Q3 2025 Exlservice Holdings Inc Earnings Call Transcript
Key Points
- ExlService Holdings Inc (EXLS) reported a strong third quarter with a revenue increase of 12% year over year, reaching $530 million.
- The company's data and AI-led revenue grew 18% year over year, now constituting 56% of total revenue, showcasing strong demand for AI-driven solutions.
- Healthcare and Life Sciences was the fastest-growing segment with a 22% increase, driven by demand for data and AI solutions.
- EXLS launched EXLdata.ai, an innovative AI suite designed to make enterprise data AI-ready, which is expected to be a game changer in overcoming AI adoption hurdles.
- The company maintains high renewal rates with more than 75% of its revenue being recurring, providing stability and predictability.
- SG&A expenses increased by 120 basis points year over year to 21.3%, driven by investments in front-end sales and marketing.
- Adjusted operating margin for the quarter was 19.4%, down 50 basis points year over year due to investments in new solutions.
- The shift of revenue from digital operations to data and AI-led categories may obscure the true growth rate of digital operations.
- Despite strong growth, the penetration rate with top clients remains low, indicating potential underutilization of existing client relationships.
- The international growth markets segment, while growing, still represents a smaller portion of total revenue, indicating a need for further expansion.
Hello, and welcome to the EXLService Holdings, Inc. third quarter 2025 earnings conference call. Also, as a reminder, this conference is being recorded today. If you have any objections, please disconnect at this time.
I will now turn the call over to Shirley Macbeth, Chief Marketing Officer.
Hello, and thank you all for joining EXL's third-quarter 2025 financial results conference call. On the call today with me are Rohit Kapoor, Chairman and Chief Executive Officer; and Maurizio Nicolelli, Chief Financial Officer.
We hope you've had an opportunity to review the third quarter press release we issued yesterday afternoon. We've also posted a slide deck and investor fact sheet on our Investor Relations website. As a reminder, some of the matters we'll be discussing this morning are forward looking.
Please keep in mind that these forward-looking statements are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from
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