NICE Q4 Earnings Beat Estimates on Strong Cloud Revenues, Stock Gains

Core Viewpoint - NICE reported strong financial results for the fourth quarter of 2024, with adjusted earnings and revenues exceeding consensus estimates, driven by growth in its cloud business and customer base expansion [1][2][3]. Financial Performance - Adjusted earnings per share (EPS) for Q4 2024 were $3.02, beating the Zacks Consensus Estimate by 2.03% and increasing 28% year over year [1]. - Non-GAAP revenues reached $721.6 million, surpassing the consensus mark by 1.20% and rising 16% year over year [2]. - Cloud revenues, which constitute 74% of total revenues, amounted to $533.9 million, reflecting a 24% year-over-year increase despite missing the consensus estimate by 0.06% [4]. - Service revenues were $149.7 million, accounting for 20.7% of total revenues, down 7.8% year over year and missing the consensus by 0.98% [4][5]. - Product revenues of $38 million, making up 5.3% of total revenues, exceeded the consensus estimate by 37.61% and increased 19.4% year over year [5]. Market and Growth Drivers - The growth in revenues was primarily attributed to the strength of the cloud business and the expansion of NICE's customer base, with over 400 enterprise cloud customers generating more than $1 million in annual recurring revenue (ARR) [4][6]. - NICE's focus on cloud solutions, particularly the CXone Mpower platform, is enhancing operational efficiency and customer experience [6]. Operating Metrics - Non-GAAP gross margin contracted by 50 basis points to 71.4% [7]. - Operating expenses as a percentage of revenues decreased by 200 basis points year over year to 39.9%, while the non-GAAP operating margin expanded by 150 basis points to 31.5% [8]. Balance Sheet and Cash Flow - As of December 31, 2024, NICE had cash and cash equivalents of $1.62 billion, an increase from $1.52 billion as of September 30, 2024 [9]. - The company allocated $95.2 million for share repurchases in Q4 2024 [10]. Guidance - For Q1 2025, NICE expects non-GAAP revenues between $693 million and $703 million, indicating a 6% year-over-year growth at the midpoint [11]. - For the full year 2025, projected non-GAAP revenues are between $2.92 billion and $2.94 billion, implying a 7% year-over-year growth at the midpoint [11].