Thoughtworks (TWKS) Baird 2024 Global Consumer, Technology & Services Conference summary

Market environment and business cycle

• Recent years have been challenging, with clients normalizing spend after accelerated growth in 2021-2022.

• The environment has stabilized, with fewer project pullbacks and some early signs of recovery.

• Clients remain cautious, focusing on cost efficiency and being more discerning in investments.

• 2024 guidance assumes a stable market, not relying on macroeconomic improvement.

Business mix, restructuring, and operational changes

• High-value project work and a 25% onshore/75% offshore headcount mix increase sensitivity to macro shifts.

• Onshore work, especially in strategy and design, has faced more headwinds due to budget pressures.

• Restructuring began in August last year, focusing on verticalizing sales and rebalancing onshore/offshore supply.

• Operational simplification and verticalization have improved efficiency and client alignment.

• Employee engagement and retention remain strong, with attrition below industry norms.

Sector performance and technology trends

• Automotive, manufacturing, and healthcare/life sciences are showing relative strength.

• AI adoption is driving demand in data and analytics, with clients prioritizing data quality.

• 2023 focused on AI pilots; 2024 is seeing more mid-scale projects and workforce upskilling.

• GenAI skills command higher bill rates due to the need for experienced consultants.