Revenue growth has turned negative, contracting by 6.4% year-over-year in 2026Q3, while gross margins have compressed significantly from historical peaks near 27% to just 15.5%.
| Metric | TTM | Jun'25 | Jun'24 | Jun'23 | Jun'22 | Jun'21 | Jun'20 | Jun'19 | Jun'18 | Jun'17 | Jun'16 | Jun'15 | Jun'14 | Jun'13 |
|---|
| Sales/Revenue | 729.1M | 772.25M | 740.76M | 794.73M | 654.76M | 446.3M | 350.95M | 287.93M | 217.61M | 159.37M | 115.43M | 84.11M | 63.91M | 42.61M |
| Revenue Growth % | -6.51% | 4.25% | -6.79% | 21.38% | 46.71% | 27.17% | 21.89% | 32.31% | 36.55% | 38.06% | 37.24% | 31.6% | 50.01% | - |
| Cost of Goods Sold | 580.99M | 574.15M | 551.95M | 530.66M | 436.83M | 292.12M | 250.56M | 189.1M | 145.44M | 108.76M | 75.05M | 52.28M | 42.18M | 28.16M |
| COGS % of Revenue | - | 74.35% | 74.51% | 66.77% | 66.72% | 65.45% | 71.39% | 65.68% | 66.84% | 68.24% | 65.01% | 62.16% | 65.99% | 66.1% |
| Gross Profit | 148.1M | 198.1M | 188.81M | 264.08M | 217.93M | 154.18M | 100.39M | 98.83M | 72.17M | 50.61M | 40.39M | 31.83M | 21.73M | 14.44M |
| Gross Margin % | 20.31% | 25.65% | 25.49% | 33.23% | 33.28% | 34.55% | 28.61% | 34.32% | 33.16% | 31.76% | 34.99% | 37.84% | 34.01% | 33.9% |
| Gross Profit Growth % | - | 4.92% | -28.5% | 21.17% | 41.35% | 53.58% | 1.58% | 36.94% | 42.61% | 25.31% | 26.89% | 46.44% | 50.47% | - |
| Operating Expenses | 152.66M | 166.59M | 168.67M | 150.3M | 122.55M | 90.63M | 80.41M | 65.86M | 46.74M | 27.55M | 20.45M | 15.59M | 11.95M | 9.81M |
| OpEx % of Revenue | - | 21.57% | 22.77% | 18.91% | 18.72% | 20.31% | 22.91% | 22.87% | 21.48% | 17.29% | 17.72% | 18.54% | 18.69% | 23.04% |
| Selling, General & Admin | 69.94M | 0 | 0 | 135.3M | 121.81M | 0 | 77.24M | 65.86M | 46.74M | 27.55M | 20.45M | 613K | 483K | 167.36K |
| SG&A % of Revenue | - | - | - | 17.03% | 18.6% | - | 22.01% | 22.87% | 21.48% | 17.29% | 17.72% | 0.73% | 0.76% | 0.39% |
| Research & Development | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| R&D % of Revenue | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Other Operating Expenses | 2M | 166.59M | 168.67M | 15M | 739K | 90.63M | 3.17M | 0 | 0 | 0 | 0 | 14.98M | 11.46M | 9.65M |
| Operating Income | -4.55M | 31.51M | 20.14M | 112.84M | 95.38M | 63.55M | 19.98M | 33.11M | 25.43M | 23.06M | 19.93M | 16.23M | 9.79M | 4.92M |
| Operating Margin % | -0.62% | 4.08% | 2.72% | 14.2% | 14.57% | 14.24% | 5.69% | 11.5% | 11.69% | 14.47% | 17.27% | 19.3% | 15.31% | 11.55% |
| Operating Income Growth % | - | 56.44% | -82.15% | 18.31% | 50.09% | 218.08% | -39.66% | 30.19% | 10.3% | 15.67% | 22.79% | 65.86% | 98.91% | - |
| EBITDA | 33.46M | 61.92M | 45.43M | 133.84M | 113.18M | 75.85M | 38.23M | 41.01M | 31.7M | 27.4M | 22.82M | 17.5M | 11M | 6.17M |
| EBITDA Margin % | 4.59% | 8.02% | 6.13% | 16.84% | 17.29% | 17% | 10.89% | 14.24% | 14.57% | 17.19% | 19.76% | 20.81% | 17.22% | 14.49% |
| EBITDA Growth % | -48.12% | 36.3% | -66.06% | 18.26% | 49.21% | 98.41% | -6.78% | 29.36% | 15.69% | 20.11% | 30.35% | 59.07% | 78.26% | - |
| D&A (Non-Cash Add-back) | 38.01M | 30.42M | 25.29M | 21M | 17.8M | 12.3M | 18.25M | 7.9M | 6.27M | 4.35M | 2.88M | 1.27M | 1.22M | 1.25M |
| EBIT | -3.3M | 37.05M | 34.28M | 121.38M | 95.76M | 66.89M | 25.25M | 30.45M | 25.22M | 23.61M | 21M | 17.11M | 9.97M | 4.92M |
| Net Interest Income | -12.31M | -9.44M | -76K | 217K | -2.81M | -2.35M | -1.34M | 141K | -537K | -390K | 898K | -56K | -29K | 0 |
| Interest Income | 0 | 1.26M | 6.19M | 3.9M | 249.87K | 104K | 555K | 486K | 35K | 18K | 1.07M | 56K | 29K | 94.13K |
| Interest Expense | 6.75M | 10.7M | 6.27M | 3.68M | 3.06M | 2.46M | 1.89M | 345K | 572K | 408K | 170K | 0 | 0 | 0 |
| Other Income/Expense | -387.31M | -7.39M | 6.84M | 1.32M | 7M | -9.18M | 3.38M | -2.87M | -783K | -1.36M | 898K | -1.03M | -101K | -384.97K |
| Pretax Income | -391.87M | 24.11M | 26.98M | 114.16M | 102.38M | 54.37M | 23.36M | 30.1M | 24.65M | 21.7M | 20.83M | 15.21M | 9.69M | 4.54M |
| Pretax Margin % | -53.75% | 3.12% | 3.64% | 14.37% | 15.64% | 12.18% | 6.66% | 10.45% | 11.33% | 13.62% | 18.05% | 18.08% | 15.15% | 10.64% |
| Income Tax | 24.98M | 2.9M | 9.86M | 20M | 19.29M | 10.92M | 3.37M | 6.09M | 5.67M | 4.87M | 4.13M | 1.66M | 1.54M | -211.34K |
| Effective Tax Rate % | -6.37% | 12.03% | 36.54% | 17.52% | 18.84% | 20.08% | 14.44% | 20.24% | 23.02% | 22.43% | 19.8% | 10.91% | 15.88% | -4.66% |
| Net Income | -416.85M | 21.21M | 17.12M | 94.16M | 83.09M | 43.45M | 19.99M | 24.01M | 18.98M | 16.83M | 16.71M | 13.55M | 8.15M | 4.75M |
| Net Margin % | -57.17% | 2.75% | 2.31% | 11.85% | 12.69% | 9.74% | 5.7% | 8.34% | 8.72% | 10.56% | 14.47% | 16.11% | 12.75% | 11.14% |
| Net Income Growth % | -2391.63% | 23.89% | -81.82% | 13.32% | 91.24% | 117.35% | -16.73% | 26.52% | 12.73% | 0.75% | 23.32% | 66.26% | 71.65% | - |
| Net Income (Continuing) | -416.85M | 21.21M | 17.12M | 94.16M | 83.09M | 43.45M | 19.99M | 24.01M | 18.98M | 16.83M | 16.71M | 13.55M | 8.15M | 4.75M |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| EPS (Diluted) | -7.98 | 0.36 | 0.29 | 1.62 | 1.43 | 0.76 | 0.36 | 0.44 | 0.38 | 0.32 | 0.32 | 0.29 | 0.16 | 0.12 |
| EPS Growth % | -2786.32% | 24.14% | -82.1% | 13.29% | 88.16% | 111.11% | -18.18% | 15.79% | 18.75% | 0% | 10.34% | 81.25% | 33.33% | - |
| EPS (Basic) | - | 0.36 | 0.29 | 1.64 | 1.48 | 0.79 | 0.37 | 0.44 | 0.38 | 0.32 | 0.32 | 0.29 | 0.16 | 0.12 |
| Diluted Shares Outstanding | 52.23M | 58.88M | 58.8M | 58.08M | 58.02M | 57.05M | 56.07M | 55.03M | 49.8M | 53M | 53M | 46.81M | 49.86M | 39.75M |
| Basic Shares Outstanding | 52.23M | 58.46M | 58.44M | 57.31M | 56.27M | 55.22M | 53.42M | 54.56M | 49.8M | 53M | 53M | 46.71M | 49.68M | 39.75M |
| Dividend Payout Ratio | - | - | - | - | - | - | - | - | - | - | 108.83% | 55.02% | - | - |
Structural margin erosion
As indicated by the most recent quarterly financial data, Endava's revenue has experienced a sustained contraction, with the latest period showing a 6.4% year-over-year decline, following a series of negative growth prints that suggest a fundamental weakening in demand for the company's digital engineering services.
The consistent negative revenue growth suggests that the company is struggling to maintain its footprint in core financial services markets. This trend warrants further investigation into whether the firm is losing market share to more agile competitors or if the broader enterprise digital transformation cycle has reached a point of saturation.
Based on reported figures, Endava's gross margin has deteriorated significantly, falling to 15.5% in 2026Q3 from historical peaks near 27%, which highlights the company's inability to effectively pass through rising labor costs to its client base in a highly competitive pricing environment.
The erosion of gross margins appears to reflect a mismatch between the company's high-cost technical workforce and the pricing power it can command in the current market. Investors should monitor whether this margin compression is a temporary cyclical phenomenon or a permanent shift in the firm's ability to monetize its specialized engineering expertise.
According to the income statement, Endava has failed to maintain positive operating leverage, with operating margins sliding into negative territory at -3.4% in 2026Q3, as the company struggles to scale its SG&A expenses relative to a shrinking and increasingly expensive revenue base.
The transition from positive operating income to consistent losses suggests that the firm's cost structure is not sufficiently flexible to adapt to declining revenue. This lack of operating leverage may indicate that the company is carrying excess capacity that it has been unable or unwilling to rationalize during the current downturn.
As reported in financial statements, the company's net income has plummeted to a loss of $403 million in 2026Q3, a figure that raises significant concerns regarding the sustainability of the current business model and the impact of non-operating items on the bottom line.
The massive net loss in the most recent quarter suggests that the company is facing severe headwinds that extend beyond simple operational inefficiencies. Analysts should scrutinize the nature of these losses to determine if they represent one-time impairments or a more systemic failure to generate profitable growth.
Based on the provided data, the bear case for Endava centers on the rapid deterioration of profitability, as evidenced by the shift to negative net margins, which suggests that the company's specialized fintech focus may no longer provide a sufficient moat against industry-wide margin pressures.
Short-sellers may focus on the company's inability to maintain its historical growth rates and the potential for further margin compression as AI-driven tools disrupt traditional time-and-materials billing models. The current financial trajectory suggests that the market's previous valuation of the firm as a high-growth engineering partner may be fundamentally misaligned with its current operational reality.
Quick answers to the most common questions about buying DAVA stock.
For fiscal year 2025, Endava plc (DAVA) reported total revenue of $772.3M. This represents a 1712.5% increase compared to $42.6M in 2013.
Endava plc (DAVA) is profitable, generating $21.2M in net income for the fiscal year ending 2025 with a net profit margin of 2.7%.
Endava plc (DAVA) reported an operating income of $31.5M, resulting in an operating profit margin of 4.1%. This margin reflects the operational efficiency of the business before interest and taxes.
Endava plc (DAVA) generated $198.1M in gross profit for the year, representing a gross profit margin of 25.7%. This demonstrates the company's core pricing power and production efficiency.