Manhattan Associates Raises Outlook as Cloud Growth Accelerates
The company lifted its full-year revenue forecast to as much as $1.166 billion.
Manhattan Associates (MANH), the supply-chain software provider, reported faster second-quarter growth as cloud-subscription revenue rose 26.2% from a year earlier.
The quarter extended a steady acceleration in total revenue, though higher sales spending and a restructuring charge weighed on GAAP profitability. Manhattan cut its global workforce by approximately 6% in a June 1 restructuring and recorded an $8.3 million pretax charge.
Revenue rose 9.3% to $297.8 million, accelerating from growth of 7.4% in the first quarter and increasing 5.5% sequentially. GAAP diluted earnings fell to $0.85 a share from $0.93, while adjusted earnings rose 6.1% to $1.39 a share and increased from $1.24 in the preceding quarter.
Cloud-subscription revenue climbed to $126.7 million from a year earlier and increased 8.2% sequentially. Services revenue rose 3.2% to $133.0 million, recovering to roughly its third-quarter 2024 level after weakening late last year. Software-license revenue remained limited at $1.9 million.
GAAP operating income fell 10.2% to $66.2 million, narrowing the operating margin to about 22.2% from 27.1% a year earlier. Sales and marketing expense increased 53.7% to $30.7 million. Adjusted operating income rose 2.7% to $103.9 million, and its margin improved sequentially to about 34.9%.
Remaining performance obligations reached $2.474 billion, rising 22.9% from a year earlier, with more than 99% tied to long-term cloud-native subscriptions. Manhattan now expects full-year revenue of $1.160 billion to $1.166 billion and adjusted earnings of $5.44 to $5.50 a share, both above its previous ranges.
The company expects an adjusted operating margin of 35.0% to 35.2%, while its GAAP margin forecast declined after incorporating restructuring costs. Manhattan repurchased 874,029 shares for $125.0 million during the quarter, leaving $225.0 million under its expanded authorization as cash declined to $186.1 million.