Globant S.A. Q3 FY2023 Earnings Call

· Earnings call transcript and AI-powered summary

  • Revenue: Globant reported Q3 2023 revenue of $545.3 million, up 18.8% YoY and 9.6% QoQ, driven by organic growth and strategic acquisitions (notably Pentalog).
  • Profitability: Adjusted operating margin was 15.3%, up 30bps QoQ. Adjusted gross profit margin was 38.2%, flat QoQ. Adjusted net income stood at $64.8 million with a margin of 11.9%.
  • EPS: Adjusted diluted EPS was $1.48, up 16.5% YoY and exceeding guidance by $0.02.
  • Full-Year Outlook: Revenue for FY2023 expected to be at least $2.094 billion (+17.6% YoY). Q4 revenue guidance is ~$579 million. Adjusted EPS guidance is $5.72.
  • Cash & Free Cash Flow: Cash position was $219.3 million with $67.4 million free cash flow YTD, up significantly from $17.8 million last year.

Key Growth Highlights

  • Geographical Performance (QoQ):
    • North America: +6.5%
    • EMEA: +28.9%
    • LATAM: +7.4%
    • Asia & Oceania: Flat
  • Industry Vertical Growth (QoQ):
    • Media & Entertainment: +6.2%
    • Travel & Hospitality: +18.8%
    • Technology: +10.9%
    • Consumer & Retail: +12.7%
    • Professional Services: +7.5%

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Arturo Langa: [Starts Abruptly] Before we begin, I would like to remind you that some of the comments 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 risk 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. I now like to turn the call over to Martin Migoya, our CEO. Martin Migoya: Good afternoon, and welcome everyone. It's a pleasure for me to be back to deliver this earnings call speech and to share with you how we're progressing on our growth vision. Let's begin with our quarterly performance. In Q3, we brought in $545.3 million in revenue, representing 18.8% year-over-year growth and 9.6% quarter-over-quarter growth. Our revenue for the last 12 months has now surpassed $2 billion, a first for Globant. Over the past quarter, we saw expansion across our key geographies, all of our verticals, as well as among our top clients. We are exceptionally proud to have deliver

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