Government services provider Maximus (NYSE: MMS) missed Wall Street’s revenue expectations in Q2 CY2026, with sales falling 5.1% year on year to $1.28 billion. On the other hand, the company’s outlook for the full year was close to analysts’ estimates with revenue guided to $5.28 billion at the midpoint. Its non-GAAP profit of $2.22 per share was 0.7% above analysts’ consensus estimates.

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Company Overview

With nearly 50 years of experience translating public policy into operational programs that serve millions of citizens, Maximus (NYSE: MMS) provides operational services, clinical assessments, and technology solutions to government agencies in the U.S. and internationally.

Revenue Growth

Reviewing a company’s long-term sales performance reveals insights into its quality. Any business can put up a good quarter or two, but many enduring ones grow for years.

With $5.25 billion in revenue over the past 12 months, Maximus 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, Maximus’s 5.2% annualized revenue growth over the last five years was decent. This shows its offerings generated slightly more demand than the average business services company, a helpful starting point for our analysis.

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. Maximus’s recent performance shows its demand has slowed as its revenue was flat over the last two years.

This quarter, Maximus missed Wall Street’s estimates and reported a rather uninspiring 5.1% year-on-year revenue decline, generating $1.28 billion of revenue.

Looking ahead, sell-side analysts expect revenue to grow 5.2% over the next 12 months, an improvement versus the last two years. This projection is above average for the sector and implies its newer products and services will fuel better top-line performance.

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Adjusted Operating Margin

Adjusted operating margin is an important measure of profitability as it shows the portion of revenue left after accounting for all core expenses — everything from the cost of goods sold to advertising and wages. It’s also useful for comparing profitability across companies because it excludes non-recurring expenses, interest on debt, and taxes.

Maximus was profitable over the last five years but held back by its large cost base. Its average adjusted operating margin of 9% was weak for a business services business.

On the plus side, Maximus’s adjusted operating margin rose by 4.3 percentage points over the last five years, as its sales growth gave it operating leverage.

This quarter, Maximus generated an adjusted operating margin profit margin of 13.2%, in line with the same quarter last year. This indicates the company’s overall cost structure has been relatively stable.

Earnings Per Share

We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.

Maximus’s EPS grew at 9.9% compounded annual growth rate over the last five years, higher than its 5.2% 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 Maximus’s earnings quality to better understand the drivers of its performance. As we mentioned earlier, Maximus’s adjusted operating margin was flat this quarter but expanded by 4.3 percentage points over the last five years. On top of that, its share count shrank by 15%. 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 Maximus, its two-year annual EPS growth of 14.3% was higher than its five-year trend. We love it when earnings growth accelerates, especially when it accelerates off an already high base.

In Q2, Maximus reported adjusted EPS of $2.22, up from $2.16 in the same quarter last year. This print was close to analysts’ estimates. Over the next 12 months, Wall Street expects Maximus’s full-year EPS to grow 18.5% from $7.76 to $9.20.

Key Takeaways from Maximus’s Q2 Results

We struggled to find many positives in these results. Its full-year EPS guidance missed and its revenue fell short of Wall Street’s estimates. Overall, this was a weaker quarter. The stock traded down 3.6% to $60.86 immediately after reporting.

Maximus underperformed this quarter, but does that create an opportunity to invest right now? What happened in the latest quarter matters, but not as much as longer-term business quality and valuation, when deciding whether to invest in this stock. We cover that in our actionable full research report which you can read here (it’s free).