cheers, Chris
EPS of $1.29 beat estimates of $1.12 and revenues of $1.77B matched estimates. Sales declined 11% year-over-year, but down 1.8% after adjusting for its AMC divestiture. Cloud sales grew by 1.3% year-over-year, and enterprise cloud bookings grew 10.3% year-over-year. In the most recent quarter it repurchased $85M of shares. Its customer support sales slowed down year-over-year, and we believe its cloud services segment will begin to accelerate the company's top line in the coming years. The company is continuing on its Business Optimization Plan, with expected costs of about $60M. The plan aims to focus on reducing its leverage, reducing its workforce, and targeting $400M in annual cost savings through these operational efficiencies. Management expects strong second-half momentum with increased investments in AI.
These were OK results, and we think the company is on a decent track to turn things around at the company. It is focusing on AI revenues and growth through its cloud segment. At an 8X forward earnings multiple and a plan for business optimizations, we would consider the name a HOLD today.