Magic Software Q4: Expecting Reversal of Negative Mix
ByAinvest
Thursday, Aug 14, 2025 11:27 am ET1min read
MGIC--
Magic Software (NASDAQ:MGIC) reported a solid second quarter, with North American (NA) revenues showing signs of recovery. Despite the impact of negative mix effects on profit growth, the company expects a reversal in Q4, indicating a positive trend in its business [1].
The company's revenue grew by 11% year-over-year (YoY) and 2.8% sequentially, with most of the growth coming from Israel and project-based work. Defense demand was a significant driver of this growth [1]. The acquisition of Theoris in late April 2024 also contributed to the revenue increase, although the company expects a sequential trough in Q3 before a pickup in Q4 [1].
Magic Software's gross margins remain strong, with software solutions contributing around 17% of revenue and professional services accounting for 83%. The company's professional services, which carry a third of the gross margin, have shown significant growth [1].
The company's pipeline is robust, with legacy players moving to the cloud and generating cloud solutions revenues. Additionally, the deployment of AI and GenAI solutions has increased. Defense remains a solid market for Magic Software [1].
Magic Software is a small part of the parent company Asseco, which has a valuation multiple of around 25x earnings before interest, taxes, depreciation, and amortization (EBITDA). This valuation is in line with other tech consulting stocks and is considered fairly valued given the company's solid revenue growth [1].
Dianthus Therapeutics (DNTH), a clinical-stage biotech, reported a wider net loss in Q2 2025 due to increased research and development and administrative expenses. The company's focus remains on clinical development and achieving trial milestones [2].
References
[1] https://seekingalpha.com/article/4813637-magic-software-expecting-a-reversal-of-negative-mix-in-q4
[2] https://www.aol.com/finance/dianthus-dnth-q2-loss-widens-204458466.html
Magic Software (NASDAQ:MGIC) reported a decent quarter with NA revenues showing signs of recovery, despite negative mix effects impacting profit growth. The company expects a reversal of negative mix in Q4, indicating a positive trend in its business.
Title: Magic Software (MGIC) Shows Signs of Recovery in Q2, Expects Profit Growth in Q4Magic Software (NASDAQ:MGIC) reported a solid second quarter, with North American (NA) revenues showing signs of recovery. Despite the impact of negative mix effects on profit growth, the company expects a reversal in Q4, indicating a positive trend in its business [1].
The company's revenue grew by 11% year-over-year (YoY) and 2.8% sequentially, with most of the growth coming from Israel and project-based work. Defense demand was a significant driver of this growth [1]. The acquisition of Theoris in late April 2024 also contributed to the revenue increase, although the company expects a sequential trough in Q3 before a pickup in Q4 [1].
Magic Software's gross margins remain strong, with software solutions contributing around 17% of revenue and professional services accounting for 83%. The company's professional services, which carry a third of the gross margin, have shown significant growth [1].
The company's pipeline is robust, with legacy players moving to the cloud and generating cloud solutions revenues. Additionally, the deployment of AI and GenAI solutions has increased. Defense remains a solid market for Magic Software [1].
Magic Software is a small part of the parent company Asseco, which has a valuation multiple of around 25x earnings before interest, taxes, depreciation, and amortization (EBITDA). This valuation is in line with other tech consulting stocks and is considered fairly valued given the company's solid revenue growth [1].
Dianthus Therapeutics (DNTH), a clinical-stage biotech, reported a wider net loss in Q2 2025 due to increased research and development and administrative expenses. The company's focus remains on clinical development and achieving trial milestones [2].
References
[1] https://seekingalpha.com/article/4813637-magic-software-expecting-a-reversal-of-negative-mix-in-q4
[2] https://www.aol.com/finance/dianthus-dnth-q2-loss-widens-204458466.html
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