Digital Platforms and Services

Amdocs rolls with the times, getting bigger and bigger

By Ray Le Maistre

Nov 10, 2022

  • The world of telecom software is changing
  • Amdocs has always been a key BSS, OSS and managed services partner for many telcos
  • It is helping operators with their migrations to cloud platforms
  • And it has just reported impressive growth for its full fiscal year

Despite the many changes in the telecom software and professional support services world in recent years, Amdocs has retained its position as one of the giants of the sector and, like an unstoppable juggernaut, just seems to plough on at increasing speed and engage with ever more network operators.

The company, which has about 30,000 staff, has just reported fiscal full-year revenues of $4.56bn, its highest ever annual sales, for the 12 months to 30 September 2022, up by 6.7% from the previous year. A large slice of its revenues, $3.1bn, came from customers in North America, where it counts all the major operators as customers (and where it is engaged in major transformation projects with AT&T and T-Mobile US). 

Its operating profit for the year came in at almost $665m, up more than 10% year on year, and the company has less debt ($650m) than it has cash ($818m). 

Its backlog of business is also higher than ever, at almost $4bn, so it’s in for another good year, with the company forecasting full-year sales growth of between 4% and 8% for the 12 months that end in September 2023. Investment analysts that track Amdocs believe the company will break through the $5bn annual revenue barrier in the following financial year.

”While Amdocs and our global customers are not immune to macroeconomic cycles, we are confident in our unique and relatively resilient business model, which results in highly recurring revenue streams and strong business visibility from the mission-critical systems we support under multi-year engagements,” noted CEO Shuky Sheffer during the company’s earnings webcast.

The Amdocs share price currently stands at $81.71, up by 8.8% since the start of this year.

Amdocs has plenty of detractors and critics for various reasons, but what is undeniable is that it is a very strong, profitable and growing business that clearly seems to be giving its customers what they want and it continues to add to its box of tricks via internal development – its R&D spend in the most recent fiscal year was $355m, up more than 13% year on year – and through M&A activity – it is due to soon complete the acquisition of MycomOSI, for example. CEO Sheffer also noted during the webcast that, during the fiscal year, the company “accelerated the post-merger integration of DevOpsGroup [acquired by Sourced Group, an Amdocs unit] to strengthen our cloud consulting expertise, and we acquired Roam Digital to expand our digital experience capabilities”. (Roam Digital was acquired by another Amdocs unit called projekt202.)

 

And the customers are coming back for more

Amdocs has this somewhat peculiar (to my mind) habit of storing up its announcements and then spewing them out en masse at the same time as its quarterly earnings reports, and the latest batch show the vendor has been signed up for new business with many major operator names.

AT&T Mexico has handed Amdocs a five-year deal to migrate the vendor’s Customer Experience Suite (CES) from an on-premises IT platform to the public cloud, while Sheffer mentioned during the earnings webcast that the vendor is also “working with [Canadian operator] Rogers to move existing Amdocs services and applications to Rogers' private cloud.” The vendor has also expanded its work with T-Mobile US as it deploys the vendor’s AI and data platform on the cloud.

Elsewhere, Telefónica Hispanoamerica has struck a new multi-year agreement with the vendor to modernise its business support systems (BSS) and deploy modules of its cloud-native operational support system (OSS) on the public cloud at Telefónica Argentina, Telefónica Chile and Telefónica Peru. “The new cloud-native OSS modules and BSS suite, operated under a managed services arrangement, will enable the three Telefónica entities to reduce costs through increased operational and delivery efficiencies, and drive improved business and operational key performance indicators (KPIs), providing Telefónica subscribers in these countries [with] an enhanced digital customer experience, as well as serving enterprise customers with innovative new services,” boasted the vendor in this announcement.

Amdocs also announced a multi-year managed services agreement with satellite operator SES that will see the vendor provide “anomaly detection, monitoring, diagnostics, and remediation across SES’s new cutting-edge O3b mPOWER satellite communications system”. It revealed it has struck a back-office software modernisation deal with new customer Azerbaijan-based Azercell, and confirmed it has landed a digital content delivery deal (via its Vubiquity unit) for Israel-based operator Cellcom, as well as struck a deal to modernise the billing and payments infrastructure of Sita, a specialist in IT for the global air transport industry, to modernise Sita’s billing and payments infrastructure.
 

- Ray Le Maistre, Editorial Director, TelecomTV

Email Newsletters

Sign up to receive TelecomTV's top news and videos, plus exclusive subscriber-only content direct to your inbox.

Subscribe

Cookies

TelecomTV uses cookies and third-party tools to provide functionality, personalise your visit, monitor and improve our content, and show relevant adverts.