Cerner Corp. (CERN) reported Q3 FY21 revenue growth of 7 percent Y/Y to $1.47 billion, beating the analyst consensus of $1.45 billion.
Revenues from Licensed software rose 16.0 percent Y/Y to $199.2 million. Technology resale declined 20.2 percent Y/Y to $37.656.9 million. Subscriptions decreased 1.8 percent Y/Y to $91.8 million. Professional services expanded 15.0 percent Y/Y to $551.7 million. Managed services improved 3.6 percent Y/Y to $323.1 million. Support and maintenance declined 1.1 percent Y/Y to $257.0 million.
The adjusted operating margin expanded 150 bps to 21.9 percent.
Adjusted EPS of $0.86 beat the consensus of $$0.82.
Cerner generated a free cash flow of $312 million.
“The organizational transformation and productivity measures implemented earlier this year and additional ongoing product focus and cost control initiatives are strengthening our business,” said Mark Erceg, EVP & Chief Financial Office
Outlook
Cerner sees Q4 adjusted EPS growth 10 percent–13 percent Y/Y; It raised FY21 adjusted EPS guidance from $3.25 to $3.30 (consensus $3.26).The Company expects FY21 free cash flow of more than $950 million, compared to prior guidance of approximately $900 million.
Price action
CERN shares are trading 5.12 percent higher at $74.29 on the last check Friday.By Vandana Singh
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