Bentley Systems 2025 Q1 Earnings Beats Expectations as Net Income Surges 29.9%

Bentley Systems (BSY) reported its fiscal 2025 Q1 earnings on May 07th, 2025. Bentley Systems exceeded expectations with a strong performance in its fiscal 2025 Q1 results. The company reported revenue of $370.54 million, up 9.7% from the previous year, surpassing analyst estimates by 1.1%. Earnings per share (EPS) also beat expectations, rising significantly to $0.29, marking a 31.8% increase from 2024 Q1. The company’s guidance remains optimistic, maintaining a framework of low double-digit ARR growth and targeting margin expansion alongside strong cash flow generation.

Revenue

Bentley Systems reported a notable increase in total revenue, which rose 9.7% to $370.54 million in Q1 2025, compared to $337.76 million in the same quarter last year. Subscription and license revenues were particularly strong, contributing $353.11 million. Within this segment, subscriptions alone accounted for $342.32 million, demonstrating robust demand. Perpetual licenses added another $10.79 million, while services contributed $17.43 million, rounding out the company's diverse revenue streams.

Earnings/Net Income

Bentley Systems' EPS rose by 31.8%, reaching $0.29 in 2025 Q1, up from $0.22 in 2024 Q1, indicating solid earnings growth. Net income also showed significant growth, climbing 29.9% to $91.34 million from $70.31 million in the previous year. This consistent upward trend in earnings highlights the company’s stable financial performance and positive outlook.

Price Action

The stock price of Bentley Systems has climbed 6.84% during the latest trading day, has climbed 7.56% during the most recent full trading week, and has surged 19.61% month-to-date.

Post Earnings Price Action Review

The strategy of purchasing Bentley Systems (BSY) shares following a quarterly revenue increase and holding them for 30 days has delivered strong returns over the past five years. This approach has resulted in an annualized return of approximately 20%, while maintaining a maximum drawdown of only 10%. Such performance illustrates the strategy's ability to capture BSY's growth potential while efficiently managing risk amid market fluctuations. The impressive annualized return underscores BSY’s robust growth prospects, reflecting the company's solid financial health. Additionally, the strategy's minimal drawdown signifies effective risk mitigation during market downturns, demonstrating resilience in the investment approach. Furthermore, its consistent performance across various market conditions over the past five years highlights the strategy’s reliability. By effectively balancing growth potential with risk management, this investment strategy presents a compelling opportunity for investors seeking to capitalize on BSY's growth while minimizing potential losses.

CEO Commentary

Nicholas Cumins, Chief Executive Officer, remarked on Bentley Systems' strong start to the year, achieving 12% year-over-year ARR growth, citing solid demand and a resilient business model amidst global uncertainties. He noted that infrastructure funding remains a priority, with backlogs extending further out due to a shortage of engineers. Cumins emphasized the positive outlook from the ACC survey for U.S. engineering firms and the importance of their E365 program, which has been a significant growth driver. He expressed optimism regarding the company’s performance, stating, "We remain confident in our ability to continue to deliver solid results despite global macro uncertainties."

Guidance

Bentley Systems expects to maintain a framework of low double-digit ARR growth, with a target of 100 basis points of margin expansion and strong cash flow generation. The company anticipates generating approximately 60% of its full-year free cash flow during the first half of 2025. Cumins highlighted that the fundamentals of demand remain unchanged, with continued infrastructure funding and a focus on improving productivity for existing engineers.

Additional News

Bentley Systems has been actively pursuing strategic acquisitions, enhancing its position in promising infrastructure sectors. Recent acquisitions, such as Seequent and Power Line Systems, have bolstered the company's business resilience and geographic diversification. These strategic moves have reduced exposure to China while increasing growth in other Asia Pacific regions. Additionally, Bentley Systems has made notable progress in its partnership with Google, leveraging technologies like Cesium for 3D geospatial visualization and integrating Google data for asset analytics. This collaboration enhances Bentley's asset analytics offerings, expanding reach and improving win rates. Furthermore, Bentley Systems is focusing on developing its strategic acquisitions to strengthen its market position and drive sustainable growth across various sectors.