Gen Digital Inc. Reports Record Revenue and Growth

Gen Digital Inc. ((GEN)) has held its Q2 earnings call. Read on for the main highlights of the call.

Gen Digital Inc. Reports Record Revenue and Positive Growth in Latest Earnings Call

The recent earnings call for Gen Digital Inc. was marked by a predominantly positive sentiment, highlighting record revenue growth and strong performance across various segments. The successful integration of MoneyLion and effective use of AI and innovation were key drivers of this growth. Despite acknowledging some macroeconomic concerns and cash flow timing issues, the company raised its annual revenue guidance, reflecting confidence in its future prospects.

Record Revenue and Growth

Gen Digital Inc. delivered a record revenue of just over $1.2 billion, marking a 25% increase year-over-year. The company also reported a 15% year-over-year increase in non-GAAP EPS to $0.62, showcasing its robust financial performance.

Strong Performance in Trust-Based Solutions

The Trust-Based Solutions segment demonstrated impressive results with a revenue increase of over 25% on a pro forma basis. The segment maintained an operating margin at the 30% target, underscoring its efficiency and market leadership.

MoneyLion Exceptional Growth

MoneyLion, Gen’s consumer fintech business, exhibited exceptional growth with a 50% year-over-year increase. This contributed significantly to Gen’s overall revenue growth of 10% when including MoneyLion’s prior year results.

Expanding Scam and Deepfake Protection

Gen expanded its scam and deepfake protection features with Norton Genie Pro and Avast Scam Guardian. These innovations support over 40 languages, with plans to expand to more countries later this year.

AI-Driven Innovation

AI integration across Gen’s products and operations has been a focal point, with advancements in behavioral-based threat detection, customer support automation, and AI-driven marketing efforts enhancing operational efficiencies.

Raising Annual Guidance

Gen raised its annual revenue guidance by $95 million, now expecting over 25% growth on a reported basis for fiscal year 2026. This adjustment reflects the company’s confidence in sustaining its growth trajectory.

Macro Environment Concerns

While noting the challenging macro environment, including a rapidly evolving threat landscape and financial wellness challenges, Gen reported no immediate negative impact on its operations.

Free Cash Flow Timing Issues

The second quarter faced higher use of cash due to the concentration of tax payments and timing of semiannual interest payments, which affected the company’s capacity for share repurchases.

Forward-Looking Guidance

During the earnings call, Gen Digital Inc. provided robust forward-looking guidance, highlighting a 25% year-over-year revenue increase to just over $1.2 billion. The company maintained a non-GAAP operating margin above 50% and achieved a non-GAAP EPS of $0.62, marking a 15% increase from the previous year. The Cyber Safety segment saw a 5% increase in bookings, and the Trust-Based Solutions segment experienced a 25% revenue growth on a pro forma basis. Gen also raised its annual revenue guidance by $95 million, reflecting over 25% growth, and reaffirmed its commitment to a balanced capital allocation strategy.

In summary, Gen Digital Inc.’s latest earnings call highlighted a positive outlook with record revenue growth and strong performance across its segments. The company’s strategic focus on AI-driven innovation and expansion in scam protection, alongside the successful integration of MoneyLion, positions it well for continued success. Despite some macroeconomic concerns, Gen’s raised revenue guidance signals confidence in its future growth trajectory.