Magic Software Enterprises Ltd. (NASDAQ:MGIC) Q2 2022 Earnings Conference Call August 11, 2022 10:00 AM ET

Company Participants

Guy Bernstein - CEO

Asaf Berenstin - CFO

Yuval Lavi - VP, Technology and Innovation

Conference Call Participants

Tavy Rosner - Barclays

Maggie Nolan - William Blair

Operator

Ladies and gentlemen, thank you for standing by. Welcome to Magic Software Enterprises 2022 Second Quarter Financial Results Conference Call. [Operator Instructions] As a reminder, this conference is being recorded.

With us on the line today are Magic's CEO, Mr. Guy Bernstein; Magic's CFO, Mr. Asaf Bernstein; and Magic VP of Technology and Innovation, Mr. Yuval Lavi. Magic second quarter 2022 earnings release was issued before the market opened this morning, and it has been posted on the company's website at www.magicsoftware.com.

Before we start, I'd like to remind everyone that this conference call may contain projections or other forward-looking statements. The safe harbor provision provided in the press release issued today also applies to the content of this call. Magic expressly disclaims any obligation to update or revise any of these forward-looking statements, whether because of future events, new information, a change in its views or expectations or otherwise.

Also, during the course of today's call, management will refer to non-GAAP financial measures. A reconciliation schedule showing GAAP versus non-GAAP results has been provided in the press release issued before the market opened this morning. A replay of this call will be available after the call on our Investor Relations section of the company's website.

I will now turn the call over to Mr. Asaf Bernstein, CFO of Magic Software. Please go ahead.

Asaf Berenstin

Thank you, operator, and thank you, everyone, for joining us today as we report our second quarter financial results 2022.

Today, I will review highlights for our second quarter results and provide an overview of our achievements. Magic delivered strong start to first half revenue increasing by 21.7% year-over-year to approximately $276 million, exceeding market expectations.

Revenues for the second quarter reached all-time second quarter high of approximately $137 million, reflecting a 15% increase compared to the same period last year. On a constant currency basis, revenue for the second quarter of 2022 increased by 17.4% compared to the same period of the previous year, with 89% of the growth organic. This achievement delivered the 10.3% year-over-year increase in our non-GAAP operating income in the second quarter with operating margin reaching 12.8%, down from 13.4% in the same period last year.