Gen Digital Q4 Earnings Surpass Expectations, Revenues Rise Y/Y

Core Insights - Gen Digital Inc. (GEN) reported strong fourth-quarter fiscal 2025 results, with both revenues and earnings exceeding the Zacks Consensus Estimate [1][3] - The company’s non-GAAP earnings were 59 cents per share, surpassing the estimate by 1.7% and reflecting an 11.3% year-over-year improvement [1][2] - Non-GAAP revenues reached $1.01 billion, marking a 5% year-over-year increase, driven by heightened demand for AI-driven cyber safety solutions [3][5] Financial Performance - Non-GAAP gross profit grew 4.3% year over year to $868 million, although gross margin contracted by 40 basis points to 85.9% [8] - Non-GAAP operating income totaled $590 million, up 4.2% year over year, with an operating margin of 58.4%, down 30 basis points [9] - The company generated operating cash flow of $1.221 billion and free cash flow of $1.206 billion for the full fiscal year [11] Revenue Breakdown - Cyber Safety revenues amounted to $998 million, with Direct Customer revenues increasing 3.9% to $877 million and Partner revenues rising 15.2% to $121 million [5] - The average direct monthly revenue per user (ARPU) was $7.27, slightly up from $7.22 in the previous year [6] - Quarterly bookings advanced 3% year over year to $1.076 billion, with an increase in average direct customer count to 40.4 million [6] Balance Sheet and Cash Flow - Gen Digital ended the quarter with cash and cash equivalents of $1.006 billion, an increase from $883 million in the previous quarter [10] - Long-term debt decreased to $7.968 billion from $8.429 billion year over year [10] - The company paid out $77 million in dividends during the fourth quarter and repurchased stocks worth $272 million [11] Future Guidance - For the first quarter of fiscal 2026, Gen Digital anticipates revenues between $1.18 billion and $1.21 billion, with non-GAAP earnings projected between 59 cents and 61 cents [12] - For fiscal 2026, the company projects revenues in the range of $4.7 billion to $4.8 billion and earnings per share between $2.54 and $2.56 [13]