Q2 2025 Sonata Software Ltd Earnings Call Transcript
Key Points
- Sonata Software Ltd (BOM:532221) reported a 2.3% quarter-on-quarter revenue growth in its international business, aligning with its forecast of 1% to 3% growth.
- The company secured three large deals and six midsized deals in Q2 FY25, expanding its client base and enhancing its revenue potential.
- Sonata Software Ltd (BOM:532221) has made significant progress in its AI initiatives, with $67 million in pipeline opportunities across 110 customers.
- The company's investment in healthcare and banking verticals has paid off, with these sectors now contributing 32% of revenue, up from 13% ten quarters ago.
- Sonata Software Ltd (BOM:532221) has been recognized by Everest Group and HFS for its growth and capabilities, highlighting its competitive position in the market.
- The EBITDA margin for the international business decreased to 18.2% from 18.7% in the previous quarter, partly due to salary increases.
- The domestic business experienced a 21% reduction in revenue, although gross contribution increased, indicating variability in contract sizes.
- There is a delay in deal closures in the retail and manufacturing sectors, impacting growth in these verticals.
- The company has not declared a dividend this quarter, raising concerns among investors about changes in its dividend policy.
- Sonata Software Ltd (BOM:532221) faces ongoing margin pressures due to investments in new capabilities and large deal transitions, which are expected to continue impacting margins until Q1 FY26.
Ladies and gentlemen, good day, and welcome to Sonata Software Limited Q2 FY24/25 Investor Conference Call. (Operator Instructions) Please note that this conference is being recorded. I now hand the conference over to the management from Sonata Software Limited. Thank you, and over to you, sir.
Thank you, moderator. This is Samir Dhir from Sonata Software. And I have the management team along with me on this call. We all welcome you to this conference. Today, we will share our strategy, the progress we have made in the recent quarters, our strategic plan and the financial results for the quarter Q2 FY25 that ended on September 30, 2024.
I thank you for joining us today. We appreciate your valuable time and support. It is my pleasure to share our progress regarding our vision and growth for Sonata despite the macroeconomic challenges and geopolitical issues, which are resulting in a slowdown in the tech spending across some of our verticals.
I'll update you on our
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