Evertec 2025 Q2 Earnings Beats Expectations with Net Income Up 27%

Evertec (EVTC) reported its fiscal 2025 Q2 earnings on Jul 31st, 2025. Evertec exceeded expectations in its second-quarter results, reporting an 8% year-over-year revenue growth to $229.61 million, surpassing analyst forecasts of $222.69 million. The company's net income surged by 27% to $40.97 million, significantly beating estimates. Earnings per share (EPS) also rose to $0.63, compared to $0.50 in the same quarter last year, reflecting strong operational performance and effective cost management. Based on these robust results, Evertec raised its full-year guidance for both revenue and adjusted EPS, demonstrating continued confidence in sustained growth.

Revenue

Evertec's revenue for 2025 Q2 grew by 8.3% to $229.61 million, compared to $211.98 million in the same quarter the previous year. The company experienced organic growth across all segments, with the Latin America Payments and Solutions segment reporting revenue of $86.1 million, showcasing a 15% increase year-over-year. The Payment Services segment in Puerto Rico & Caribbean grew 4% to $56.4 million, while Business Solutions recorded a revenue increase of 4% to $64.5 million. Merchant Acquiring revenue rose by 4% year-over-year, reaching $47.3 million, driven by increased transaction volumes and strategic pricing initiatives.

Earnings/Net Income

Evertec's EPS rose by 26.0% to $0.63 in 2025 Q2 from $0.50 in 2024 Q2, marking continued earnings growth. Meanwhile, the company's profitability strengthened with a net income of $40.97 million in 2025 Q2, marking 26.0% growth from $32.52 million in 2024 Q2. The Company has sustained profitability for 14 years over the corresponding fiscal quarter, reflecting stable business performance. The EPS performance was strong, showcasing effective cost management and operational efficiency.

Price Action

The stock price of Evertec has edged up 1.15% during the latest trading day, has jumped 9.18% during the most recent full trading week, and has edged up 0.28% month-to-date.

Post-Earnings Price Action Review

The strategy of buying Evertec (EVTC) shares 30 days after its earnings release following a quarter-over-quarter revenue increase over the past three years delivered poor performance. Despite the company’s positive quarterly earnings results, this investment strategy yielded a compound annual growth rate (CAGR) of -5.47%, resulting in a total return of -24.35%. This performance fell significantly short of the benchmark return of 85.57%. The strategy experienced a maximum drawdown of 0.00%, indicating no significant losses at any point, yet its Sharpe ratio of -0.51 suggests that the approach was unsuccessful in achieving profitable returns relative to its risk level. Overall, this highlights the challenges faced by investors attempting to capitalize on short-term post-earnings stock price movements with a risk-averse but profit-chasing mindset.

CEO Commentary

Mac Schuessler, President and Chief Executive Officer, expressed satisfaction with the strong organic revenue growth in the second quarter, attributing this success to enhancements across all segments and contributions from recent acquisitions. He highlighted improvements in merchant acquiring revenue due to effective pricing strategies and increased transaction volumes. Schuessler's remarks underscore a commitment to strategic investments and an optimistic outlook, as the company raises its full-year guidance based on robust performance metrics.

Guidance

The company expects 2025 revenue to range between $901 million and $909 million, reflecting a growth of approximately 6.6% to 7.6%, or 7.8% to 8.7% on a constant currency basis. Adjusted earnings per common share are projected to be between $3.44 and $3.52, indicating growth of 4.8% to 7.0%, or 6.3% to 8.5% on a constant currency basis. Capital expenditures are anticipated to remain around $85 million, with an adjusted effective tax rate expected to be between 6% and 7%.

Additional News

In recent weeks, Evertec announced an increase and extension of its share repurchase program authorization to $150 million, valid through December 31, 2026. This strategic move aims to enhance shareholder value and reflects the company's confidence in its financial stability. Furthermore, Evertec completed the acquisition of Nubity, a cloud services provider based in Mexico, bolstering its existing product offerings and expanding its reach in Latin America. These developments align with Evertec's strategic initiatives to drive growth and strengthen its market position in the transaction processing industry.