SS&C Technologies Holdings, Inc. Q4 FY2025 earnings call

• Bill Stone mentioned the company's deep moat and belief that the AI boom will be a tailwind, with rapid deployment of AI solutions. Fourth quarter results demonstrated strength in adjusted revenue, earnings, and EBITDA. The Callisto acquisition is showing early progress. - Rahul Kanwar highlighted solid organic growth, with multiyear partnerships creating recurring revenue and AI advancement being positive for the business. - Brian Schell discussed financials including adjusted results, core expenses, cash flow, and share repurchases, noting cash from operating activities growth and share count decrease due to repurchases.

Fourth quarter results of SS&C Technologies Holdings, Inc. showed record adjusted revenue of $1.655 billion, up 8%, and adjusted diluted earnings per share of $1.69, an 18% increase. Adjusted consolidated EBITDA was $651 million, up 9%, with an adjusted consolidated EBITDA margin of 39.3%. Fourth quarter adjusted organic revenue growth was 5.3%. GIDS had 13.2% revenue growth, GlobeOp had 9.6% revenue growth. Interlinks showed modest growth in Q4. Cash from operating activities for the twelve months ended 12/31/2025 was $1.745 billion, up 26% year over year. In Q4, $384 million was returned to shareholders, including 3.7 million shares repurchased for $319 million and a $66 million common stock dividend. Over $1 billion was allocated to share repurchase in 2025.

For 2026, revenue is expected to be in the range of $1.608 billion to $1.648 billion with 5% organic growth at the midpoint. Adjusted net income is in the range of $404 million to $420 million. Interest expense, excluding amortization to deferred financing costs, is in the range of $102 million to $104 million. Diluted shares are in the range of 249.2 million to 250.2 million, and adjusted diluted EPS is in the range of $1.62 to $1.68. For the full year 2026, revenue is expected to be in the range of $6.654 billion to $6.14 billion with 5.1% organic revenue growth at the midpoint. Targeted annual EBITDA expansion of 50 basis points with the goal of a 40% margin in Q4. Adjusted net income is in the range of $1.662 billion to $1.762 billion, adjusted diluted EPS is in the range of $6.7 to $7.02, and cash from operating activities is in the range of $1.713 billion to $1.813 billion.

• Competition from AI-driven automation tools in various functions which could impact market share. - Regulatory challenges in highly regulated industries like healthcare and financial services. - Market volatility affecting share repurchase and acquisition opportunities. - Uncertainties in the adoption and integration of new technologies like AI.

Q: Question on the healthcare business, tough quarter organic perspective.

A: Bill Stone said healthcare is a long-term play, with lumpy results due to regulated nature. There were large license sales in prior periods, and new technology like Amesys and One Health with Amesys and Domain are being developed.

Q: Update on the Elevance relationship.

A: Dominion Rx is ready, but Elevance's long-standing relationships with other large healthcare organizations make it challenging, though the company thinks there are enticements for Elevance.

Q: Alternative administration assets under administration growth.

A: Fourth quarter had good organic growth, with about $92 billion of the change in assets under administration being organic and the rest from acquisition of Kurofun Services.

Q: Intelligent automation business outlook.

A: Bill Stone is optimistic, with much AI innovation centered there, perfecting in other businesses and selling out.

Q: Organic growth guide cadence.

A: Bill Stone said the business is getting stronger with more predictability, and the organic growth will be pretty strong all year.

Q: Maintaining competitive advantage with AI, fintechs.

A: Bill Stone said the large organization with many people and products, control consciousness for regulated clients, and financial wherewithal to invest wisely gives a competitive edge.

Q: Wealth management organic growth.

A: Optimistic about the Black Diamond platform, which has approaching $3.5 trillion under administration and integrated Morningstar clients.

Q: M&A environment.

A: Bill Stone said the company is constantly looking, well-positioned with earnings and cash flow for potential large acquisitions, and sees flexibility in the M&A landscape.