Government consulting firm Booz Allen Hamilton (NYSE: BAH) met Wall Street’s revenue expectations in Q2 CY2025, but sales were flat year on year at $2.92 billion. The company’s outlook for the full year was close to analysts’ estimates with revenue guided to $12.25 billion at the midpoint. Its non-GAAP profit of $1.48 per share was 2.1% above analysts’ consensus estimates.
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Booz Allen Hamilton (BAH) Q2 CY2025 Highlights:
- Revenue: $2.92 billion vs analyst estimates of $2.94 billion (flat year on year, in line)
- Adjusted EPS: $1.48 vs analyst estimates of $1.45 (2.1% beat)
- Adjusted EBITDA: $311 million vs analyst estimates of $308.5 million (10.6% margin, 0.8% beat)
- The company reconfirmed its revenue guidance for the full year of $12.25 billion at the midpoint
- Management reiterated its full-year Adjusted EPS guidance of $6.38 at the midpoint
- EBITDA guidance for the full year is $1.34 billion at the midpoint, below analyst estimates of $1.35 billion
- Operating Margin: 8.8%, in line with the same quarter last year
- Free Cash Flow Margin: 3.3%, up from 0.7% in the same quarter last year
- Market Capitalization: $14.3 billion
Company Overview
With roots dating back to 1914 and deep ties to nearly all U.S. cabinet-level departments, Booz Allen Hamilton (NYSE: BAH) provides management consulting, technology services, and cybersecurity solutions primarily to U.S. government agencies and military branches.
Revenue Growth
A company’s long-term sales performance can indicate its overall quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul.
With $11.96 billion in revenue over the past 12 months, Booz Allen Hamilton is one of the larger companies in the business services industry and benefits from a well-known brand that influences purchasing decisions.
As you can see below, Booz Allen Hamilton’s 9.5% annualized revenue growth over the last five years was impressive. This is a great starting point for our analysis because it shows Booz Allen Hamilton’s demand was higher than many business services companies.
We at StockStory place the most emphasis on long-term growth, but within business services, a half-decade historical view may miss recent innovations or disruptive industry trends. Booz Allen Hamilton’s annualized revenue growth of 11.3% over the last two years is above its five-year trend, suggesting its demand was strong and recently accelerated. 
This quarter, Booz Allen Hamilton’s $2.92 billion of revenue was flat year on year and in line with Wall Street’s estimates.
Looking ahead, sell-side analysts expect revenue to grow 3.5% over the next 12 months, a deceleration versus the last two years. This projection doesn't excite us and implies its products and services will see some demand headwinds. At least the company is tracking well in other measures of financial health.
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Operating Margin
Booz Allen Hamilton was profitable over the last five years but held back by its large cost base. Its average operating margin of 8.8% was weak for a business services business.
On the plus side, Booz Allen Hamilton’s operating margin rose by 2.5 percentage points over the last five years, as its sales growth gave it operating leverage.
In Q2, Booz Allen Hamilton generated an operating margin profit margin of 8.8%, in line with the same quarter last year. This indicates the company’s overall cost structure has been relatively stable.
Earnings Per Share
Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth – for example, a company could inflate its sales through excessive spending on advertising and promotions.
Booz Allen Hamilton’s EPS grew at a spectacular 14.6% compounded annual growth rate over the last five years, higher than its 9.5% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded.
We can take a deeper look into Booz Allen Hamilton’s earnings quality to better understand the drivers of its performance. As we mentioned earlier, Booz Allen Hamilton’s operating margin was flat this quarter but expanded by 2.5 percentage points over the last five years. On top of that, its share count shrank by 10.6%. These are positive signs for shareholders because improving profitability and share buybacks turbocharge EPS growth relative to revenue growth. 
Like with revenue, we analyze EPS over a more recent period because it can provide insight into an emerging theme or development for the business.
For Booz Allen Hamilton, its two-year annual EPS growth of 14.8% is similar to its five-year trend, implying strong and stable earnings power.
In Q2, Booz Allen Hamilton reported EPS at $1.48, up from $1.38 in the same quarter last year. This print beat analysts’ estimates by 2.1%. Over the next 12 months, Wall Street expects Booz Allen Hamilton’s full-year EPS of $6.45 to grow 1.9%.
Key Takeaways from Booz Allen Hamilton’s Q2 Results
Revenue was in line, but it was encouraging to see Booz Allen Hamilton beat analysts’ EPS expectations modestly this quarter. Looking ahead, the company reaffirmed its full-year revenue and EPS guidance, which shows that the business is on track. Overall, this was a decent quarter without many surprises. The stock traded up 3.2% to $118.75 immediately following the results.
So should you invest in Booz Allen Hamilton right now? When making that decision, it’s important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here, it’s free.
