Record start to fiscal year
Total revenue $1.296B, up 6.7% year-over-year; company reiterates full-year expectation of at least 7% growth (as-reported). Q2 revenue guidance $1.324B–$1.336B (~6% growth at midpoint).
May 7th, 2026
Summary
- Earnings Call Date:
- 2026-05-07
- Change Since:
- -16.77%
- Next Earnings Date:
- 2026-08-06
Earnings Call Sentiment
PositiveThe call presents a largely positive picture: accelerating high-value revenue in Advanced Technology Solutions (ATS) and agentic offerings, strong margin expansion, record backlog/pipeline, and meaningful partner and client wins outweigh measured near-term challenges such as slow growth in legacy core business services, early-stage realization of headcount decoupling, and macro/ execution risks tied to rapid adoption of new technologies.
Company Guidance
Genpact guided to at least 7% revenue growth for fiscal 2026 (as‑reported) with Advanced Technology Solutions now expected to grow at least 20% (Q1 ATS was $345M, +24% YoY and 27% of revenue); full‑year gross margin is expected to expand ~50 bps to 36.5% and adjusted operating income margin to increase ~25 bps to 17.7%, with adjusted diluted EPS forecast to grow over 10% (Q1 adjusted diluted EPS was $0.98, +16.7% YoY; Q1 total revenue $1.296B, +6.7%). For Q2 they expect revenue of $1.324–$1.336B (midpoint ≈6% YoY), ATS growth ≥20%, gross margin ~36.4%, adjusted operating income margin ~17.4%, and adjusted diluted EPS of $0.96–$0.97; management also cited record backlog, pipeline and inflows, six large deals in Q1, non‑FTE revenue at 48%, partner revenue up 35% to ~13% of total, $578M cash, and $102M returned to shareholders in Q1.
Advanced Technology Solutions (ATS) acceleration
ATS revenue $345M, up 24% year-over-year and now ~27% of total revenue; management notes ATS pipeline grew >30% over the last 90 days and expects ATS to grow at least 20% for the year.
Strong agentic momentum and bookings
Agentic solutions total contract value nearly doubled versus all of 2025; more than 50% of cumulative awarded agentic contract value from new clients; six large deals signed in Q1 (large = ≥ $50M TCv); building annualized recurring, amortized revenue streams.
Margin expansion and strong adjusted EPS growth
Gross margin expanded ~110 basis points to 36.4% (12th consecutive quarter of expansion); adjusted operating income $224M with margin 17.3%; adjusted diluted EPS $0.98, up 16.7% year-over-year, and management expects adjusted diluted EPS to grow >10% for the year.
Commercial model shift toward non‑FTE outcomes
Non‑FTE revenue represented 48% of total revenue in Q1 and management highlights a '2x 2x, 70/70' thesis for ATS (more than 2x revenue per headcount, >2x revenue growth vs. company, ~70% amortized revenue and ~70% from non‑FTE models), indicating a durable recurring revenue mix.
Partner strategy progress and ecosystem wins
Partner-related revenues grew 35% year-over-year and now account for ~13% of total revenue; announced a strategic alliance with Google to create agentic and AI-led finance solutions and showcased joint client wins (e.g., Cardinal Health).
Balance sheet and shareholder returns
Ended Q1 with $578M in cash and cash equivalents (up $16M YoY); used $24M cash in operations (typical Q1 seasonality); returned $102M to shareholders in Q1 via $70M share repurchases and $32M dividends.
Global client traction and transformational deals
Signed multiyear strategic partnerships with major clients including a European insurance/financial-services leader and Bendigo Bank (Australia), demonstrating global adoption of agentic and AI-led transformations.
Operator
Good day, ladies and gentlemen, and welcome to the 2026 First Quarter Genpact Limited Earnings Conference Call. My name is Carmen, and I will be your conference moderator for today. At this time, all participants are in a listen-only mode. As a reminder, this call is being recorded for replay purposes. The replay of the call will be archived and made available on the IR section of Genpact Limited's website. I would now like to turn the call over to Kyle Bergstrom, Head of Investor Relations at Genpact Limited. Please proceed.
Kyle Bergstrom
Good afternoon, everyone, and welcome to Genpact Limited's Q1 2026 Earnings Conference Call. We hope you have had a chance to read our earnings press release posted on the Investor Relations section of our website, genpact.com. Today, we have with us Balkrishan Kalra, president and CEO, and Michael Weiner, chief financial officer. Balkrishan will start with an overview of our results, and then Michael will discuss our financial performance in greater detail before we take your questions. Please note that during this call, we will make forward-looking statements including statements about our business outlook, strategies, and long-term goals. These comments are based on our plans, predictions, and expectations as of today, which may change over time. Actual results could differ materially due to a number of important risks and uncertainties, including the risk factors in our 10-Ks and 10-Q filings with the SEC. During this call, we will discuss certain non-GAAP financial measures.
We have reconciled those to the most directly comparable GAAP financial m...
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