- Revenue Growth and Drivers: Q4 revenue reached $2.55 billion (3.1% constant currency growth), with full-year growth of 2.1%, driven by high-complexity work, wallet share gains, and IP investments.
- AI Platform Breakthrough: IXSuite AI achieved breakeven profitability in 2025, contributing $60 million in annualized revenue, while adjusted free cash flow surged 32% to $626 million.
- 2026 Guidance: Revenue expected to rise 1.5–3% to $10.035–10.18 billion, with non-GAAP operating income projected at $1.24–1.29 billion and adjusted free cash flow of $630–650 million.
- Margin Improvements: Anticipated margin expansion in H2 2026 from automation, capacity optimization, and transformational deals, including $95 million invested in new capabilities and facilities.
- Strategic Priorities: Focus on high-margin verticals (data annotation, compliance) and client consolidation, with a 3% growth headwind from low-complexity work offset by long-term quality-driven revenue growth.
Revenue Growth and Profitability
The company's revenue growth was driven by its focus on high-complexity work and investments in its own IP. The IXSuite AI platform achieved breakeven profitability, with annualized AI revenue exceeding $60 million. The company's adjusted free cash flow reached a record $626 million, up 32% from the prior year, and returned $258 million to shareholders through dividend and share repurchases.
Guidance and Outlook
For 2026, Concentrix expects reported revenue of $10.035 billion to $10.18 billion, implying constant currency revenue growth of 1.5% to 3%. Non-GAAP operating income is expected to be $1.24 billion to $1.29 billion, and non-GAAP EPS is expected to be $11.48 to $12.07. The company guides for low single-digit revenue growth in fiscal 2026 on a constant currency basis, with the traditional CX market being flat, while other services grow at mid-single digits, and some services grow at high single digits.
Valuation and Metrics
Using the current valuation metrics, the company's P/E Ratio stands at -1.9, P/B Ratio at 0.89, and P/S Ratio at 0.25. The Dividend Yield is 3.47%, and the Free Cash Flow Yield is 20.71%. Analysts estimate next year's revenue growth at 3.6%. The company's focus on driving quality revenue and its global footprint providing access to a robust talent pool should help it be seen as a valued partner to its clients. Christopher A. Caldwell mentioned that the company has been selective in the types of work it takes on, prioritizing complex projects that drive value for clients and create sticky relationships.
Future Prospects
The company expects margin improvement in the back half of the year as it completes working through overcapacity issues, implements transformational deals, and drives automation efforts. It guides conservatively, focused on each quarter and the full year. With its pure AI platform growing and a run rate of $60 million exiting fiscal 2025, the company is well-positioned for future growth. The company's capital allocation priority remains balanced, with expectations to spend similar to fiscal year 2025 on share repurchases.