Globant S.A. Q1 FY2023 Earnings Call

· Earnings call transcript and AI-powered summary

  • Revenue: Globant reported Q1 2023 revenue of $472.4 million—an increase of 17.7% year-over-year. Q1 revenue exceeded guidance expectations.
  • Profitability: Adjusted Operating Income was $71.4 million (15.1% margin); Adjusted EPS was $1.28, up 7.6% YoY. Adjusted gross margin stood at 38.2%.
  • Full-Year Guidance (Updated):
    • Revenue expected at ≥ $2.74 billion (+16.5% YoY; ~12% organic, ~4.5% from M&A).
    • Adjusted Operating Margin expected between 15–17%.
    • Adjusted EPS expected at $5.71.
  • Q2 2023 Guidance:
    • Revenue: ≥ $496 million (+15.5% YoY).
    • Adjusted EPS: ≥ $1.33.
    • Operating margin range: 15–16%.

Key Business Highlights

  • AI Integration: Significant investment in AI with new and enhanced offerings including MAGNIFY 5.0, GeneXus NEXT, and initiatives like “Mines” for internal AI training and certification.
  • Client Base & Engagements:
    • Disney account grew 0.9% YoY but declined 16.2% QoQ. Sequential growth anticipated later in 2023.
    • 14 clients generated over $20M in annual revenue; 276 clients contributed over $1M (up 34% YoY).

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Arturo Langa: Good day, and welcome to Globant's First Quarter 2023 Earnings Conference Call. I'm Arturo Langa, Head of Investor Relations at Globant. [Operator Instructions]. Please note this event is being recorded and streamed live on YouTube. By now, you should have received a copy of the earnings release. If you have not, a copy is available on our website, investors.globant.com. Our speakers today are Martin Migoya, Co-Founder and Chief Executive Officer; Juan Urthiague, Chief Financial Officer; Patricia Pomies, Chief Operating Officer; and Diego Tartara, Chief Technology Officer. Before we begin, I would like to remind you that some moments on our call today may be deemed forward-looking statements. This includes our business and financial outlook and the answers to some of your questions. Such statements are subject to the risks and uncertainties as described in the company's earnings release and other filings with the SEC. Please note that we follow IFRS accounting rules in our financial statements. During our call today, we will report non-IFRS or adjusted measures, which is how we track performance internally and the easiest way to compare Globant to our peers in the industry. You will find a reconciliation of IFRS and non-IFRS measures at the end of the press release we published on our Investor Relations website announcing this quarter's results. Martin Migoya : Thank you, Arturo. Good afternoon, everyone. You may have noticed that I'm not the real Martin Migoya

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