Amdocs Limited (NASDAQ: DOX), a leading provider of software and
services to communications and media companies, today reported
operating results for the three months ended March 31, 2022.
“I am excited to report another very strong quarter for Amdocs
as we continued to enable our customer’s strategy to provide a
superior mobile and broadband experience by supporting their
long-term investments in 5G monetization, cloud adoption, digital
modernization, and network automation. Record revenue of $1.15
billion was up 10.1% in constant currency(3) from a year ago,
reflecting strong business activity building next-generation
platforms for large customers like AT&T, T-Mobile, and Vodafone
Germany under multi-year programs. Sales momentum was also strong
in Q2 and included a digital transformation project award with
VodafoneZiggo in Netherlands, and a new 5G policy deal which
expands our footprint at a leading Tier 1 European operator.
Overall, we ended the fiscal second quarter with record-high
12-month backlog of $3.89 billion, which was up nearly 10% from a
year ago,” said Shuky Sheffer, president and chief executive
officer of Amdocs Management Limited.
“Demonstrating great execution in Q2, we set another company
record for the number of quarterly milestones deployed. Our
accomplishments included the go-live of a major digital
transformation project for Three UK in just 15 months, highlighting
our unrivalled reputation for project delivery. This was also a
record quarter in managed services, driven by continued growth with
new and existing customers. At Bell Canada, we signed a five-year
managed services extension that expands our long-term strategic
relationship in support of Bell’s continued cloud transformation.
Additionally, we strengthened our partnership with PLDT in the
Philippines, where this leading operator awarded Amdocs a
three-year extension of our existing managed services agreement
through 2028, in addition to future projects to support PLDT’s
cloud journey,” said Tamar Rapaport-Dagim, chief financial officer
& chief operating officer of Amdocs Management Limited.
Sheffer concluded, “Our growth strategy is highly aligned with
the needs of the market, and we see an expanding pipeline of
opportunities ahead of us which we are well positioned to monetize
with our market-leading products, best-in-class execution and
highly talented people. Moreover, we are tracking in line with the
high end of our fiscal 2022 revenue growth outlook of 8.0% to 10.0%
on a pro forma(2), constant currency(3) basis, our confidence in
which is supported by the business momentum reflected in our record
12-month backlog at the halfway point in the year.”
Revenue(All comparisons are against the prior
year period)
|
In Millions |
|
Three months ended |
|
March 31, 2022 |
|
Actual |
PreviousGuidance |
Revenue |
$1,145 |
$1,110- $1,150 |
Revenue growth, as
reported |
9.2% |
|
Revenue growth, constant
currency(3) |
10.1% |
|
|
|
|
- Revenue for the second fiscal quarter of 2022 was at the high
end of Amdocs’ guidance, including an immaterial impact from
foreign currency movements compared to our guidance
assumptions
- Revenue for the
second fiscal quarter of 2022 includes an unfavorable impact from
foreign currency movements of approximately $2 million relative to
the first quarter of fiscal 2022
Net Income and Earnings Per Share
|
|
In thousands, except per share data |
|
|
Three months ended |
|
|
March 31, |
|
|
2022 |
|
2021 |
GAAP
Measures |
|
|
|
|
|
|
|
|
|
Net income |
|
$ |
158,497 |
|
|
$ |
119,067 |
|
|
|
|
|
|
Diluted earnings per
share |
|
$ |
1.28 |
|
|
$ |
0.91 |
|
|
|
|
|
|
Non-GAAP
Measures |
|
|
|
|
|
|
|
|
|
Net income |
|
$ |
190,944 |
|
|
$ |
148,095 |
|
|
|
|
|
|
|
|
|
|
Diluted earnings per
share |
|
$ |
1.54 |
|
|
$ |
1.13 |
|
|
|
|
|
|
|
|
|
|
- Non-GAAP net income excludes amortization of purchased
intangible assets and other acquisition-related costs, changes in
certain acquisition related liabilities measured at fair value,
equity-based compensation expenses, and other, net of related tax
effects, in all the periods presented
For further details of the reconciliation of selected financial
metrics from GAAP to Non-GAAP, please refer to the tables
below.
Capital Allocation: Returning Cash to
Shareholders
- Quarterly Cash Dividend Program: On May 11,
2022, the Board approved the Company’s next quarterly cash dividend
payment of $0.395 per share and set June 30, 2022 as the record
date for determining the shareholders entitled to receive the
dividend, which will be payable on July 29, 2022
- Share Repurchase Activity: Repurchased $130
million of ordinary shares during the second quarter of fiscal
2022
Twelve-month
BacklogTwelve-month backlog was a record
$3.89 billion at the end of the second quarter of fiscal 2022, up
approximately 9.9% as compared to last year’s second fiscal
quarter. Twelve-month backlog includes anticipated revenue related
to contracts, estimated revenue from managed services contracts,
letters of intent, maintenance and estimated on-going support
activities.
Third Quarter Fiscal 2022
Outlook
|
In millions, except per share data |
|
Q3 2022 |
Revenue |
$1,140-$1,180 |
GAAP diluted EPS |
$0.97-$1.05 |
Non-GAAP diluted EPS |
$1.23-$1.29 |
|
|
- Third quarter revenue guidance assumes approximately $1 million
sequential unfavorable impact from foreign currency fluctuations as
compared to the second quarter of fiscal 2022
- Third quarter
non-GAAP diluted EPS guidance excludes amortization of purchased
intangible assets and other acquisition-related costs, changes in
certain acquisitions related liabilities measured at fair value,
and approximately $0.12-$0.14 per share of equity-based
compensation expense and other, net of related tax effects
Full Year Fiscal 2022
Outlook
|
FY 2022, year-over-year growth |
|
Current Guidance |
Previous Guidance |
Revenue growth, as
reported |
5.2%-7.2% |
3.4%-7.4% |
Pro forma(2) revenue
growth, constant currency(3) |
8.0%-10.0% |
6.0%-10.0% |
|
|
|
|
|
|
GAAP diluted EPS growth |
(20.5) % -(17.0)% |
(23.0) % -(17.5)% |
Adjusted GAAP diluted EPS
growth(4) |
7.5%-12.5% |
6.0%-13.0% |
Non-GAAP diluted EPS
growth |
7.3%-10.3% |
6.3%-10.3% |
Pro forma(2) non-GAAP
diluted EPS growth |
9.0%-12.0% |
8.0%-12.0% |
|
|
|
|
FY 2022, in millions |
|
Current Guidance |
Previous Guidance |
Free cash flow(1) |
~$500 |
~$500 |
Normalized free cash
flow(1) |
~$650 |
~$650 |
|
|
|
- Full year fiscal
2022 revenue guidance incorporates an expected unfavorable impact
from foreign currency fluctuations of approximately 0.8%
year-over-year as compared with an unfavorable impact of about 0.6%
year-over-year previously
- Non-GAAP diluted
earnings per share growth, and pro forma(2) non-GAAP diluted
earnings per share growth, excludes amortization of purchased
intangible assets and other acquisition-related costs, changes in
certain acquisitions related liabilities measured at fair value,
approximately $0.46-$0.50 per share of equity-based compensation
expense, gain from divestiture of OpenMarket and other, net of
related tax effects. Adjusted GAAP diluted earnings per share
growth(4), excludes gain from divestiture of OpenMarket, net of
related tax effects
- Non-GAAP effective
tax rate is anticipated to be within a range of 13.0% to 17.0% for
the full year fiscal 2022
- Free cash flow(1) is
comprised of cash flow from operations, less net capital
expenditures and other
- Normalized free cash
flow excludes expected capital expenditure of $131 million related
to the new campus development in Israel, and other items
Three Year Fiscal 2022-2024
Outlook
- In addition to our
full year fiscal 2022 revenue guidance, we project revenue growth
of 6.0% to 10% year-over-year on a constant currency(3) basis in
each of fiscal years 2023 and 2024
- Projecting revenue
growth on an as reported basis in each of fiscal years 2023 and
2024 is not possible without unreasonable efforts given the
uncertain impact of foreign exchange rates and acquisition activity
which cannot be reasonably predicted at this time
Our third fiscal quarter 2022 and full year fiscal 2022, 2023
and 2024 forward looking projections take into consideration the
Company’s current expectations regarding macro and industry
specific risks and various uncertainties and certain assumptions
that we will discuss on our earnings conference call. However, we
note that market dynamics continue to shift rapidly and we cannot
predict all possible outcomes, including those resulting from the
COVID-19 pandemic, including its novel strains, which has created,
and continues to create, a significant amount of uncertainty, or
from current and potential customer consolidation or their other
strategic corporate activities.
Conference Call and
Earnings Webcast
Presentation Details Amdocs will
host a conference call and earnings webcast presentation on May 11,
2022 at 5:00 p.m. Eastern Time to discuss the Company's second
quarter of fiscal 2022 results. To participate, please dial +1
(844) 513-7152, or +1 (508) 637-5600 outside the United States,
approximately 15 minutes before the call and enter passcode
4136629. The conference call and webcast will also be carried live
on the Internet and may be accessed via the Amdocs website at
https://investors.amdocs.com. Presentation slides will be available
shortly before the webcast.Non-GAAP Financial
Measures This release includes non-GAAP diluted earnings
per share and other non-GAAP financial measures, including free
cash flow and normalized free cash flow, revenue on a constant
currency(3) basis, non-GAAP cost of revenue, non-GAAP research and
development, non-GAAP selling, general and administrative, non-GAAP
operating income, non-GAAP operating margin, non-GAAP interest and
other expenses, net, non-GAAP income taxes, non-GAAP effective tax
rate, non-GAAP net income and non-GAAP diluted earnings per share
growth. These other non-GAAP measures exclude the following
items:
- amortization of purchased intangible assets and other
acquisition-related costs;
- changes in certain acquisition-related liabilities measured at
fair value;
- non-recurring and unusual charges or benefits (such as a gain
from divestiture of OpenMarket);
- equity-based compensation expense;
- other; and
- tax effects related to the above.
Free cash flow equals cash generated by operating activities
less net capital expenditures and other. Normalized free cash flow,
a measure of our operating performance, is further adjusted to
exclude net capital expenditures related to the new campus
development, payments for non-recurring and unusual charges (such
as capital gains tax in relation to the divestiture of OpenMarket),
and payments of acquisition related liabilities. These non-GAAP
financial measures are not in accordance with, or an alternative
for, generally accepted accounting principles and may be different
from non-GAAP financial measures used by other companies. In
addition, these non-GAAP financial measures are not based on any
comprehensive set of accounting rules or principles. Amdocs
believes that non-GAAP financial measures have limitations in that
they do not reflect all of the amounts associated with Amdocs’
results of operations as determined in accordance with GAAP and
that these measures should only be used to evaluate Amdocs’ results
of operations in conjunction with the corresponding GAAP
measures.
Amdocs believes that the presentation of non-GAAP diluted
earnings per share and other financial measures, including free
cash flow and normalized free cash flow, non-GAAP cost of revenue,
non-GAAP research and development, non-GAAP selling, general and
administrative, non-GAAP operating income, non-GAAP operating
margin, non-GAAP interest and other expenses, net, non-GAAP income
taxes, non-GAAP effective tax rate, non-GAAP net income and
non-GAAP diluted earnings per share growth when shown in
conjunction with the corresponding GAAP measures, provides useful
information to investors and management regarding financial and
business trends relating to its financial condition and results of
operations, as well as the net amount of cash generated by its
business operations after taking into account capital spending
required to maintain or expand the business.
For its internal budgeting process and in monitoring the results
of the business, Amdocs’ management uses financial statements that
do not include amortization of purchased intangible assets and
other acquisition-related costs, changes in certain
acquisition-related liabilities measured at fair value,
non-recurring and unusual charges or benefits, equity-based
compensation expense, other and related tax effects. Amdocs’
management also uses the foregoing non-GAAP financial measures, in
addition to the corresponding GAAP measures, in reviewing the
financial results of Amdocs. In addition, Amdocs believes that
significant groups of investors exclude these items in reviewing
its results and those of its competitors, because the amounts of
the items between companies can vary greatly depending on the
assumptions used by an individual company in determining the
amounts of the items.
Amdocs further believes that, where the adjustments used in
calculating non-GAAP diluted earnings per share are based on
specific, identified amounts that impact different line items in
the Consolidated Statements of Income (including cost of revenue,
research and development, selling, general and administrative,
operating income, interest and other expenses, net, income taxes
and net income), it is useful to investors to understand how these
specific line items in the Consolidated Statements of Income are
affected by these adjustments. Please refer to the Reconciliation
of Selected Financial Metrics from GAAP to Non-GAAP tables
below.
Supporting Resources
- Keep up with Amdocs news by visiting the Company’s website
- Subscribe to Amdocs’ RSS Feed and follow us on Twitter,
Facebook, LinkedIn and YouTube
About AmdocsAmdocs helps those who build the
future to make it amazing. With our market-leading portfolio of
software products and services, we unlock our customers’ innovative
potential, empowering them to provide next-generation communication
and media experiences for both the individual end user and large
enterprise customers. Our 30,000 employees around the globe are
here to accelerate service providers’ migration to the cloud,
enable them to differentiate in the 5G era, and digitalize and
automate their operations. Listed on the NASDAQ Global Select
Market, Amdocs had revenue of $4.3 billion in fiscal 2021.
For more information, visit Amdocs at www.amdocs.com.
This press release includes information that constitutes
forward-looking statements made pursuant to the safe harbor
provision of the Private Securities Litigation Reform Act of 1995,
including statements about Amdocs’ growth and business results in
future quarters and years. Although we believe the expectations
reflected in such forward-looking statements are based upon
reasonable assumptions, we can give no assurance that our
expectations will be obtained or that any deviations will not be
material. Such statements involve risks and uncertainties that may
cause future results to differ from those anticipated. These risks
include, but are not limited to, the effects of general economic
conditions, the duration and severity of the COVID-19 pandemic, and
its impact on the global economy, Amdocs’ ability to grow in the
business markets that it serves, Amdocs’ ability to successfully
integrate acquired businesses, adverse effects of market
competition, rapid technological shifts that may render the
Company's products and services obsolete, potential loss of a major
customer, our ability to develop long-term relationships with our
customers, and risks associated with operating businesses in the
international market. Amdocs may elect to update these
forward-looking statements at some point in the future; however,
Amdocs specifically disclaims any obligation to do so. These and
other risks are discussed at greater length in Amdocs’ filings with
the Securities and Exchange Commission, including in our Annual
Report on Form 20-F for the fiscal year ended September 30, 2021
filed on December 9, 2021 and our Form 6-K furnished for the first
quarter of fiscal 2022 on February 14, 2022.
Contact: Matthew SmithHead of Investor
RelationsAmdocs314-212-8328E-mail: dox_info@amdocs.com
(1) Please refer to the Selected Financial Metrics tables below
(figures may not sum because of rounding).(2) Pro forma growth rate
excludes the financial impact of OpenMarket (which was divested on
December 31, 2020) from fiscal year 2021(3) Revenue on a constant
currency basis assumes exchange rates in the current period were
unchanged from the prior period(4) Adjusted GAAP excludes the gain
from the sale of OpenMarket, which was divested on December 31,
2020, from the current and comparable fiscal years; fiscal 2022
GAAP diluted EPS growth outlook is expected to be (20.5)%-(17.0)%
on a non-adjusted basis(5) Effective tax rate on a GAAP and
non-GAAP basis in the second quarter fiscal 2022 was lower than
anticipated in quarterly guidance primarily due to the release of
tax reserves connected with funding decisions for the construction
of the new Israel campus. This tax benefit was among the scenarios
contemplated in non-GAAP effective tax rate guidance for the full
fiscal year 2022, which is still anticipated to be within a range
of 13.0% to 17.0%.
|
AMDOCS
LIMITEDConsolidated Statements of
Income(In thousands, except per share
data) |
|
|
|
|
|
|
|
Three months
ended |
|
Six months
ended |
|
|
March 31, |
|
March 31, |
|
|
2022 |
|
2021 |
|
2022 |
|
2021(a) |
|
|
|
|
|
|
|
|
|
Revenue |
|
$ |
1,145,271 |
|
|
$ |
1,048,734 |
|
|
$ |
2,249,903 |
|
|
$ |
2,135,077 |
|
|
|
|
|
|
|
|
|
|
Operating expenses: |
|
|
|
|
|
|
|
|
Cost of revenue |
|
|
741,257 |
|
|
|
685,515 |
|
|
|
1,457,975 |
|
|
|
1,414,231 |
|
Research and development |
|
|
87,064 |
|
|
|
75,154 |
|
|
|
169,009 |
|
|
|
150,823 |
|
Selling, general and administrative |
|
|
134,982 |
|
|
|
116,951 |
|
|
|
263,058 |
|
|
|
238,839 |
|
Amortization of purchased intangible assets and other |
|
|
18,317 |
|
|
|
21,870 |
|
|
|
36,064 |
|
|
|
41,740 |
|
|
|
|
981,620 |
|
|
|
899,490 |
|
|
|
1,926,106 |
|
|
|
1,845,633 |
|
Operating income |
|
|
163,651 |
|
|
|
149,244 |
|
|
|
323,797 |
|
|
|
289,444 |
|
|
|
|
|
|
|
|
|
|
Interest and other expense, net |
|
|
(8,619 |
) |
|
|
(3,542 |
) |
|
|
(11,181 |
) |
|
|
(10,032 |
) |
Gain from sale of a business |
|
|
- |
|
|
|
- |
|
|
|
10,000 |
|
|
|
226,410 |
|
Income before income taxes |
|
|
155,032 |
|
|
|
145,702 |
|
|
|
322,616 |
|
|
|
505,822 |
|
|
|
|
|
|
|
|
|
|
Income tax (benefit) expense |
|
|
(3,465 |
) |
|
|
26,635 |
|
|
|
30,517 |
|
|
|
87,123 |
|
Net income |
|
$ |
158,497 |
|
|
$ |
119,067 |
|
|
$ |
292,099 |
|
|
$ |
418,699 |
|
Basic earnings per share |
|
$ |
1.29 |
|
|
$ |
0.92 |
|
|
$ |
2.36 |
|
|
$ |
3.21 |
|
Diluted earnings per share |
|
$ |
1.28 |
|
|
$ |
0.91 |
|
|
$ |
2.34 |
|
|
$ |
3.19 |
|
Basic weighted average number of shares outstanding |
|
|
122,977 |
|
|
|
129,774 |
|
|
|
123,748 |
|
|
|
130,457 |
|
Diluted weighted average number of shares outstanding |
|
|
123,821 |
|
|
|
130,696 |
|
|
|
124,571 |
|
|
|
131,147 |
|
Cash dividends declared per share |
|
$ |
0.395 |
|
|
$ |
0.36 |
|
|
$ |
0.755 |
|
|
$ |
0.6875 |
|
|
|
|
|
|
|
|
|
|
|
AMDOCS
LIMITEDSelected Financial
Metrics(In thousands, except per share
data) |
|
|
|
|
|
|
|
Three months
ended |
|
Six months
ended |
|
|
March 31, |
|
March 31, |
|
|
2022 |
|
2021 |
|
2022 |
|
2021(a) |
|
|
|
|
|
|
|
|
|
Revenue |
|
$ |
1,145,271 |
|
|
$ |
1,048,734 |
|
|
$ |
2,249,903 |
|
|
$ |
2,135,077 |
|
|
|
|
|
|
|
|
|
|
Non-GAAP operating income |
|
|
201,625 |
|
|
|
184,883 |
|
|
|
395,232 |
|
|
|
372,864 |
|
|
|
|
|
|
|
|
|
|
Non-GAAP net income |
|
|
190,944 |
|
|
|
148,095 |
|
|
|
341,079 |
|
|
|
301,067 |
|
|
|
|
|
|
|
|
|
|
Non-GAAP diluted earnings per share |
|
$ |
1.54 |
|
|
$ |
1.13 |
|
|
$ |
2.74 |
|
|
$ |
2.30 |
|
|
|
|
|
|
|
|
|
|
Diluted weighted average number of shares outstanding |
|
|
123,821 |
|
|
|
130,696 |
|
|
|
124,571 |
|
|
|
131,147 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Free Cash
Flows and Normalized Free Cash Flow(In
thousands) |
|
|
|
|
|
|
|
Three months
ended |
|
Six months
ended |
|
|
March 31, |
|
March 31, |
|
|
2022 |
|
2021 |
|
2022 |
|
2021(a) |
|
|
|
|
|
|
|
|
|
Net Cash
Provided by Operating Activities |
|
$ |
168,856 |
|
|
$ |
119,736 |
|
|
$ |
372,974 |
|
|
$ |
536,221 |
|
|
|
|
|
|
|
|
|
|
Purchases of property and equipment, net(c) |
|
|
(47,271 |
) |
|
|
(49,245 |
) |
|
|
(104,496 |
) |
|
|
(99,310 |
) |
|
|
|
|
|
|
|
|
|
Free Cash Flow |
|
|
121,585 |
|
|
|
70,491 |
|
|
|
268,478 |
|
|
|
436,911 |
|
|
|
|
|
|
|
|
|
|
Tax payment on sale of business(b) |
|
|
3,193 |
|
|
|
25,190 |
|
|
|
3,193 |
|
|
|
25,190 |
|
|
|
|
|
|
|
|
|
|
Payments of acquisition related liabilities |
|
|
4,871 |
|
|
|
13,234 |
|
|
|
14,350 |
|
|
|
13,234 |
|
|
|
|
|
|
|
|
|
|
Net capital expenditures related to the new campus
development |
|
|
30,109 |
|
|
|
24,221 |
|
|
|
59,416 |
|
|
|
42,555 |
|
|
|
|
|
|
|
|
|
|
Normalized Free Cash Flow |
|
$ |
159,758 |
|
|
$ |
133,136 |
|
|
$ |
345,437 |
|
|
$ |
517,890 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) Since January 1, 2021, OpenMarket results
are not included in the Consolidated Statements of Income given its
divestiture. (b) Tax payment related to capital gain
from divestiture of OpenMarket, which was completed on
December 31, 2020.(c) The amounts under "Purchase of property and
equipment, net” include proceeds from sale of property and
equipment of $555 and $136 for the six months ended March 31, 2022
and 2021, respectively.
|
AMDOCS
LIMITEDReconciliation of Selected Financial
Metrics from GAAP to Non-GAAP(In
thousands) |
|
|
|
Three months
ended |
|
March 31, 2022 |
|
|
|
|
Reconciliation items |
|
|
|
|
GAAP |
Amortizationof purchasedintangibleassets
andother |
Equity basedcompensationexpense |
Changes incertainacquisitionsrelated liabilitiesmeasured at
fairvalue |
Other |
Taxeffect |
Non-GAAP |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue |
$ |
741,257 |
|
$ |
- |
|
$ |
(8,070 |
) |
$ |
(1,820 |
) |
$ |
- |
|
$ |
- |
|
$ |
731,367 |
|
Research and |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
development |
|
87,064 |
|
|
- |
|
|
(1,375 |
) |
|
- |
|
|
- |
|
|
- |
|
|
85,689 |
|
Selling, general and |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
administrative |
|
134,982 |
|
|
- |
|
|
(8,392 |
) |
|
- |
|
|
- |
|
|
- |
|
|
126,590 |
|
Amortization of |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
purchased intangible |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
assets and other |
|
18,317 |
|
|
(18,317 |
) |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
Total
operating |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
expenses |
|
981,620 |
|
|
(18,317 |
) |
|
(17,837 |
) |
|
(1,820 |
) |
|
- |
|
|
- |
|
|
943,646 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income |
|
163,651 |
|
|
18,317 |
|
|
17,837 |
|
|
1,820 |
|
|
- |
|
|
- |
|
|
201,625 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and
other expense, net |
|
(8,619 |
) |
|
- |
|
|
- |
|
|
- |
|
|
1,100 |
|
|
- |
|
|
(7,519 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
(benefit) expense |
|
(3,465 |
) |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
6,627 |
|
|
3,162 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income |
$ |
158,497 |
|
$ |
18,317 |
|
$ |
17,837 |
|
$ |
1,820 |
|
$ |
1,100 |
|
$ |
(6,627 |
) |
$ |
190,944 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended |
|
March 31, 2021 |
|
|
|
|
Reconciliation items |
|
|
|
|
GAAP |
Amortizationof purchasedintangibleassets
andother |
Equity basedcompensationexpense |
Changes incertainacquisitionsrelated liabilitiesmeasured at
fairvalue |
Other |
Taxeffect |
Non-GAAP |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue |
$ |
685,515 |
|
$ |
- |
|
$ |
(5,582 |
) |
$ |
(394 |
) |
$ |
- |
|
$ |
- |
|
$ |
679,539 |
|
Research and |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
development |
|
75,154 |
|
|
- |
|
|
(1,012 |
) |
|
- |
|
|
- |
|
|
- |
|
|
74,142 |
|
Selling, general and |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
administrative |
|
116,951 |
|
|
- |
|
|
(6,781 |
) |
|
- |
|
|
- |
|
|
- |
|
|
110,170 |
|
Amortization of |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
purchased intangible |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
assets and other |
|
21,870 |
|
|
(21,870 |
) |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
Total
operating |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
expenses |
|
899,490 |
|
|
(21,870 |
) |
|
(13,375 |
) |
|
(394 |
) |
|
- |
|
|
- |
|
|
863,851 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income |
|
149,244 |
|
|
21,870 |
|
|
13,375 |
|
|
394 |
|
|
- |
|
|
- |
|
|
184,883 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and
other expense, net |
|
(3,542 |
) |
|
- |
|
|
- |
|
|
- |
|
|
(375 |
) |
|
- |
|
|
(3,917 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
(benefit) expense |
|
26,635 |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
6,236 |
|
|
32,871 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income |
$ |
119,067 |
|
$ |
21,870 |
|
$ |
13,375 |
|
$ |
394 |
|
$ |
(375 |
) |
$ |
(6,236 |
) |
$ |
148,095 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AMDOCS
LIMITEDReconciliation of Selected Financial
Metrics from GAAP to Non-GAAP(In
thousands) |
|
|
|
Six months
ended |
|
March 31, 2022 |
|
|
|
|
Reconciliation items |
|
|
|
|
GAAP |
Amortizationofpurchasedintangibleassets
andother |
Equity basedcompensationexpense |
Changes in certainacquisitions relatedliabilities
measuredat fair value |
Gain fromsale of abusiness |
Other |
Taxeffect |
Non-GAAP |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue |
$ |
1,457,975 |
|
$ |
- |
|
$ |
(15,217 |
) |
$ |
(793 |
) |
$ |
- |
|
$ |
- |
|
$ |
- |
|
$ |
1,441,965 |
|
Research and |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
development |
|
169,009 |
|
|
- |
|
|
(2,598 |
) |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
166,411 |
|
Selling, general and |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
administrative |
|
263,058 |
|
|
- |
|
|
(16,763 |
) |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
246,295 |
|
Amortization of |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
purchased intangible assets and other |
|
36,064 |
|
|
(36,064 |
) |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
Total
operating |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
expenses |
|
1,926,106 |
|
|
(36,064 |
) |
|
(34,578 |
) |
|
(793 |
) |
|
- |
|
|
- |
|
|
- |
|
|
1,854,671 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income |
|
323,797 |
|
|
36,064 |
|
|
34,578 |
|
|
793 |
|
|
- |
|
|
- |
|
|
- |
|
|
395,232 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and
other expense, net |
|
(11,181 |
) |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
(2,505 |
) |
|
- |
|
|
(13,686 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain from
sale of a business |
|
10,000 |
|
|
- |
|
|
- |
|
|
- |
|
|
(10,000 |
) |
|
- |
|
|
- |
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
(benefit) expense |
|
30,517 |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
9,950 |
|
|
40,467 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income |
$ |
292,099 |
|
$ |
36,064 |
|
$ |
34,578 |
|
$ |
793 |
|
$ |
(10,000 |
) |
$ |
(2,505 |
) |
$ |
(9,950 |
) |
$ |
341,079 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended |
|
March 31, 2021(a) |
|
|
|
|
Reconciliation items |
|
|
|
|
GAAP |
Amortizationofpurchasedintangibleassets
andother |
Equity basedcompensationexpense |
Changes in certainacquisitions relatedliabilities
measuredat fair value |
Gain fromsale of abusiness |
Other |
Taxeffect |
Non-GAAP |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue |
$ |
1,414,231 |
|
$ |
- |
|
$ |
(10,523 |
) |
$ |
(15,728 |
) |
$ |
- |
|
$ |
- |
|
$ |
- |
|
$ |
1,387,980 |
|
Research and |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
development |
|
150,823 |
|
|
- |
|
|
(1,844 |
) |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
148,979 |
|
Selling, general and |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
administrative |
|
238,839 |
|
|
- |
|
|
(13,585 |
) |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
225,254 |
|
Amortization of |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
purchased intangible assets and other |
|
41,740 |
|
|
(41,740 |
) |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
Total
operating |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
expenses |
|
1,845,633 |
|
|
(41,740 |
) |
|
(25,952 |
) |
|
(15,728 |
) |
|
- |
|
|
- |
|
|
- |
|
|
1,762,213 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
income |
|
289,444 |
|
|
41,740 |
|
|
25,952 |
|
|
15,728 |
|
|
- |
|
|
- |
|
|
- |
|
|
372,864 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and
other expense, net |
|
(10,032 |
) |
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
824 |
|
|
- |
|
|
(9,208 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gain from
sale of a business |
|
226,410 |
|
|
- |
|
|
- |
|
|
- |
|
|
(226,410 |
) |
|
- |
|
|
- |
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax
(benefit) expense |
|
87,123 |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
- |
|
|
(24,534 |
) |
|
62,589 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income |
$ |
418,699 |
|
$ |
41,740 |
|
$ |
25,952 |
|
$ |
15,728 |
|
$ |
(226,410 |
) |
$ |
824 |
|
$ |
24,534 |
|
$ |
301,067 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
AMDOCS
LIMITEDCondensed Consolidated Balance
Sheets(In thousands) |
|
|
|
|
|
As
of |
|
|
March 31, |
|
September 30, |
|
|
2022 |
|
2021 |
|
|
|
|
|
ASSETS |
|
|
|
|
|
|
|
|
|
Current
assets |
|
|
|
|
Cash and cash equivalents |
|
$ |
593,056 |
|
|
$ |
709,064 |
|
Short-term
interest-bearing investments |
|
|
263,372 |
|
|
|
256,527 |
|
Accounts receivable, net, including unbilled of $128,406 and
$162,278, respectively |
|
|
1,022,642 |
|
|
|
866,819 |
|
Prepaid
expenses and other current assets |
|
|
223,108 |
|
|
|
235,089 |
|
Total current assets |
|
|
2,102,178 |
|
|
|
2,067,499 |
|
|
|
|
|
|
Property and
equipment, net |
|
|
727,509 |
|
|
|
698,768 |
|
Lease
assets |
|
|
232,447 |
|
|
|
233,162 |
|
Goodwill and
other intangible assets, net |
|
|
2,907,134 |
|
|
|
2,881,676 |
|
Other
noncurrent assets |
|
|
589,835 |
|
|
|
630,669 |
|
Total
assets |
|
$ |
6,559,103 |
|
|
$ |
6,511,774 |
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
|
Current
liabilities |
|
|
|
|
Accounts
payable, accruals and other |
|
$ |
985,675 |
|
|
$ |
1,007,777 |
|
Lease
liabilities |
|
|
56,676 |
|
|
|
58,714 |
|
Deferred
revenue |
|
|
360,192 |
|
|
|
237,374 |
|
Total current liabilities |
|
|
1,402,543 |
|
|
|
1,303,865 |
|
Lease
liabilities |
|
|
179,139 |
|
|
|
177,906 |
|
Long-term
debt, net of unamortized debt issuance costs |
|
|
644,832 |
|
|
|
644,553 |
|
Other
noncurrent liabilities |
|
|
728,398 |
|
|
|
750,266 |
|
Total Amdocs
Limited Shareholders’ equity |
|
|
3,561,682 |
|
|
|
3,592,675 |
|
Noncontrolling interests |
|
|
42,509 |
|
|
|
42,509 |
|
Total
equity |
|
|
3,604,191 |
|
|
|
3,635,184 |
|
Total
liabilities and equity |
|
$ |
6,559,103 |
|
|
$ |
6,511,774 |
|
|
|
|
|
|
|
AMDOCS
LIMITEDConsolidated Statements of Cash
Flows(In thousands) |
|
|
|
|
|
Six months
ended |
|
|
March 31, |
|
|
2022 |
|
2021(a) |
|
|
|
|
|
Cash Flow from Operating Activities: |
|
|
|
|
Net income |
|
$ |
292,099 |
|
|
$ |
418,699 |
|
Reconciliation of net income to net cash provided by operating
activities: |
|
|
|
|
Depreciation and amortization |
|
|
101,071 |
|
|
|
101,298 |
|
Amortization of debt issuance costs |
|
|
279 |
|
|
|
272 |
|
Equity-based compensation expense |
|
|
34,578 |
|
|
|
25,952 |
|
Gain from sale of a business |
|
|
(10,000 |
) |
|
|
(226,410 |
) |
Deferred income taxes |
|
|
(35,879 |
) |
|
|
(27,778 |
) |
Loss from short-term interest-bearing investments |
|
|
1,333 |
|
|
|
221 |
|
Net changes in operating assets and liabilities, net of amounts
acquired: |
|
|
|
|
Accounts receivable, net |
|
|
(140,863 |
) |
|
|
(108,799 |
) |
Prepaid expenses and other current assets |
|
|
3,848 |
|
|
|
(11,906 |
) |
Other noncurrent assets |
|
|
3,042 |
|
|
|
(10,763 |
) |
Lease assets and liabilities, net |
|
|
(67 |
) |
|
|
7,522 |
|
Accounts payable, accrued expenses and accrued personnel |
|
|
(22,006 |
) |
|
|
76,427 |
|
Deferred revenue |
|
|
102,997 |
|
|
|
226,904 |
|
Income taxes payable, net |
|
|
27,378 |
|
|
|
41,629 |
|
Other noncurrent liabilities |
|
|
15,164 |
|
|
|
22,953 |
|
Net cash
provided by operating activities |
|
|
372,974 |
|
|
|
536,221 |
|
|
|
|
|
|
Cash
Flow from Investing Activities: |
|
|
|
|
Purchase of property and equipment,
net(c) |
|
|
(104,496 |
) |
|
|
(99,310 |
) |
Proceeds from sale of short-term interest-bearing
investments |
|
|
13,142 |
|
|
|
4,258 |
|
Purchase of short-term interest-bearing investments |
|
|
(34,275 |
) |
|
|
(200,088 |
) |
Net cash paid for business and intangible assets
acquisitions |
|
|
(24,497 |
) |
|
|
(87,600 |
) |
Net cash
received from sale of a business |
|
|
10,000 |
|
|
|
290,789 |
|
Other |
|
|
(2,958 |
) |
|
|
562 |
|
Net cash
used in investing activities |
|
|
(143,084 |
) |
|
|
(91,389 |
) |
|
|
|
|
|
Cash
Flow from Financing Activities: |
|
|
|
|
Repurchase
of shares |
|
|
(300,929 |
) |
|
|
(450,074 |
) |
Proceeds
from employee stock options exercises |
|
|
50,550 |
|
|
|
78,438 |
|
Payments of
dividends |
|
|
(89,366 |
) |
|
|
(85,934 |
) |
Payment of
contingent consideration from a business acquisition |
|
|
(6,153 |
) |
|
|
(1,462 |
) |
Net cash
used in financing activities |
|
|
(345,898 |
) |
|
|
(459,032 |
) |
|
|
|
|
|
Net decrease
in cash and cash equivalents |
|
|
(116,008 |
) |
|
|
(14,200 |
) |
Cash and
cash equivalents at beginning of period |
|
|
709,064 |
|
|
|
983,188 |
|
Cash and
cash equivalents at end of period |
|
$ |
593,056 |
|
|
$ |
968,988 |
|
|
|
|
|
|
|
AMDOCS
LIMITEDSupplementary
Information(In millions) |
|
|
|
|
|
Three months ended |
|
|
March
31, |
|
December 31, |
|
September 30, |
|
June 30, |
|
March 31, |
|
|
2022 |
|
2021 |
|
2021 |
|
2021 |
|
2021 |
North America |
|
$ |
772.2 |
|
|
$ |
745.5 |
|
|
$ |
722.8 |
|
|
$ |
686.1 |
|
|
$ |
679.1 |
|
Europe |
|
|
147.2 |
|
|
|
142.5 |
|
|
|
146.8 |
|
|
|
155.7 |
|
|
|
148.8 |
|
Rest of the
World |
|
|
225.9 |
|
|
|
216.6 |
|
|
|
217.7 |
|
|
|
224.5 |
|
|
|
220.8 |
|
Total
Revenue |
|
$ |
1,145.3 |
|
|
$ |
1,104.6 |
|
|
$ |
1,087.3 |
|
|
$ |
1,066.3 |
|
|
$ |
1,048.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended |
|
|
March
31, |
|
December 31, |
|
September 30, |
|
June 30, |
|
March 31, |
|
|
2022 |
|
2021 |
|
2021 |
|
2021 |
|
2021 |
Managed
Services Revenue |
|
$ |
663.4 |
|
|
$ |
659.7 |
|
|
$ |
637.5 |
|
|
$ |
650.5 |
|
|
$ |
634.6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of |
|
|
March
31, |
|
December 31, |
|
September 30, |
|
June 30, |
|
March 31, |
|
|
2022 |
|
2021 |
|
2021 |
|
2021 |
|
2021 |
12-Month
Backlog |
|
$ |
3,890 |
|
|
$ |
3,830 |
|
|
$ |
3,690 |
|
|
$ |
3,590 |
|
|
$ |
3,540 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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