Sign in

You're signed outSign in or to get full access.

ST

SS&C Technologies Holdings Inc (SSNC)·Q2 2025 Earnings Summary

Executive Summary

  • SS&C delivered a clean beat: revenue $1.537B vs ~$1.513B consensus and adjusted EPS $1.45 vs ~$1.39; GAAP EPS $0.72 declined 4% YoY while adjusted EPS rose 9.8% YoY (consensus from S&P Global estimates*).
  • Adjusted organic revenue growth slowed to 3.5% (vs 5.1% in Q1), but margin execution remained solid: adjusted EBITDA hit a quarterly record $600.4M with 39.0% margin (+50 bps YoY) .
  • FY25 guidance was raised at the midpoint for revenue (+$15M), adjusted EPS (+$0.10), adjusted net income, and operating cash flow; Q3 guide embeds ~4.5% organic growth midpoint .
  • Strategic catalysts: announced $1.03B Calastone acquisition (expected Q4 close; EPS accretive within 12 months) and highlighted first external AI agent sale leveraging Blue Prism; international momentum in Europe, Australia, and Middle East .
  • Capital return remained active (3.4M shares repurchased for $269M in Q2); net leverage modest at 2.72x, leaving dry powder for M&A; management comfortable with leverage up to “mid-4s” for compelling deals .

*Values retrieved from S&P Global.

What Went Well and What Went Wrong

  • What Went Well

    • Record profitability on an adjusted basis: adjusted consolidated EBITDA reached $600.4M (+7.4% YoY) with 39.0% margin (+50 bps YoY); adjusted EPS up 9.8% YoY to $1.45 .
    • Demand pockets and international traction: GlobeOp organic growth 7.3% (double-digit in private markets/retail alts), financial services recurring revenue growth 3.9%; “strength in Europe, Australia, and the Middle East” with 97% retention .
    • AI momentum: first AI agent sale reduced manual effort “up to 80%,” 3x faster, 99%+ accuracy; Blue Prism cited as a core advantage; internally scaled to 2,700+ digital workers/AI agents and >$200M annual savings .

  • What Went Wrong

    • GAAP optics: GAAP EPS fell 4% YoY to $0.72; net income down 5% YoY amid higher operating expenses and mixed other income .
    • Mixed business mix: Intralinks organic declined 4.5% given lower M&A deal flow, pressuring growth relative to Q1; management expects 2H pickup but near-term drag noted .
    • Margins vs sequential: GAAP operating margin slipped to 22.4% (from 23.6% in Q1) and gross margin eased vs Q1 as revenue mix/costs shifted; Q2 gross profit $736.9M (47.9% margin) vs Q1 $747.1M (49.3%) .

Financial Results

Headline results vs prior periods

MetricQ4 2024Q1 2025Q2 2025
Revenue ($M)$1,529.7 $1,513.9 $1,536.8
GAAP Diluted EPS ($)$0.98 $0.84 $0.72
Adjusted Diluted EPS ($)$1.58 $1.44 $1.45
GAAP Operating Margin (%)23.4% 23.6% 22.4%
Adjusted EBITDA Margin (%)39.1% 39.1% 39.0%

Year-over-year comparison

MetricQ2 2024Q2 2025YoY
Revenue ($M)$1,451.5 $1,536.8 +5.9%
GAAP Diluted EPS ($)$0.75 $0.72 -4.0%
Adjusted Diluted EPS ($)$1.32 $1.45 +9.8%
Adjusted EBITDA ($M)$558.9 $600.4 +7.4%
Adjusted EBITDA Margin (%)38.5% 39.0% +50 bps

Revenue mix

Revenue Type ($M)Q2 2024Q1 2025Q2 2025
Software-enabled services$1,192.4 $1,269.9 $1,267.7
License, maintenance and related$259.1 $244.0 $269.1
Total Revenue$1,451.5 $1,513.9 $1,536.8

Operating cash flow (quarter)

MetricQ2 2024Q1 2025Q2 2025
Net cash from operating activities ($M)$384.9 $272.2 $372.9

KPIs and capital structure

KPIQ1 2025Q2 2025
Adjusted Organic Revenue Growth (%)5.1% 3.5%
Financial Services Recurring Revenue Growth (%)5.9% 3.9%
Net leverage ratio (LTM)2.74x 2.72x
Share repurchases2.4M shares; $206.9M at $87.21 avg 3.4M shares; $269.0M at $77.99 avg
Cash & Cash Equivalents ($M)$515.0 $480.3
Gross Debt ($M)$6,892.8 $6,858.4

Guidance Changes

MetricPeriodPrevious Guidance (Q1-issued)Current Guidance (Q2-issued)Change
Adjusted Revenue ($M)FY 2025$6,118 – $6,238 $6,143 – $6,243 Raised (midpoint +$15M)
Adjusted Net Income ($M)FY 2025$1,441 – $1,541 $1,462 – $1,542 Raised
Adjusted Diluted EPS ($)FY 2025$5.68 – $6.00 $5.82 – $6.06 Raised
Cash from Operating Activities ($M)FY 2025$1,458 – $1,558 $1,479 – $1,559 Raised
Interest Expense ($M)FY 2025$406 – $416 $407 – $417 Slightly raised
Capital Expenditures (% of revenue)FY 20254.0% – 4.4% 4.1% – 4.5% Slightly raised
Diluted Shares (M)FY 2025253.7 – 256.7 251.5 – 254.5 Lowered
Effective Tax Rate (%)FY 202523% – 25% 23% – 25% Maintained
Adjusted Revenue ($M)Q3 2025N/A$1,525 – $1,565 New
Adjusted Diluted EPS ($)Q3 2025N/A$1.44 – $1.50 New

Other relevant post-quarter development: SS&C increased its quarterly dividend by 8% to $0.26 per share on Aug 18, 2025 .

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4’24 and Q1’25)Current Period (Q2’25)Trend
AI/Automation (Blue Prism)Q1: “embed AI and Quantum technologies” in products/services .First external AI agent sale; 80% manual reduction, 3x speed, 99%+ accuracy; ongoing AI investments .Accelerating commercialization and client adoption.
International ExpansionQ1: Strong Australia presence; EMEA wins; bullish on Australia/Middle East .Strength in Europe, Australia, Middle East with higher win rates; 97% retention .Building momentum internationally.
Product performance: GlobeOp, WITQ1: GlobeOp 10.3% organic; WIT solid .GlobeOp 7.3% organic; WIT ~4.0% organic .Still growing; slight deceleration QoQ.
Intralinks (M&A)Q1: steady; bookings a leading indicator .Intralinks -4.5% organic on weak deal flow; bookings/deal counts improving for 2H .Near-term headwind; expected 2H improvement.
Capex/R&D paceQ1 FY25 capex guide 4.0–4.4% .Capex guide lifted to 4.1–4.5%; CTO expects elevated levels to continue .Higher, growth-focused capex sustained.
M&A strategyQ4’24: Active capital allocation, record EBITDA .Announced $1.03B Calastone deal (10%+ growth, 40%+ EBITDA margin; EPS accretive in 12 months) .Adding higher-growth assets; strategic adjacency.

Management Commentary

  • Strategy and positioning: “We delivered record adjusted consolidated EBITDA... quarterly adjusted consolidated EBITDA margin of 39%... We are bullish on our opportunity across the globe in Europe, the Middle East, and Australia” (Bill Stone, CEO) .
  • AI execution: “Our first AI agent sale… reduces manual effort by up to 80%, speeds up processing by 3X, and improves accuracy to 99%+” (Bill Stone) .
  • Guidance philosophy: “We are raising our top-line guidance by $15 million at the midpoint... adjusted diluted EPS in the range of $5.82–$6.06” (Brian Schell, CFO) .
  • Capital allocation and leverage: “Comfortable… mid-4s [net leverage]… could probably do a $5B acquisition… we’re a very sticky business” (Bill Stone) .
  • Capex discipline for growth: “Technology is our seed corn… we’re going to continue to invest… not going to starve our development teams” (Bill Stone) .

Q&A Highlights

  • Calastone synergies: Management sees substantial cross-sell into ETFs, digital assets, and distribution; Calastone has ~4,500 clients across 57 markets; expected revenue growth 10%+ and EPS accretive in 12 months .
  • Leverage appetite: Comfortable to “mid-4s” net leverage for attractive deals, implying capacity for ~+$5B transactions if justified .
  • Capex outlook: Expect capex to remain ~4.1–4.5% of revenue, tied to product and geography investments (e.g., Australia, private assets, Genesis, Singularity) .
  • Intralinks cadence: Q2 weakness on M&A; bookings and deal counts are up, implying back-half growth resumption .
  • Batia (class action services): Low double-digit growth; seasonally weighted to 2H as courts clear dockets; revenue recognition visibility improving .

Estimates Context

MetricQ2 2024Q1 2025Q2 2025
Revenue Consensus Mean ($M)*1,432.11,505.11,513.8
Revenue Actual ($M)1,451.5 1,513.9 1,536.8
Surprise ($M / %)+19.4 / +1.4%+8.8 / +0.6%+23.0 / +1.5%
EPS Consensus Mean ($)*1.1961.4041.386
Adjusted Diluted EPS Actual ($)1.32 1.44 1.45
Surprise ($ / %)+0.074 / +6.2%+0.036 / +2.5%+0.064 / +4.6%

*Values retrieved from S&P Global.

Key Takeaways for Investors

  • Positive setup: SS&C beat on revenue and adjusted EPS, raised FY25 guidance, and delivered record adjusted EBITDA—evidence of durable execution despite mixed macro pockets .
  • Margin resilience: Adjusted EBITDA margin held ~39% while organic growth slowed to 3.5%; cost discipline (core expenses +3.1% YoY) and lower interest expense supported EPS outperformance .
  • AI as a monetization vector: First external AI agent deal and Blue Prism’s installed base point to emerging revenue opportunities; internal deployment has already yielded material savings .
  • Catalysts: Calastone acquisition (expected Q4 close) adds a 10%+ growth, 40%+ margin asset in ETFs/digital assets and broadens global distribution—likely a narrative positive into close .
  • Capital returns and optionality: Active buybacks and 2.72x leverage leave capacity for additional M&A; management comfortable leveraging up for strategic assets .
  • Watchlist items: Intralinks recovery in 2H, trajectory of organic growth back toward 4–5%, sustained capex at ~4.1–4.5% driving new product wins, and progress on Calastone integration planning .
  • Trading lens: Beat-and-raise quarter with visible 2H catalysts; stock reactions typically hinge on organic growth momentum and AI commercialization updates; monitor bookings/retention and cross-sell disclosures next quarter .

Additional Relevant Press Releases (Q2 context)

  • SS&C Blue Prism recognized as Gartner RPA Leader; internal deployment of 2,700+ digital workers/AI agents with >$200M annual savings .
  • SS&C to acquire Calastone for £766M ($1.03B); expected Q4 close; EPS accretive within 12 months; 4,500 clients across 57 markets .