R Systems International Limited

R Systems reported a robust Q3 FY25, with revenue reaching ₹498.6 crores ($57.2 million), reflecting a 7.9% quarter-on-quarter growth in INR and 5.9% in USD terms. This also represents a year-on-year growth of over 12.3%. Adjusted EBITDA for the quarter stood at ₹84.4 crores ($9.7 million), translating to a 16.9% operating EBITDA margin, a 6.1% year-over-year growth. The adjusted net profit was ₹43.4 crores ($5 million), demonstrating continued profitable operations.

For the nine months ended September 30, 2025, the company achieved a revenue of ₹1,403.1 crores ($162.3 million), an 8.5% increase year-over-year. Adjusted EBITDA for this period was ₹241 crores ($27.9 million), marking a 14.2% year-on-year growth. The adjusted EBITDA margin improved from 16.3% in 9M FY24 to 17.2% in 9M FY25, an 86 basis points increase. Adjusted net profit for the nine months was ₹133.2 crores ($15.4 million), a 23.3% increase over the previous year.

R Systems continues to differentiate itself through its OptimaAI suite, which includes over a dozen in-house developed agents for various software development lifecycle stages. The company has been recognized as a leader in Everest Peak metrics for software product engineering services and a major contender in talent readiness for AI by Everest Group. These capabilities are crucial for winning against competition and are a strong differentiator in the tech services and product/platform engineering space.

The company reported 6 key deal wins in Q3, many of which are AI-heavy and transformative, including building an Agentic AI platform for autonomous anomaly detection and an AI-powered field services platform. R Systems is actively increasing its wallet share with existing clients and has seen its average deal size almost double in the last 12-18 months. The goal is to further increase average deal sizes to 2.5x or 3x of previous levels, leading to more substantial and sticky client relationships.

North America remains the primary geography, contributing about 73.5% of the business. Europe and Southeast Asia contribute 8.5% and 13.8% respectively. India's contribution grew slightly from 2.3% to 2.9%, driven by focused GCC initiatives. Client concentration remains healthy, with the top 10 clients contributing between 25% and 26% of revenue, and the top client growing from 6.1% to 6.7%.

Utilization remained at a healthy 82.3%, providing room for future opportunities while maintaining operational efficiency. Days Sales Outstanding (DSO), including unbilled, was 78 days, consistent with the previous quarter. The company maintains a strong balance sheet with total equity attributable to shareholders at ₹743.1 crores and cash and bank balances at ₹261.3 crores.

The acquisition of Novigo is expected to finalize within 'a week or two,' with all approvals nearly complete. Management expressed strong bullishness on the Middle East market, viewing it as a very exciting place with a large target spend. Novigo's established brand and partnerships in the region are expected to lead R Systems' go-to-market strategy and facilitate capturing reasonably sized deals.