Sonata Software (SONATSOFTW) Q2 24/25 earnings summary

Executive summary

• Achieved over $1B in revenue, with a 15.1% CAGR over 10 years and a global workforce of 6,900+ engineers across multiple regions.

• Consolidated Q2 FY25 revenue was $259.1M (₹2,169.8 crore), down 14% QoQ but up 13% YoY; H1'25 revenue grew 20% YoY to ₹4,697.2 crore.

• Focused on outcome-based modernization services, leveraging proprietary Platformation™ framework and strong partnerships with Microsoft, AWS, Salesforce, and others.

• Won 3 large deals in Q2 FY25, including a multi-million-dollar Microsoft Fabric deal and a GenAI modernization project for a top pharma client.

• Strategic goal to reach $1.5B revenue by FY27, with international EBITDA in the low 20s and 12% YoY domestic growth.

Financial highlights

• Q2 FY25 consolidated revenue was $259.1M (INR 2,169.8 cr), with international services revenue up 2.3% QoQ and domestic business up 2.5% QoQ.

• International IT Services Q2'25 revenue: ₹707.9 crore (2.9% QoQ, 6% YoY growth); EBITDA: ₹128.9 crore (0.1% QoQ); PAT: ₹62.2 crore (-4.5% QoQ).

• EBITDA before other income and FX grew 0.7% QoQ to INR 177.3 cr, with consolidated EBITDA margin at 8.2%.

• PAT increased 0.8% QoQ to INR 106.5 cr; EPS per share at 3.84.

• Domestic business revenue declined 21% QoQ but grew 17.5% YoY; international services revenue up 4.6% YoY.

Outlook and guidance

• Targeting $1.5B revenue by FY27, with continued investments in sales, large deals, BFSI, healthcare, and AI capabilities.

• Management remains optimistic about long-term growth, citing a healthy pipeline and continued modernization demand.

• Focus on building multiple large accounts, diversifying client base, and strengthening global brand.

• Pipeline growth of 5% QoQ, with 49% of active pipeline consisting of large deals and 36% with Fortune 500 clients.