Endava plc
DAVA
$6.74 4.01%
Exchange: NYSE | Sector: Technology | Industry: Software Infrastructure
Q3 2024
Published: May 23, 2024

Earnings Highlights

  • Revenue of $174.37M down 14.3% year-over-year
  • EPS of $-0.03 decreased by 107.1% from previous year
  • Gross margin of 21.3%
  • Net income of -1.74M
  • ""pent-up demand for technology services to undertake and complete digital transformation and to get ready for generative AI"" - John Cotterell
DAVA
Company DAVA

Executive Summary

Endava reported QQ3 2024 revenue of GBP 174.4 million, down 14.3% year over year (YoY) and 11.8% in constant currency, with no GalaxE contribution in the quarter. Despite the topline decline, management emphasized a rebound-driven medium-term opportunity from AI-enabled core modernization and enterprise transformation. The company closed the GalaxE acquisition in April 2024, and guided for Q4 FY2024 revenue of GBP 195–197 million (up 3.5–4.5% YoY in constant currency, including GalaxE) and full-year FY2024 revenue of GBP 741–743 million (constant currency down 4.0% to 4.5%). Adj. diluted EPS for the quarter was GBP 0.22; GAAP net income was negative at GBP -1.74 million, reflecting operating headwinds and integration-related costs. Endava entered the quarter with a strong liquidity position (cash and cash equivalents of GBP 190.0 million) and a net cash surplus (net debt of GBP -132.8 million) despite M&A-related cash outlays (GBP -129 million for GalaxE in April). Management underscored a high level of visibility, with contracted and committed revenue at 99% of the Q4 guide. The strategic narrative centers on leveraging AI to transform core data and processes, expanding offerings through GalaxE (notably in US healthcare), and driving margin uplift through bench reductions and SG&A normalization as integration progresses. Investors should monitor GalaxE integration milestones, pipeline velocity, utilization trends, and the pace of discretionary spend re-accelerating in a slower macro environment.

Key Performance Indicators

Revenue
Decreasing
174.37M
QoQ: -5.01% | YoY: -14.33%
Gross Profit
Decreasing
37.19M
21.33% margin
QoQ: -17.11% | YoY: -42.46%
Operating Income
Decreasing
-1.83M
QoQ: -139.67% | YoY: -106.09%
Net Income
Decreasing
-1.74M
QoQ: -120.81% | YoY: -107.13%
EPS
Decreasing
-0.03
QoQ: -121.21% | YoY: -107.07%

Revenue Trend

Margin Analysis

Historical Earnings Comparison

PeriodRevenue ($M)EPS ($)YoY GrowthReport
Q2 2025 195.59 0.11 +6.6% View
Q1 2025 195.05 0.04 +3.5% View
Q4 2024 194.42 -0.03 +2.4% View
Q3 2024 174.37 -0.03 -14.3% View
Q2 2024 183.55 0.14 -10.6% View