Amdocs (DOX) Q1 2026 earnings summary

Executive summary

• Q1 FY2026 revenue reached $1.16 billion, up 4.1% year-over-year and slightly above guidance midpoint, with strong performance in North America and Europe.

• Non-GAAP diluted EPS was $1.81, exceeding guidance due to a lower-than-expected tax rate.

• 12-month backlog increased to $4.25 billion, up $60 million sequentially and 2.7% year-over-year, supporting future revenue visibility.

• Announced a new multi-year agreement with T-Mobile, including managed services, software development, and AI innovation; expanded engagements with Vodafone Germany and TELUS.

• Closed the $197 million acquisition of MATRIXX Software, expanding charging and monetization solutions.

• CEO succession announced: Shimie Hortig to succeed Shuky Sheffer as CEO effective March 31, 2026.

Financial highlights

• Q1 revenue: $1.16 billion (+4.1% YoY as reported, +3.5% YoY constant currency), with strong North America and Europe growth.

• Non-GAAP operating margin was 21.6%, up 40 basis points year-over-year and stable sequentially.

• Managed services revenue was $746 million, up 2.3% year-over-year, representing 65% of total revenue, with high renewal rates.

• Free cash flow before restructuring was $237 million, about 33% of the full-year target.

• Cash balance at quarter-end was $248 million; aggregate borrowings were $780 million.

• $146 million in share repurchases and $57 million in dividends paid in Q1.

Outlook and guidance

• Fiscal 2026 revenue growth expected between 1% and 5% in constant currency, with a 3% midpoint.

• Non-GAAP diluted EPS growth projected at 4%-8% for fiscal 2026.

• Free cash flow for fiscal 2026 expected between $710 million-$730 million, with a 90% conversion rate relative to Non-GAAP net income.

• Majority of free cash flow to be returned to shareholders.

• Q2 revenue guidance: $1.15 billion-$1.19 billion; non-GAAP EPS: $1.73–$1.79.

• Non-GAAP operating margin target range for 2026: 21.3%-21.9%.