Genpact (G) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue reached $1.21 billion, up 7% year-over-year, driven by Data-Tech-AI and Digital Operations, surpassing guidance.

• Net income rose 13% year-over-year to $133 million, with diluted EPS up 16% to $0.74 and adjusted diluted EPS up 12% to $0.85.

• Adjusted income from operations was $213 million, up 9% year-over-year, with AOI margin at 17.6%.

• Accelerated innovation in AI and partnerships contributed to market share gains and expanded client base.

• Average headcount increased 9.1% year-over-year to 137,500 in Q3 2024.

Financial highlights

• Data-Tech-AI revenue rose 9% year-over-year to $569 million (47% of total); Digital Operations grew 5% to $642 million (53% of total).

• Gross margin was 35.6%, up 10 basis points year-over-year; adjusted operating income margin at 17.6%.

• Operating cash flow increased 41% to $228 million in Q3; cash and equivalents at $1.02 billion, up $541 million year-over-year.

• SG&A expenses were $243.3 million, up 5.9% year-over-year, but as a percentage of revenue decreased to 20.1%.

• Amortization of acquired intangibles fell 13.4% to $6.5 million in Q3 2024.

Outlook and guidance

• Full-year 2024 revenue guidance raised to $4.74–$4.75 billion (up 5.9%–6.1%); adjusted EPS guidance increased to $3.23–$3.24.

• Q4 2024 revenue expected between $1.222–$1.233 billion, with Data-Tech-AI and Digital Operations projected to grow 9% and 5.4%, respectively.

• Adjusted income from operations margin for 2024 expected at 17.1%, up from prior guidance.

• Board declared a Q3 2024 dividend of $0.1525 per share, payable December 23, 2024.

• Management expects cash from operations, reserves, and debt capacity to be sufficient for operations, growth, dividends, and share repurchases for the next twelve months and foreseeable future.