Amdocs Stock Rises 4% as Q1 Earnings and Revenues Surpass Estimates

Amdocs Limited DOX shares gained 4% during Tuesday’s extended trading session after the company reported better-than-expected first-quarter fiscal 2026 results. DOX’s non-GAAP earnings of $1.81 per share came above the midpoint of management’s guidance of $1.73-$1.79 and increased 9% year over year. The figure also surpassed the Zacks Consensus Estimate of $1.75.

Amdocs’ first-quarter revenues of $1.156 billion topped the consensus mark of $1.15 billion and came above the midpoint of management’s $1.135-$1.175 million guidance range. The top line increased 4.1% on a reported basis and 3.5% on a constant-currency basis.

Amdocs’ Q1 Details

Amdocs reported a decline in revenues across North America, Europe and the Rest of the World (RoW). North America reported revenues of $765 million (66% of total revenues), which increased 3.7% year over year. Europe revenues (16% of total revenues) of $182 million soared 17% year over year.

Amdocs Limited Price, Consensus and EPS Surprise

Amdocs Limited price-consensus-eps-surprise-chart | Amdocs Limited Quote

RoW revenues (18% of total revenues) dropped 3.6% year over year to $209.5 million. Our model estimates for North America, RoW and Europe were pinned at $769.9 million, $209.2 million and $171.8 million, respectively.

Managed services revenues rose 2.3% year over year to $746 million. The company ended the first quarter of fiscal 2026 with a 12-month backlog of $4.25 billion, up $60 million sequentially. Our model estimates for managed services revenues and backlog were pegged at $760.6 million and $4.23 billion, respectively.

The non-GAAP operating income increased 6.2% year over year to $249.9 million, while the operating margin expanded 40 basis points (bps) to 21.6%.

Amdocs’ Balance Sheet & Cash Flow

Amdocs had cash and short-term investments of $247.9 million as of Dec. 31, 2025 compared with $325 million as of Sept. 30, 2025. Long-term debt was $647 million as of Dec. 31, 2025, almost flat to the Sept. 30, 2025 level of $646.9 million.

During the first quarter, it generated an operating cash flow of $220 million and a free cash flow of $188 million. During the first quarter, it repurchased shares worth $146.2 million and paid $57.2 million in dividends.

Amdocs Updates FY2026 & Q2 Guidance

For fiscal 2026, Amdocs now expects revenues to grow in the 1.5-5.5% range, instead of the earlier band of 1.7-5.7%. The Zacks Consensus Estimate for revenues is pegged at $4.7 billion, suggesting a year-over-year increase of 3.7%.

The non-GAAP operating margin is still anticipated to be in the range of 21.3-21.9% for fiscal 2026. Non-GAAP earnings per share are still expected to grow in the band of 4-8%. The Zacks Consensus Estimate for earnings is pegged at $7.42 per share, indicating a year-over-year rise of 6.2%.

The company still expects free cash flow between $710 million and $730 million.

Amdocs also initiated guidance for the second quarter of fiscal 2026. For the second quarter, the company expects revenues to be in the band of $1.15-$1.19 billion (midpoint $1.17 billion). The Zacks Consensus Estimate for revenues is pegged at $1.17 billion, suggesting a year-over-year jump of 3.4%.

Amdocs expects non-GAAP earnings per share to be between $1.73 and $1.79. The Zacks Consensus Estimate for earnings is pegged at $1.82 per share, calling for a year-over-year rise of 2.3%.

DOX’s Zacks Rank and Stocks to Consider

Currently, Amdocs carries a Zacks Rank #4 (Sell).

Amphenol APH, Micron Technology MU and Analog Devices ADI are some other top-ranked stocks that investors can consider in the Zacks Computer and Technology sector. Amphenol and Micron Technology sport a Zacks Rank #1 (Strong Buy) each at present, while Analog Devices carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Amphenol’s 2026 earnings has been revised upward by 2 cents over the past seven days to $4.32 per share, calling for an increase of 29.3% year over year. Amphenol shares have surged 110.5% over the past year.

The Zacks Consensus Estimate for Micron Technology’s fiscal 2026 earnings has moved southward by 14 cents in the past 30 days to $32.90 per share, implying 296.9% year-over-year growth. Micron Technology shares have soared 362.1% over the past year.

The Zacks Consensus Estimate for Analog Devices’ fiscal 2026 earnings has moved northward by 21 cents over the past 30 days to $9.97 per share, indicating a year-over-year increase of 28%. Analog Devices shares have rallied 51.3% over the past year.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research