CSG's (NASDAQ:CSGS) Q1 Sales Beat Estimates, Guides for Strong Full-Year Sales

Yahoo

08-05-2025

Customer experience software company CSG Systems (NASDAQ:CSGS) beat Wall Street's revenue expectations in Q1 CY2025, with sales up 1.5% year on year to $299.5 million. The company's full-year revenue guidance of $1.23 billion at the midpoint came in 8.1% above analysts' estimates. Its non-GAAP profit of $1.14 per share was 12% above analysts' consensus estimates.
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CSG (CSGS) Q1 CY2025 Highlights:
Revenue: $299.5 million vs analyst estimates of $295.2 million (1.5% year-on-year growth, 1.4% beat)
Adjusted EPS: $1.14 vs analyst estimates of $1.02 (12% beat)
Adjusted EBITDA: $64.34 million vs analyst estimates of $59.35 million (21.5% margin, 8.4% beat)
The company reconfirmed its revenue guidance for the full year of $1.23 billion at the midpoint
Management raised its full-year Adjusted EPS guidance to $4.78 at the midpoint, a 2.1% increase
EBITDA guidance for the full year is $263.5 million at the midpoint, below analyst estimates of $265 million
Operating Margin: 9.8%, in line with the same quarter last year
Free Cash Flow was $7.07 million, up from -$34.13 million in the same quarter last year
Market Capitalization: $1.66 billion
'Team CSG's strong first quarter results enabled us to raise our 2025 non-GAAP profitability and EPS guidance targets. We grew revenue nicely at customers outside of communication service providers ('CSPs') with a third of our revenue now coming from big, faster growing industry verticals providing a buffer against today's macro-economic uncertainty.' said Brian Shepherd, President and Chief Executive Officer of CSG.
Company Overview
Powering billions of critical customer interactions annually, CSG Systems (NASDAQ:CSGS) provides cloud-based software platforms that help companies manage customer interactions, process payments, and monetize their services.
Sales Growth
Examining a company's long-term performance can provide clues about its quality. Any business can have short-term success, but a top-tier one grows for years.
With $1.20 billion in revenue over the past 12 months, CSG is a small player in the business services space, which sometimes brings disadvantages compared to larger competitors benefiting from economies of scale and numerous distribution channels.
As you can see below, CSG's 4.2% annualized revenue growth over the last five years was mediocre. This shows it couldn't generate demand in any major way and is a tough starting point for our analysis.
CSG Quarterly Revenue
We at StockStory place the most emphasis on long-term growth, but within business services, a half-decade historical view may miss recent innovations or disruptive industry trends. CSG's annualized revenue growth of 3.4% over the last two years aligns with its five-year trend, suggesting its demand was consistently weak.