Credit: Image source: Getty Images.Luxoft Holding (NYSE: LXFT) announced fiscal third-quarter 2019 results on Wednesday, including a small year-over-year sales decline as the company pushes forward with its strategic customer-diversification initiatives. Of course, Luxoft's performance this quarter was overshadowed by its impending acquisition by IT services and solutions leader DXC Technology (NYSE: DXC) -- a $2 billion deal that sent Luxoft stock skyrocketing 80% when it was announced early last month .
But the acquisition is still subject to regulatory approval. So in the meantime, let's look at how Luxoft started the second half of its fiscal year.
Image source: Getty Images.
Luxoft Holding results: The raw numbers
Data source: Luxoft Holding. *For the three months ended Dec. 31, 2018.
What happened with Luxoft Holding this quarter?
- On Jan. 7, 2019, Luxoft agreed to be acquired by DXC for $59 per share in cash -- an 86% premium from the previous trading day's closing price. The acquisition is expected to close by June 2019 pending regulatory review, after which Luxoft will maintain its brand and operate as a subsidiary of DXC.
- Revenue was near the low end of Luxoft's guidance provided in November , which called for a range of $230 million to $235 million.
- On an adjusted (non-GAAP) basis, which excludes items like stock-based compensation and acquisition costs, Luxoft's net income arrived at $0.61 per share, down from $0.89 in the same year-ago period.
- Adjusted EBITDA declined 18.5% year over year, to $32.6 million.
- By industry vertical:
- Financial services revenue declined 15.8% to $116.3 million.
- Digital enterprise revenue fell 7.7% to $57.3 million.
- Automotive revenue grew 55.8% to $56.8 million.
- Annual revenue per billable engineer declined 1.7% year over year to $83,923.
- Luxoft's top two accounts, UBS and Deutsche Bank , represented 24.9% of total revenue, down 9.5 percentage points from the same year-ago period.
- Luxoft's top five accounts were 39% of revenue (down 7 percentage points from a year ago), and its top 10 accounts were 50.9% of revenue (down 6.3 percentage points).
What management had to say
Luxoft CEO Dmitry Loschinin said:
Looking forward
Given its pending acquisition by DXC, Luxoft did not hold a subsequent conference call and is not providing guidance.
Still, this was a reasonably solid quarter for the company ahead of its acquisition. So even in the unlikely scenario that regulators opt not to approve the transaction -- and with shares currently trading within 1.4% of the agreed acquisition price -- shareholders who've decided to hold on can take solace knowing Luxoft continues to execute its strategic initiatives in the meantime.
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Steve Symington has no position in any of the stocks mentioned. The Motley Fool recommends Luxoft Holding. The Motley Fool has a disclosure policy .
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
