Information Services Group (III) Q1 2026 earnings summary

Executive summary

• Q1 2026 revenue reached $61.2 million, up 3% year-over-year, driven by strong growth in Europe and AI-driven services, partially offset by declines in the Americas and Asia Pacific.

• Adjusted EBITDA grew 12% to $8.3 million, marking the sixth consecutive quarter of double-digit growth and margin expansion over 100 basis points to 13.5%.

• Net income rose 83% to $2.7 million, with diluted EPS up to $0.05 and adjusted EPS at $0.09.

• AI-related revenue surged to $21 million, about a third of total revenue, up from $12 million a year ago.

• Signed the largest deal in company history: a multi-year, $17 million AI governance contract with a global manufacturer, managing $300 million in global technology spend.

Financial highlights

• Revenue: $61.2 million, up 3% year-over-year, at the top end of guidance.

• Adjusted EBITDA: $8.3 million, up 11.8%, margin expanded 111 bps to 13.5%.

• Operating income: $5 million, up 47.7% year-over-year; operating margin 8.2%.

• GAAP net income: $2.7 million ($0.05 per diluted share), up from $1.5 million ($0.03) last year.

• Cash at quarter end: $22.7 million, down from $28.7 million at year-end 2025.

Outlook and guidance

• Q2 2026 revenue guidance: $62.5–$63.5 million; adjusted EBITDA: $8–$9 million.

• Management expects current cash and operations to meet working capital, capex, and debt needs for at least the next twelve months.

• Americas and Asia Pacific expected to show sequential and year-over-year growth in Q2, with Asia Pacific Q2 revenues expected up 20% sequentially.

• Clients remain cautious due to macro and geopolitical conditions, focusing on cost optimization and AI adoption.