Gen Digital Inc. Contingent Value Rights Q4 FY2025 earnings call

• Fiscal 2025 was transformative with record bookings, revenue, operating margin, and EPS. Total bookings were $4 billion, revenue was $3.935 billion, operating margin 58.4%, non-GAAP EPS $2.22. - Continued innovation in AI-driven threat detection, launching Genie Scam Protection and enhancing security engines. - Expanded geographic and channel reach, introducing privacy and identity products into 15 new markets, doubling down on partner program. - Acquired MoneyLion to expand into financial wellness, integrating it to leverage its technology and marketplace. - Grew direct customer count to over 40 million direct paid customers and over 65 million total direct and indirect paid customers.

The company has two segments. The cyber safety platform segment has a mid-single digit revenue growth potential and approximately 60% non-GAAP operating margin. The trust-based solutions segment has a high single-digit revenue growth potential and a non-GAAP operating margin target in excess of 30% as financial wellness scales. Fiscal 2025 total bookings were $4 billion, up 4% year-over-year, total revenue was $3.935 billion, up 4% in USD and constant currency, operating income was $2.3 billion with an operating margin of 58.4%. Q4 2025 bookings was $1.08 billion, up 5% in constant currency, total Q4 revenue was $1.01 billion, up 5% in USD and constant currency.

• Fiscal 2026 revenue is expected to be between $4.7 billion and $4.8 billion, representing 6% to 8% pro forma growth. - Non-GAAP EPS is expected to be in the range of $2.46 to $2.54 per share, representing 12% to 15% growth for the year. - Q1 2026 non-GAAP revenue is expected to be in the range of $1.18 billion to $1.21 billion, translating to approximately 5% to 7% pro forma year-over-year growth. - Q1 2026 non-GAAP EPS is expected to be in the range of $0.59 to $0.61, representing 12% to 15% growth in constant currency.

• The threat landscape continues to evolve with AI-powered threats becoming more sophisticated, which could impact the demand for cyber safety solutions. - Macroeconomic uncertainty could potentially affect consumer spending on non-essential services like cyber safety solutions. - Integration of MoneyLion could face challenges, which might impact the expected growth and financial performance of the trust-based solutions segment.

Q: Congrats on those solid results. I really like the way you segmented the business between cyber safety and the trust-based solutions. Certainly makes a lot of sense putting that LifeLock in the trust-based segment. So I guess my question is, my first one would be on guidance. It looks roughly like your guidance for fiscal 26, as soon as the MoneyLion growth can kind of stay in that 29% to 30% range that they delivered this last fiscal year. How much visibility do you have in that segment relative to your cyber safety platform?

A: Vincent Pilette responded that the guidance is based on previous outlooks. Cyber safety all-in before MoneyLion has mid-single digit growth potential. When combining MoneyLion, which grew around 24%-25% in the last calendar year, there are shifts including cross-selling into the install base and transforming to a subscription business. When combined, it gives the 6%-8% pro forma guidance.

Q: Thanks for taking my questions here and congrats on closing MoneyLion. Vincent, for sure. Vincent, maybe for you. MoneyLion, and you touched on this in your prepared remarks, MoneyLion really brings a big network of potential customers to cross sell to. And maybe one question around that is, how does that network maybe change the type of potential subscribers that you can go after? Does that make sense?

A: Vincent Pilette responded that the strategy is to use MoneyLion's architecture to embed features into solutions for existing customers. The cyber safety platform is a foundation, and MoneyLion allows expanding into financial wellness. It provides the opportunity to offer full spectrum solutions from cyber safety to financial wellness, leveraging the existing customer base and following consumer demands.

Q: Hi guys. Appreciate the comment earlier that you said that the business remains resilient despite some macro uncertainty. But I wanted to ask as you look at the remainder of the year, especially in the second half of the calendar year where the tariff pause kind of goes away, are you seeing or what I should say like this, what signs of demand are you seeing that gives you confidence that the business remains durable? And maybe the second part to that question, as we think about MoneyLion, is there any concerns that that could be more macro sensitive versus other parts of your business?

A: Vincent Pilette responded that the business model is resilient with high subscription and auto renewal. The threat landscape remains active, and demand for cyber safety products is strong. With MoneyLion, offering features to current customers who asked for more PFM and marketplace features, and in a tight environment, people need better financial decisions which MoneyLion fits. Natalie Derse supplemented that they keep customers at the center and have a diverse set of products to go to market with.

Q: And again, congrats on a strong quarter and closing the acquisition. A nice quarter of subscriber ads, and we've gotten a couple of questions from investors around Google AI overviews might impact your business. I'd love to hear about how you're thinking about this potentially impacting your SEO lead Gen strategy and any assumptions you're making around click-through rates or customer acquisition costs or anything on that side of the lead Gen.

A: Vincent Pilette responded that the company has a diversified reach to market and almost plays in every dimension. AI is changing the landscape, but they have not seen immediate changes, and it's about contextual marketing. They stay in touch with market moves and see it as an opportunity.

Q: Hey, everyone. Thank you. For this concludes our conference call today. Thank you very much for joining.

A: Operator concluded the conference call.