Q3 2024 Epam Systems Inc Earnings Call Transcript
Key Points
- EPAM Systems Inc (EPAM) reported stronger-than-expected third-quarter results, with revenue growth both year-over-year and sequentially.
- The acquisition of Nedis provides EPAM with entry into new markets in Latin America and parts of Europe, expanding their client portfolio and delivery capabilities.
- The company saw improvements in client engagement across all verticals, particularly in financial services, life sciences, healthcare, and software sectors.
- EPAM's global delivery strategy is focused on diversification, with significant growth in India and Latin America, and a strong presence in Europe.
- EPAM is actively engaged with 70% of its top 100 clients on Gen AI initiatives, showcasing its capabilities in AI-driven transformations.
- Despite positive results, EPAM continues to face challenges with delayed decision-making and a focus on cost optimization among clients.
- The company is experiencing wage inflation pressures, which are not fully offset by pricing improvements, impacting profitability.
- EPAM's profitability is expected to be slightly below the 16% to 17% range in 2025, even with benefits from Polish R&D incentives.
- There is a continued need for strategic investments to capture market share, which may impact short-term financial performance.
- The integration of recent acquisitions, such as Nedis, may initially contribute lower profitability compared to EPAM's standalone operations.
Thank you for standing by my name is Bella, and I will be your conference operator today. At this time, I would like to welcome everyone to the EPAM third quarter 2024 Earnings Conference Call. (Operator Instructions)
I would now like to turn over the call to Mike Rowshandel, Head of Investor Relations. Please go ahead.
Good morning, everyone and thank you for joining us today. As the operator just mentioned, I'm Mike Rowshandel, Head of Investor Relations. By now, you should have received your copy of the earnings release for the company's third quarter 2024 results. If you have not, a copy is available on epam.com in the Investors section. With me on today's call are Arkadiy Dobkin, CEO and President; and Jason Peterson, Chief Financial Officer.
I would like to remind those listening that some of the comments made on today's call may contain forward-looking statements. These statements are subject to risks and uncertainties as described in the company's earnings release and SEC filings. Additionally,
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