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Amdocs (DOX) Q3 Earnings Surpass Estimates, Revenues Miss
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Amdocs Limited (DOX - Free Report) reported third-quarter fiscal 2024 results, wherein earnings surpassed the Zacks Consensus Estimate but revenues missed the same. However, both top and bottom lines marked a year-over-year improvement.
The company reported third-quarter non-GAAP earnings of $1.62 per share, beating the consensus mark of $1.61. The non-GAAP earnings came at the higher end of management’s guidance of $1.57-$1.63. Quarterly earnings increased 3.2% from the year-ago quarter’s $1.57 per share.
Amdocs reported revenues of $1.25 billion, which missed the Zacks Consensus Estimate of $1.26 billion and came within management’s guidance of $1.235-$1.275 billion. Compared with the year-ago quarter, revenues were up 1.1% on a reported basis and 1.8% on a constant-currency basis.
Amdocs’ top-line performance was primarily driven by healthy growth in the Rest of the World, partially offset by a decline in Europe and North America.
North America reported revenues of $828.8 million (66.3% of total revenues), which declined 0.25% year over year. Europe revenues (14% of total revenues) of $175.9 million decreased 6.1% year over year. Rest of the World revenues (19.6% of total revenues) grew 12.6% year over year to $245.3 million. Our model estimates for North America, Europe and Rest of the World were pegged at $840.3 million, $190.4 million and $224.6 million, up 1.1%, 1.7% and 3.1%, respectively, year over year.
Managed services revenues rose 3% year over year to $740.8 million. The company ended the third quarter of fiscal 2024 with a 12-month backlog of $4.25 billion, up $20 million sequentially and $110 million year over year. Our model estimates for managed services revenues and backlog were pegged at $727.7 million and $4.23 billion, respectively.
The non-GAAP operating income increased 5.5% year over year to $232.4 million, while the operating margin expanded 80 basis points to 18.6%. The year-over-year improvement in the non-GAAP operating margin was mainly driven by the company’s continuous focus on improving operational excellence and the adoption of automation and artificial intelligence.
Balance Sheet and Cash Flow
Amdocs had cash and short-term investments of $502.2 million as of Jun 30, 2024, compared with $544.4 million as of Mar 31, 2023.
In the third quarter of fiscal 2024, net cash provided by operating activities was $191.5 million, up from $132.7 million in the previous quarter and $172.6 million in the year-ago period. Free cash flow was $175 million compared with the previous quarter’s $113 million and the year-earlier quarter’s $143.6 million.
The company repurchased shares worth $443.3 million in the first nine months of fiscal 2024 and paid $157.3 million in dividends.
On May 8, the company’s board approved the next quarterly cash dividend of 47.9 cents. The increased quarterly cash dividend will be paid on Oct 25 to shareholders of record as of Sep 30, 2024.
FY24 Guidance
For fiscal 2024, the company revised the guidance for revenue growth from 1.6-3.6% to 1.9-2.7% on a reported basis. On a constant-currency basis, revenues are now projected to grow in the range of 2.3-3.1%.
For fiscal 2024, the company has revised the GAAP diluted earnings per share guidance from 7.0-13.0% to 7.4-9.2%. The non-GAAP earnings per share is estimated to grow in the band of 8.5-9.5%.
The fiscal 2024 outlook reflects an expected unfavorable foreign currency impact of approximately 0.4% on a year-over-year basis. The free cash flow is projected to be $700 million.
For the fourth quarter of fiscal 2024, the company projects revenues between $1.24 billion and $1.28 billion and adjusted earnings in the range of $1.67-$1.73 per share.
Zacks Rank & Stocks to Consider
Amdocs currently carries a Zacks Rank #3 (Hold). Shares of DOX have lost 7.1% year to date (YTD).
The consensus mark for Twilio’s 2024 earnings has been revised upward by 10 cents to $3.22 per share over the past seven days, indicating a 5.29% increase from 2023. It has a long-term earnings growth expectation of 33%. The stock has plunged 22.4% YTD.
The Zacks Consensus Estimate for ANET’s fiscal 2024 earnings has been revised upward by 32 cents to $8.24 per share in the past 30 days, suggesting year-over-year growth of 16%. The long-term estimated earnings growth rate for the stock is 17.2%. The stock has gained 34.7% YTD.
The Zacks Consensus Estimate for Datadog’s 2024 earnings has remained unchanged at $1.54 in the past 90 days, indicating an increase of 16.7% on a year-over-year basis. Shares of DDOG have plunged 11% YTD. The long-term estimated earnings growth rate for the stock is 9.6%.
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Amdocs (DOX) Q3 Earnings Surpass Estimates, Revenues Miss
Amdocs Limited (DOX - Free Report) reported third-quarter fiscal 2024 results, wherein earnings surpassed the Zacks Consensus Estimate but revenues missed the same. However, both top and bottom lines marked a year-over-year improvement.
The company reported third-quarter non-GAAP earnings of $1.62 per share, beating the consensus mark of $1.61. The non-GAAP earnings came at the higher end of management’s guidance of $1.57-$1.63. Quarterly earnings increased 3.2% from the year-ago quarter’s $1.57 per share.
Amdocs reported revenues of $1.25 billion, which missed the Zacks Consensus Estimate of $1.26 billion and came within management’s guidance of $1.235-$1.275 billion. Compared with the year-ago quarter, revenues were up 1.1% on a reported basis and 1.8% on a constant-currency basis.
Amdocs Limited Price, Consensus and EPS Surprise
Amdocs Limited price-consensus-eps-surprise-chart | Amdocs Limited Quote
Quarterly Details
Amdocs’ top-line performance was primarily driven by healthy growth in the Rest of the World, partially offset by a decline in Europe and North America.
North America reported revenues of $828.8 million (66.3% of total revenues), which declined 0.25% year over year. Europe revenues (14% of total revenues) of $175.9 million decreased 6.1% year over year. Rest of the World revenues (19.6% of total revenues) grew 12.6% year over year to $245.3 million. Our model estimates for North America, Europe and Rest of the World were pegged at $840.3 million, $190.4 million and $224.6 million, up 1.1%, 1.7% and 3.1%, respectively, year over year.
Managed services revenues rose 3% year over year to $740.8 million. The company ended the third quarter of fiscal 2024 with a 12-month backlog of $4.25 billion, up $20 million sequentially and $110 million year over year. Our model estimates for managed services revenues and backlog were pegged at $727.7 million and $4.23 billion, respectively.
The non-GAAP operating income increased 5.5% year over year to $232.4 million, while the operating margin expanded 80 basis points to 18.6%. The year-over-year improvement in the non-GAAP operating margin was mainly driven by the company’s continuous focus on improving operational excellence and the adoption of automation and artificial intelligence.
Balance Sheet and Cash Flow
Amdocs had cash and short-term investments of $502.2 million as of Jun 30, 2024, compared with $544.4 million as of Mar 31, 2023.
In the third quarter of fiscal 2024, net cash provided by operating activities was $191.5 million, up from $132.7 million in the previous quarter and $172.6 million in the year-ago period. Free cash flow was $175 million compared with the previous quarter’s $113 million and the year-earlier quarter’s $143.6 million.
The company repurchased shares worth $443.3 million in the first nine months of fiscal 2024 and paid $157.3 million in dividends.
On May 8, the company’s board approved the next quarterly cash dividend of 47.9 cents. The increased quarterly cash dividend will be paid on Oct 25 to shareholders of record as of Sep 30, 2024.
FY24 Guidance
For fiscal 2024, the company revised the guidance for revenue growth from 1.6-3.6% to 1.9-2.7% on a reported basis. On a constant-currency basis, revenues are now projected to grow in the range of 2.3-3.1%.
For fiscal 2024, the company has revised the GAAP diluted earnings per share guidance from 7.0-13.0% to 7.4-9.2%. The non-GAAP earnings per share is estimated to grow in the band of 8.5-9.5%.
The fiscal 2024 outlook reflects an expected unfavorable foreign currency impact of approximately 0.4% on a year-over-year basis. The free cash flow is projected to be $700 million.
For the fourth quarter of fiscal 2024, the company projects revenues between $1.24 billion and $1.28 billion and adjusted earnings in the range of $1.67-$1.73 per share.
Zacks Rank & Stocks to Consider
Amdocs currently carries a Zacks Rank #3 (Hold). Shares of DOX have lost 7.1% year to date (YTD).
Some better-ranked stocks in the broader technology sector are Twilio (TWLO - Free Report) , Arista Networks (ANET - Free Report) and Datadog (DDOG - Free Report) , each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The consensus mark for Twilio’s 2024 earnings has been revised upward by 10 cents to $3.22 per share over the past seven days, indicating a 5.29% increase from 2023. It has a long-term earnings growth expectation of 33%. The stock has plunged 22.4% YTD.
The Zacks Consensus Estimate for ANET’s fiscal 2024 earnings has been revised upward by 32 cents to $8.24 per share in the past 30 days, suggesting year-over-year growth of 16%. The long-term estimated earnings growth rate for the stock is 17.2%. The stock has gained 34.7% YTD.
The Zacks Consensus Estimate for Datadog’s 2024 earnings has remained unchanged at $1.54 in the past 90 days, indicating an increase of 16.7% on a year-over-year basis. Shares of DDOG have plunged 11% YTD. The long-term estimated earnings growth rate for the stock is 9.6%.