Latent View Analytics (LATENTVIEW) Q1 24/25 earnings summary

Executive summary

• Q1 FY25 revenue reached INR 1,789 million, up 4.2% sequentially and 21.1% year-on-year, driven by existing accounts and a robust GenAI pipeline.

• The company completed the acquisition of 70% of Decision Point, a CPG-focused analytics firm, for $39.1 million (₹3,352.09 million), with integration underway to drive sectoral synergies.

• Growth was primarily from existing accounts, with new client wins at smaller scales but showing future potential.

• GenAI pipeline is strong, with over $4 million in late-stage opportunities and increasing client interest in moving from pilots to production.

• Operations span US, Europe, and APAC, with 93.7% of Q1 revenue from the US.

Financial highlights

• Q1 FY25 operating revenue was INR 1,789 million, up 4.2% sequentially and 21.1% year-on-year.

• EBITDA for Q1 was INR 383 million, up 36.3% year-on-year but down 5.2% sequentially; margin impacted by wage hikes and one-off costs.

• PAT for Q1 was INR 389 million, up 18.2% year-on-year but down 13.9% sequentially, affected by expiry of SEZ tax benefits and reduced ESOP-related tax breaks.

• Basic EPS for Q1 was ₹1.89, up 18.1% year-on-year.

• Cash and investments stood at INR 11,330 million as of June 30, 2024, with INR 3,352.09 million allocated for the Decision Point acquisition.

Outlook and guidance

• FY25 revenue growth guidance is 16%-18%, with confidence in achieving the higher end if deal conversions accelerate.

• EBITDA margin expected to recover to 23% by Q3 as one-off costs subside and operating leverage improves.

• Decision Point’s results will be consolidated from Q2, expected to positively impact margins and sectoral growth.

• Growth strategies include expanding in Europe and APAC, building expertise in BFSI and retail, and leveraging supply chain and fraud analytics solutions.

• All unutilized IPO proceeds as of June 30, 2024, were deployed for the Decision Point acquisition on July 1, 2024.