Broadridge Q1 Recurring Revenue Rises 11%; FY2027 Outlook Reaffirmed

Broadridge Financial Solutions Inc. (NYSE: BR) reported an 11% increase in fiscal first-quarter recurring revenue on a constant-currency basis, supported by growth across its governance, capital-markets and wealth-management businesses. The company reaffirmed its fiscal 2027 outlook, even as lower event-driven revenue and higher costs weighed on quarterly operating profit and margins.

For the three months ended September 30, 2026, recurring revenue rose to $1.08 billion from $977 million a year earlier. Total revenue increased 5% to $1.67 billion, with recurring revenue contributing seven percentage points of growth and distribution revenue adding one point. Event-driven revenue declined 41% to $67 million, reducing total revenue growth by three percentage points.

Broadridge said organic factors accounted for nine percentage points of constant-currency recurring revenue growth, including contributions from closed sales and internal growth, partly offset by client losses. Acquisitions contributed another two percentage points.

Operating income fell 8% to $174 million, while the GAAP operating margin narrowed to 10.4% from 11.9%. Adjusted operating income decreased 9% to $230 million, and the adjusted operating margin contracted by 200 basis points to 13.8%.

GAAP diluted earnings per share declined 41% to $0.83. The quarter included a $40.2 million loss on digital assets, compared with a $45.8 million gain in the prior-year period. Broadridge excludes gains and losses on digital assets from its adjusted results. Adjusted EPS increased 3% to $1.56, while adjusted net earnings were broadly unchanged at $177.9 million.

Capital Markets Leads Segment Growth

Investor Communication Solutions recurring revenue increased 10% in constant currency to $568 million. Regulatory revenue rose 17% to $230 million, while data-driven fund solutions grew 10% to $122 million. Issuer revenue increased 4% to $34 million, and customer communications revenue rose 3% to $182 million.

The company said investor participation trends included continued growth in equity positions and faster growth in mutual fund and exchange-traded fund positions. Equity and mutual fund/ETF position growth was 7% during the quarter, while internal trade growth was 11%.

Global Technology and Operations recurring revenue grew 13% in constant currency to $516 million. Capital-markets revenue increased 17% to $327 million, helped in part by the CQG acquisition, which Broadridge said was progressing well and generating cross-sales. Wealth and investment-management revenue rose 6% in constant currency to $188 million, with the company citing demand in Canada.

Closed sales increased 10% to $36 million. Broadridge also said it remained on track to enable 23-hour, five-day trading across front- and back-office applications.

Digital Assets and AI Remain Investment Priorities

Broadridge highlighted digital engagement, tokenization and agentic artificial intelligence as building blocks for future growth. Its initiatives include bringing governance and digital transfer-agency capabilities to the New York Stock Exchange’s alternative trading system for digital assets, extending shareholder rights and proxy voting to Kraken/Payward, and supporting cross-border atomic settlement for G7 securities through its distributed-ledger repo platform.

The company also launched DLX, a multi-asset tokenization platform supporting the DTCC Tokenization Service. In AI, management said Broadridge remains on track to achieve $25 million in fiscal 2027 savings. First-quarter restructuring costs included $15.2 million of severance associated in part with workforce actions arising from AI and productivity initiatives, and the company said it continues to evaluate additional actions.

Free cash flow increased to $76.3 million from $12.7 million a year earlier, while net cash provided by operating activities rose to $93.2 million from $42.3 million. Broadridge repurchased about $200 million of shares and paid $111 million in dividends during the quarter.

As of September 30, Broadridge reported digital assets valued at $226 million, including $185 million of Canton coins and $41 million of common stock and warrants in Canton Strategic Holdings. The company noted that gains and losses on digital assets cannot be forecast and are excluded from its fiscal 2027 adjusted guidance.

Fiscal 2027 Outlook Reaffirmed

Broadridge maintained its fiscal 2027 guidance for constant-currency recurring revenue growth of 6% to 8%, adjusted EPS growth of 8% to 12%, and an adjusted operating margin of approximately 21%. It continues to expect free cash flow conversion of at least 100% and closed sales of $290 million to $330 million. GAAP diluted EPS is projected to range from a 4% decline to no growth, while the GAAP operating margin is expected to be about 19%.

The outlook remains subject to risks including regulatory changes, cybersecurity incidents, dependence on a relatively small number of clients, weaker securities-market activity, technology and service disruptions, competitive pressure, acquisition execution, and broader economic and geopolitical conditions.