Nasdaq:NCNO
nCino, Inc.
nCino provides cloud-based banking software solutions enabling digital transformation for financial institutions across North America.
Key Metrics
Investment Thesis
Bull Case
nCino offers compelling growth potential given its dominant position in a niche market that remains underserved by larger technology providers. The narrowing net loss trajectory combined with strong operating cash flows suggests the company is successfully transitioning toward sustainable profitability without sacrificing its aggressive expansion strategy. Acquisitions totaling over $216M indicate management's confidence in building a comprehensive ecosystem that can drive long-term revenue per customer.
Bear Case
The persistent negative net income of -$33M raises concerns about the path to break-even, especially given the heavy capital expenditures and share-based compensation costs. Investors should be wary of the significant goodwill balance of $1.02B which requires consistent performance from acquired units to avoid future write-downs that could materially impact earnings. The reliance on a specific banking segment exposes the stock to regulatory headwinds that could disproportionately affect community banks compared to larger financial institutions.
About nCino, Inc.
nCino is a leading provider of cloud-based banking technology solutions designed to accelerate digital transformation for mid-market and community banks. The company serves the North American financial services sector with its flagship core banking platform and customer experience tools that streamline operations and enhance client engagement. Revenue growth driven by market expansion has been strong, though profitability remains a key focus as the company continues to invest heavily in R&D and acquisitions.
Analysis
Management Discussion
Despite improving revenue trends with a 37% increase from 2023 to 2025, the company continues to report net losses, narrowing from -$101.8M in 2023 to -$33.0M in 2025. This improvement is supported by strong operating cash flow of $55.2M which partially offsets the negative earnings, suggesting potential for future profitability as scale increases and R&D investments begin to yield returns.
Industry Overview
The cloud-based banking software industry is rapidly evolving as traditional banks seek to modernize legacy systems to compete with fintech disruptors. Market demand is driven by the need for real-time data analytics, seamless mobile experiences, and regulatory compliance automation, creating a favorable environment for specialized SaaS providers. Consolidation is ongoing as smaller vendors struggle to keep pace with technological advancements, leaving room for leaders like nCino to capture market share.
Financial Statements
Income Statement
Balance Sheet
Cash Flow
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Revenue | $408.3M | $476.5M | $540.7M |
| Cost of Revenue | $169.6M | $191.5M | $215.9M |
| Gross Profit | $238.7M | $285.1M | $324.8M |
| Operating Expenses | $332.7M | $324.6M | $342.9M |
| Operating Income | $-94.0M | $-39.5M | $-18.1M |
| R&D | $121.6M | $117.3M | $129.4M |
| G&A | $83.5M | $76.7M | $90.3M |
| Marketing | $127.7M | $130.5M | $123.2M |
| Stock-Based Comp | $50.2M | $58.0M | $71.6M |
| D&A | $34.7M | $45.3M | $36.3M |
| Depreciation | $6.5M | $8.0M | $6.3M |
| Amortization | $28.2M | $37.2M | $30.1M |
| Other OpEx | $0 | $0 | $0 |
| Non-Operating Income | $-3.8M | $-2.4M | $-17.4M |
| Interest Expense | $2.8M | $4.1M | — |
| Interest Income | $403.0K | $2.6M | $1.8M |
| Pre-Tax Income | $-97.8M | $-41.9M | $-35.6M |
| Income Tax | $4.1M | $1.6M | $-2.5M |
| Continuing Ops | $-101.8M | $-43.5M | $-33.0M |
| Discontinued Ops | $0 | $0 | $0 |
| Net Income | $-101.8M | $-43.5M | $-33.0M |
| Minority Interest | $-1.1M | $-1.1M | $-472.0K |
| Net to Common | $-100.7M | $-42.4M | $-32.6M |
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Current Assets | $207.2M | $250.8M | $302.2M |
| Cash & Equivalents | $82.0M | $112.1M | $120.9M |
| Accounts Receivable | $99.5M | $113.0M | $146.8M |
| Prepaid Expenses | $16.3M | $15.2M | $21.1M |
| Other Current Assets | $9.4M | $10.5M | $13.5M |
| Long-Term Assets | $1.12B | $1.09B | $1.31B |
| PP&E (Net) | $84.4M | $79.1M | $75.0M |
| Goodwill | $839.4M | $838.9M | $1.02B |
| Operating Leases | $10.5M | $19.3M | $16.0M |
| LT Investments | $6.5M | $9.3M | $9.3M |
| Other LT Assets | $179.2M | $143.1M | $188.5M |
| Total Assets | $1.33B | $1.34B | $1.61B |
| Current Liabilities | $205.2M | $215.0M | $251.5M |
| Accounts Payable | $11.9M | $11.8M | $13.6M |
| Current Leases | $3.9M | $3.6M | $5.2M |
| Deferred Revenue | $154.9M | $170.9M | $191.2M |
| Taxes Payable | $1.3M | $2.0M | $1.2M |
| Other Current Liab | $33.2M | $26.6M | $40.3M |
| Long-Term Liabilities | $94.4M | $72.8M | $261.3M |
| LT Operating Leases | $7.3M | $16.4M | $12.8M |
| Other LT Liab | $57.2M | $56.4M | $248.2M |
| Total Liabilities | $299.6M | $287.8M | $512.8M |
| Shareholders' Equity | $1.03B | $1.05B | $1.10B |
| Paid-In Capital | $1.33B | $1.40B | $1.47B |
| Retained Earnings | $-310.3M | $-352.8M | $-385.3M |
| AOCI | $694.0K | $996.0K | $176.0K |
| Total L&E | $1.33B | $1.34B | $1.61B |
| Metric | 2023 | 2024 | 2025 |
|---|---|---|---|
| Net Income (CFO) | $-101.8M | $-43.5M | $-33.0M |
| Non-Cash Adjustments | $22.7M | $71.9M | $34.7M |
| Working Capital Changes | $63.8M | $28.9M | $53.5M |
| Cash from Operations | $-15.4M | $57.3M | $55.2M |
| Capital Expenditures | $18.3M | $3.5M | $1.8M |
| Cash from Investing | $-20.7M | $-6.3M | $-219.2M |
| Cash from Financing | $36.7M | $-21.1M | $170.5M |
| FX Effect | $-1.6M | $182.0K | $-2.7M |
| Net Change in Cash | $-981.0K | $30.0M | $3.8M |
| Beginning Cash | $88.4M | $87.4M | $117.4M |
| Ending Cash | $87.4M | $117.4M | $121.3M |
Frequently Asked Questions
How does nCino, Inc. make money?
The company's revenue is primarily derived from its Core Banking Platform which serves as the foundational system for banks, alongside its Customer Experience suite that includes loan origination, deposit management, and mobile banking tools. Additional streams include professional services and consulting engagements related to implementation and customization, as well as licensing fees for specific software modules used by financial institutions.
What are the main risks for NCNO?
Sustained operating losses indicate that the company is burning significant cash, which could lead to liquidity issues if revenue growth slows or funding costs rise unexpectedly. High concentration of goodwill and accumulated intangible assets from past acquisitions poses a risk of future impairment charges if those acquired units underperform expectations. Dependence on a single primary customer segment (community and mid-sized banks) makes the company vulnerable to regulatory changes or economic downturns affecting this specific niche.
What is NCNO's competitive advantage?
nCino possesses a deep moat built on extensive industry-specific data and proprietary algorithms that provide superior risk modeling and customer insights compared to generic SaaS competitors. The company benefits from high switching costs due to its deeply integrated ecosystem of banking applications and the complexity of migrating large-scale core banking systems away from nCino once implemented. Its focus on the underserved mid-market segment allows it to avoid direct price wars with enterprise giants while capturing significant market share in community banking.
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Not financial advice. All content is for informational purposes only. Data may contain errors. Consult a qualified financial advisor before making investment decisions.