Alight’s second quarter reflected a mix of operational improvement and market headwinds, as the company’s revenue came in slightly above Wall Street’s expectations but declined year over year. Management attributed the results to ongoing delays in deal closures and flat participant volumes, noting that new deals are taking longer to finalize. CEO Dave Guilmette described the period as “a transitional year,” highlighting that while the company made progress in automation and AI adoption, commercial execution fell short. He acknowledged, “Our commercial execution to get deals across the line has not been sufficient.”
Is now the time to buy ALIT? Find out in our full research report (it’s free).
Alight (ALIT) Q2 CY2025 Highlights:
- Revenue: $528 million vs analyst estimates of $525 million (1.9% year-on-year decline, 0.6% beat)
- Adjusted EPS: $0.10 vs analyst estimates of $0.10 (in line)
- Adjusted EBITDA: $127 million vs analyst estimates of $126.4 million (24.1% margin, in line)
- The company dropped its revenue guidance for the full year to $2.31 billion at the midpoint from $2.35 billion, a 2% decrease
- Management reiterated its full-year Adjusted EPS guidance of $0.61 at the midpoint
- EBITDA guidance for the full year is $632.5 million at the midpoint, above analyst estimates of $625.7 million
- Operating Margin: -191%, down from -9.7% in the same quarter last year
- Market Capitalization: $2.03 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Alight’s Q2 Earnings Call
- Kyle Peterson (Needham & Company) asked if the longer deal cycles would impact results beyond this year. CEO Dave Guilmette replied that if execution improves in the second half, the company feels “good about the opportunities that sit in the pipeline” for the following year.
- Peterson (Needham & Company) also inquired about the Goldman Sachs partnership’s impact. Guilmette emphasized that while revenue benefits are expected in future years, the deal should strengthen Alight’s positioning in wealth solutions and support new business pursuits.
- Scott Schoenhaus (KeyBanc Capital Markets) pressed for details on the $35 million revenue pushout, asking if large clients or many small deals were responsible. Guilmette explained it was primarily mid-market deals and some new logos that were delayed or lost.
- Schoenhaus (KeyBanc Capital Markets) followed up on sales team changes. Guilmette cited the need for more domain expertise in complex areas, referencing recent hiring and ongoing leadership searches to address this.
- Kevin McVeigh (UBS) requested specifics on project revenue cadence for the rest of the year. CFO Jeremy Heaton indicated project revenue is expected to remain down in the third quarter but could trend closer to flat in the fourth quarter.
Catalysts in Upcoming Quarters
In upcoming quarters, the StockStory team will be tracking (1) the impact of new commercial leadership and specialized sales hires on deal win rates, (2) conversion of late-stage pipeline deals into bookings that contribute to revenue, and (3) the pace at which automation and AI investments deliver further efficiency gains. Renewals and expansions with large clients, along with the rollout of new partnerships like Goldman Sachs Asset Management, will also be important indicators of momentum.
Alight currently trades at $3.90, down from $5.15 just before the earnings. Is the company at an inflection point that warrants a buy or sell? See for yourself in our full research report (it’s free).
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