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BROADRIDGE FINANCIAL SOLUTIONS, INC. (BR)·Q1 2026 Earnings Summary

Executive Summary

  • Q1 FY26 delivered double-digit top-line growth and a material earnings beat: total revenue $1.589B (+12% YoY) with Adjusted EPS $1.51 vs S&P Global consensus $1.25*; GAAP diluted EPS was $1.40 .
  • Recurring revenue rose 9% (+8% constant currency), aided by strength in ICS event-driven mutual fund proxies (+81% YoY to $114M) and 12% GTO recurring growth; AOI margin expanded 280 bps to 15.8% .
  • Management raised FY26 recurring revenue growth (constant currency) to the high end of 5–7%; reaffirmed AOI margin 20–21%, Adjusted EPS growth 8–12%, and closed sales $290–$330M; declared a $0.975 quarterly dividend payable Jan 5, 2026 .
  • Strategic catalysts: tokenization momentum (DLR volumes now >$300B/day; Canton super-validator revenue $4M and $46M unrealized gain), governance innovation (Voting Choice; ExxonMobil retail standing instructions), and wealth platform onboarding (SIS integration) .

S&P Global estimates disclaimer: Values marked with an asterisk (*) are retrieved from S&P Global.

What Went Well and What Went Wrong

  • What Went Well

    • “Near-record event-driven revenue” drove outsized earnings leverage; AOI margin up 280 bps to 15.8% and Adjusted EPS up 51% YoY to $1.51 .
    • Tokenization inflection: DLR processed >$300B tokenized trades/day in September; Canton super-validator added $4M recurring revenue and $46M unrealized gain; management sees tokenization as a decade-long megatrend .
    • Governance innovation: nearly 400 funds using Voting Choice; launched ExxonMobil pilot for retail standing voting instructions to raise participation .

  • What Went Wrong

    • Closed sales were soft at $33M, down 43% YoY, though FY guidance was reaffirmed; management attributed underlying pipeline strength and conversion of $430M backlog to sustain growth .
    • Distribution/postage mix continues to drag margins (~30 bps AOI impact); event-driven normalization expected after Q1, implying less EPS contribution in coming quarters .
    • GAAP volatility from digital asset marks will persist; management expects to adjust out gains/losses and to liquidate holdings over time to reduce volatility .

Financial Results

Headline metrics vs prior year, prior quarter, and estimates

MetricQ1 FY25Q4 FY25Q1 FY26 ConsensusQ1 FY26 Actual
Revenue ($USD Millions)$1,422.9 $2,065.4 $1,541.5*$1,589.4
Recurring Revenues ($USD Millions)$900.3 $1,423.6 —$977.5
Adjusted EPS ($)$1.00 $3.55 $1.25*$1.51
Diluted EPS ($)$0.68 $3.16 —$1.40
Operating Income Margin (%)9.4% 24.1% —11.9%
Adjusted Operating Income Margin (%)13.0% 27.0% —15.8%

S&P Global estimates disclaimer: Values marked with an asterisk (*) are retrieved from S&P Global.

Segment breakdown (Q1 FY26 vs Q1 FY25)

Segment/TypeQ1 FY25Q1 FY26YoY Change
ICS Recurring Revenues ($M)$493.1 $518.0 +5%
ICS Event-driven Revenues ($M)$63.0 $113.8 +81%
ICS Distribution Revenues ($M)$459.5 $498.1 +8%
ICS Total Revenues ($M)$1,015.6 $1,130.0 +11%
GTO Recurring Revenues ($M)$407.2 $459.5 +13%
Capital Markets Recurring ($M)$261.0 $280.7 +8%
Wealth & Investment Mgmt Recurring ($M)$146.2 $178.8 +22%
Consolidated Total Revenues ($M)$1,422.9 $1,589.4 +12%

KPIs and margins

KPI/MarginQ1 FY25Q1 FY26Notes
Closed Sales ($M)$57.5 $32.5 Pipeline supports FY target
Equity Positions Growth (%)3% 12% Revenue equity positions +7%
Mutual Fund/ETF Positions Growth (%)6% 2% Timing mix impact
Internal Trade Growth (%)10% 17% Broad-based equity/fixed income
Free Cash Flow ($M)$(157.6) $12.7 FY26 conversion >100% guided
AOI Margin (Non-GAAP, %)13.0% 15.8% +280 bps YoY
GAAP Operating Margin (%)9.4% 11.9% +250 bps YoY

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Recurring revenue growth (constant currency, Non-GAAP)FY265–7% High end of 5–7% Raised to high end
Adjusted Operating Income Margin (Non-GAAP)FY2620–21% 20–21% Maintained
Adjusted EPS Growth (Non-GAAP)FY268–12% 8–12% Maintained
Closed Sales ($M)FY26$290–$330 $290–$330 Maintained
Q2 Adjusted EPS as % of full-yearFY26—~13–15% Seasonality clarified
Dividend per shareFY26$0.975 quarterly (implies $3.90 annual) from Aug 2025 decision $0.975 declared; payable Jan 5, 2026 Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q3 FY25 and Q4 FY25)Current Period (Q1 FY26)Trend
Tokenization & DLRPost-trade sales and DLR solution momentum highlighted (Q3) ; DLR volumes >$200B/day (Q4) DLR processed >$300B/day; adding stablecoin rails; super-validator revenue $4M; $46M unrealized gain Accelerating adoption; small but growing P&L contribution
Governance & Shareholder EngagementDemand for data/digitization drives governance (Q3) ; pass-through voting and digital growth (Q4) Voting Choice ~400 funds; ExxonMobil pilot for retail standing voting instructions Expanding institutional and retail engagement
Wealth Platform Momentum (SIS)WIM growth and SIS contribution (Q3/Q4) WIM +22% YoY; client onboarding on track; SIS integration in Canada Continued revenue growth and integration progress
Market structure (trading/clearing changes)—Preparing clients for “23 by 5” equity trading and decentralized treasury clearing; mutualized platform benefits Active client engagement on structural changes
Postage/Distribution mix impactPostage raised distribution revenue (+$32M Q3; +$29M Q4) Distribution +$39M; ~$25M from postage; ~30 bps AOI margin drag Ongoing revenue tailwind; modest margin headwind

Management Commentary

  • “Broadridge delivered strong first quarter results… we are raising our recurring revenue outlook to the higher end of our 5% to 7% growth range.” — CEO Tim Gokey .
  • “In September, we processed over $300,000,000,000 in tokenized trades per day… next, we’re going to real-time repo… we’ll also be incorporating stablecoin as the cash rails.” — CEO Tim Gokey .
  • “Broadridge recognized $4,000,000 of digital asset revenues… recorded a $46,000,000 unrealized gain on the value of the 1.7 billion coins we held.” — CFO Ashima Ghei .
  • “We launched a pilot program with ExxonMobil to enable retail shareholders to provide standing voting instructions… has the potential to increase retail voting.” — CEO Tim Gokey .
  • “We expect Q2 adjusted EPS to be approximately 13% to 15% of our full year outlook.” — CFO Ashima Ghei .

Q&A Highlights

  • EPS guidance vs high-end: Management kept Adjusted EPS growth at 8–12% despite a strong start, citing investment priorities in tokenization, digital communications, shareholder engagement, AI, and platform; early to re-calibrate earnings translation .
  • Digital asset volatility: Expect GAAP volatility from Canton marks; plan to liquidate holdings over time; digital asset revenues ~1 pt to capital markets growth in FY26 .
  • Sales cycles/government shutdown: Selling environment stable; pipeline healthy; no material slowdown from shutdown .
  • Volume sensitivity in GTO: About one-third of GTO revenue tied to volumes (half direct, half agent bank structures); durable tailwind, but not assuming elevated volatility levels .
  • Super-validator mechanics: Role separate from DLR platform; compensation commonly in coin per Canton network rules; low investment to operate .

Estimates Context

  • Q1 FY26 results beat Street: Adjusted EPS $1.51 vs $1.25*; revenue $1.589B vs $1.542B*; magnitude driven by near-record event-driven revenue and operating leverage .
  • Q4 FY25 was broadly in line to modest beat: Adjusted EPS $3.55 vs $3.50*; revenue $2.065B vs $2.057B* .
  • FY26 consensus baseline: EPS ~$9.45*; revenue ~$7.27B*; management’s raised recurring growth and unchanged margin/EPS guardrails suggest modest upward bias to full-year revenue forecasts, but CFO flagged Q2 seasonality and normalization in event-driven revenues .

S&P Global estimates disclaimer: Values marked with an asterisk (*) are retrieved from S&P Global.

MetricQ4 FY25 ConsensusQ4 FY25 ActualQ1 FY26 ConsensusQ1 FY26 Actual
Revenue ($USD Millions)$2,057.4*$2,065.4 $1,541.5*$1,589.4
Adjusted EPS ($)$3.50*$3.55 $1.25*$1.51

Key Takeaways for Investors

  • Earnings quality was strong: Adjusted EPS +51% on broad-based revenue growth and favorable event mix; AOI margin expanded despite postage and float headwinds (~30 bps) .
  • Tokenization is becoming commercially relevant: DLR volumes >$300B/day; super-validator revenues/gains emerging; expect ~1 pt growth to capital markets in FY26, but GAAP marks will be volatile and excluded from Adjusted EPS .
  • Governance innovations (Voting Choice; retail standing instructions) deepen moat and should support equity revenue position growth in H1 and beyond .
  • Closed sales softness in Q1 ($33M) is not thesis-breaking; pipeline and $430M backlog conversion underpin 5–7% recurring growth (now guided to high end) .
  • Event-driven revenues likely normalize (~$50–$60M/quarter) after Q1; expect Q2 to be ~13–15% of full-year EPS, tempering near-term momentum .
  • Free cash flow conversion targeted >100% in FY26, supporting dividend continuity ($0.975) and buybacks while funding tuck-ins (Signal, iJoin) .
  • Near-term trade: Positive bias on beats and raised revenue outlook; watch Q2 seasonal EPS dip and any Canton-driven GAAP volatility; medium-term thesis levered to governance digitization, DLR/tokenization, and wealth platform onboarding .