Amdocs Beats on Q1 Earnings and Revenue Estimates

Core Insights - Amdocs Limited (DOX) reported first-quarter fiscal 2025 non-GAAP earnings of $1.66 per share, exceeding management's guidance and the Zacks Consensus Estimate, reflecting a year-over-year increase of 6.4% [1] - The company's first-quarter revenues of $1.11 billion matched consensus expectations but showed a decline of 10.9% year-over-year due to the phase-out of certain business activities [2][3] Financial Performance - Amdocs experienced a revenue decline across all regions, with North America contributing $737.4 million (66.4% of total revenues), down 12% year-over-year [3] - Europe revenues, accounting for 14% of total revenues, decreased by 14.4% year-over-year to $155.2 million, while Rest of the World revenues fell 3.7% to $217.4 million [4] - Managed services revenues rose 0.9% year-over-year to $729 million, with a 12-month backlog of $4.14 billion, up $80 million sequentially [5] Balance Sheet & Cash Flow - As of December 31, 2024, Amdocs had cash and short-term investments of $349 million, down from $514.3 million as of September 30, 2024, while long-term debt slightly increased to $646.4 million [6] - The company generated an operating cash flow of $105.6 million and a free cash flow of $78 million during the first quarter [6] Guidance Update - For the second quarter, Amdocs expects revenues between $1.105 billion and $1.145 billion, with a midpoint of $1.125 billion, indicating a year-over-year decline of 9.7% [7] - The company anticipates non-GAAP earnings per share to range from $1.67 to $1.73, suggesting a year-over-year rise of 8.3% [8] - For fiscal 2025, Amdocs expects revenues to decline between 8.4% and 11.6%, slightly worse than previous guidance, with a Zacks Consensus Estimate of $4.52 billion, indicating a 9.6% year-over-year decline [8] Operating Margin & Cash Flow Expectations - The non-GAAP operating margin is projected to be between 21.1% and 21.7% for fiscal 2025, with non-GAAP earnings expected to grow between 6.5% and 10.5% [9] - Free cash flow is anticipated to be between $710 million and $730 million [9]