SS&C(US:SSNC)2025-10-23 22:02Financial Data and Key Metrics Changes - The company reported record adjusted revenue of $1.569 billion, an increase of 7% year-over-year, and adjusted diluted earnings per share of $1.57, reflecting a 17.2% increase [5][12] - Adjusted consolidated EBITDA reached $619 million, up 9.3%, resulting in a quarterly adjusted consolidated EBITDA margin of 39.5% [5][13] - Cash from operating activities for the nine months ended September 30, 2025, was $1.101 billion, a 22% increase over the prior year [6][15] - The company returned $305 million to shareholders in Q3, including $240 million for share repurchases and $65.8 million in dividends [6][7] Business Line Data and Key Metrics Changes - The GIDS business experienced a 9% revenue growth, while GlobeOp reported a 9.6% revenue growth, contributing to the overall performance [5][12] - Financial services recurring revenue growth was 6.7% in Q3 [5] Market Data and Key Metrics Changes - The company noted strength across all alternative markets and capitalized on international opportunities, particularly in Australia and the U.S. [5][10] - The acquisition of Curo Fund Services is expected to enhance the company's presence in the African market, which is still developing compared to Europe and the U.S. [7][26] Company Strategy and Development Direction - The company aims to enhance user interfaces and client experiences as competitive differentiators, particularly through emerging technologies [10] - Intelligent automation and AI are viewed as both revenue opportunities and means to improve operational efficiency [9][10] - The company is focused on high-quality acquisitions and has recently completed the acquisition of Calastone, which adds capabilities in money markets, ETFs, and digital assets [8][7] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the fourth quarter and the remainder of the year, expecting continued strong performance [15][18] - The company anticipates revenue growth of approximately 4.5% in Q4 and has raised its full-year revenue guidance [17][18] - Management acknowledged the competitive landscape but remains confident in the company's growth trajectory despite some lost business [31][32] Other Important Information - The company is hosting its annual Deliver Conference, which will showcase its latest offerings and advancements in AI [18] - The effective non-GAAP tax rate was reported at 21.1% for the quarter [13] Q&A Session Summary Question: Contribution of Pathea to Q4 organic growth - Management expects Pathea to contribute approximately $25 million in Q4, up from $16 million in the previous year [20][21] Question: Details on organic growth mechanics - A significant portion of organic growth was attributed to a large liftout in Sydney, Australia, completed on July 1 [22][23] Question: Curo Fund Services deal attraction and revenue - The African market's potential and existing relationships with large insurers were key attractions, with Curo generating approximately $15 million in revenue [26][27] Question: Update on agentic AI implementation - The company is integrating AI across its business, enhancing existing technologies with smarter agents [28] Question: Impact of lost business from State Street - Management indicated a small impact from lost business but remains confident in overall growth [31] Question: Margin outlook with GIDS and GlobeOp growth - The company expects continued margin improvement due to strong performance from GlobeOp and efforts to enhance GIDS margins [32] Question: Seasonality of Calastone's revenue - Management stated that Calastone does not have significant seasonality that would impact overall growth rates [39] Question: M&A pipeline and Intralinks growth - Early indicators show improvement in the M&A pipeline, although revenue growth may lag behind [42] Question: Confidence in healthcare business growth - Management expressed cautious optimism about the healthcare business, highlighting its potential for large deals [43]