Booz Allen (BAH) Q1 2025 earnings summary

Executive summary

• Achieved 10.8% year-over-year revenue growth to $2.94 billion, with strong demand, increased headcount, and 10.6% organic revenue growth fueling momentum.

• Net income rose 2.4% to $165.2 million; diluted EPS increased 4.1% to $1.27, while adjusted diluted EPS declined 6.1% to $1.38.

• Backlog reached a record $36.2 billion, up 15.7%–16% year-over-year, with a book-to-bill ratio of 1.72x.

• Closed the acquisition of PAR Government Systems Corporation in June 2024, expected to add $80–$90 million in revenue and $230.5 million to backlog.

• Client staff headcount grew 7.7% year-over-year to 35,100, supporting delivery on national priority missions.

Financial highlights

• Revenue: $2.94 billion, up 10.8% year-over-year; organic revenue up 10.6%.

• Adjusted EBITDA: $302 million, down 1.6% year-over-year; margin at 10.3%, down from 11.6%.

• Net income margin: 5.6%, down from 6.1% year-over-year.

• Free cash flow: $19.7 million, a significant improvement from -$82 million in the prior year.

• Cash from operations improved to $52 million; free cash flow conversion at 11%.

Outlook and guidance

• Fiscal 2025 revenue growth expected at 8%–11%.

• Adjusted EBITDA guidance: $1.26–$1.3 billion, with margin around 11%.

• Adjusted diluted EPS guidance: $5.80–$6.05; free cash flow: $725–$825 million.

• Operating cash flow forecast: $825–$925 million.

• Guidance includes $80–$90 million inorganic revenue from PGSC and assumes an adjusted effective tax rate of 23–25%.