Summary
Certara reported second quarter fiscal 2025 revenue of $104.6 million, up 12% from the prior-year quarter. Year-to-date revenue was $210.6 million, up 10.8% from the prior-year period. Total bookings reached $112.0 million, up 13%. Software bookings increased 11% to $46.6 million, and services bookings increased 15% to $65.4 million. The net retention rate was 107.6% in the second quarter of 2025, compared with 102.4% in the first quarter of 2025 and 108.0% in the second quarter of 2024. Chemaxon contributed $5.4 million to total bookings. Management said commercial interest remains strong and pointed to strength in core biosimulation software and QSP services, while noting a mixed operating environment. Certara describes itself as a global leader in biosimulation technology and solutions for model-informed drug development. Its products are used by more than 2,400 biopharmaceutical companies, academic institutions, and regulatory agencies across 70 countries, and its software is licensed by more than 94,000 users and 23 global drug regulatory agencies.
GAAP results swung to a profit at the operating line. Operating income was $9.6 million for the quarter, up 205.7% from the prior-year quarter as the company swung to a profit. The operating margin was 9.1%, up 18.8 percentage points from the prior-year quarter. Net loss was $2.0 million, a narrowed loss from the prior-year quarter, and diluted EPS was $(0.01), a narrowed loss. For the first six months, operating income was $17.2 million, up 266.3% and swung to a profit. Net income was $2.8 million, up 116.1% and swung to a profit. Diluted EPS was $0.02, and the operating margin was 8.2%, up 13.6 percentage points.
Adjusted results also improved. Adjusted EBITDA was $31.9 million, up 21% from the prior-year quarter. Adjusted net income was $11.6 million, compared with $11.4 million, and adjusted diluted EPS was $0.07, flat compared with $0.07. Cash generation was stronger. Operating cash flow was $17.8 million for the quarter, up 81.8% from the prior-year quarter. For the six months, operating cash flow was $35.2 million, up 149.4%. Deferred revenue was $71.2 million, up 14.5% from the prior-year quarter, and remaining performance obligations were $150.8 million, up 25.2%. The combination of higher bookings, deferred revenue, and RPO points to a growing contracted backlog, though the company notes that bookings can vary from period to period and may not predict future revenue.
Certara reiterated its full year 2025 guidance. The company expects revenue of $415 million to $425 million, an adjusted EBITDA margin of 30-32%, adjusted diluted EPS of $0.42 to $0.46, and fully diluted shares of 162 million to 164 million. This guidance is for the full fiscal year, not the next quarter. The company has not reconciled the forward-looking non-GAAP guidance to GAAP because of variability and low visibility around acquisition, financing, and stock compensation costs. Risks include regulatory policy changes, a new U.S. federal administration focused on drug pricing and accelerated drug approval, the ongoing review of the regulatory services business, competition, macroeconomic conditions, customer retention, and integration of acquisitions. The filing also cites deceleration in acceptance of model-informed biopharmaceutical discovery, trends in R&D spending, consolidation within biopharma, ability to retain key personnel, delays or defects in new software releases, issues relating to AI and machine learning, customer renewal risk, and cybersecurity and data privacy risks. Certara operates in a highly regulated market where changes in government policy could affect demand for model-informed drug development.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q2 FY2025 | Q1 FY2025 | QoQ | Q2 FY2024 | YoY |
|---|---|---|---|---|---|
| Revenue | $104.6M | $106.0M | -1.4% | $93.3M | +12.1% |
| Research & development | $9.0M | $10.5M | -14.7% | $9.1M | -1.0% |
| Sales & marketing | $14.0M | $12.7M | +10.0% | $12.2M | +14.5% |
| General & administrative | $17.2M | $19.7M | -12.6% | $28.1M | -38.8% |
| Total operating expenses | $54.3M | $56.9M | -4.5% | $62.5M | -13.2% |
| Operating income (loss) | $9.6M | $7.6M | +25.3% | -$9.0M | +205.7% |
| Operating margin | 9.1% | 7.2% | +1.9 pp | -9.7% | +18.8 pp |
| Net income (loss) | -$2.0M | $4.7M | -141.5% | -$12.6M | +84.3% |
| Net margin | -1.9% | 4.5% | -6.3 pp | -13.5% | +11.6 pp |
| Diluted EPS | -$0.01 | $0.03 | -$0.04 | -$0.08 | +$0.07 |
| Customers | 2,014 | 2,014 | ±0.0% | 2,014 | ±0.0% |
Risks
MD&A states a new U.S. federal administration shows signs of reforming the pharmaceutical industry, particularly focusing on drug pricing and accelerated drug approval, and that changes in government or regulatory policy, or a reversal in acceptance of in silico data, could decrease demand for the company's products and services or lead regulators to cease or recommend against their use.
The company initiated a review process in 2024 to evaluate long-term strategic options for its regulatory services business; MD&A says this could result in several potential directions and have a significant impact on operations.
MD&A says future results depend on entering new markets and retaining and expanding existing customers, and that bookings vary significantly. Q2 2025 bookings were $112.0 million and net retention rate was 107.6%, compared with Q2 2024 bookings of $98.9 million and net retention rate of 108.0%.
The market for biosimulation products and related services is competitive and highly fragmented, with principal competitive factors including functionality and quality of models, breadth of molecular types, regulator acceptance, ease of use, and total cost.
MD&A flags uncertain macroeconomic conditions, including higher inflation, rising interest rates, instability in the financial system, trade disputes, tariffs, changes in government funding, geopolitical conflicts, and pandemics or other infectious disease outbreaks, as challenges to the business.
As of June 30, 2025, the company had $297.0 million outstanding on its term loan and $100.0 million of availability under its revolving credit facility. Net cash used in financing activities was $44.7 million in first six months of 2025, compared with $14.1 million in the same period of 2024.
Income tax expense was $8.2 million for Q2 2025 with an effective income tax rate of 131%, compared with income tax expense of $0.3 million and an effective income tax rate of (2)% for Q2 2024. MD&A states it expects income tax expense to increase over time as the company grows more profitable.
The company completed 21 acquisitions since 2013 and as of June 30, 2025, including Chemaxon for $96.4 million, and the Chemaxon purchase price allocation remains preliminary for deferred taxes and residual goodwill. Acquisitions contributed $11.2 million of the $20.6 million year-to-date revenue increase.
SaaS KPIs
All quarters →Services Bookings
Software Bookings
Total Bookings
Net Revenue Retention
Summary, forecast, risks and KPIs are extracted from Certara, Inc.'s SEC filings for Q2 FY2025 (10-Q / 10-K and the 8-K earnings release); GAAP figures in the summary are checked against the reported XBRL data. They can contain errors; the filings are authoritative. Processed Oct 1, 2026.