Temenos ((CH:TEMN)) has held its Q2 earnings call. Read on for the main highlights of the call.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
The recent earnings call for Temenos Q2 2025 was marked by a predominantly positive sentiment. The company showcased strong financial performance, highlighted by successful deal closures and strategic advancements in AI and product offerings. Temenos also raised its full-year guidance, signaling confidence in its growth trajectory. Despite some challenges, such as issues with SaaS growth due to a BNPL client and macroeconomic uncertainties, the positive aspects significantly outweighed the negative ones.
Strong Revenue and Profitability Growth
Temenos reported a robust revenue growth of 16% in Q2 2025, with subscription and SaaS revenue increasing by 24%. The company’s EBIT grew by 28% during the quarter, driven by strong revenue growth and effective cost control measures.
Successful Deal Closures
The company successfully signed significant deals with Banco da Amazonia and East West Bank, demonstrating strong traction in the Latin America and APAC regions. The number of go-lives increased to 81 this quarter, up from 70 in Q1, showcasing the company’s expanding reach and implementation capabilities.
AI and Product Innovation
Temenos launched new AI products, including the Temenos Product Manager CoPilot and FCM AI agent, which enhance product capabilities and customer offerings. These innovations are set to strengthen Temenos’s position in the market.
Industry Recognition
Temenos was named the best-selling core banking provider by IBS Intelligence for the 20th consecutive year and received several notable awards, including being ranked as the fourth most sustainable company by Time Magazine. This recognition underscores the company’s leadership and commitment to excellence.
Raised Full-Year Guidance
Following a strong H1 performance, Temenos raised its full-year guidance for subscription and SaaS growth to at least 6% and increased its EBIT guidance to at least 9%. This adjustment reflects the company’s confidence in its continued growth and strategic direction.
Challenges with SaaS Growth
Despite strong subscription growth, Temenos faced challenges with SaaS growth due to a downsell linked to a BNPL client, which created a headwind for SaaS revenue. This issue highlights the need for careful management of client relationships and market dynamics.
Macroeconomic Uncertainty
Despite its strong performance, Temenos maintained a cautious outlook due to macroeconomic uncertainty and potential volatility affecting future quarters. This prudent approach reflects the company’s awareness of external factors that could impact its operations.
DSO Increase
The Days Sales Outstanding (DSO) jumped to 150 days, which could indicate potential cash flow management challenges. This increase warrants attention to ensure effective financial management and operational efficiency.
Forward-Looking Guidance
During the earnings call, Temenos reported strong financial performance and raised its full-year guidance. The company anticipates acceleration in free cash flow growth in the second half, with a focus on larger deals, especially in Europe and the Americas. Temenos also highlighted successful strategic initiatives, including significant new hires and AI product enhancements, while reaffirming its 2028 targets and maintaining strong pipeline visibility.
In summary, the Temenos Q2 2025 earnings call reflected a positive outlook, with strong financial performance and strategic advancements. While challenges such as SaaS growth issues and macroeconomic uncertainties were noted, the company’s raised guidance and successful deal closures underscore its confidence in continued growth. Temenos’s commitment to innovation and industry leadership remains evident, positioning it well for future success.