CSG Systems International Reports 2.3% Revenue Growth in Q2 2025

CSG Systems International, Inc. reported its financial results for the second quarter and first half of 2025, revealing a revenue increase of 2.3% to $297.1 million compared to $290.3 million in the same period of 2024. For the six months ended June 30, 2025, total revenue reached $596.6 million, up 1.9% from $585.5 million year-over-year. The company's operating income also saw an increase, rising to $29.9 million with an operating margin of 10.0%, compared to $25.4 million and an 8.8% margin in the prior year. However, net income decreased to $12.3 million, or $0.44 per diluted share, down from $13.8 million, or $0.48 per diluted share, in the second quarter of 2024.

The financial performance reflects a strategic focus on expanding its Software as a Service (SaaS) offerings, which contributed significantly to revenue growth. The company reported that SaaS and related solutions revenue increased to $269.5 million for the quarter, compared to $262.7 million in the previous year. This growth was partially offset by a decline in professional services revenue. CSG's total operating expenses increased slightly to $267.3 million, driven by higher acquisition-related costs, particularly related to earn-out compensation from the DGIT acquisition.

In terms of operational developments, CSG Systems has been actively managing its workforce and restructuring its operations. The company reduced its global workforce by approximately 150 employees as part of cost efficiency measures, incurring restructuring charges of $4.6 million in the second quarter. Additionally, CSG announced plans to close its design and delivery center in Crawfordville, Florida, which will result in further workforce reductions. The company has also been focusing on geographic expansion, with a notable increase in revenue from the Europe, Middle East, and Africa region, which rose to $31.9 million in the second quarter, compared to $19.0 million in the prior year.

CSG's balance sheet as of June 30, 2025, showed total assets of $1.42 billion, down from $1.50 billion at the end of 2024. The company reported cash and cash equivalents of $145.9 million, a decrease from $161.8 million at the end of the previous year. Long-term debt stood at $537.8 million, reflecting the company's recent entry into a $600 million credit agreement to replace its previous debt structure. The company has indicated that it expects to continue investing in growth through acquisitions and product development, while also returning value to shareholders through dividends and stock repurchases.

Looking ahead, CSG Systems remains optimistic about its growth trajectory, particularly in the SaaS market. The company anticipates that approximately 70% of its remaining performance obligations, valued at $1.7 billion, will be recognized as revenue by the end of 2027. However, management has acknowledged potential risks from macroeconomic factors, including inflation and geopolitical uncertainties, which could impact future performance. The company plans to continue leveraging its technology and expertise to enhance customer engagement and drive profitability in the evolving digital landscape.