CEO Guy Bernstein said Magic Software continued investment in digital and cloud transformation solutions and expressed confidence in the company’s ability to sustain momentum and drive long-term profitability.
Magic Software Enterprises Ltd. (MGIC) shares rallied Tuesday after the IT consulting services and application development platforms company reported positive fourth-quarter results and guided 2025 revenue above the consensus estimate. The company also confirmed a going-private transaction.
The Or Yehuda, Israel-based company reported adjusted earnings per share (EPS) of $0.24 for the fourth quarter of the fiscal year 2024, flat compared to the year-ago period and in line with the Finchat-compiled consensus estimate.
Revenue climbed 13.6% year over year to $142.6 million, faster than the 10.4% growth for the third quarter. The topline also exceeded the $137 million consensus estimate.
For the full year, Magic Software reported an adjusted EPS of $0.93 and revenue of $552.5 million, ahead of the consensus estimate of $544 million to $550 million.
The company's cash flow from operating activities for the year was $74.7 million, compared to $69 million in 2024. The company ended the year with a cash position of $112.8 million.
CEO Guy Bernstein said, “Our continued investment in cutting-edge digital and cloud transformation solutions has reinforced our position as a trusted partner for our clients.”
“With a strengthening demand environment in the U.S. and a solid pipeline of opportunities, we are confident in our ability to sustain momentum and drive long-term profitability, delivering lasting value to our shareholders.”
The company initiated its fiscal year 2025 guidance that calls for revenue of $593 million to $603 million versus the consensus estimate of $566.30 million.
Separately, Magic Software confirmed signing a new memorandum of understanding under which Matrix will acquire its entire share capital through a reverse triangular merger. Upon completion of the deal, Magic Software will become a private company wholly owned by Matrix.
Late Monday, Magic Software said the two companies were considering a merger.
On Stocktwits, retail sentiment toward Magic Software stock stayed ‘bearish’ (36/100), and the message volume remained ‘extremely low.’
Magic Software stock rose nearly 6% to $13.60 Tuesday afternoon. The stock has gained about 6.8% so far this year.
For updates and corrections, email newsroom[at]stocktwits[dot]com.<
