Magic Software Enterprises (MGIC) Q3 2025 earnings summary

Executive summary

• Achieved record-breaking revenues of $161.7 million for Q3 2025, up 13.1% year-over-year, and $460.6 million for the nine months ended September 30, 2025, up 12.4% year-over-year.

• Net income attributable to shareholders rose 17.0% in Q3 to $9.9 million and 11.4% for the nine months to $29.3 million.

• Declared a quarterly cash dividend of 15.1 cents per share, totaling approximately $7.4 million.

• Announced a definitive merger agreement with Matrix I.T., expected to enhance scale and market reach.

Financial highlights

• Q3 2025 gross profit increased 11.4% to $44.2 million; gross margin slightly decreased by 50 bps to 27.3%.

• Q3 operating income rose 13.6% to $17.1 million; non-GAAP operating income up 8.1% to $19.9 million.

• Diluted EPS for Q3 was $0.20 (GAAP) and $0.25 (non-GAAP), up 17.6% and 8.7% year-over-year, respectively.

• For the nine months, operating income grew 8.9% to $48.5 million; non-GAAP operating income up 4.0% to $57.0 million.

• Cash flow from operating activities for the nine months was $40.6 million, down from $49.1 million year-over-year.

Outlook and guidance

• Full-year 2025 revenue guidance raised to $610–$620 million, reflecting anticipated annual growth of 10.4%–12.2%.

• Management expects continued operational momentum and robust demand for digital, AI-driven, and cloud solutions.