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The call presented a largely constructive picture: the company achieved sustained margin expansion, steady recurring revenue and ARR growth, tangible AI/product progress (including a patent), strong cash generation and an aggressive capital return authorization. Challenges were noted in the Data business (churn and slower growth), VMS comparability due to one‑time timing effects, reporting/guidance uncertainty tied to ongoing divestitures and FX, and some one‑time adjustments affecting comparability. Management emphasized cost discipline and a clear strategic focus, which offsets many of the near‑term headwinds.
Altus guided to steady organic revenue growth of 4%–6% (constant currency, dollar ranges use January FX) for continuing operations (ex‑Appraisals, which was ~$31M last year), with software expected to be the strongest performer at solid high single‑digit growth and ARGUS Intelligence specifically in the double‑digit range, VMS assumed to grow in line with current market conditions (Q4 VMS +9.8% but underlying ~5%), and data expected to improve over the next few quarters; management said roughly 80% of growth should come from volume/pricing and 20% from new logos, ARR was up ~11% in the quarter, software revenue grew 5.4% in Q4, and the plan includes sustained margin expansion (consolidated margins improved 310 bps in 2025, Analytics adjusted EBITDA margins expanded 360 bps in Q4 to finish the year at 33%, with guidance implying a ramp from ~18–19% EBITDA in Q1 toward ~25–26% by year‑end and targeting low‑to‑mid‑30s by 2027 as part of a Rule of 40 path), stronger cash generation and record conversion (double‑digit cash growth), a funded net debt/EBITDA target of ~2.5x, and an expanded capital return program of up to $800M this year with evaluation of up to an additional $450M to deploy in H1 2026.
Consolidated margins improved by ~310 basis points year over year. Analytics segment adjusted EBITDA margins expanded ~360 basis points in the quarter and ~270 basis points for the full year, with Analytics finishing at ~33% adjusted EBITDA margin. The company delivered its sixth consecutive quarter of margin expansion driven by revenue growth, portfolio optimization, delivery efficiency and cost discipline.
Software revenue grew 5.4% year over year with ARGUS Intelligence delivering double‑digit growth. ARGUS ARR was reported as healthy (cited ~11% growth in the quarter in Q&A). VMS revenue grew 9.8% in the quarter (note: included a one‑time timing benefit; underlying VMS growth ~5%). Recurring revenue, software and VMS ARR and retention metrics are all trending positively.
The company reported double‑digit growth driven by record cash conversion and a very strong balance sheet. The Board authorized flexibility to deploy up to $800 million this year for capital returns and is evaluating methods to return up to an additional $450 million in H1 2026, with plans to be in the market within ~100 days.
Management emphasized ARGUS franchise strength and AI as an accelerator. Internal demos showed automation could reduce time to valuation by up to 90%. New AI features (Benchmark Manager, advanced Valuation Agent) are being tested and the company received a patent for the Altus Knowledge Graph, enhancing proprietary data and benchmarking capabilities.
The majority of ARGUS Enterprise clients recontracted and management cited major broker upgrades (JLL, Newmark, Cushman) migrating to ARGUS Intelligence. Approximately 80% of ARGUS Enterprise ARR is now on ARGUS Intelligence and ~40% of ARGUS Intelligence revenue is asset‑based; VMS is fully asset‑based, increasing recurring/usage alignment.
Announced sale of the Canadian Appraisals business (moved to discontinued operations) and an LOI for the Canadian Development Advisory business; management is pursuing additional noncore divestitures to sharpen focus on analytics and prepare for a planned U.S. listing in 2027.
Initiated a restructuring program and other cost actions expected to deliver millions of dollars in annualized savings. Management highlighted ongoing optimization of R&D and G&A and plans to eliminate the corporate cost line in 2026 to streamline reporting and operations.
Good day, everyone. Welcome to Altus Group's Q4 and Full Year 2025 Financial Results Conference Call. At this time, I would like to hand things over to Camilla. Please go ahead.
Thank you, Lisa. Hi, everyone, and welcome to the conference call and webcast discussing Altus Group's fourth quarter and year-end financial results for the period ended December 31, 2025. Our press release, MD&A, financial statements and the slides accompanying our prepared remarks are all available on our website and as required, have been filed to SEDAR+ after market close this afternoon. I'm joined today by our CEO, Mike Gordon; and our CFO, Pawan Chhabra. Before we get started, I wanted to point out a couple of things. As discussed at our Investor Day, beginning with our Q4 results, we have rolled out some of our new disclosures. To help investors and analysts rebuild their models under our new reporting format, we have published a supplemental document that shows a representation of our historic results, posted on the Investors section of our website along with the other materials I referenced. Earlier this week, we announced the sale of our appraisal business to Newmark.
This business has been moved under discontinued operations for our results. And accordingly, our results for continuing operations exclude the Appraisals business revenue and adjusted EBITDA contribution. Also of note, we plan to eliminate the corporate cost line in our reporting at some point in 2026. Turning to our disclaimer slide. Some of our remarks on this call and in our disclosures may contain forward-looking informat...