Q2 2025 Epam Systems Inc Earnings Call Transcript
Key Points
- EPAM Systems Inc (EPAM) delivered double-digit year-over-year revenue growth in Q2 2025, surpassing expectations.
- The company achieved its third consecutive quarter of positive organic growth, with organic growth accelerating from low-single digits to mid-single digits.
- All six verticals and three geographic regions showed strong year-over-year growth, indicating broad-based performance improvements.
- EPAM Systems Inc (EPAM) is expanding its market-leading position as an AI-native transformation company, with AI-native revenue growing double digits sequentially.
- The company is successfully scaling and optimizing its global delivery hubs, enhancing its ability to deliver strategic global capabilities.
- GAAP gross margin decreased to 28.8% from 29.3% in the same quarter last year, and non-GAAP gross margin also declined.
- Cash flow from operations and free cash flow both decreased compared to the same quarter in 2024.
- The company faces a complex macroeconomic climate, which remains a challenge for sustained growth.
- There is a potential risk of seasonal impacts in the second half of the year, which could affect revenue growth.
- Higher variable compensation and lower profitability from recent acquisitions contributed to lower gross margin levels.
Thank you for standing by. My name is Jeannie, and I will be your conference operator today. At this time, I would like to welcome everyone to the EPAM reports results for second-quarter 2025 conference call. (Operator Instructions)
I would now like to turn the call over to Mike Rowshandel, Head of Investor Relations. Please go ahead.
Good morning, everyone, and thank you for joining us today on our second-quarter 2025 earnings announcement. As the operator just mentioned, I'm Mike Rowshandel, Head of Investor Relations.
We hope you've had an opportunity to review our earnings release we issued earlier today. If you have not, copies are available on epam.com in the Investors section. With me on today's call are Arkadiy Dobkin, CEO and President; Balazs Fejes, President of Global Business and Chief Revenue Officer; 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
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