Summary
Manhattan Associates reported first quarter 2025 revenue of $262.8 million, up 3.2% from the prior-year quarter. Operating income rose 9.6% to $63.2 million. Net income fell 2.3% to $52.6 million. GAAP diluted earnings per share was $0.85, down $0.01. Operating margin expanded to 24.0%, up 1.4 percentage points. Non-GAAP adjusted diluted earnings per share was $1.19 compared to $1.03. Adjusted operating income was $91.3 million compared to $79.7 million. The company generated operating cash flow of $75.3 million, up 37.5%. Capital expenditures were $0.9 million, down 61.6%. Deferred revenue rose 12.4% to $296.6 million. Remaining performance obligations increased 26.7% to $1.90 billion.
The quarter showed a mixed revenue mix. Cloud subscription revenue grew 21% year over year. Software license revenue rose 231%. Services revenue declined 8%. Maintenance revenue declined 8%. Hardware revenue declined 10%. Management said cloud revenue represents about 91% of total software revenue. RPO growth was driven by strong demand for cloud offerings. Over 98% of RPO represents cloud native subscriptions with non-cancelable terms greater than one year. The company repurchased about 0.5 million shares for $100.0 million during the quarter. In April 2025, the board approved replenishing the remaining share repurchase authority to $100.0 million. Days sales outstanding was 72 days at March 31, 2025, compared to 74 days at December 31, 2024. The company employed approximately 4,530 employees worldwide at March 31, 2025. Management said the company's unified cloud portfolio offers best-in-class functionality and that it is the only cloud provider named by industry analysts as a leader across the supply chain commerce ecosystem.
Management issued full-year 2025 guidance. Total revenue growth is expected to be 2% to 3%. Adjusted operating margin is guided to 33.0% to 33.5%. Adjusted earnings per share guidance is $4.54 to $4.64, down 4% to 2%. The company also provided GAAP operating margin and GAAP earnings per share guidance, which include equity-based compensation, an unusual health insurance claim, and restructuring expense. The guidance reflects a cautious view of the global macro environment. Management said results for the first three months of 2025 were driven by solid demand for cloud solutions. However, the company remains cautious regarding the pace of global economic growth. It believes geopolitical and economic volatility will continue to shape enterprise software buying decisions. The company expects to continue investing in its cloud business, including enterprise investments in innovation and strategic operating expenses to support growth objectives.
Risks include extended sales cycles for large cloud subscriptions. The company said the current business climate may affect customers' and prospects' decisions regarding timing of strategic capital expenditures. Other risks include economic conditions, delays in product development, competitive and pricing pressures, software errors, information technology failures, security breaches, and global instability, including the wars in Ukraine and the Middle East. The company also cited risks from tariffs, trade wars, generative artificial intelligence, large system implementations, foreign currency exchange risk, and the long sales cycle associated with its products. It eliminated about 100 positions in January 2025 to align services capacity with customer demand, which was impacted by short-term macro-economic uncertainty. The company has no debt and no credit facilities. It expects existing cash to meet working capital and capital expenditure needs for at least the next twelve months. The company also flagged risks related to its dependence on a single line of business, its dependence on generating revenue from cloud subscriptions and software licenses, undetected errors or bugs in its software, defects or interruptions in cloud subscription services, compromises of data protection and IT security measures, and the difficulty of predicting operating results.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q1 FY2025 | Q4 FY2024 | QoQ | Q1 FY2024 | YoY |
|---|---|---|---|---|---|
| Revenue | $262.8M | $255.8M | +2.7% | $254.6M | +3.2% |
| Gross profit | $148.2M | $142.8M | +3.8% | $135.3M | +9.6% |
| Gross margin | 56.4% | 55.8% | +0.6 pp | 53.1% | +3.3 pp |
| Research & development | $35.3M | $33.0M | +7.0% | $35.0M | +0.8% |
| Sales & marketing | $21.1M | $20.3M | +3.7% | $19.9M | +5.7% |
| General & administrative | $24.2M | $27.2M | -10.9% | $21.2M | +14.2% |
| Total operating expenses | $199.6M | $195.1M | +2.3% | $196.9M | +1.4% |
| Operating income (loss) | $63.2M | $60.7M | +4.1% | $57.6M | +9.6% |
| Operating margin | 24.0% | 23.7% | +0.3 pp | 22.6% | +1.4 pp |
| Net income (loss) | $52.6M | $48.0M | +9.5% | $53.8M | -2.3% |
| Net margin | 20.0% | 18.8% | +1.2 pp | 21.1% | -1.1 pp |
| Diluted EPS | $0.85 | $0.77 | +$0.08 | $0.86 | -$0.01 |
Risks
In February and April 2025, two putative securities class action lawsuits were filed against the company. Management states it is unable to predict the ultimate timing or outcome, or reasonably estimate possible losses, and an adverse result could affect business, operating results, financial condition or reputation.
MD&A states the company remains cautious regarding the current turbulent global macro environment and that global geopolitical and economic volatility likely will continue to shape customers' and prospects' enterprise software buying decisions.
MD&A states current sales cycles for large cloud subscriptions in target markets could be extended. Services revenue decreased $11.1 million in Q1 2025 versus the prior-year quarter, primarily due to customer budgetary constraints that shifted services work to future periods and negatively impacted professional services revenue related to cloud subscriptions.
In January 2025, the company eliminated approximately 100 positions to align services capacity with customer demand impacted by short-term macro-economic uncertainty, recording approximately $2.9 million pretax restructuring expense in Q1 2025.
MD&A notes approximately 65% of Q1 2025 total revenue was generated in the United States and 21% in EMEA, and Gartner estimates about 80% of supply chain software spend is in North America and Western Europe, so the health of those economies meaningfully impacts financial results.
Maintenance revenue decreased 8% in Q1 2025 versus the prior-year quarter, and MD&A expects maintenance revenues to decline as the company continues to develop cloud offerings, offset by additional cloud revenue including from customers converting maintenance contracts to cloud subscriptions.
The effective income tax rate was 18.5% for Q1 2025 versus 8.2% for Q1 2024 due to a decrease in excess tax benefits on restricted stock awards that vested during the quarter. This contributed to net income down 2.3% and diluted EPS down 1.2% in Q1 2025 despite operating income up 9.6%.
G&A expenses increased $3.0 million in Q1 2025 versus the prior-year quarter primarily due to a $3.0 million signing bonus, $0.7 million recruiting fees, and $3.1 million additional stock compensation for hiring the new chief executive officer. Forward-looking factors also include the ability to attract and retain highly skilled employees.
SaaS KPIs
All quarters →Remaining Performance Obligations
Cloud Subscriptions Revenue
Cloud Subscriptions Revenue Growth
Summary, forecast, risks and KPIs are extracted from MANHATTAN ASSOCIATES INC's SEC filings for Q1 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.