Alithya Group (ALYA) Q3 2025 earnings summary

Executive summary

• Achieved record adjusted EBITDA and gross margin, marking milestones in the three-year strategic plan, with sequential organic growth across all geographies and strong enterprise transformation and IP-based services.

• Robust third-quarter bookings and backlog, with notable contributions from the XRM Vision acquisition, which expanded Microsoft and smart shoring capabilities.

• Focused on delivering higher-value services, expanding smart shoring, and scaling AI/IP solutions, supported by recent acquisitions.

• Net loss increased to $3.7M due to a $5.1M goodwill impairment, despite improved adjusted net earnings.

Financial highlights

• Q3 revenues were $115.8M, down 3.9% year-over-year but up 3.8% sequentially, with organic growth in all geographies.

• Gross margin reached a record 32.3% ($37.4M), up 100 bps year-over-year and 170 bps sequentially.

• Adjusted EBITDA was $10.3M (8.9% margin), up 8.7% year-over-year and 10.8% sequentially.

• Adjusted net earnings were $5.7M, up 32.6% year-over-year; adjusted EPS $0.06.

• Net cash from operating activities was $11.7M; net debt at $86.0M–$108M, with a leverage ratio of 2.0x–2.6x.

Outlook and guidance

• Targeting gross margin of 33%–35% and adjusted EBITDA margin of 11%–13% within three years.

• Management targets 5–10% annualized organic growth and $150M in acquired revenues by fiscal 2027.

• Expecting continued growth in all geographies, with the U.S. anticipated to outpace Canada.

• Focus on scaling AI and IP solutions, expanding smart shoring, and achieving carbon care certification.

• Bookings and backlog support continued business momentum and long-term growth.