Amdocs Ltd. (NYSE: DOX) missed the analysts' revenue consensus but beat the earnings per share consensus, with $753.2 million revenue for its third fiscal quarter and non-GAAP earnings per share of $0.58. GAAP-based net profit was $92.3 million.
Revenue rose 9.1% compared with the corresponding quarter of 2009, and rose 1.2% over the preceding quarter, but the market had expected more; the revenue consensus was $758.2 million.
96.6% of Amdocs' revenue came from services. 76% of revenue came from North America. Although these revenue sources were unchanged from the preceding quarter, revenue from the rest of the world rose 26.6% to exceed the $100 million threshold. Revenue from Europe, however, fell 12.5% compared with the preceding quarter.
Amdocs CEO Dov Baharav said, "While we are encouraged with the level of activity in North America and the emerging markets, we are marginally more cautious on our European business given our third fiscal quarter results in Europe and relatively weaker spending trends in the region."
Amdocs' 12-month orders backlog was almost unchanged at $2.47 billion at the end of June.
Operating profit rose to $105.3 million for the third fiscal quarter. Excluding amortization for intangible assets and employee compensation, non-GAAP operating profit rose to $137.8 million.
GAAP-based net profit rose to $92.3 million ($0.45 per share) for the third fiscal quarter from $85.5 million for the corresponding quarter. Non-GAAP net profit rose to $119.4 million ($0.58 per share) from $108.6 million for the corresponding quarter. The company beat the market consensus by $0.01 per share.
Amdocs' cash flow from operations was $537.6 million in the first half of 2010, and its cash and cash equivalents totaled $1.29 billion at the end of June. The company spent $209 million on a share buy-back during the third fiscal quarter.
In its guidance for the fourth fiscal quarter, Amdocs expects $755-770 million. The guidance is less than the market consensus of $772 million revenue, which Baharav attributes to the weakness in Europe. It expects non-GAAP earnings per share of $0.57-0.60 (a non-GAAP net profit of $117-123 million), in-line with the market consensus of $0.58. Amdocs expects GAAP-based earnings per share of $0.44-0.49.
The guidance indicates that Amdocs will achieve 4-5% revenue growth and 5.8-7.2% profit growth in fiscal year 2010 compared with 2009, which was a year of crisis.
Amdocs also announced that it was expanding its relationship with Australian carrier Sensis Ltd, by signing a six-year outsourcing contract. The company also announced that it had extended its outsourcing contract with AT&T Inc. (NYSE: T) by 31 months, through 2017. Earlier this week, Amdocs and AT&T announced the establishment of a joint innovations center for start-ups in Israel.
Amdocs' share closed at $28.68 yesterday, giving a market cap of $5.9 billion.
Published by Globes [online], Israel business news - www.globes-online.com - on July 22, 2010
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