Gen Digital (GEN) Q2 2025 earnings summary

Executive summary

• Q2 FY25 revenue reached $974 million, up 3% year-over-year, with strong bookings and customer growth, especially in identity protection and US markets.

• Bookings increased 5% year-over-year in constant currency, marking the highest since the Avast acquisition and the 21st consecutive quarter of growth.

• Direct paying customers grew by 400,000 in the quarter to 39.7 million, with ARPU at $7.26 and retention rate at 78%.

• Operating income rose to $567 million (non-GAAP, up 4%) and $402 million (GAAP, up sharply), with non-GAAP EPS at $0.54, up 16%.

• Continued investment in AI-driven solutions, including Genie anti-scam and LifeLock credit insights, in response to increased cyber threats and mega breaches.

Financial highlights

• Q2 bookings were $964 million, up 5% in constant currency and 4% in USD; non-GAAP revenue was $974 million, up 3%.

• Non-GAAP operating income was $567 million (up 4%); GAAP operating income was $402 million (up 1,727%).

• Net income (non-GAAP) was $336 million (up 12%); GAAP net income was $161 million (up from $147 million).

• Free cash flow for Q2 was $156 million; cash and cash equivalents at quarter end were $737 million.

• Gross margin was 86.1% (non-GAAP) and 80% (GAAP); operating margin was 58.2% (non-GAAP) and 41% (GAAP).

Outlook and guidance

• Q3 FY25 non-GAAP revenue expected between $980–$990 million; EPS between $0.54–$0.56.

• FY25 non-GAAP revenue guidance raised to $3.905–$3.93 billion; EPS to $2.18–$2.23, with 12–15% annual growth.

• Management expects sufficient liquidity for at least the next 12 months, supported by cash, operations, and undrawn credit facilities.