Intellect Design Arena (INTELLECT) Q2 24/25 earnings summary

Executive summary

• Q2 FY25 revenue was INR 556 crore, with license revenue at INR 85 crore and AMC at INR 120 crore; 12 deal wins and 9 digital transformation projects went live, with strong momentum in Americas, Europe, and IMEA.

• Annual recurring revenue reached INR 666.62 crore, and the company maintains a zero-debt status with a cash balance of INR 755 crore at Q2 end.

• LTM revenue was INR 2,344 crore, with 53 deal wins and 52 digital transformation go-lives.

• eMACH.ai platform recognized for innovation and operational excellence, driving significant client wins and digital transformation projects globally.

• Board approved unaudited standalone and consolidated financial results for the quarter and half year ended September 30, 2024, following Audit Committee recommendation and limited review by statutory auditors.

Financial highlights

• Q2 FY25 revenue at INR 556 crore, up from INR 530 crore in Q2 FY24; H1 FY25 revenue at INR 1,161 crore.

• Gross margin for Q2 was INR 298 crore (54%), EBITDA at INR 79 crore (14%), and PAT at INR 53 crore.

• LTM EBITDA margin stood at 20%, with PBT of INR 408 crore.

• Collections during Q2 were INR 550 crore.

• Revenue mix: 39% USD, 18% GBP, 16% INR, 14% Others, 7% EUR, 6% CAD.

Outlook and guidance

• No formal guidance provided due to deal closure volatility; management remains bullish on achieving 20%+ EBITDA margin and 15-20% revenue growth over the next 3-5 years.

• Q3 and Q4 expected to be stronger due to budget cycles in Americas and Europe.

• Strong deal pipeline with INR 8,889 crore in funnel value and 89 active deals as of Q2 FY25.

• Directionally targeting 30% EBITDA margin in three years, with continued investment in sales expansion.