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FORTY

Formula Systems (1985) Ltd.

FORTY

Formula Systems (1985) Ltd. • NASDAQ
$154.00 ▲ 2.84% (+4.25)
Market Cap $2.36 B
52w High $169.03
52w Low $80.15
Dividend Yield 1.75%
P/E 32.42
Volume 10
Outstanding Shares 15.31M

Income Statement

Period Revenue Operating Expense Net Income Net Profit Margin Earnings Per Share EBITDA
Q3-2025 $696.638M ▼ $81.154M ▼ $17.328M ▲ 2.487% ▲ $0.76 ▼ $65.945M ▼
Q2-2025 $743.369M ▼ $117.606M ▲ $15.053M ▼ 2.025% ▼ $0.98 ▼ $67.889M ▼
Q1-2025 $754.682M ▲ $110.164M ▲ $19.316M ▼ 2.559% ▼ $1.26 ▼ $70.544M ▼
Q4-2024 $691.499M ▼ $109.257M ▲ $20.054M ▼ 2.9% ▼ $1.31 ▼ $71.867M ▲
Q3-2024 $699.931M $101.868M $23.618M 3.374% $1.55 $71.03M

Balance Statement

Period Cash & Short-term Total Assets Total Liabilities Total Equity
Q3-2025 $432.082M ▲ $3.327B ▲ $1.75B ▲ $777.693M ▲
Q2-2025 $406.165M ▼ $3.197B ▲ $1.734B ▲ $722.92M ▲
Q1-2025 $526.794M ▼ $3.046B ▲ $1.668B ▲ $681.02M ▲
Q4-2024 $563.2M ▲ $3.015B ▲ $1.625B ▲ $679.338M ▲
Q3-2024 $510.853M $2.85B $1.489B $660.089M

Cash Flow Statement

Period Net Income Cash From Operations Cash From Investing Cash From Financing Net Change Free Cash Flow
Q3-2025 $17.328M ▲ $0 $0 $0 $0 $0
Q2-2025 $15.053M ▼ $0 $0 $0 $0 $0
Q1-2025 $19.316M ▼ $0 $0 $0 $0 $0
Q4-2024 $20.054M ▼ $0 $0 $0 $0 $0
Q3-2024 $23.618M $0 $0 $0 $0 $0

Five-Year Company Overview

Income Statement

Income Statement Revenue has grown steadily over the past five years, showing a business that continues to win work and expand. Profit at the operating level has also trended upward, although profit margins look a bit thinner than the peak years, suggesting some pressure from higher costs, pricing, or mix of business. Earnings at the bottom line are consistently positive but move around from year to year, which is typical for an IT group exposed to different geographies and business cycles. Overall, the income statement paints a picture of a mature, growing company with solid but not explosive profitability and some margin volatility to watch.

Balance Sheet

Balance Sheet The balance sheet looks balanced and generally healthy. Total assets have been rising gradually, which implies ongoing investment in the business. Cash levels are stable and meaningful, providing a liquidity cushion. Debt sits at a moderate level relative to the size of the company and has not been rising aggressively, while equity has been building over time. This combination points to a company that is growing without over‑stretching its finances, though it still carries a noticeable, but manageable, amount of leverage that should be monitored if conditions worsen.

Cash Flow

Cash Flow Cash generation is a clear strength. Operating cash flow has been consistently positive and has improved over time, which means the accounting profits are being backed by real cash. Free cash flow remains positive even after investment spending, and capital expenditures are relatively modest and predictable. This pattern suggests the business is not overly capital‑intensive and has room to fund operations, service debt, and potentially support strategic initiatives without depending heavily on new financing.

Competitive Edge

Competitive Edge Formula’s edge comes from being a holding company of several specialized IT and software businesses rather than a single, monolithic operation. Through Sapiens, it has deep roots in insurance technology, where complex regulation and embedded systems create high switching costs for clients. Magic Software gives exposure to low‑code development and integration tools, areas that benefit from the ongoing wave of digital transformation. Matrix IT adds scale and breadth in IT services, including cybersecurity, cloud, and industry‑specific solutions. Together, these create a diversified and defensible position. The main competitive risks are intense rivalry in software and IT services, rapid technology shifts, and the challenge of keeping all subsidiaries aligned and performing well across cycles.

Innovation and R&D

Innovation and R&D Innovation is distributed across the group and focused on practical, in‑demand areas. Sapiens is pushing AI and generative AI into insurance platforms, aiming to make insurers more automated and data‑driven. Magic Software is advancing low‑code, integration, and cloud‑based tools that let companies build and connect systems faster with less technical effort. Matrix IT is evolving in higher‑growth service lines such as cloud, cybersecurity, and digital transformation projects, often with sector‑specific offerings in areas like healthcare. The opportunity is to ride the structural shift toward AI and cloud, but the company must keep investing heavily to stay ahead of global competitors and avoid its offerings becoming commoditized or outdated.

Summary

Overall, Formula Systems looks like a diversified technology group with steady growth, solid cash generation, and a reasonably conservative balance sheet. Its value comes from a portfolio of niche leaders in insurance software, low‑code platforms, and IT services, all positioned in areas where digital and AI‑driven transformation are long‑term themes. The key positives are recurring, service‑based business models, embedded customer relationships, and consistent free cash flow. The key risks are margin pressure, fast‑moving competition in software and IT services, execution risk across multiple subsidiaries and acquisitions, and sensitivity to enterprise IT spending cycles. The company appears financially stable and strategically well‑placed, but its long‑term outcome will depend on how effectively it sustains innovation and defends its competitive advantages in a very dynamic market.

NEWS

November 20, 2025 · 8:19 AM UTC

Formula Systems Reports Third Quarter and Nine-Months Period Ended September 30, 2025 Financial Results

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