Financial Data and Key Metrics Changes - Revenue for Q4 2025 was $1.15 billion, up 2.8% year-over-year in pro forma constant currency, exceeding the midpoint of guidance [6][24] - Non-GAAP diluted earnings per share (EPS) was $1.83, slightly above guidance midpoint, with a 12-month backlog of $4.19 billion, up 3.2% from a year ago [7][32] - Profitability improved by 300 basis points year-over-year, with a non-GAAP operating margin of 21.6%, up 290 basis points from the previous year [25][26] Business Line Data and Key Metrics Changes - Cloud revenue grew by double digits, contributing over 30% of total revenue, compared to roughly 25% in the prior year [26] - Managed services revenue reached a record $3 billion in fiscal 2025, up 3.1% from a year ago, with managed services accounting for 66% of overall revenue [27][28] Market Data and Key Metrics Changes - North America saw over 2% sequential improvement, marking its strongest quarter of the fiscal year, while Europe experienced a decline following a record quarter [24] - The rest of the world showed mixed trends, with expectations for continued growth despite fluctuations due to project orientation [24] Company Strategy and Development Direction - The company is focusing on cloud, digital, and generative AI solutions to support telco customers, with a strategy to enhance customer experiences and operational efficiencies [9][10] - A significant investment in generative AI is planned, with the development of a next-generation platform called Cognitive Core, aimed at transforming telecom operations [19][20] Management's Comments on Operating Environment and Future Outlook - The company is entering fiscal 2026 with a healthy backlog and strong visibility, expecting revenue growth between 1.7%-5.7% as reported [21][22] - Management acknowledged potential impacts from the uncertain global macroeconomic environment on customer demand and spending behavior [22] Other Important Information - Free cash flow for fiscal 2025 was $645 million, with a healthy cash balance of approximately $325 million and a $500 million revolving credit facility [30][31] - The company plans to return the majority of free cash flow to shareholders, including an 8% increase in quarterly cash dividends [31] Q&A Session Summary Question: Impact of AI on the telecom industry - Management discussed the gradual improvement in productivity through generative AI, emphasizing its potential to enhance operations and customer offerings [37][38] Question: R&D capital allocation - The decision to reallocate capital into R&D was driven by the need to capture growth opportunities, with ongoing productivity gains expected to support this investment [40][41] Question: Customer pricing expectations - There is ongoing dialogue with customers regarding pricing, with efforts to expand the scope of agreements to include new technologies and services [44][46] Question: Cash flow and growth expectations - Management clarified that cash flow levels are consistent, with expectations for stronger growth in the second half of fiscal 2026, despite some pressures from major customers like T-Mobile [48][49] Question: Long-term growth positioning - The company aims to establish multiple growth engines, including cloud and generative AI, to drive sustainable growth beyond current levels [56][57]

Fiscal Year 2025 Performance - Amdocs achieved revenue growth of 3.1% year-over-year[14] - The company's non-GAAP operating margin increased by 300 basis points year-over-year to 21.4%[14] - Non-GAAP EPS grew by 8.5% year-over-year[14] - Cloud revenue now accounts for over 30% of total revenue, demonstrating double-digit growth[15, 55] - Managed services reached a record 66% of total revenue[16] Q4 FY2025 Results - Revenue reached $1.15 billion, up approximately 2.8% year-over-year[18] - Non-GAAP operating margin was 21.6%, a 290 basis point increase year-over-year[18] - Non-GAAP EPS was $1.83, above the guidance midpoint[18] - The 12-month backlog increased to $4.19 billion, a 3.2% year-over-year increase[18] FY2026 Outlook - The company projects revenue growth of 1.0% to 5.0% year-over-year in constant currency, with a midpoint of 3.0%[41] - Non-GAAP EBIT margin is expected to be 21.3% to 21.9%, with a midpoint of 21.6%, up 20 basis points year-over-year[41] - Non-GAAP EPS growth is projected to be 4.0% to 8.0%, with a midpoint of 6%[41] - Free cash flow is estimated between $710 million and $730 million[41]

Core Insights - Amdocs has launched the connectX SaaS platform for Smart Communications, enabling fully customizable mobile plans for Gen Z subscribers [1] - The initiative aims to enhance the digital mobile experience and support the growth of mobile virtual network operators (MVNOs) in the Philippines [1] Company Overview - Smart Communications is a subsidiary of PLDT, a major telecommunications and digital service provider in the Philippines [1] - The collaboration with Amdocs focuses on delivering hyper-personalized mobile services through the KiQ app [1] Industry Impact - The introduction of the connectX platform is expected to empower Gen Z users by allowing them to design their own mobile plans, providing greater flexibility and control [1] - This move is part of a broader strategy to accelerate the launch of new MVNOs in the region, indicating a shift towards more personalized mobile service offerings [1]

Core Insights - Amdocs has entered into a multi-year strategic agreement with Telia Finland to develop a next-generation Digital Business Support System (BSS) [1] - This partnership signifies Telia Finland's inaugural BSS engagement with Amdocs, highlighting a significant step in Telia's digital transformation efforts [1] Company Developments - The agreement is aimed at redefining customer engagement, accelerating innovation, and enhancing the digital journey for millions of Telia users [1] - Amdocs is recognized as a leading provider of software and services tailored for communications and media companies, indicating its strong position in the industry [1] Industry Impact - The collaboration is expected to play a crucial role in the ongoing digital transformation within the telecommunications sector, reflecting broader trends in the industry towards modernization and improved customer experiences [1]

Core Insights - Amdocs has signed a multi-year agreement with Vivo to modernize its operations support systems (OSS) [1] - The agreement includes extended support for existing platforms and professional services to enhance Vivo's operational efficiency and service agility [1] - The modernization program will ensure Vivo operates on the latest version of Amdocs' OSS products, incorporating recent software enhancements, security updates, and architectural improvements [1] Company Overview - Amdocs is a leading provider of software and services specifically for communications and media companies [1] - Vivo is a member of the Telefónica group, indicating its significant position in the telecommunications sector in Brazil [1] Industry Context - The modernization of OSS is crucial for telecommunications companies to maintain competitive advantage through improved operational efficiency and agility [1] - The agreement reflects a trend in the industry towards adopting the latest technology solutions to enhance service delivery and customer satisfaction [1]

Core Insights - Amdocs has expanded its managed services agreement with Globe to include the network domain, enhancing Globe's capabilities in mobile network optimization and automation [1] - The three-year engagement aims to improve service quality, operational agility, and customer experience for Globe [1] Company Overview - Amdocs is a leading provider of software and services specifically tailored for communications and media companies [1] - Globe is recognized as a leading digital solutions provider in the Philippines [1] Strategic Implications - The strategic extension of the agreement is expected to empower Globe to drive efficiency and deliver superior customer experiences [1] - This partnership highlights the growing importance of managed services in enhancing operational capabilities within the telecommunications sector [1]

Core Insights - Lumen Technologies is advancing its cloud transformation strategy by migrating critical Business Support Systems (BSS) applications to Google Cloud Platform (GCP) [1] - This migration is part of Lumen's cloud-first strategy, which aims to enhance agility, resiliency, and operational efficiency [1] - The initiative establishes a scalable and consumption-based IT foundation for future transformation efforts [1] Company Strategy - The partnership with Amdocs signifies a strategic move to leverage public cloud technologies [1] - The focus on cloud services is intended to drive future-ready customer experiences [1] - Lumen's strategy emphasizes the importance of operational efficiency in a competitive market [1]

Core Insights - Amdocs has announced an expanded strategic partnership with Fidium to enhance operational efficiency, reduce costs, and improve customer experience [1] - The partnership includes a software and IT services agreement focused on modernizing Fidium's IT operations [1] - The collaboration supports Fidium's broader digital transformation strategy [1] Company Overview - Amdocs is a leading provider of software and services specifically for communications and media companies [1] - Fidium, previously known as Consolidated Communications, is a next-generation fiber internet and network services provider in the United States [1] Strategic Goals - The partnership aims to modernize and manage Fidium's IT operations [1] - The initiative is part of a larger digital transformation strategy for Fidium [1]

Core Insights - Amdocs Limited reported fiscal 2025 revenue of $4.53 billion, a decrease of 9.4% year-over-year as reported, but an increase of 3.1% year-over-year in pro forma constant currency [1][1][1] - The company achieved accelerated profitability improvement targets and reported a 12-month backlog of $4.19 billion, up 3.2% year-over-year [1][1][1] - Amdocs initiated its fiscal 2026 outlook, expecting revenue growth of 1.7%-5.7% year-over-year as reported and 1.0%-5.0% year-over-year in constant currency [1][1][1] Fiscal 2025 Highlights - Total revenue for fiscal 2025 was $4,533 million, down 9.4% due to the phase-out of certain business activities, while pro forma constant currency revenue increased by 3.1% [1][1][1] - Managed services revenue reached a record $2,996 million, accounting for approximately 66% of total revenue [1][1][1] - GAAP diluted EPS was $5.05, an increase of 18.8%, including a restructuring charge of $0.65 per share; without this charge, EPS would have exceeded the guidance range of 31.5%-33.5% [1][1][1] - Non-GAAP diluted EPS was $6.99, up 8.5% and at the midpoint of the 8.0%-9.0% guidance range [1][1][1] - Free cash flow was $645 million, derived from cash flow from operations of $749 million, less $104 million in net capital expenditures [1][1][1] - The company repurchased $551 million of ordinary shares during the fiscal year [1][1][1] Fourth Quarter Fiscal 2025 Highlights - Revenue for the fourth quarter was $1,150 million, down 9.0% as reported, but up 2.8% in pro forma constant currency [1][1][1] - Managed services revenue for the fourth quarter was $748 million, approximately 65% of total revenue, and up 3.7% compared to the previous year's fourth quarter [1][1][1] - GAAP diluted EPS for the fourth quarter was $0.88, including a restructuring charge of $0.60 per share; without this charge, EPS would have been at the high end of the $1.41-$1.49 guidance range [1][1][1] - Non-GAAP diluted EPS was $1.83, slightly above the midpoint of the guidance range of $1.79-$1.85 [1][1][1] - GAAP operating income was $133 million, with a GAAP operating margin of 11.5%, reflecting a 260 basis point increase compared to the previous year's fourth quarter [1][1][1] - Non-GAAP operating income was $248 million, with a non-GAAP operating margin of 21.6%, up 290 basis points year-over-year [1][1][1] Dividend Announcement - The Board of Directors approved an 8% increase in the quarterly cash dividend from $0.527 per share to $0.569 per share, expected to be first paid in April 2026, subject to shareholder approval [1][1][1]

Core Insights - Amdocs has announced a seven-year extension of its managed services agreement with PLDT Inc. and its wireless subsidiary Smart Communications, enhancing their long-term partnership [1] Group 1: Partnership and Collaboration - The expanded collaboration aims to modernize PLDT's IT operations and streamline business processes [1] - Amdocs will leverage artificial intelligence (AI) and generative AI (GenAI) technologies to enhance customer experiences [1] Group 2: Strategic Goals - The partnership is focused on driving agility within PLDT's operations [1] - The initiative is expected to simplify IT operations for PLDT and Smart Communications [1]