UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 OF THE SECURITIES EXCHANGE ACT OF 1934

For the month of March 2023

Commission File Number 0-19415

MAGIC SOFTWARE ENTERPRISES LTD.

(Translation of Registrant's name into English)

Terminal Center, 1 Yahadut Canada Street, Or-Yehuda, Israel 6037501 (Address of Principal Executive Office)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F ☒ Form 40-F ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): ☐

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): ☐

Quarterly Results of Operations

On March 9, 2023, Magic Software Enterprises Ltd. (the "Company", "we" or "us") announced our financial results for the fourth quarter and full year ended December 31, 2022. A copy of our press release announcing our results is furnished as Exhibit 99.1 to this Report of Foreign Private Issuer on Form 6-K (this "Form 6-K") and is incorporated herein by reference.

The GAAP financial statements appended to this Form 6-K in Exhibit 99.1 are hereby incorporated by reference in our Registration Statements on Form S-8 (SEC File No.'s 333-113552, 333-132221 and 333-149553).

Exhibit No. Title of Exhibit

99.1 Magic Software Reports Fourth Quarter and Full Year 2022 Financial Results with Record-Breaking Full Year 2022 Results Recorded Across All Key Financial Indices (Revenues, Gross Profit, Operating Income and Net Income).

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

MAGIC SOFTWARE ENTERPRISES LTD.

By: /s/ Asaf Berenstin

Name: Asaf Berenstin Title: Chief Financial Officer

Dated: March 9, 2023

PRESS RELEASE

Magic Software Reports Fourth Quarter and Full Year 2022 Financial Results with Record-Breaking Full Year 2022 Results Recorded Across All Key Financial Indices (Revenues, Gross Profit, Operating Income and Net Income)

Net income for the year increased by 38.6% year over year to a record-breaking result of \$40.7 million; non-GAAP net income for the year increased by 13% year over year to a record-breaking result of \$52.0 million.

Or Yehuda, Israel, March 9, 2023 – Magic Software Enterprises Ltd. (NASDAQ and TASE: MGIC) ("the Company"), a global provider of IT consulting services and end-to-end integration and application development platforms solutions, announced today its financial results for the fourth quarter and full year ended December 31, 2022.

Summary Results for the Fourth Quarter 2022 (USD in millions, except per share data)

		GAAP			Non-GAAP
	Q4 2022		Q4 2021	% Change	Q4 2022	Q4 2021	% Change
Revenues	\$ 147.1	\$	133.0	10.6% \$	147.1	\$ 133.0	10.6%
Gross profit	\$ 41.8	\$	37.4	11.9% \$	43.2	\$ 38.7	11.5%
Gross margin	28.4%		28.1%	30 bps	29.3%	29.1%	20 bps
Operating income	\$ 14.6	\$	14.3	2.2% \$	19.2	\$ 19.8	-2.9%
Operating margin	9.9%		10.7%	(80) bps	13.0%	14.9%	(190) bps
Net income (*)	\$ 10.1	\$	6.5	54.6% \$	13.9	\$ 12.6	9.9%
Diluted EPS	\$ 0.20	\$	0.13	53.8% \$	0.28	\$ 0.26	7.7%

(*) Attributable to Magic Software's shareholders.

Financial Highlights for the Fourth Quarter Ended December 31, 2022

Revenues for the fourth quarter of 2022 increased by 10.6% to a record-breaking result of \$147.1 million, compared to \$133.0 million in the same period of the previous year. On a constant currency basis (calculated based on average currency exchange rates for the three months ended December 31, 2021), revenues for the fourth quarter of 2022 would have increased by 16.5% to a record breaking \$155.0 million, with 69.6% of such revenues resulting from organic growth.
Operating income for the fourth quarter of 2022 increased by 2.2% to a fourth quarter record-breaking \$14.6 million, compared to \$14.3 million in the same period of the previous year. Operating income for the fourth quarter of 2022, was negatively impacted by \$1.9 million expense recorded with respect to share based payment to employees.
Non-GAAP operating income for the fourth quarter of 2022 decreased by 2.9% to \$19.2 million, compared to \$19.8 million in the same period of the previous year. On a constant currency basis (calculated based on average currency exchange rates for the three months ended December 31, 2021), non-GAAP operating income for the fourth quarter of 2022 would have increased by 3.1% to a record-breaking result of \$20.4 million.
Net income attributable to Magic Software's shareholders for the fourth quarter of 2022 increased by 54.6% to a fourth quarter record-breaking result of \$10.1 million, or \$0.20 per fully diluted share, compared to \$6.5 million, or \$0.13 per fully diluted share, in the same period of the previous year.
Non-GAAP net income attributable to Magic Software's shareholders for the fourth quarter of 2022 increased by 9.9% to \$13.9 million, or \$0.28 per fully diluted share, compared to \$12.6 million, or \$0.26 per fully diluted share, in the same period of the previous year.

Summary Results for the Year Ended December 31, 2022 (USD in millions, except per share data)

	GAAP			Non-GAAP
	12M 2022		12M 2021	% Change	12M 2022		12M 2021	% Change
Revenues	\$ 566.8	\$	480.3	18.0% \$	566.8	\$	480.3	18.0%
Gross Profit	\$ 155.4	\$	133.0	16.8% \$	160.8	\$	139.1	15.6%
Gross Margin	27.4%		27.7%	(30) bps	28.4%		29.0%	(60) bps
Operating Income	\$ 61.4	\$	51.2	19.8% \$	74.1	\$	66.8	11.0%
Operating Margin	10.8%		10.7%	10 bps	13.1%		13.9%	(80) bps
Net Income (*)	\$ 40.7	\$	29.3	38.6% \$	52.0	\$	46.0	13.0%
Diluted EPS	\$ 0.79	\$	0.60	31.7% \$	1.06	\$	0.94	12.8%

(*) Attributable to Magic Software's shareholders.

Financial Highlights for the Year Ended December 31, 2022

Revenues for the year increased by 18.0% to a record-breaking \$566.8 million compared to \$480.3 million last year. On a constant currency basis (calculated based on the average currency exchange rates during the twelve months period ended December 31, 2021), revenues for the year would have increased by 21.1% to \$581.9 million, with 88.7% accounting for organic growth.
Operating income for the year increased by 19.8% to a record-breaking \$61.4 million compared to \$51.2 million last year. On a constant currency basis (calculated based on the average currency exchange rates during the twelve months period ended December 31, 2021), operating income for the year would have increased by 25.2% to \$64.2 million.
Non-GAAP operating income for the year increased by 11.0% to a record-breaking \$74.1 million compared to \$66.8 million last year. On a constant currency basis (calculated based on the average currency exchange rates during the twelve months period ended December 31, 2021), non-GAAP operating income for year would have increased by 15.1% to \$76.9 million, with 88.7% of such revenues resulting from organic growth.
Net income attributable to Magic Software's shareholders for the year increased by 38.6% to a record-breaking \$40.7 million, or \$0.79 per fully diluted share, compared to \$29.3 million, or \$0.60 per fully diluted share, last year.
Non-GAAP net income attributable to Magic Software's shareholders for the year increased by 13.0% to a record-braking \$52.0 million, or \$1.06 per fully diluted share, compared to \$46.0 million, or \$0.94 per fully diluted share, last year.
Cash flow from operating activities for the year, amounted to \$49.5 million compared to \$37.8 million last year. Cash flow from operating activities excluding the impact of payments of deferred and contingent consideration related to acquisitions amounted to \$53.6 and \$38.4 million for the years ended December 31, 2022, and 2021, respectively.
As of December 31, 2022, Magic's net cash, cash equivalents and short and long-term bank deposits amounted to \$87.0 million and total financial debt amounted to \$51.1 million.
Magic is introducing 2023 annual revenue guidance of between \$585 million and \$593 million, reflecting annual growth of 3.2% to 4.6% (based on current currency exchange rates). Based on 2022 average currency exchange rates Magic's 2023 annual revenue guidance would have been between \$600 million and \$608 million, reflecting annual growth of 5.9% to 7.3%.

Declaration of Dividend for the Second Half of 2022

In accordance with its dividend distribution policy, the Company's board of directors declared a semi-annual cash dividend in an amount of 30.0 cents per share and in an aggregate amount of approximately \$14.7 million, which together with the dividend distributed for the first half of 2022 in an amount of approximately \$14.2 million, reflects 71% of the Company's net income attributable to its shareholders for the year.
The dividend is payable on April 20, 2023, to all of the Company's shareholders of record at the close of trading on the NASDAQ Global Select Market on April 10, 2023.
In accordance with Israeli tax law, the dividend is subject to withholding tax at source at the rate of 30% (if the recipient of the dividend is at the time of distribution or was at any time during the preceding 12-month period the holder of 10% or more of the Company's share capital) or 25% (for all other dividend recipients) of the dividend amount payable to each shareholder of record, subject to applicable exemptions.
The dividend will be paid in US dollars on the ordinary shares of Magic Software Enterprises that are traded both on the Tel Aviv Stock Exchange and the NASDAQ Global Select Market

Guy Bernstein, Chief Executive Officer of Magic Software, said: "I am very proud of our fourth quarter and full year achievements. During the year, we continued to make big strides across multiple fronts of our business, which is reflected by record breaking results as well as double digit growth in all our key financial indices for the year (revenues, gross profit, operating income, and net income). Our strong results demonstrate the growing investment made by enterprises and organizations worldwide to leverage their digital technologies and cloud-based platforms creating high demand for our innovative software solutions and services which together with the outstanding execution by our teams led to another year of strong performance recorded across our business. With our investment portfolio well diversified, we continue to invest organically and inorganically in our service lines and are excited about the innovative capabilities we are building to drive continued long term profitable growth and shareholder value."

First time adoption of International Financial Reporting Standards for the Company's consolidated financial statements for the year ended December 31, 2022

We have resolved to voluntarily adopt International Financial Reporting Standards as issued by the International Accounting Standards Board, or IFRS, for the Company's consolidated financial statements for the year ending December 31, 2022 to be included in our annual report on Form 20-F. We believe that this change will enhance efficiency of our financial reporting, improve the comparability of our financial information across international capital markets as well as standardize our financial information. Accordingly, the Company is preparing financial statements that comply with IFRS applicable as of December 31, 2022, together with the comparative periodic data for the year ended December 31, 2021. An explanation of the principal adjustments made in presenting the Company's U.S. GAAP financial statements, including the statement of financial position as of January 1, 2021, the Company's date of transition to IFRS and the financial statements for the year ended December 31, 2021, in order to comply with IFRS, will be provided in our consolidated financial statements to be included in our 2022 annual report on Form 20-F. The transition to IFRS is not expected to have a material impact on the Company's revenues, net income, or shareholders' equity. The transition to IFRS will not have an impact on the Company's revenue guidance for 2023.

Conference Call Details

Magic Software's management will host a conference call on Thursday, March 9, 2023, at 10:00 am Eastern Daylight Time (5:00 am Pacific Daylight Time, 17:00 Israel Daylight Time) to review and discuss Magic Software's results.

To participate, please call one of the following teleconferencing numbers. Please begin placing your calls at least 5 minutes before the conference call commences. If you are unable to connect using the toll-free numbers, call the international dial-in number.

NORTH AMERICA: +1-866-652-8972

UK: 0-800-917-9141

ISRAEL: 03-918-0650

ALL OTHERS: +972-3-918-0650

For those unable to join the live call, a replay of the call will be available in the Investor Relations section of Magic Software's website, www.magicsoftware.com.

Non-GAAP Financial Measures

This press release contains the following non-GAAP financial measures: non-GAAP gross profit, non-GAAP operating income, non-GAAP net income attributable to Magic Software's shareholders and non-GAAP basic and diluted earnings per share.

Magic Software believes that these non-GAAP measures of financial results provide useful information to management and investors regarding certain financial and business trends relating to Magic Software's financial condition and results of operations. Magic Software's management uses these non-GAAP measures to compare the Company's performance to that of prior periods for trend analyses, for purposes of determining executive and senior management incentive compensation and for budgeting and planning purposes. These measures are used in financial reports prepared for management and in quarterly financial reports presented to the Company's board of directors. The Company believes that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing the Company's financial measures with other software companies, many of which present similar non-GAAP financial measures to investors.

Management of the Company does not consider these non-GAAP measures in isolation or as an alternative to financial measures determined in accordance with GAAP. The principal limitation of these non-GAAP financial measures is that they exclude significant expenses and income that are required by GAAP to be recorded in the Company's financial statements. In addition, they are subject to inherent limitations as they reflect the exercise of judgment by management about which expenses and income are excluded or included in determining these non-GAAP financial measures. In order to compensate for these limitations, management presents non-GAAP financial measures together with GAAP results. Magic Software urges investors to review the reconciliation of its non-GAAP financial measures to the comparable GAAP financial measures, which it includes in press releases announcing quarterly financial results, including this press release, and not to rely on any single financial measure to evaluate the Company's business.

Non-GAAP measures used in this press release are included in the financial tables of this release. These non-GAAP measures exclude the following items:

Amortization of purchased intangible assets and other related costs;
In-process research and development capitalization and amortization;
Equity-based compensation expenses;
Costs related to acquisition of new businesses;
The related tax, non-controlling interests and redeemable non-controlling interest's effects of the above items;
Change in valuation of contingent consideration related to acquisitions;
Change in value of put options of redeemable non-controlling interests; and
Change in deferred tax assets on carry forward tax losses.

Reconciliation of the most comparable GAAP financial measures to the non-GAAP financial measures used in this press release are included in the financial tables of this release.

About Magic Software Enterprises

Magic Software Enterprises Ltd. (NASDAQ and TASE: MGIC) is a global provider of end-to-end integration and application development platforms solutions and IT consulting services.

For more information, visit www.magicsoftware.com.

Forward Looking Statements

Some of the statements in this press release may constitute "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities and Exchange Act of 1934 and the United States Private Securities Litigation Reform Act of 1995. Words such as "will," "look forward", "expect," "believe," "guidance" and similar expressions are used to identify these forward-looking statements (although not all forward-looking statements include such words). These forward-looking statements, which may include, without limitation, projections regarding our future performance and financial condition, are made based on management's current views and assumptions with respect to future events. Any forwardlooking statement is not a guarantee of future performance and actual results could differ materially from those contained in the forward-looking statement. These statements speak only as of the date they were made, and we undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. We operate in a changing environment. New risks emerge from time to time and it is not possible for us to predict all risks that may affect us. For more information regarding these risks and uncertainties as well as certain additional risks that we face, you should refer to the Risk Factors detailed in our Annual Report on Form 20-F for the year ended December 31, 2021, which filed on May 12, 2022, and subsequent reports and filings made from time to time with the Securities and Exchange Commission.

Magic® is a registered trademark of Magic Software Enterprises Ltd. All other product and company names mentioned herein are for identification purposes only and are the property of, and might be trademarks of, their respective owners.

Press Contact:

Asaf Berenstin | Chief Financial Officer Magic Software Enterprises [email protected]

MAGIC SOFTWARE ENTERPRISES LTD. CONDENSED CONSOLIDATED STATEMENTS OF INCOME

U.S. Dollars in thousands (except per share data)
---------------------------------------------------	--

	Three months ended December 31,				Year ended December 31,
		2022		2021		2022		2021
			Unaudited				Unaudited
Revenues	\$	147,146	\$	133,002	\$	566,792	\$	480,325
Cost of Revenues		105,325		95,627		411,437		347,331
Gross profit		41,821		37,375		155,355		132,994
Research and development, net		2,714		2,123		10,090		8,995
Selling, marketing and general and administrative expenses		24,294		19,139		83,949		70,257
Increase (decrease) in valuation of contingent consideration related to acquisitions		220		1,829		(63)		2,507
Total operating expenses		27,228		23,091		93,976		81,759
Operating income		14,593		14,284		61,379		51,235
Financial expenses, net		(1,059)		(2,447)		(3,662)		(5,972)
Income before taxes on income		13,534		11,837		57,717		45,263
Taxes on income		1,974		3,573		11,197		10,359
Net income	\$	11,560	\$	8,264	\$	46,520	\$	34,904
Net income attributable to redeemable non-controlling interests		(844)		(1,185)		(3,420)		(3,517)
Net income attributable to non-controlling interests		(647)		(567)		(2,433)		(2,055)
Net income attributable to Magic's shareholders	\$	10,069	\$	6,512	\$	40,667	\$	29,332
Net earnings per share attributable to Magic's shareholders :
Net Income attributable to Magic Shareholder's		10,069		6,512		40,667		29,332
Accretion of redeemable non-controlling interests		(429)		(4,026)		(1,892)		(4,026)
Net Income attributable to Magic Shareholder's after accretion of redeemable non-controlling interests	\$	9,640	\$	2,486	\$	38,775	\$	25,306
Weighted average number of shares used in computing net earnings per share
Basic		49,093		49,073		49,089		49,055
Diluted		49,131		49,120		49,138		49,100
Basic and diluted earnings per share attributable to Magic's shareholders	\$	0.23	\$	0.05	\$	0.79	\$	0.52

Net earnings per share attributable to Magic's shareholders : excluding of accretion of redeemable non-controlling interest
Basic	\$	0.20	\$	0.13	\$	0.79	\$	0.60
Diluted	\$	0.20	\$	0.13	\$	0.79	\$	0.60
6

MAGIC SOFTWARE ENTERPRISES LTD. RECONCILIATION OF GAAP AND NON-GAAP RESULTS U.S. Dollars in thousands (except per share data)

	Three months ended December 31,					Year ended December 31,
		2022	2021			2022		2021
		Unaudited				Unaudited
GAAP gross profit	\$	41,821	\$	37,375	\$	155,355	\$	132,994
Amortization of capitalized software and acquired technology		1,124		1,200		4,431		5,444
Amortization of other intangible assets		229		158		974		624
Non-GAAP gross profit	\$	43,174	\$	38,733	\$	160,760	\$	139,062
GAAP operating income	\$	14,593	\$	14,284	\$	61,379	\$	51,235
Gross profit adjustments		1,353		1,358		5,405		6,068
Amortization of other intangible assets		1,731		2,006		7,889		7,046
Increase in valuation of contingent consideration related to acquisitions		220		1,829		(63)		2,507
Capitalization of software development		(730)		(848)		(3,059)		(3,193)
Costs related to acquisitions		116		971		492		2,203
Cost of share-based payment		1,893		155		2,103		956
Non-GAAP operating income	\$	19,176	\$	19,755	\$	74,146	\$	66,822

GAAP net income attributable to Magic's shareholders Operating income adjustments	\$	10,069 4,583	\$	6,512 5,471	\$	40,667 12,767	\$	29,332 15,587
Expenses attributed to non-controlling interests and redeemable non-controlling interests		(197)		(206)		(641)		(764)
Changes in unsettled fair value of contingent consideration related to
acquisitions		(89)		1,144		744		2,817
Deferred taxes on the above items		(477)		(288)		(1,570)		(974)
Non-GAAP net income attributable to Magic's shareholders	\$	13,889	\$	12,633	\$	51,967	\$	45,998
Non-GAAP basic net earnings per share	\$	0.28	\$	0.26	\$	1.06	\$	0.94
Weighted average number of shares used in computing basic net earnings per share		49,093		49,073		49,089		49,055
Non-GAAP diluted net earnings per share	\$	0.28	\$	0.26	\$	1.06	\$	0.94
Weighted average number of shares used in computing diluted net earnings per share		49,138		49,138		49,150		49,136

Summary of Non-GAAP Financial Information

U.S. Dollars in thousands (except per share data)

			Three months ended December 31,		Year ended December 31,
		2022			2021	2022		2021 Unaudited
	Unaudited				Unaudited	Unaudited
Revenues		\$ 147,146		100% \$ 133,002		100% \$ 566,792		100% \$ 480,325	100%
Gross profit		43,174	29.3%	38,733	29.1%	160,760	28.4%	139,062	29.0%
Operating income		19,176	13.0%	19,755	14.9%	74,146	13.1%	66,822	13.9%
Net income attributable to Magic's shareholders		13,889	9.4%	12,633	9.5%	51,967	9.2%	45,998	9.6%

Basic earnings per share	\$	0.28		\$ 0.26		\$ 1.06		\$ 0.94
Diluted earnings per share	\$	0.28		\$ 0.26		\$ 1.06		\$ 0.94