I last wrote about Endava Plc (NYSE: DAVA ) in March 2025, framing it as a recovery setup after what I believed was a cyclical reset year. The stock was down 45% in the preceding year when I published that article, and it is downI’m Emmanuel Onwusah—a financial analyst, writer, and recovering engineer. I hold FMVA® and BIDA® certifications from the Corporate Finance Institute, and I spend most of my time creating pitch decks, building models, analyzing companies, and trying to make sense of where value meet ...

I last wrote about Endava Plc (NYSE: DAVA ) in March 2025, framing it as a recovery setup after what I believed was a cyclical reset year. The stock was down 45% in the preceding year when I published that article, and it is downI’m Emmanuel Onwusah—a financial analyst, writer, and recovering engineer. I hold FMVA® and BIDA® certifications from the Corporate Finance Institute, and I spend most of my time creating pitch decks, building models, analyzing companies, and trying to make sense of where value meet ...

Night Watch Investment Management, an investment management firm, released its fourth-quarter 2025 investor letter. A copy of the letter can be downloaded here. Despite experiencing high volatility in individual stocks during Q4, the fund finished the quarter approximately flat. Overall, the firm is pleased with how 2025 unfolded. Like 2024, the results were broad-based and did not rely on any single security.  In addition, please check the fund’s top five holdings to know its best picks in 2025. In its ...

Summary of Endava FY Conference Call (December 09, 2025) Company Overview - **Company**: Endava (NYSE:DAVA) - **Industry**: Digital Engineering - **Global Workforce**: Over 11,000 professionals - **Operational Base**: Central Europe with growing presence in APAC through both inorganic and organic means [1] Key Insights and Arguments Market Conditions and Internal Changes - The industry has faced volatility over the past two to three years, influenced by macroeconomic factors such as high interest rates, which have suppressed discretionary IT spending [5][6] - Corporates have shifted focus towards internal AI experimentation, diverting funds from external innovation projects [6] - Endava has invested in AI and developed its own AI methodology, positioning itself for future demand as corporates seek tangible returns on their AI investments [6][7] Demand and Business Performance - Demand for larger deals (over GBP 10 million) has been slow due to client decision-making delays, partly attributed to AI-related considerations [11] - Recent trends indicate a firming demand for larger deals, with a more predictable cadence expected in 2026 [12] - The company has seen a 50% reduction in revenue from the payments sector over the past two to three years, but conversations in this area are becoming more robust [15] Fiscal Year 2026 Guidance - Endava's guidance for fiscal 2026 includes a cautious optimism, with a focus on large deals contributing significantly to revenue [27][29] - The company has a contracted and committed pipeline at approximately 81%, which is higher than historical averages [29] AI and Endava Flow - Endava is transitioning to an AI-native business model with the introduction of Endava Flow, which aims to enhance productivity significantly [34][36] - The methodology is still in the rollout phase, with expectations for it to contribute to revenue growth and margin enhancement in fiscal years 2027 and 2028 [36][50] - The company anticipates a shift from time and material contracts to more outcome-based pricing models as AI adoption increases [35][50] Pricing and Margin Recovery - Endava has maintained pricing discipline despite market pressures, with stable day rates and a focus on recovering margins through operational leverage and the adoption of Endava Flow [48][50] - The company aims to improve gross margins from approximately 30% to 35% and adjusted PBT margins to around 15% in the future [51] Additional Important Points - The company has faced challenges in forecasting large deal timings, which has affected visibility and guidance [8][11] - There is a cautious approach to pipeline conversion, with skepticism applied to ensure realistic expectations [29] - The impact of geopolitical factors and tariffs has been acknowledged, but the company is adapting to the new normal in decision-making processes [19][20] This summary encapsulates the key points discussed during the Endava FY Conference Call, highlighting the company's strategic focus, market conditions, and future outlook.

Group 1 - The article does not provide any relevant content regarding company or industry insights [1]

Summary of Endava (NYSE:DAVA) 2025 Conference Call Company Overview - **Company**: Endava (NYSE:DAVA) - **Date**: November 18, 2025 - **Speakers**: Mark (CFO), Al (Chief Engagement Officer), Puneet (JPMorgan) Key Points Financial Performance - **Q3 Results**: Results were slightly below expectations primarily due to an unexpected credit issue with a significant client, impacting revenue and EPS [5][6] - **Revenue Impact**: The credit issue was not due to poor performance but was aimed at securing future work with the client. This led to a revenue shortfall, affecting EPS directly [5][6] - **Pipeline Weakness**: There was some weakness in the non-big deal pipeline, with fewer conversions than anticipated. However, three large deals were secured, including a five-year $100 million deal with Paysafe, which is expected to boost revenue in the second half of the year [6][7] Client Engagement and Deal Structure - **Large Deals**: Endava is focusing on securing large, multi-year transformational deals, particularly in financial services. These deals are characterized by immediate service delivery rather than gradual ramp-ups [12][13] - **AI Integration**: The company is integrating AI into its service delivery, emphasizing the importance of partnerships and long-term commitments with clients [18][19] - **Client Concerns**: Clients are looking for partners who can help navigate the complexities of AI implementation and ensure data security and compliance [31][33] Market Trends and Industry Dynamics - **Payments Industry**: Endava is well-positioned in the payments sector, which accounts for over 30% of its revenue. The company is helping clients modernize their payment platforms amidst regulatory changes and the rise of new competitors [50][52] - **Sovereignty of Data**: There is a growing trend towards data sovereignty in payments, particularly in Asia and South America, as governments seek to create local jobs and support local companies [51][52] Endava Flow Methodology - **Endava Flow**: This is described as a methodology rather than a platform, focusing on using AI agents to enhance efficiency in project delivery. It aims to streamline processes while maintaining governance and quality [56][60] - **Cultural Impact**: The company emphasizes a strong culture among its employees, who are motivated by working on innovative projects and contributing to significant outcomes for clients [67][69] Future Outlook - **Growth Potential**: The company sees significant growth potential in core modernization services, which are essential for enabling AI capabilities. However, the pace of growth has not met previous expectations [35][36] - **Client Engagement Strategy**: Endava is shifting its focus to higher-level C-suite engagements, addressing broader industry challenges rather than just technological solutions [65][66] Additional Insights - **AI Use Cases**: There is a focus on both operational efficiency and new business propositions enabled by AI, with examples from various industries, including payments and healthcare [40][43] - **Regulatory Environment**: The company is actively engaging with clients on regulatory matters, particularly in the context of emerging technologies like stablecoins and crypto [54][55] This summary captures the essential insights from the Endava conference call, highlighting the company's financial performance, strategic focus, and market dynamics.

Core Insights - Paysafe has partnered with Endava to enhance payment solutions and community engagement through advanced technology [2][4] - The collaboration aims to leverage Paysafe's payment expertise and Endava's AI-driven engineering to improve transaction experiences [4][5] Company Overview - Paysafe specializes in facilitating secure transactions globally, offering services like digital wallets, prepaid solutions, and online payment processing [2] - Endava provides a variety of tech and business services, including engineering optimization and AI solutions, with experience in the payments sector [3] Partnership Goals - The partnership seeks to establish a new standard for payments and community experiences, focusing on quicker rollouts and richer digital experiences [4] - The collaboration combines world-class payment infrastructure with next-generation engineering to simplify and enhance transaction processes [5] Recent Performance and Challenges - Paysafe recently lowered its quarterly earnings guidance, citing challenges with digital wallet products [5] - The CEO noted that while digital wallets are still developing, consumer engagement in eCash has been strong, with over 500,000 registrations for account and card offerings [6] Market Dynamics - Digital banking partnerships are increasing in Europe, but traditional wallets are not meeting growth expectations due to global weaknesses [7] - The complexity of the regulatory and banking ecosystem has delayed the execution of product roadmaps, although the customer pipeline remains strong [7]

Core Insights - Endava has launched Dava.Rise, a program aimed at connecting high-potential scale-ups with global enterprises to accelerate innovation [1][4][14] - The initiative is designed to bridge the gap between the demand for rapid innovation from enterprises and the solutions provided by emerging scale-ups [2][3] Program Details - Dava.Rise will assist scale-ups in demonstrating product-market fit and accelerating their commercial pathways, providing mentorship, workshops, and technical guidance [3][5] - The program aims to facilitate the adoption of innovative technologies by enterprises and foster collaboration among investors, ventures, and industry leaders [4][5] Market Focus - The initial cohort of Dava.Rise will focus on the UK market, with plans for global expansion and industry-specific cohorts in 2026 across various sectors including finance, healthcare, and media [5]

Core Insights - Endava's stock experienced a significant sell-off, dropping 29.5% in a week while the S&P 500 rose 0.1% and the Nasdaq Composite fell 0.5% [1][2] - The decline was triggered by disappointing Q1 results for fiscal 2026, which ended on September 30, leading to a dramatic contraction in the company's valuation [2][3] Financial Performance - In Q1, Endava reported non-GAAP earnings of 0.15 British pounds ($0.20) on sales of 178.2 million pounds ($234.5 million) [3] - Sales declined unexpectedly by 8.7% year over year, or 7.3% on a currency-adjusted basis, with both revenue and earnings per share falling short of prior guidance [3] - Management has lowered full-year performance targets, now guiding for sales between 735 million pounds and 752 million pounds, indicating an annual decline of 3.5% at the midpoint [5] Market Reaction - Following the weak performance, Endava's stock plummeted, reflecting investor concerns about the company's future growth, particularly regarding its artificial intelligence strategies [5]

Group 1 - The article discusses Endava plc (DAVA) as a high-growth IT consulting firm, often compared with Globant (GLOB) [1] - The author emphasizes the importance of experience in analyzing diverse industries, including airlines, oil, retail, mining, fintech, and e-commerce, as well as macroeconomic factors [1] - The author reflects on their extensive experience through various crises, which enhances their ability to understand and benefit from new ideas and business models [1] Group 2 - There is a disclosure indicating a beneficial long position in DAVA shares, highlighting the author's personal investment in the company [2] - The article expresses the author's independent opinions without any external compensation, reinforcing the authenticity of the analysis [2] - Seeking Alpha's disclosure notes that past performance does not guarantee future results, emphasizing the need for individual assessment of investment suitability [3]