Amdocs Q2 Earnings Top Estimates, Stock Falls on Dim Q3 Profit Outlook

Core Insights - Amdocs Limited (DOX) reported better-than-expected second-quarter fiscal 2025 results with non-GAAP earnings of $1.78 per share, exceeding management's guidance and increasing 14.1$1.23 billion, surpassing the consensus estimate but down 9.4% year over year due to the phase-out of certain business activities [2][4] Financial Performance - Amdocs' earnings surpassed the Zacks Consensus Estimate in three of the last four quarters, with an average surprise of 0.1% [2] - Managed services revenues rose 3.7% year over year to $747 million, while the non-GAAP operating income increased 4.7$240.1 million, with an operating margin expansion of 290 basis points to 21.3% [6] - The company ended the second quarter with a backlog of $4.17 billion, up$30 million sequentially [6] Regional Revenue Breakdown - North America generated revenues of $738.3 million, accounting for 65$180.7 million [5] - Rest of the World (RoW) revenues, which represent 19% of total revenues, declined 12% year over year to $209.2 million [5] Guidance and Outlook - For the third quarter, Amdocs expects revenues between$1.11 billion and $1.15 billion, with a midpoint of$1.13 billion, indicating a year-over-year decline of 9.3% [8] - Non-GAAP earnings per share guidance for the third quarter is set between $1.68 and$1.74, below the Zacks Consensus Estimate of $1.75 [9] - For fiscal 2025, the company revised its revenue decline rate guidance to 9.1-10.9$324 million, down from $349 million at the end of 2024 [7] - The company generated operating cash flow of$172 million and free cash flow of $156 million during the second quarter [7]