Gen Digital Inc (GEN) Q1 2025 Earnings Report

- Revenue: $965.0 million in Q1 FY2025, up 2.3% YoY and -0.21% QoQ (USD basis; constant currency +3% YoY).
- Bookings: $913.0 million, up 3% QoY and 4% in constant currency.
- Cyber Safety bookings (excluding legacy lines): +4% YoY in constant currency.
- Direct revenue: $850.0 million, +3% YoY in constant currency; direct customers: 39.3 million, +1.1 million YoY; sequential gain of 192k.
- ARPU (monthly): $7.23, up $0.01 sequentially; down $0.01 YoY; offset by $0.04 negative FX headwinds YoY and $0.02 sequentially.
- Retention: ~78% (Gen record), with Avast retention at 72% and LifeLock retention at record levels.
- Cross-sell penetration: Norton base cross-sell 20% (from 15% YoY).
- Partner revenue: $101 million, +4% YoY, +6% CC; goal to scale partner business toward $0.5B annually.
- Operating income: $564 million, up 4% YoY; margin 58.4%.
- Net income: $335 million; EPS (diluted): $0.53, +13% YoY, +15% in CC.
- Cash flow: OCF $264 million; FCF $262 million; cash balance $644 million; liquidity > $2.0 billion (ending cash plus revolver).
- Capital allocation: $272 million in share repurchases (≈11 million shares); regular quarterly dividend $0.125; debt repayments of $30 million of Term Loan B and $58 million on maturity.
- Leverage and capital plan: net leverage at 3.5x post-repurchases; reaffirming plan to reach sub-3x EBITDA net leverage by FY2027; intends to return 100% of excess FCF to shareholders.
- Guidance for FY2025: Q2 revenue of $965–$975 million; Q2 non-GAAP EPS $0.53–$0.55; full-year revenue $3.89–$3.93 billion; non-GAAP EPS $2.17–$2.23; FX headwinds (yen) expected to temper reported revenue.
- Strategic initiatives: Gen Stack migration across brands, Norton Ultra VPN launch, and AI-enabled customer engagement (Norton Genie and anti-scam capabilities) to lift engagement, retention, and cross-sell across the portfolio.