Revenue was $3.57 billion for the third quarter of fiscal year 2023, down 12.8% as compared to prior year period, and down 3.8% on an organic basis. The third quarter of fiscal 2023 was impacted by a difficult comparison related to lower resale, a perpetual license sale in the prior year quarter, and lower than anticipated levels of project revenue this year.
Net income was $61 million, or 1.7% of sales for the third quarter of fiscal year 2023, compared to $102 million, or 2.5% of sales, in the prior year quarter. EBIT was $117 million or 3.3% of sales. Net income and EBIT in the quarter included the following items: amortization of acquired intangible assets of $100 million, restructuring costs of $49 million, merger related indemnification and arbitration charges of $20 million, a loss on disposition of $9 million, an impairment charge of $8 million, and transaction, separation, and integration costs of $6 million. Excluding these items, Adjusted EBIT margin was 8.7% in the third quarter, flat as compared to the prior year quarter.
Diluted earnings per share was $0.25 and Non-GAAP diluted earnings per share was $0.95 for the third quarter of fiscal year 2023. Compared to the prior year quarter, diluted earnings per share and non-GAAP diluted earnings per share were positively impacted by a lower share count and lower net interest expense, partially offset by foreign exchange headwinds and lower sales volumes.
On a trailing twelve months basis, the company delivered a book to bill of 1.06x.
Financial Information by Segment
Global Business Services ("GBS")(1) |
|
Q3 FY23 |
|
Q3 FY22 |
||||
Revenue |
|
$ |
1,738 |
|
|
$ |
1,946 |
|
YoY Revenue Growth |
|
|
(10.7 |
)% |
|
|
1.3 |
% |
YoY Organic Revenue Growth(2) |
|
|
0.2 |
% |
|
|
7.0 |
% |
|
|
|
|
|
||||
Segment Profit |
|
$ |
244 |
|
|
$ |
315 |
|
Segment Profit Margin |
|
|
14.0 |
% |
|
|
16.2 |
% |
|
|
|
|
|
||||
Book-to-Bill (TTM) |
|
1.16x |
|
1.17x |
||||
Book-to-Bill |
|
1.21x |
|
1.28x |
||||
(1) In millions, except numbers presented as percentages and ratios |
||||||||
(2) Reconciliation of GAAP to Non-GAAP measures provided in Non-GAAP Results. |
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GBS segment revenue was $1,738 million in the third quarter of fiscal year 2023, down 10.7% compared to the prior year period and up 0.2% on an organic basis. GBS performance was driven by continued growth in the Analytics & Engineering business, where revenue increased 11.7% on an organic basis. GBS segment profit was $244 million and segment profit margin was 14.0%, down 220 bps compared to prior year period, due to a difficult comparison resulting from a perpetual license sale in the prior year quarter. GBS bookings for the quarter were $2.1 billion for a book-to-bill of 1.21x, and 1.16x on a trailing twelve months basis.
