Broadridge (BR) Q4 Revenue Rises 6%

Key Points

• Broadridge Financial Solutions (NYSE:BR) exceeded both non-GAAP earnings and GAAP revenue estimates in Q4 FY2025. This performance was driven by 7% recurring revenue growth (Non-GAAP) for FY2025.

• Margins in the Global Technology and Operations segment declined in Q4 FY2025, offsetting some top-line gains as a result of higher expenses and investments.

• The company raised its annual dividend by 11% to $3.90 per share for FY2025, marking the 19th consecutive yearly increase in its annual dividend.

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Broadridge Financial Solutions (NYSE:BR), a leading provider of investor communications and financial technology services, reported its earnings for the fourth quarter of fiscal 2025 on August 5, 2025. Broadridge delivered higher-than-expected non-GAAP earnings per share (EPS) of $3.55 in Q4 FY2025. Non-GAAP earnings per share (EPS) reached $8.55, exceeding analyst expectations of $3.50 for FY2025. GAAP revenue was $2.07 billion in Q4 FY2025, ahead of estimates at $2.06 billion. This marked a healthy period, with GAAP revenue up 5.9% year-over-year from fiscal 2024 to fiscal 2025. Non-GAAP EPS (Adjusted EPS) increased 1% in Q4 FY2025. Operating income increased 17% in fiscal 2025 compared to the prior year, even as selected business areas reported margin pressure due to continued investment. Overall, the quarter showed solid progress against Broadridge's goals, particularly in recurring revenue growth and capital returns to shareholders.

Source: Analyst estimates provided by FactSet. Management expectations based on management's guidance, as provided in Q3 2025 earnings report.

Company Overview and Strategic Priorities

Broadridge operates as a backbone technology provider to banks, broker-dealers, asset managers, and other financial institutions. Its core businesses span investor communications, proxy processing, regulatory compliance, and back-office technology. Recurring fees from its SaaS (software-as-a-service) platforms, regulatory communications, and trade processing underpin a large share of the business.

Recently, Broadridge has focused on expanding its technological capabilities, investing in cloud, artificial intelligence, and blockchain to support scalable and efficient solutions. Key pillars for Broadridge's success this year have been driving digital transformation in client engagements, innovating in data-driven products, maintaining regulatory compliance, and seeking global growth opportunities through both organic efforts and acquisitions.

Fourth Quarter Highlights: Sales, Growth Areas, and Challenges

The fourth quarter saw Broadridge top expectations, with both GAAP revenue and non-GAAP EPS exceeding analyst estimates. Recurring revenue, an important measure of Broadridge's business model stability, increased 7% year-over-year in FY2025. This growth reflected strong equity and mutual fund position gains, higher trading volumes, and strong sales performance across product lines. The Investor Communication Solutions (ICS) segment generated $1.60 billion in GAAP revenue in Q4 FY2025, up 5%. Regulatory recurring revenue increased 8% in Q4 FY2025, driven by steady growth in equity and fund positions.

In the Global Technology and Operations (GTO) segment, recurring revenue rose 12% in Q4 FY2025. Within this segment, Wealth & Investment Management technology products saw the most benefit, growing 25% in Q4 FY2025 (including 15% from the SIS acquisition and 11% from organic growth). Capital Markets recurring revenues were up 5% in Q4 FY2025. However, GTO pre-tax margin fell to 7.3% from 11.3% in the prior year during Q4 FY2025, as higher expenses from investment and integration initiatives offset revenue gains.

Operating income (GAAP) increased 13% to $499 million in Q4 FY2025 compared to the prior year. Free cash flow (non-GAAP) reached $1.06 billion in FY2025. Broadridge reported closed sales of $113.5 million in Q4 FY2025, down 28% from $156.6 million in Q4 FY2024. Management attributed this to a longer closing cycle for some client sales, though it emphasized that deal activity remained strong and that delays were a timing issue, not lost business.

Key innovations during the quarter included wins for Broadridge's AI-enabled analytics products (such as the Global Demand Data and Analytics tool), the expansion of its Distributed Ledger Repo solution, a blockchain-powered trading platform processing $100 billion in average daily transactions as of Q3 FY2025, and ongoing rollouts of next-generation wealth platforms. These efforts demonstrate how Broadridge uses new technology to serve evolving client needs across governance, trading, and wealth management.

From a shareholder return perspective, the company raised its annual dividend for the 19th consecutive year, increasing it by 11% to $3.90 per share for FY2025. It also repurchased $100 million of its shares in FY2025. Cash and equivalents (GAAP) rose by over 80% from fiscal 2024, reaching $561.5 million as of fiscal 2025. Net debt declined from fiscal 2024 to fiscal 2025.

Revenue retention remained high at 98% in Q3 FY2025, reflecting strong client satisfaction and low churn.

Products and Platform Families: Context for Non-Experts

Within investor communications, Broadridge processes regulatory mailings, shareholder votes, and other required communications for public companies and funds. Its technology also supports digital client communications and regulatory compliance. The ICS segment uses digital transformation and automation to reduce postage and print costs and improve efficiency.

GTO encompasses SaaS platforms for capital markets, such as trade processing solutions for banks, and wealth management platforms for investment advisors. The new wealth platform allows clients to modernize operations by connecting core data, user interfaces, and third-party solutions, with 34 clients now live on one or more platform components and 40 more onboarding. Broadridge’s Distributed Ledger Repo solution is a blockchain-enabled platform supporting repurchase agreement transactions.

Looking Ahead: Guidance and Priorities for the Coming Year

Broadridge's management provided full-year guidance for FY2026, projecting recurring revenue growth of 5–7% in constant currency (Non-GAAP). The company projects an adjusted operating income margin of 20–21% in FY2026, and "closed sales" (future contracted revenue) between $290 million and $330 million in FY2026. No material changes were made to guidance compared to prior updates, and management reiterated confidence in the company’s ability to meet its three-year objectives.

The company highlighted that while the current sales cycle is taking longer to close, strong client demand, a healthy sales pipeline, and a record revenue backlog should provide stability for future periods. As of Q3 FY2025, management cited a $450 million revenue backlog and strong visibility into growth over the next 12 to 18 months. Investors and market watchers should keep an eye on the pace at which small and fractional account positions (which currently generate little revenue but may produce more over time) convert to profitable revenue streams, as well as on the execution of recent acquisitions such as SIS and the pending Acolin deal. Watch for GTO margin developments as Broadridge continues its investment in innovation and integration.

The annual dividend was increased by 11% to $3.90 per share, as approved by the Board of Directors on August 4, 2025.

Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.

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JesterAI is a Foolish AI, based on a variety of Large Language Models (LLMs) and proprietary Motley Fool systems. All articles published by JesterAI are reviewed by our editorial team, and The Motley Fool takes ultimate responsibility for the content of this article. JesterAI cannot own stocks and so it has no positions in any stocks mentioned. The Motley Fool has positions in and recommends Broadridge Financial Solutions. The Motley Fool has a disclosure policy.