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JERSEY CITY, NJ - In a move to enhance its service offerings, AT&T (NYSE:T) has partnered with Amdocs (NASDAQ:DOX), a prominent software and services provider for the communications and media sector, to utilize the Amdocs connectX platform. This collaboration, announced today, aims to facilitate AT&T's development of a state-of-the-art ecosystem tailored to the changing demands of consumers.
The connectX platform, a cloud-native SaaS solution powered by Amazon (NASDAQ:AMZN) Web Services (AWS), offers a comprehensive "telco-in-a-box" approach. It is designed to expedite the integration and launch processes for new influencer brands and Mobile Virtual Network Operators (MVNOs). By leveraging connectX, AT&T intends to swiftly design and introduce disruptive, innovative brands and services.
William Traylor, AT&T's Vice President of 5G Ecosystems and Partnerships, expressed enthusiasm about delivering quick, agile, and digitally-focused solutions to create unparalleled experiences for end-users. He emphasized the company's commitment to providing flexible and cost-effective solutions, crediting the Amdocs platform for its role in empowering AT&T's digital customer base.
Amdocs Group President of Technology and Head of Strategy, Anthony Goonetilleke, also shared his excitement over the expanded relationship with AT&T. He highlighted the importance of experience agility in attracting new subscribers and praised connectX for its ability to simplify connectivity experiences through robust partner management and marketplace capabilities, with embedded AI playing a central role.
Amdocs, with a reported revenue of $4.89 billion in fiscal 2023, continues to drive innovation in the communications and media industries, enabling service providers to transition to the cloud, differentiate in the 5G era, and digitize and automate their operations.
In other recent news, Amdocs reported a record revenue of $1.25 billion for the second quarter of fiscal year 2024, a 2% increase from the previous year. The company also reported a record 12-month backlog of $4.23 billion, up 3% from the previous year. Despite these positive results, Baird adjusted its outlook on Amdocs, lowering the price target to $90 from the previous $97, maintaining a Neutral rating on the shares. This revision followed Amdocs' disclosure of its financial results for the second fiscal quarter and a slight reduction in its full-year guidance.
Amdocs recently announced a collaboration with Google (NASDAQ:GOOGL) Cloud aimed at enhancing data transformation for communication service providers. The partnership leverages Google Cloud's unified AI-ready data platform, combined with Amdocs' telecom-specific data insights, to transform customer experiences and business operations.
Despite challenges in the business environment, particularly a slower conversion rate in its sales pipeline in the North American market, Amdocs expects revenue growth of 1.7% to 3.7% for fiscal year 2024 on a constant currency basis, and projects non-GAAP diluted EPS growth to be between 7% to 11% for the fiscal year.
InvestingPro Insights
In light of the recent partnership between AT&T and Amdocs, investors are closely watching Amdocs (NASDAQ:DOX) for its potential growth trajectory and financial stability. According to InvestingPro data, Amdocs currently holds a market capitalization of $9.48 billion, signaling a strong presence in the market. The company's Price to Earnings (P/E) ratio stands at 18.38, indicating how much investors are willing to pay for a dollar of earnings, which is a key metric for valuation.
Amdocs has been showing a commitment to returning value to shareholders, as evidenced by one of the InvestingPro Tips, which highlights that Amdocs has raised its dividend for 12 consecutive years. This consistent increase in dividends may appeal to income-focused investors, especially considering the company's dividend yield of 2.33%. Additionally, Amdocs has maintained dividend payments for 13 consecutive years, further reinforcing its image as a reliable dividend-paying stock.
Another InvestingPro Tip worth noting is that management has been aggressively buying back shares. This can be interpreted as a signal that the company's leadership believes the stock is undervalued and that there is confidence in the company's future prospects. This aligns with the strategic initiatives Amdocs is undertaking, such as its collaboration with AT&T to enhance service offerings.
For investors seeking more in-depth analysis and additional tips on Amdocs, InvestingPro offers a comprehensive list of tips to guide investment decisions. For Amdocs, there are 10 additional InvestingPro Tips available, which can be accessed through the InvestingPro platform.
As Amdocs continues to innovate and expand its services in the communications and media industries, these financial metrics and insights from InvestingPro provide valuable context for investors considering the company's stock in their portfolios.
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