Breaking Down IDT Corporation (IDT) Financial Health: Key Insights for Investors

You're looking at IDT Corporation and seeing a classic value-to-growth story, but you need to know if the numbers back up the hype, especially with the stock trading around $49.79 in November 2025. The short answer is that IDT is defintely executing its pivot from legacy telecom to a high-margin fintech and SaaS (Software as a Service) model, but the market hasn't fully priced in the transformation. For the full fiscal year 2025, the company delivered a consolidated revenue of $1,231.5 million, which is a modest 2% lift, but the real story is the operational efficiency: Adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) surged 43% to a record $128.7 million. Here's the quick math: that jump was fueled by the National Retail Solutions (NRS) segment, which saw recurring revenue climb 27% for the year, and the BOSS Money digital channel, now driving over 80% of transactions. Still, the Traditional Communications segment is a drag, and if the market gets spooked by any slowdown in the core growth engines, that analyst median price target of $80.00-implying a 60.7% upside-could be at risk. Let's break down the financial health.

Revenue Analysis

You're looking at IDT Corporation (IDT) because you see the headline growth, but you need to know where the money is actually coming from. The direct takeaway is this: IDT's consolidated revenue for fiscal year 2025 was $1,231.5 million, a modest 2% increase year-over-year, but that small number hides a massive, intentional shift in the business model.

The company is intentionally moving away from its legacy, low-margin business-Traditional Communications-and accelerating its high-margin, recurring revenue streams. This 2% growth is actually a significant inflection point, marking the first full-year consolidated revenue increase since 2021.

The revenue structure is a tale of two companies: a legacy communications business that is shrinking, and a suite of high-growth technology solutions that are expanding rapidly. The primary revenue sources now fall into four key segments: National Retail Solutions (NRS), BOSS Money (Fintech), net2phone (Cloud Communications), and Traditional Communications.

Here's the quick math on where the real momentum is. The growth businesses are delivering double-digit revenue increases, and this is what you should focus on, as they are driving the company's impressive profitability gains, like the 43% surge in consolidated Adjusted EBITDA to a record $128.7 million in FY 2025.

The big change in the revenue mix is the strategic pivot. For the first time, the high-margin growth segments (Fintech, NRS, and net2phone) combined to generate over 50% of the consolidated Adjusted EBITDA in the fourth quarter of 2025. This shows their increasing contribution to the bottom line, even if the Traditional Communications segment still accounts for the largest chunk of the top-line revenue.

What this revenue analysis hides is the ongoing decline in the International Long Distance (ILD) voice businesses within the Traditional Communications segment. That legacy decline is being more than offset by the growth in the IDT Digital Payments business within the same segment, plus the powerful growth from NRS and BOSS Money. You defintely need to watch the growth segments' recurring revenue metrics, not just the consolidated top-line number, to understand the true value creation. For a deeper dive into the valuation, check out Breaking Down IDT Corporation (IDT) Financial Health: Key Insights for Investors.

• Growth businesses' revenue is accelerating.
• Digital channels are driving the Fintech segment, with digital revenue for BOSS Money up 36% to $99.0 million.
• NRS is growing its recurring revenue with Merchant Services and Software as a Service (SaaS) fees.

Profitability Metrics

You want to know if IDT Corporation (IDT) is truly profitable, or just selling a lot of low-margin services. The direct takeaway for Fiscal Year (FY) 2025 is this: IDT's shift to higher-margin fintech and software-as-a-service (SaaS) segments is paying off, driving a 55% surge in operating profit, even as overall revenue growth was modest.

For the full FY 2025, IDT Corporation (IDT) generated $1,231.5 million in revenue and a Gross Profit of $446.2 million. That translates to a Gross Profit Margin of 36.2%. This margin expanded by 380 basis points (bps) over the prior year, which is a strong signal. Here's the quick math: the company's cost of goods sold is growing slower than its revenue, defintely indicating improved product mix and pricing power in the newer business lines.

• Gross Profit: $446.2 million (+14% YoY)
• Gross Profit Margin: 36.2% (up 380 bps)
• Revenue: $1,231.5 million (+2% YoY)

Operational Efficiency and Margin Trends

The real story lies further down the income statement, where operational efficiency is measured. IDT Corporation (IDT)'s Income from Operations (Operating Profit) hit $100.4 million in FY 2025, a massive 55% increase from the previous year. This jump is a testament to strong cost management and operating leverage (the rate at which profit grows faster than revenue). The resulting Operating Profit Margin is 8.15%.

Net Income Attributable to IDT, or Net Profit, followed suit, rising 18% to $76.1 million. This gives you a Net Profit Margin of 6.18%. What this estimate hides is the significant growth in the NRS and BOSS Money segments, which are pulling the consolidated numbers higher, offsetting the lower-margin Traditional Communications business.

Comparison with Industry Benchmarks

When you compare IDT Corporation (IDT)'s margins to its peers, you see a mixed picture that reflects its hybrid business model. For the high-growth segments, the industry benchmark for scalable fintechs with transaction-heavy products (like BOSS Money) typically sees Gross Margins in the 40-60% range, and the average EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) margin for public fintechs climbed to 16% in 2024.

IDT's consolidated Gross Margin of 36.2% is below the top-tier fintech benchmark, but that's because the legacy communications business still drags it down. However, the company's Operating Margin of 8.15% is a solid result for a company in transition. For context, the broader Credit Services industry, which includes parts of their fintech operation, has an average Net Profit Margin around 17%, while the Telecommunication sector's average operating margin is around 15.91%. IDT is not yet at those industry-leading levels, but the rapid margin expansion suggests they are closing the gap as the higher-margin segments become a larger part of the whole. You can read more about the sector's investor profile here: Exploring IDT Corporation (IDT) Investor Profile: Who's Buying and Why?

Your action is clear: Monitor the segment-level margins-especially NRS and BOSS Money-to ensure they continue to expand and eventually push the consolidated Operating Margin past 10% in FY 2026.

Debt vs. Equity Structure

IDT Corporation (IDT) has one of the cleanest balance sheets you will see in the technology and communications space, operating with a near-zero debt policy. This is a deliberate, conservative strategy that heavily favors equity and cash on hand over debt financing, giving the company tremendous financial flexibility.

As of the fiscal year ending July 31, 2025, IDT Corporation's total debt stood at a minuscule $1.1 million USD. Given this figure represents the sum of all current (short-term) and non-current (long-term) obligations, the company essentially carries no meaningful interest-bearing debt. This is a rare position for a growth-oriented company and is a defintely a key differentiator for investors looking for stability.

The company's Debt-to-Equity (D/E) ratio (a measure of how much debt a company is using to finance its assets relative to the value of shareholders' equity) confirms this ultra-conservative approach. With total stockholders' equity at approximately $305.131 million as of July 31, 2025, the resulting D/E ratio is an incredibly low 0.01. This means IDT Corporation has only one cent of debt for every dollar of equity.

Here's the quick math and comparison to the broader industry:

What this estimate hides is the strategic mindset. When you compare IDT Corporation's Total Debt/Total Capital ratio of 0.1% to the Communication Services sector average of 20.3%, the difference is stark. IDT Corporation is not just low-debt; it is structurally averse to it. The company's CFO has been clear, stating they 'will not take on debt like some other companies do to buy back shares,' underscoring a commitment to funding growth and share repurchases primarily through internally generated cash flow.

This preference for equity funding over debt financing means IDT Corporation avoids the interest expense and refinancing risks that plague many competitors. While they carry virtually no debt, it's worth noting they do have operating lease liabilities totaling about $1.56 million, which are operational obligations, not traditional interest-bearing debt. The lack of recent debt issuances or credit rating news is a non-story for a company that simply doesn't borrow money.

For a detailed look at the operating performance that supports this clean structure, you can read the full analysis at Breaking Down IDT Corporation (IDT) Financial Health: Key Insights for Investors.

• Avoids high interest payments, boosting net income.
• Maintains maximum flexibility for strategic acquisitions.
• Limits financial risk during economic downturns.

Liquidity and Solvency

IDT Corporation (IDT) shows a strong near-term liquidity position, with its most recent quarterly ratios well above the safe benchmark of 1.0. You can comfortably cover your short-term obligations with current assets, but the cash flow trends require a deeper look, especially the impact of customer funds on operating cash flow.

Current and Quick Ratios: A Strong Buffer

As of the second quarter of fiscal year 2025 (ending January 31, 2025), IDT's balance sheet reflects a healthy liquidity buffer. The current ratio, which measures current assets against current liabilities, stands at approximately 1.66 (Current Assets of $462.1 million divided by Current Liabilities of $278.2 million). This means IDT has $1.66 in liquid assets for every dollar of liability coming due in the next twelve months. The quick ratio is essentially the same, indicating negligible inventory, which is typical for a fintech and communications company. A ratio this high is defintely a strength.

Here's the quick math on the key liquidity metrics from the Q2 2025 filing:

• Current Assets (Jan 31, 2025): $462.1 million
• Current Liabilities (Jan 31, 2025): $278.2 million
• Current Ratio: 1.66 (Strong liquidity)
• Cash, Cash Equivalents, and Current Investments: $171.1 million

Working Capital Trends and Debt Position

The company maintains a substantial positive working capital (current assets minus current liabilities) of approximately $183.9 million as of the second quarter of 2025. This positive trend is a clear sign of operational efficiency and a solid foundation for managing day-to-day operations without stress. Plus, the company reported having no outstanding debt at the end of the second quarter of fiscal 2025, which significantly de-risks the balance sheet and enhances solvency. This net cash position is a key differentiator in the market.

Cash Flow Statements Overview: The Critical Adjustments

The cash flow statement reveals a more nuanced picture. While the reported net cash provided by operating activities (OCF) for Q2 2025 was a positive $20.2 million, it's crucial to look at the OCF exclusive of changes in customer funds deposits from the BOSS Money segment (remittances). This adjustment gives you a clearer view of the core business's cash generation.

The adjusted OCF for Q2 2025 was a lower, but still positive, $7.3 million. For Q1 2025, the reported OCF was only $0.2 million, with the adjusted OCF being a negative $(2.6) million. This volatility is important to track, but the Traditional Communications segment is a reliable source, generating $70 million in Free Cash Flow for the full fiscal year 2025.

Here is a summary of the cash flow components and their trends:

Potential Liquidity Strengths and Actions

The overall picture is one of strength, not concern. The high Current and Quick Ratios, coupled with zero outstanding debt, provide a significant financial cushion. The Traditional Communications segment's consistent $70 million in Free Cash Flow acts as a durable funding source for the faster-growing Fintech and net2phone segments. Your key action is to monitor the adjusted operating cash flow closely; while the overall liquidity is strong, a sustained negative trend in the adjusted OCF would signal a need to re-evaluate the capital intensity of the growth businesses. You can read more about the company's segments in Breaking Down IDT Corporation (IDT) Financial Health: Key Insights for Investors.

Valuation Analysis

You're looking at IDT Corporation (IDT) and trying to figure out if the market is missing something, or if the stock's recent price action is justified. The quick takeaway is that IDT appears undervalued based on analyst targets, but its valuation multiples are mixed when compared to the broader telecom/fintech industry, suggesting a premium is already priced in for its high-growth segments.

As of late November 2025, the stock is trading around the $49.79 mark, which is much closer to its 52-week low of $44.77 than its 52-week high of $71.12. The stock has only seen a slight price increase of about +0.69% over the last 52 weeks, so momentum has defintely cooled off after a period of significant long-term gains.

Here's the quick math on core valuation multiples using trailing twelve-month (TTM) data, largely reflecting the strong Fiscal Year 2025 results, where Adjusted EBITDA hit a record $128.7 million:

• Price-to-Earnings (P/E) Ratio: The TTM P/E ratio is around 16.54. This is slightly above the global telecom industry average of 16.1x, suggesting the market is paying a small premium for IDT's earnings.
• Price-to-Book (P/B) Ratio: At approximately 4.12, the P/B ratio is relatively high. This indicates investors see significant intangible value in the company, likely tied to its Fintech and National Retail Solutions (NRS) segments, which drove a 43% increase in consolidated Adjusted EBITDA in FY2025.
• Enterprise Value-to-EBITDA (EV/EBITDA): The TTM EV/EBITDA sits at about 8.70. This is a reasonable multiple, especially considering the 267% growth in Adjusted EBITDA from the Fintech segment, which includes BOSS Money and NRS.

The forward P/E ratio is a more attractive 13.87, which suggests analysts expect earnings per share (EPS) to grow into the current price.

Dividend Profile and Analyst Consensus

IDT is not a major income play, but it does offer a modest dividend. The forward dividend yield is around 0.48%, based on an annual payout of $0.24 per share. The payout ratio is very healthy and sustainable at about 7.64% of earnings, leaving plenty of capital for reinvestment into high-growth areas like the AI-driven solutions in net2phone and the expansion of NRS.

What this estimate hides is the potential for a new federal tax on remittances, which could impact the BOSS Money segment, a key growth driver. Still, the analyst community is overtly bullish. The consensus rating is a Buy, with the single Wall Street analyst covering the stock setting a median price target of $80.00. This target implies a significant upside of over 60% from the current trading price, leading to the narrative that the stock is fundamentally undervalued. For a deeper dive into the company's long-term vision, you can review its Mission Statement, Vision, & Core Values of IDT Corporation (IDT).

To be fair, the market is pricing IDT above its peer average, but the analyst target suggests the market is not yet fully appreciating the value creation from its digital transformation efforts.

Your next step should be to model the cash flow impact of a potential remittance tax versus the projected revenue growth from the NRS and BOSS Money segments to stress-test that $80.00 target.

Risk Factors

You're looking at IDT Corporation (IDT) and seeing record-breaking growth in their high-margin segments-like the 43% surge in consolidated Adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) to a record $129 million for fiscal year 2025. That's great. But as a seasoned analyst, I focus on where the chassis is rusting, not just how fast the engine is going.

The core risk for IDT Corporation (IDT) is the structural decline in their legacy business, plus competitive pressure in their growth areas. You need to map these near-term risks to specific segments to understand the real exposure. It's a tale of two companies, honestly.

The Structural Drag of Traditional Communications

The biggest external risk is the ongoing, industry-wide decay of the paid-minute voice business, which sits in the Traditional Communications segment. This is a headwind that never stops. While management is doing a good job of mitigating the impact-they're shifting their traffic mix to higher-margin routes and cutting costs-this segment is still expected to face declines in gross profit and Adjusted EBITDA moving forward. You can only cut so much.

Here's the quick math: IDT Corporation (IDT)'s strategy relies on the growth segments (Fintech, National Retail Solutions (NRS), net2phone) growing fast enough to more than offset this decline. They've done it so far, with fiscal 2025 revenue increasing 2%, the first full-year increase since 2021. That's an inflection point, but the risk remains that the decline accelerates faster than the growth.

Operational and Market Hurdles in Growth Segments

Even the high-growth segments have their own set of operational and market risks highlighted in the recent fiscal 2025 filings. These are the risks that require clear, actionable mitigation plans, and IDT Corporation (IDT) has them, but execution is defintely key.

• NRS Terminal Churn: The National Retail Solutions (NRS) segment, which saw its recurring revenue up 22% in FY2025, is facing increased customer churn. This isn't just normal turnover; it's driven by external factors like heightened competition and complex card scheme compliance issues.
• Advertising Revenue Volatility: The NRS platform also took a hit in its advertising and data revenue, which saw an 8% year-over-year decline in the fourth quarter of fiscal 2025. This was due to the loss of a major programmatic advertising partner, showing how quickly a single relationship can impact a growing revenue stream.

The company's mitigation plan for NRS churn is an excellent example of a clear action: they are using Artificial Intelligence (AI) for churn prediction, deploying a new retention team, and enhancing service levels. That's a smart, data-driven response to an operational issue.

External Financial and Regulatory Exposure

Beyond the segment-specific issues, two external factors introduce persistent financial risk. The first is foreign exchange (FX) volatility. Because net2phone and other businesses operate globally, a strengthening US dollar materially impacts reported growth, especially in key South American markets. What looks like great growth in local currency gets muted when translated back to US dollars. The second is the ever-present regulatory risk in the Fintech space (BOSS Money), where compliance with international remittance and payment transfer rules is non-negotiable and constantly evolving.

For a deeper dive into the company's valuation and cash flow metrics, you should check out the full post: Breaking Down IDT Corporation (IDT) Financial Health: Key Insights for Investors.

Growth Opportunities

You're looking for a clear path forward for IDT Corporation (IDT) beyond the strong fiscal year 2025 results, and the story is simple: the company is successfully executing a pivot toward high-margin, digital-first fintech and cloud services. This shift drove a record consolidated Adjusted EBITDA of $129 million in FY 2025, a massive 43% jump from the prior year.

The core growth engine isn't the legacy business; it's the high-growth segments: National Retail Solutions (NRS), BOSS Money, and net2phone. Management is guiding for consolidated Adjusted EBITDA to grow another 7% to 10% in fiscal year 2026, targeting a range of $141 million to $145 million. That's a solid, realistic projection.

Key Growth Drivers and Digital Expansion

The company's growth is fundamentally tied to two major trends: the digital migration in money transfer and the expansion of value-added services for independent retailers. BOSS Money's digital channel now accounts for over 80% of its remittance volume, reflecting a significant, customer-led shift from retail to digital. This is a massive opportunity, and they are building market share by integrating with platforms like WhatsApp and planning to deploy a cross-border digital wallet.

For the National Retail Solutions (NRS) segment, the focus is on recurring revenue from Merchant Services and Software-as-a-Service (SaaS) fees. NRS recurring revenue hit $122.6 million in FY 2025, up 27% year-over-year. They expect NRS revenue growth to accelerate by 20% to 25% in FY 2026, driven by adding new terminals-they added about 5,100 net active terminals in FY 2025 alone.

• BOSS Money total revenue grew 29% to $139.8 million in FY 2025.
• net2phone Adjusted EBITDA surged 54% to $12.1 million in FY 2025.
• The Fintech segment's income from operations increased to $15.4 million from a loss the prior year.

Product Innovation and Competitive Edge

IDT is defintely leveraging product innovation, especially with Artificial Intelligence (AI). The net2phone segment, which saw its Adjusted EBITDA climb 54% to $12.1 million in FY 2025, is a prime example. They are transitioning net2phone to a usage-based revenue model for their AI Agent-a 2025 AI Agent Product of the Year Award winner-which should generate high-margin revenue. Plus, they are using machine learning in the BOSS Money back office to reduce costs and improve the customer experience.

The company's competitive advantage lies in its diversified portfolio that serves underserved markets. The NRS point-of-sale (POS) platform has built the largest network serving independent retailers in the US, giving them a unique, data-rich reach for marketers. This strong cash generation across segments-income from operations rose 55% to $100 million in FY 2025-gives them the capital to invest in new growth initiatives and evaluate potential bolt-on acquisitions.

Here's the quick math on the segment growth: BOSS Money is guided for high teens growth in FY 2026, while NRS is aiming for over 20%. This outpaces the overall consolidated growth guidance, showing where the real value is being created. For a deeper look at the company's long-term vision, you can review their Mission Statement, Vision, & Core Values of IDT Corporation (IDT).

What this estimate hides is the potential for a new federal tax on remittances or changes in immigration policy, which are real risks for the BOSS Money segment, so we need to monitor those legislative changes closely. Still, the company's robust balance sheet, with $254 million in cash and investments and zero debt, provides a strong buffer against market volatility. The next step is to drill down into the NRS terminal churn rate to confirm the long-term stickiness of that recurring revenue base.