Magic Software Reports Q2 EPS 26c, Revenue $151.6M, CEO: Business Resilience Demonstrated.

Magic Software reports Q2 EPS of 26c, up from 24c last year. The company's revenue increased to $151.6M from $136.3M last year. CEO Guy Bernstein attributed the growth to strong demand for the company's digital, AI, and cloud transformation solutions, as well as its services in the defense sector. The company surpassed an annualized revenue run-rate of $600M.

Magic Software Enterprises (NASDAQ: MGIC) reported its second quarter 2025 earnings, with earnings per share (EPS) of $0.26, up from $0.24 in the same period last year [4]. The company's revenue surged to $151.6 million, a significant increase from the $136.3 million reported in the second quarter of 2024 [1, 2, 3].

CEO Guy Bernstein attributed the growth to robust demand for the company's digital, artificial intelligence (AI), and cloud transformation solutions, as well as its services in the defense sector [4]. The company's revenue growth was particularly strong in its U.S. operations, which saw a 9% year-over-year (YoY) increase driven by agreements executed in late 2024 and early 2025 [3]. Additionally, Magic Software's gross profit increased to $42.4 million, marking a 9.1% YoY growth, although the gross margin declined by 60 basis points to 27.9% [2].

The company also revised its full-year 2025 revenue guidance to $600-610 million, projecting an annual growth rate of 8.6-10.4% [2]. This upward revision reflects the company's confidence in its growth prospects and strong demand for its services.

Despite the margin compression, Magic Software's solid financial performance underscores its business resilience and strong demand for its digital, AI, and cloud transformation solutions. The company is also making significant strides in its strategic direction, as it is in negotiations for a potential merger with Matrix I.T., expected to be presented for shareholder approval in Q4 2025 [2].

References:
[1] https://za.investing.com/news/earnings/magic-software-enterprises-earnings-matched-revenue-topped-estimates-3837142
[2] https://www.ainvest.com/news/magic-software-q2-rev-11-3-yoy-151-6mln-2508/
[3] https://www.tradingview.com/news/reuters.com,2025:newsml_PLXC6250E:0-israeli-it-firm-magic-software-s-q2-revenue-growth-beats-estimates-on-us-client-strength/
[4] https://www.insidermonkey.com/blog/magic-software-enterprises-ltd-nasdaqmgic-q2-2025-earnings-call-transcript-1590601/