The Descartes Systems Group (DSG) Q4 2025 earnings summary

Executive summary

• Achieved record Q4 and annual results with strong services revenue and Adjusted EBITDA growth year-over-year, driven by expansion of the Global Logistics Network and complementary service additions.

• Management highlighted the ability to help customers navigate global trade complexity and uncertainty, leveraging expertise in tariffs, sanctions, and supply chain diversity.

• Growth was fueled by domestic logistics, Global Trade Intelligence, and multiple acquisitions.

Financial highlights

• FY25 revenues reached $651 million, up 14% year-over-year; Q4 revenue was $167.5 million, up 13% from Q4 last year.

• FY25 net income was $143.3 million, up 24%; Q4 net income was $37.4 million, up 18%.

• Adjusted EBITDA for FY25 was $284.7 million (44% margin), up 15%; Q4 Adjusted EBITDA was $75.0 million (45% margin), up 14%.

• Cash provided by operating activities in FY25 was $219.3 million, up 6%; Q4 cash from operations was $60.7 million, up 19%.

• Gross margin steady at 76% for Q4 and the year.

Outlook and guidance

• Targeting 10%-15% Adjusted EBITDA growth for FY 2026, with a margin range of 40%-45%.

• Baseline Q1 FY26 revenues estimated at $145 million, Adjusted EBITDA calibration at $55.5 million (38% margin).

• Expecting $6–7 million in capital additions and $71.2 million in amortization expense for FY 2026.

• Anticipate $3 million in earn-out payments and a tax rate of 24%-28% for FY 2026.