Certara (CERT) Q1 2025 earnings summary

Executive summary

• Achieved Q1 2025 revenue of $106.0 million, up 10% year-over-year, with bookings of $118.2 million, up 12%, driven by strong commercial execution in software and services and supported by the Chemaxon acquisition.

• Net income reached $4.7 million, reversing a net loss of $4.7 million in Q1 2024, with adjusted EBITDA up 20% to $34.8 million and adjusted net income of $22.2 million.

• Software revenue rose 18% to $46.4 million; services revenue increased 4% to $59.6 million year-over-year.

• Launched Non-Animal Navigator solution and prepared for the Certainty conference to showcase advancements in model-informed drug development.

• Strong cash flow from operations at $17.4 million, with $179.1 million in cash and equivalents and $100 million available under the revolving credit facility.

Financial highlights

• Total revenues grew $9.4 million year-over-year, with $5.9 million from acquisitions and $3.5 million organic growth.

• Adjusted EBITDA was $34.8 million (32.9% margin), up from $29.1 million last year, aided by slower-than-expected hiring.

• Adjusted diluted EPS was $0.14, up from $0.10 in Q1 2024; diluted EPS was $0.03, compared to a loss per share of $0.03 in Q1 2024.

• Operating expenses decreased by $1.8 million year-over-year, mainly due to a $3.1 million reduction in contingent consideration fair value.

• Ended the quarter with $179.1 million in cash and $294.8 million in term loan borrowings.

Outlook and guidance

• Reiterated 2025 guidance: total revenue of $415–$425 million (8–10% growth), Chemaxon software revenue of $23–$25 million, adjusted EBITDA margin of 30–32%.

• Adjusted EPS expected in the range of $0.42–$0.46; tax rate of 25–30%; fully diluted shares projected at 162–164 million.

• Management expects continued investment in R&D, sales, and international expansion to drive growth.