Ivanti’s second-quarter earnings fell sharply, adding to pressure on the Clearlake Capital-backed cybersecurity software company as it works to revive growth and manage a heavy debt burden following its shift to a subscription-based model, according to a report by Bloomberg.
The report cites unnamed people familiar with the figures as saying that the Utah-based company reported second-quarter revenue of $189m, an 11% decline from a year earlier. Pro forma adjusted EBITDA fell 21% to $72m.
Ivanti’s annual recurring revenue also slipped, declining 1% to $778m. Subscription and software-as-a-service products accounted for about 83% of ARR and are growing at roughly 10%, although around 5% of total recurring revenue is tied to products being phased out.
The changing revenue model has put additional strain on Ivanti’s finances. The company has moved away from upfront software licensing towards recurring subscriptions, a transition that can depress revenue and earnings during the conversion period even as it creates a larger base of recurring income over time.
The weaker performance comes as Ivanti faces significant leverage. S&P Global Ratings downgraded the company to CCC in June, citing its high debt levels, ongoing cash burn and limited liquidity, while warning of an increased risk of default or a distressed debt exchange.
Ivanti has about $1.8bn of first-lien debt due in 2029. The loan has fallen roughly eight points since the company reported its latest results to lenders in mid-August, trading at around 36 cents on the dollar, according to Bloomberg-compiled data.
The company is also carrying annual interest costs of about $280m, according to people familiar with the matter.
Ivanti is attempting to offset the weakness with new products, including its Autonomous Endpoint Management offering, which uses AI-based technology to identify and remediate security and compliance risks across customers’ IT environments.
The new product generated a sales pipeline of approximately $71m in the second quarter, according to one of the people, with management expecting that figure to increase.
Ivanti said that although the broader software market is facing near-term headwinds, customer interest in Autonomous Endpoint Management has been encouraging.
The latest results follow a weak first quarter. Revenue fell 4% year-on-year to $204 million, while pro forma adjusted EBITDA declined 13% to $87 million. ARR was broadly unchanged at $785 million.
Ivanti’s financial difficulties have also highlighted the challenges facing private equity owners of highly leveraged software businesses as customers transition to subscription models and technology spending comes under pressure.
Clearlake acquired a controlling interest in Ivanti alongside TA Associates and Charlesbank Capital Partners. The owners and the company have previously taken steps to give the business more time to execute a turnaround.
In 2025, Ivanti reached an agreement with lenders to extend debt maturities and secured $350m of additional capital. The move provided additional liquidity while management sought to improve the company’s operating performance.
