outlook, which fell short of market consensus. For the first quarter of 2026, Varonis forecast an adjusted loss per share of $0.06 to $0.05, contrasting sharply with analyst expectations for a profit of $0.04 per share.
Furthermore, the company's full-year 2026 adjusted EPS guidance of $0.06 to $0.10 was significantly below the consensus estimate of $0.35. While Varonis announced the acquisition of AI security firm AllTrue.ai to enhance its enterprise capabilities, the weaker-than-expected earnings outlook appears to be the primary driver behind the stock's sharp decline.