SS&C Technologies Holdings, Inc. (SSNC) Earnings

Management highlights

### Overall Financial Performance - Q2 2026 set multiple company quarterly records: adjusted revenue of $1.697 billion (+10.3% YoY), adjusted EBITDA of $671 million (+11.7% YoY), adjusted diluted EPS of $1.76 (+18.1% YoY), adjusted EBITDA margin of 39.5% (50 bps expansion YoY), and shares repurchased. - Adjusted organic revenue growth was 7.6% YoY on a constant currency basis, driven by large core business performance, new client wins, strong multi-year renewals, and favorable market and transaction tailwinds. - Year-to-date (six months ending June 30, 2026) cash from operating activities was $716 million, up 11% YoY. ### Capital Allocation - Share repurchases remain the company's top capital allocation priority. Q2 2026 saw $499 million returned to shareholders, including 6.4 million shares repurchased for $435.2 million, the highest quarterly buyback in company history. Diluted shares outstanding are down 4% YoY. - The company ended Q2 with a net leverage ratio of 2.75x LTM EBITDA, and is actively exploring refinancing opportunities for 2027-maturing bonds to optimize its capital structure. ### Acquisitions and Strategic Innovation - The two acquisitions completed at the end of 2025 are both tracking ahead of expectations: Carol has added attractive EMEA exposure with growing revenue, while Calistone is outperforming forecasts. The combined business is building infrastructure to support tokenized investment products, enabling digital investment settlement via regulated digital cash (stable coins, tokenized commercial bank deposits) to reduce settlement risk and improve cross-border transaction efficiency. - The company is deploying AI across all products and internal operations with a "governance first" approach (proven internally before client rollout). A new client win was announced for the WorkHQ platform to scale agentic AI automation for a global reinsurance leader, reflecting growing enterprise demand for SS&C's AI capabilities. The company acquired Blue Prism for $1.6 billion to access its existing AI/ML/RPA/natural language processing capabilities, and has scaled the team to support AI deployment. ### Key Business Milestones - The highly anticipated Medicare GLP-1 Bridge Program, supported by SS&C's Domani Rx platform for client Humana, launched July 1, 2026, and has already processed nearly 3 million claims, demonstrating the platform's scale, reliability, and flexibility.

Guidance

- **Q3 2026 Guidance**: Management expects total revenue in the range of $1.657 billion to $1.697 billion, with 5% organic revenue growth at the midpoint. Adjusted diluted EPS is projected between $1.73 and $1.79, and adjusted net income is projected between $413 million and $429 million, with interest expense (excluding amortization, deferred financing costs, and original issue discount) expected between $103 million and $105 million. - **Full Year 2026 Guidance**: Management upwardly revised full year expectations, projecting total revenue between $6.672 billion and $6.832 billion, with 5.5% organic revenue growth at the midpoint. The target for full year EBITDA growth is 9.3%, with 50 bps of EBITDA margin expansion and a goal of reaching a 40% EBITDA margin in Q4 2026. Full year adjusted diluted EPS is projected between $6.93 and $7.50, reflecting approximately 15.5% growth at the midpoint, and operating cash flow is projected between $1.717 billion and $1.817 billion. - Key assumptions for 2026 guidance include: short-term interest rates holding at current levels, an adjusted effective tax rate of ~22.5%, capital expenditures equal to 4.4% to 4.8% of revenue, and continued prioritization of share repurchases over debt reduction.

Segment performance

The transcript does not break out full financial performance and revenue contribution percentages for individual product segments. Key segment-level operational performance updates are provided: 1) Front, middle, and back office technology including Geneva delivered strong Q2 results, with robust momentum in multi-year technology license renewals across the client base. 2) Global Investor and Distribution Services (Globop) has strong underlying organic growth exceeding 5% after excluding the recent Insignia lift-out transaction, and holds 65% market share in its core space, with a healthy pipeline of new lift-out mandates across North America, Europe, and Australia. 3) Interlink's virtual data room business saw sequential improvement in organic growth, with performance tied to strengthening M&A activity; the business's alternatives LP communication segment has delivered steady growth. 4) Domani Rx, the company's healthcare claims platform, processed nearly 3 million claims for the newly launched Medicare GLP-1 Bridge Program as of early July 2026.

Risks & headwinds

- Uncertainty around the future of the Medicare GLP-1 Bridge Program, which is a 6-month temporary government trial; management notes there is only a 50% probability the government will extend the successful program. - Lift-out transactions are highly competitive and require significant management and operational attention to win and deliver successfully. - Forward-looking statements (including guidance) are inherently uncertain, and actual results may differ materially due to risk factors outlined in the company's most recent Form 10-K filed with the SEC.

Analyst Q&A

• Q: Dan Perlin (RBC) asked why Q2 2026 organic growth came in 200 bps above guidance, and if the outperformance was driven by a tilt toward large license renewals, plus how market volatility impacts quarterly organic growth. /

  A: Bill Stone explained Q2's outperformance was primarily due to timing of large contract renewals: when multi-year (often 7-year) contracts expire and renew, revenue is recognized upfront under accounting rules, creating lumpiness in organic growth results. He added that as the company grows larger, the increasing number of large renewals generally smooths this lumpiness over time. On market impacts, Stone noted hedge fund redemption activity was at its lowest level since 2009, indicating strong underlying hedge fund industry health, and assets under administration in the fund administration business have grown by $581 billion over the past two years, demonstrating strong segment momentum.

• Q: Jeff Schmidt (William Blair) asked if rising AI adoption demand is driving increased outsourcing demand, and what the underlying growth of Globop is after excluding recent liftouts, plus how the lift-out pipeline looks. /

  A: Rahul Kanwar confirmed that AI modernization is driving increased outsourcing demand: enterprise clients prefer to partner with SS&C to access scalable, proven AI capabilities rather than building AI tools in-house. Bill Stone added that the company has a strong pipeline of new lift-out opportunities, supported by its 65% market share and global track record of winning mandates across North America, Europe, and Australia; underlying growth for Globop after excluding the Insignia lift-out remains above 5%.

• Q: Bella Camagian (JP Morgan) asked why Q3 organic guidance implies a step down from Q2's outperformance, if the step down is due to renewal timing, and if there is upside potential from additional large renewals in H2 2026. She also asked where current capitalized software investment is concentrated, and if this investment level will persist. /

  A: Bill Stone explained Q3 guidance reflects the company's consistent conservative approach, not a soft underlying demand outlook; the pipeline is full of opportunities including upcoming large renewals, so there is clear upside potential if deals perform better than expected. Capitalized software investment is concentrated across multiple new platform launches and updates (including Genesis, new Eclipse releases, Domani Rx, WorkHQ, and AI guardrails), plus private cloud infrastructure and cybersecurity improvements; this level of R&D investment is expected to persist, while AI adoption will drive material margin improvements over time.

• Q: Michael Infante (Morgan Stanley) asked how AI is factored into large renewal conversations, and if clients are using AI as a reason to push back on SS&C's price realization. /

  A: Bill Stone noted AI is a top priority for client executives during renewal discussions, and SS&C's governance-first, end-to-end approach to AI (with guardrails for regulated industries and orchestrated workflow automation) has been very effective. Clients recognize SS&C can deliver scalable AI capabilities from task-level RPA to complex agentic AI, and there has been no meaningful pushback on price realization tied to AI investments.