CGI reports third quarter Fiscal 2025 results

Executive Summary

• CGI Inc. reported third-quarter Fiscal 2025 results showing revenue growth of 11.4% year-over-year to $4.09 billion, driven by strong performance in AI-related services and strategic capital deployment.
• While reported net earnings declined 7.2% to $408.6 million due to significant restructuring and acquisition integration costs, adjusted net earnings rose 6.8% to $470.1 million, with adjusted diluted EPS increasing 9.9% to $2.10.
• The company maintained a strong balance sheet with $30.58 billion in backlog (2.0x annual revenue) and returned $33.6 million to shareholders via dividends, while also investing $105.1 million back into the business and $286.2 million in share buybacks.

Key Details

• Revenue: $4.09 billion, up 11.4% year-over-year (YoY); up 7.0% in constant currency.
• Earnings Before Income Taxes: $551.6 million, down 7.1% YoY, with a margin of 13.5% (vs 16.2% in Q3-F2024).
• Adjusted EBIT: $666.1 million, up 10.5% YoY, with a margin of 16.3%.
• Net Earnings: $408.6 million, down 7.2% YoY, with a margin of 10.0%.
• Diluted EPS: $1.82, down 4.7% YoY.
• Adjusted Net Earnings: $470.1 million, up 6.8% YoY, with a margin of 11.5%.
• Adjusted Diluted EPS: $2.10, up 9.9% YoY.
• Operating Cash Flow: $486.6 million (11.9% of revenue); trailing twelve-month operating cash flow was $2.20 billion (14.1% of revenue).
• Bookings: $4.15 billion, resulting in a book-to-bill ratio of 101.4% (106.7% on a trailing twelve-month basis).
• Backlog: $30.58 billion as of June 30, 2025, representing 2.0x annual revenue.
• Workforce: Approximately 93,000 consultants and professionals worldwide as of June 30, 2025.
• Capital Allocation:
  • Invested $105.1 million back into the business.
  • Invested $286.2 million in Normal Course Issuer Bid to purchase and cancel Class A subordinate voting shares.
  • Paid $33.6 million in dividends.
• Debt & Leverage:
  • Long-term debt and lease liabilities: $4.24 billion (up from $3.05 billion YoY), driven by $1,671.0 million in new senior unsecured notes partially offset by $475.8 million in repayments.
  • Net debt: $3.12 billion (up from $1.85 billion YoY).
  • Net debt-to-capitalization ratio: 23.4% (vs 17.2% YoY).
• Restructuring Costs: Recorded $45.5 million in restructuring costs and $38.1 million in acquisition/integration costs. The company expects to incur approximately $100.0 million to complete its restructuring program over the remainder of calendar 2025.
• Dividend Declaration: Board approved a quarterly cash dividend of $0.15 per share, payable September 19, 2025, to shareholders of record as of August 15, 2025.

Notable Quotes

• "In the third quarter, CGI delivered double-digit revenue growth fueled by our financial strength and strategic deployment of capital," said François Boulanger, President and Chief Executive Officer. "Our team remains focused on proactively managing the fundamentals of our business to deepen our resilience and continued profitable growth."
• "CGI continued to see strong momentum in AI-related wins in Q3, demonstrating the depth of our expertise globally," continued Boulanger. "On a day-to-day basis, our CGI Partners work jointly with clients to use AI to inform, accelerate and improve project delivery."