Rimini Street's AI Pivot Takes Hold as Growth Accelerates

New AI governance offerings and a resurgent stock signal a strategic shift from litigation-burdened support provider to innovation-led software services firm.

RMNI · Earnings Call · 2026-07-30

From Support Vendor to Innovation Partner

Rimini Street (RMNI) has spent two years emerging from the shadow of Oracle litigation and the PeopleSoft wind-down. The second quarter of 2026 marks a clear inflection: revenue grew 6.7% YoY (10% ex-PeopleSoft), and the stock has rallied 61% in the last 90 days, reflecting investor conviction in the company's new AI-centric strategy. “We have now delivered 4 consecutive quarters of improved growth metrics” — Seth A. Ravin, Chief Executive Officer · 2026-07-30, CEO Seth Ravin said on the call, pointing to the alignment with the vision laid out at the December 2025 Investor Day. The company's top keywords now revolve around AI agent and Rimini Govern for AI, a governance-as-a-service offering launched that day. This is a decisive move beyond traditional third-party maintenance into the agentic AI layer, positioning RMNI as the operating system for enterprise AI deployed over existing ERP systems.

Financial Momentum

Financially, the quarter was solid. Revenue of $111.1M, gross margin of 60.9% (GAAP), and adjusted EBITDA of $10.5M (9.5% of revenue) came in within guidance. CFO Michael Perica emphasized the quality of growth: “positive growth drivers over the past 4 quarters has lifted revenue and revenue retention rates on a year over year basis” — Michael L. Perica, Chief Financial Officer · 2026-07-30. Importantly, the PeopleSoft drag is fading—now just 3% of revenue, down from 6% a year ago—allowing underlying momentum to shine through. On the metrics side, revenue has been climbing since early 2025, with Q2 2026 marking the fastest year-over-year growth in several quarters. Excluding PeopleSoft, ARR grew 8.1% YoY, and RPO rose 8.8% ex-PeopleSoft, providing visibility into 2026 and beyond.

AI Strategy: From Experimentation to Scale

The CEO's narrative is consistent: enterprises are overwhelmed by forced upgrades and costly migrations. RMNI offers a path—its Agentic AI ERP solutions—that lets clients modernize without replacing core systems. The launch of Rimini Govern for AI completes the stack, adding governance and control over AI agents.

Now that is changing and those customers, we have several of them that have signed with us because now they are confident they do not need to make that return trip to the vendor, the boomerang effect that some refer to.
Seth A. Ravin, Chief Executive Officer · 2026-07-30

This is a structural shift: the litigation overhang is gone, and customers no longer fear becoming “trapped” with RMNI. The ServiceNow partnership, now in its second year, is showing traction. Of the 26 customers initially testing the Agentic AI solution, several have moved into production, and the pipeline combines both existing and new logos. The company is also expanding its indirect channel, which should improve sales efficiency over time. “we will achieve a meaningful reduction in total operating cost and more leverage as we move forward” — Seth A. Ravin, Chief Executive Officer · 2026-07-30, Seth noted when asked about AI's impact on the cost model. The investment in AI is not new—as far back as May, Seth said: “We also, of course, are investing in our Agentic AI ERP solutions” — Seth Ravin, Chief Executive Officer and President · 2026-05-01. But the scale and speed of execution have accelerated.

Risks and Watch Points

Despite the optimism, risks remain. Sales and marketing costs have risen to 37.6% of revenue (non-GAAP) as RMNI invests in new sellers and product launches; management says this is near its peak. Retention, at 90% for service subscriptions, still needs to climb to the 90s to support the rule-of-20 goal. The new logo acquisition model (hunter-farmer) is working in the Americas, but international execution is untested. Management has long signaled its operating leverage target: “We have always said that we expect eventually at scale... somewhere around $1 billion of annualized sales... mid-30s, 33% to 35%” — Seth Ravin, CEO and President · 2026-02-20. The current investments are a bridge to that outcome. Externally, the recent European Commission decision against SAP's anti-competitive practices could be a tailwind, as it validates the third-party support ecosystem. Seth noted: "I think that when you look at the decision, the agreement in Europe with SAP, I think this is really bigger than SAP." (component_hash=5260302065646809691) If RMNI can execute on its AI roadmap while maintaining disciplined cost control, the 90-day rally may be the beginning of a longer re-rating.