Newgen Software has announced a solid 27% growth in revenues for its third quarter results compared with Q3 2023. This revenue growth was assisted by 11 new logo wins. Bringing the number of customers to over 520 across 17 verticals. The company has also seen a 27% increase in deal sizes year over year and has 51 customers being billed more than Rs 50 million (~ US$600,000).
Key figures from the announcement included q3 2024 figures of:
- Revenue INR 335 Cr (~US$40.3 million), up 27% year over year
- Sales INR 324 Cr (~US$38.9 million), up 27% year over year
- Net Income INR 68.35 Cr (~US$8.2 million), up 44.4% year over year
- Diluted earnings per share from continuing operations was INR 4.73 (2023 Q3 INR 3.38)
Diwakar Nigam, Chairman & Managing Director, Newgen Software Technologies Ltd. said, “In the nine-month period ending December 2023, Newgen has demonstrated strong growth in revenues led by India and EMEA. We are witnessing tremendous opportunities in the Lending and Trade Finance space. We have also maintained robust profitability and strong cash flow generation, highlighting the financial strength and resilience of our operations.
“Through our investments in innovation, people, and customer-centric approach, we have been nurturing and expanding our existing customer relationships, along with adding 38 new logos in 9M FY’24.”
Diverse Revenue Growth
Newgen has seen revenue growth across its recurring revenue areas, and the company called out its growth in banking and financial services across all geographies.
- ATS/AMC, cloud and subscription license rose to INR 96 Cr
- Support revenues were INR 95 Cr
- Implementation revenues grew 66% to INR 69 Cr
While based in India, Newgen sees revenues from across the globe.
- India 34%
- APAC 13% (Non-India)
- USA 22%
- EMEA 31%
While 65% of its revenue comes from the banking segment, it still has a considerable presence in Government (11%), Insurance (10%) and Healthcare (7%).
Recognition and AI emerge
During the quarter, Newgen launched NewgenONE Marvin, its GenAI-powered enhancement to NewgenONE its automation platform. Virender Jeet, CEO Newgen Software, commented, “We are extremely delighted with the response our products are getting from customers across different geographies. We continue to innovate and drive our products through AI-led capabilities. With the launch of NewgenONE Marvin, we are excited to bring generative AI capabilities to our customers. NewgenONE Marvin is set to further accelerate low code capabilities with faster and smarter application development automation of customer journeys as well as help in building better customer engagement frameworks.”
What does 2024 have in store?
There is more to come in 2024 as well. In a recent interview, Varun Goswami, Vice President of Product Management at Newgen Software, commented, “We are looking at two different aspects. One is in terms of the capability. The second is in terms of privacy and the ability to handle those things correctly without hallucinating. It is why we built the NewgenONE Marvin layer because we did not want our customers to take a course on prompt engineering and then come back and try to figure out how do I ask this question.
“We’ve created the interfaces, and we’ve allowed them to mention what they want to build. Then we do the prompt engineering, and we get the data, parse it and paste it on the interface. We have taken a very different approach to generative AI.”
Newgen also received industry recognition from analyst firms such as Forrester, Gartner and Everest for its low-code platform. Everest placed it as a leader for Low-code Technology Providers in Insurance.
During the quarter it also published details of some of the recent customers it has won. These included the Development Bank (DB) in Oman, the Jammu and Kashmir (J&K) Bank, and multinational firm APL Apollo Tube Ltd. To help further grow the customer base, it also added a partnership with Duck Creek Technologies, the insurtech company.
Enterprise Times: What does this mean
Newgen has posted impressive results, with the SaaS industry often being challenged with job losses and slowing growth. Newgen seems to be bucking the trend. While its share price slipped slightly on the day (down 2.8%), over the last month, they have risen 21.04% to INR 875.1, and in the last year, an impressive 340.42% to 876 INR.
With more product announcements planned, a strong focus, and partnerships with the leading GSIs, NewgenONE is looking strong. What it hasn’t done is forecast an outlook for the next fiscal year or what it intends to achieve for Q4, although on the earnings call, there was confidence from Nigam of a strong Q4.
