Concentrix (CNXC) 27 Sep 232023 Q3 Earnings call transcript

Thank you for standing by, and welcome to Concentrix Fiscal Third Quarter 2023 Financial Results Conference Call. [Operator Instructions] I would now like to hand the call over to Vice President, Investor Relations, David Stein. Please go ahead.

Thank you, Latif, and good evening. Welcome to the Concentrix Corporation Third Quarter Fiscal 2023 Earnings Call.

the Concentrix this Webhelp. of operate we result one as a combination week, earlier now As written This Webhelp be without and is may call the not recorded property or of Concentrix permission. rebroadcast that address call that, their address nature, forward-looking This that uncertain. our by are contains matters future performance expected and statements or future of cause forward-looking events not materially undertake future update to our different new forward-looking than uncertainties may results our do These those as statements. We result a statements information our actual developments. be expressed in or to Please with today's our earnings that information recent refer release to affect in the regarding most our future could additional filings financial results. SEC for uncertainties non-GAAP This operating constant XX-K includes SEC call, currency non-GAAP filings. Also adjusted in our risk discuss free provided the EBITDA, adjusted and measures, flow, cash annual financial report income, EPS including non-GAAP subsequent revenue factors on and during Form will growth. the we A under Chief call reconciliation and Chief measures company release non-GAAP President our our and the Investor Executive available me Officer. news the and Officer; Financials. With Andre is in of Chris Caldwell, these Valentine, Relations Financial on website on are the and provide outlook. our a summary results and performance strategy, Andre will will our financial operating and cover Chris growth of business questions. we'll the for call Then open your

the over turn Chris. I'll Now call to

everyone, you, earnings for our call. for Thank third Hello, and joining David. quarter you thank us today

focus business entered signings, services, to drive stable and mix and with drove continued continue cash our into combination quarter third growth with in We profit high-value will the are transformative the growth thrilled that to our flow a to We're the exciting believe have have deliver experienced in third as pipeline with fourth technology-infused XXXX. We we expansion. We we quarter strong executed achieved of we and solid the closed and that you quarter. our our performance pleased us strong for discuss margin new revenue with news business on opportunities that we continued Webhelp. demand

was quarter currency X.X%. organic the $X.XX constant billion. grew On in basis, revenue third revenue reported Our an

adjusted EBITDA by compared Our income third quarter $XXX growing operating with non-GAAP to X% increased $XXX million last year. million, and both increased to over

yielded Solid our EBITDA both basis non-GAAP margins point OI adjusted last over in year. execution and XX improvements

was largely per the share with impact $X.XX non-GAAP of reflecting compared EPS interest year, rates. last expected share per $X.XX higher Our

Given our cash continued XX%. flow and the quarterly pleased free by raise combination, organic accretive we share generation growth, basis. This translates Webhelp dividend strong increased on to the annualized $X.XX an quarterly per dividend to are

volume select solutions. in last gained We quarterly Catalyst of sequential our continued large verticals, with a our with continue experienced offset as digital strategic CX grow few we clients more again -- we to perspective, softness each growth discussed experience we than which revenue a quarter. From

at our unique integrate deploy solutions and peers. From focus continue from design, digital operations, on Catalyst to IT our with CX CX thousands to design, technology-infused Our differentiates of significantly sales as run and a with traditional build our us and one able approach services. service combined staff capabilities scale we sell perspective,

cost look managing for geographies saw ways service across clients to while differentiated customers verticals quarter, steady we the multiple as structure. During to continue their demand their and

wins. While deals performing clients pleased are that work we slowly, with smaller are the higher with will still that ramp these signing more complexity we be new

operating pursue client we exceptional record with delivering combination. From see of not would organization combined an also a We Webhelp the as scores perspective, this been prior that a are to strong we pipeline to quarter. Concentrix have opportunities attainment able service

our winning clients' our to the relationships Our within focus our account. more remains for best stickier relationships clients partner and The opportunities each provide on technology-infused services more being become. we the

applications supports both quarter our the now internal site X.X select AI and recruiting AI across productivity generative in internally deploying this see with solutions, Alex-based progress million enterprise. continue perspective, to additional X.X an platform our roll already and clients. processes as benefits scale million out and accelerated effectively, we've It we visits we to our our year. has career Notably, more and allowed From cost team already

management for workforce. concurrent where additional management now for scheduling workforce of again peak utilization will our team. user staff the optimizes XXX,XXX solution AI-based of to rest over better and scale we the This and we Our as benefits experience have see our up

visibility assist Our now most team widely to used for over easily improves easier. and automation information XXX access to productivity every tools day performs required members the proprietary provide product AI to smart the the jobs through

to our AI-based ability the insights an From interactions AI of automation from deployed. services, platform drive use we where quality customer to for XXX% client enhance our

in Now platform customers' the across value. into million delivering XXX to reviewed to tens of audit XX% clients improvements efficiency XX% high insights seats, see has that thousands and interactions date, of

our Our X% utilizes scenarios the to bots a proficiency, speed over end cognitive in better to and will AI service And significant during XX% million by ramp improving margin proprietary the AI this XXX by customer value us. for real-world our higher higher simulate delivering team interactions learning over year, processing for average XX,XXX clients bot developed and time customer to establishing training, implementations effectiveness for period. handle client-specific members new of reducing for

with further interactions productivity quality actively the enhance are investing additional of AI We and in workforce generative customers. to solutions improve

deployment Webhelp new operations our our business with legacy are XX% start year-end AI combination tool on from the to shortly. clients tools wide deploy and across our within of of We track by nearly our

with Turning to clients. our AI

large one this design, with the in software We in of of AI to cycle. life clients and deliver we use than value quarter, some XX% build services their methods solutions are traditional few faster run also to world's releases XX% generative and our key power Working across the gains AI efficiency generative project in companies technology largest collaborating the development chain. with

before. deployment that new a modeling AI-infused also been global we years. management proof done knowledge our solutions XD augmented Catalyst be offering couldn't concept close of its builds During that AnyPaaS developing cost effectively X to the first quarter, retail have reality for generative for also generative for we that delivered and launched AI a client of

intelligence care a automated patients health in tech our advisers For transitioned our generative X seamlessly and entire with for fully than of client first we experiences the AI enabling implementation, less staff substantial hours, CCaaS reporting resulted and insights transition. This for capabilities. business. has our clients for have savings in to weeks this a Historically, revenue months taken would our AI to generative opportunity and new

to of and knowledge, now tool with we automation next grow with across the combination generative For a becoming deployed another unique working million train increase to and a are to more of of plan be are all and to opportunity examples of working base the thousands a AI X subject net we and more humans conversations see the matter conversations hundreds industry. building Using are and see and in this on, months. With it knowledge have that hope to AI and we in we our efficient domain these key many client, and with I train it benefit categories revenue test scope AI customer-facing. evident customer the exclusively to our advance different multiple a is of X as of

our evolution. our a new This combination turn to for in industry. that in offering the historic stage milestone Now business chapter combination our Webhelp let's is a sets the attention

footprint industry. as possesses Concentrix in such This as success and organization, strategic payment our XX-plus create a combined scale. combination our services the brings tailored number we Webhelp that a countries, helps deeper EMEA, a clients, IT drive at our customer and a on services increases global transformative spanning believe and new for verticals expertise in laundering robust a know of financial advantages core us differentiation force in will expertise scale offer anti-money distinct enabling to domain our As solutions your and

spend the services historically believe and clients has capabilities that that also to We X,XXX on over ability gained offered. new we have Concentrix

commitment which their is and and nurturing supportive Our and harmonious workplace to are for practices renowned the our by inclusive integration excellence reinforced to globally cultures, commitment ESG. of a further workforce

a have Webhelp. from returns to financial path We clear combination the positive with

well accretion the and on enhanced achieve non-GAAP year. track profitability growth, to We revenue EPS within first are

underscoring financial in the of We expect combination. in year, strength the further the EPS accretion double-digit second non-GAAP

In year, million by $XXX our these post schedule, great process confident is confidence us Since will spend announcement, to the $XX time that we year able we integration in to third the have first addition has million on right already. achieve is are of synergies compelling this made which substantial the including benefits, more close and been transaction given we team, that the progress with with the Webhelp cost investment.

of and Board and completed Duha, We and team. CEO, changers integration I would all Partner to new work Webhelp Gheysens, also GBL Vice expect welcome of Concentrix our Chair months, who members, X and Webhelp to like new of becomes game Nicolas welcome like to Board the I XX to a within our would our Olivier Co-Founder the Director. be Directors;

like the trust, Andre? our would our thank And our their and to ahead. their prosperous commitment talented Andre. over I'll Directors support continued of exceptional for to for their support. call year your for investors Board to We Finally, and and our mentorship for forward look an staff exciting clients I execution, to now turn

Webhelp's Webhelp Well, our this Adding leading excited our proposition as and combination company. talented week. We're global a strengthens thank global you, closed with solutions staff solidifies CX Chris, and value earlier position our to everyone. have hello,

quarter, I'll first review guidance contributions anticipated including conclude completion transaction, from results, additional I fourth I'll on Before quarter details the provide of the the then third with Webhelp. for our

quarter, exceeding the currency In ranges execution. continued came our midpoint rate non-GAAP profit income reflecting our operating organic the in our Both of the income within revenue constant increased non-GAAP our operating guidance growth guidance. revenue third with non-GAAP improved, strong and

in an health financial e-commerce quarter, strategic and on and few Revenue basis. care, and basis, verticals with The X.X%, growth of meaningful $XXX free point quarter. the constant ServiceSource reinforces growth the cash fluctuations by strong prior as on organic approximately industries. Revenue reported a growth a up X.X% retail, in revenue posted year-over-year X clients from a basis, grew reported themes including Webhelp. softness achieving no our way, currency in from year with the quarter reported increased banking, clients travel, continued over from million in both and large our our insurance, full organic of quarter. of organic each continuation contributions impact Additionally, constant increase in not On the revenue XXXX. There was growth in offset flow, e-commerce the expectation included X.X growth from communications from as currency health constant clients travel impact from consumer including in confidence reflecting X% of in currency a cash care services with Strong clients. double-digit the revenue acquisition in our XX% and on positive currency travel leading flow generation the electronics July revenue in and X% reported generating volume

Revenue Revenue by as services currency X% from reported financial X% reported from from by Revenue on basis an organic and X% about organic an as communications clients currency about and other constant electronics our quarter. an third constant consumer and organic decreased on and clients on basis. X% grew constant decreased an currency and reported basis X% on technology clients banking, constant currency organic clients insurance basis. the on X% in as basis. from vertical Revenue and X% reported in grew X%

Turning Non-GAAP year. quarter was third million income compared with in $XXX $XXX to million the profitability. operating last

last was third with year. of was in up XX% the $XXX EBITDA XX.X%, points XX million Our margin compared third non-GAAP Adjusted from year. basis in million last quarter the $XXX quarter operating

XX up Our in points XX.X%, adjusted EBITDA third margin the year. from was last basis quarter XX.X%

in adjustment were up issued Third expense purchase earnings costs expense quarter net interest million for expense approximately $XX our a quarter related tax million currency transaction. the the item Non-GAAP third the expected. Other the related higher The to million reflects invested the million quarter the $X Webhelp $XX million included which on compared also approximately income in net $XXX the prior for this foreign year. The financing a remainder increase million $X was in interest XX.X%. from $XX of $X expense, rate The $XX P&L more decrease approximately expense change to the This of of with quarter the interest the and million, in was non-GAAP third $XXX of line million with the charge was other due was in It relates income share-based of associated to the losses. of results the in million in fees for quarter. primarily Webhelp last third on and the $X.XX non-GAAP basis amortization for remainder included share in million was includes that expenses X, Included hedge higher of interest to to of on rates compared proceeds. were $XX our of than $XX of million quarter of operating offset the expense expense. interest Webhelp year. and year third transaction. compensation as interest increase in intangibles, $XX related income. Earnings August expenses integration included bridge increase currency mark-to-market in GAAP a per senior price quarter approximately on operating interest million notes the $X.XX non-GAAP The to acquisition-related combination. last

flow. to Turning cash

cash quarter third from third $XXX Our expenditures capital cash totaled $XXX were of quarterly flow $XX million. flow and record This free resulted operations million. million in quarter

continue fourth million, contribution cash for excluding quarter $XXX the flow Webhelp costs. transaction to integration expect to exceed We the and and cash free the year in full flow of

share. of $X.XXX dividend During the quarter, quarterly we paid per a

the the to $X.XXXX reflects our on at share confidence share. and commitment quarter. an had repurchased the the million the in after increase This in the our of our to future financial XXX,XXX we in the price our to of during remaining to end to strength, per As disciplined Board repurchase our We approximately resumed third third transaction. dividend repurchases paid authorization. has per were million Chris mentioned, $XX filing proxy be quarterly share of related average quarter. quarterly our deployment. Share dividend quarter statement our approximately for stock quarter, made capital fourth in raised $XXX Repurchases our Webhelp our $XX At the shares quarter

$XXX balance funds billion. the end hand $X.XX third sheet. $X.XX million end the the includes end senior At a term the debt and quarter, at elevated complete At partially of billion on unsecured $X.XX the debt the were total to of Moving billion to $XXX the year. the on Webhelp outstanding and decrease cash and Webhelp -- equivalents debt transaction the at quarter, quarter, of reflects third of cash the transaction. The the end of was billion second the balance the third was balance of cash the the beginning million decrease $X.XX loan. of of of Net our the level the end $X.XX since outstanding issued notes quarter from to a quarter fund billion and

closing equivalents basis. $X.X debt totaling complete $X.XX million on post borrowings trailing of the net loan revolving $X.XX our closing primary components $X.XX X Our our forma sheet closing billion executed Webhelp approximately the Webhelp note and were to borrowings, payable under Monday, in to gross million combination, was securitization a the X.Xx million notes upon adjusted was million at approximately and shares our EUR XXX interest million of on undrawn accounts pro we leverage Net the and end Webhelp we The million receivable X-year $XXX credit debt was which paid the on off billion billion cash represents of shareholders on shareholders, there a in gross outstanding facility facility. At basis. securitization. borrowings net and quarters the were million at of billion, of debt shareholders forma XX.X quarter, the approximately Webhelp X.Xx in bearing we no X%. After leverage incurred of $X.XX the debt senior of to EBITDA approximately balance Webhelp To Webhelp approximately a shareholders to quarter, issued the combination. pro receivable approximately cash billion. $XXX had payable closing, end accounts $XXX billion, $XXX term $XXX paid and on in outstanding third notes, On $X.X

of XX.X shares. undrawn. million outstanding share Webhelp Our count shares increased The approximately to shareholders credit remained to our revolving issuance facility

lower Regarding the rates. total cross-currency convert at XXXX the each the of the senior prevailing effectively into combination entered notes. on of billion closed, in amount million day swap the arrangements we XXXX for and debt the notes, euro-based interest synthetic of $XXX a $XXX notes $X.XX notional arrangements million of The

notes In approximately weighted of a swaps our also rate to addition organization's to the cash euro-denominated average the payments approximately $X.XX currency flows, portion to billion of the from of X.XX% interest the the X.XX%. interest reduced aligning

As we Xx free adjusted and our Webhelp committed our announced EBITDA transaction to we said a generation and combination clear gives transaction, leverage us we're the when cash X flow strong adjusted to reducing net within path to reducing the growth of leverage, EBITDA the years after about closed.

and our of Regarding allocation our repaying on the priorities, focus capital growth, the planned organic synergies is integration realizing Webhelp, successful debt.

principles. to We investment-grade are committed

and the reducing leverage equity paying grants. will down debt dividend offset disciplined to net while prioritize of and repurchases continuing share our dilution We our

anticipated Webhelp the than to more quarter contributions for I'll slightly The from of the fourth including forecasted my months. a outlook guidance financial fourth Now turn for quarter, includes performance business attention in period the contribution X Webhelp.

a exchange expect based be of in the to billion quarter, $X.XX rates. $X.XXX For billion we reported revenue to fourth now current range on

Our of fourth the for of occurred if organization quarter the the currency X% XXXX. the of to had combined X% fourth at quarter expectations reflect beginning constant pro growth combination approximately forma

of expected guidance currency with Excluding quarter constant for consistent the the the effect combination, the in fourth the full year. Webhelp would be prior our growth

of Our of quarter over for $XXX million. profitability equates million XX.X%, the of our of year. a in approximately this midpoint the prior XX non-GAAP At operating margin to a range expectations to the basis income points operating an non-GAAP include guidance, increase income $XXX fourth

the for Excluding will non-GAAP the quarter the expected operating consistent guidance the year the full fourth be XXXX. effect with our income of Webhelp in prior combination,

for per diluted we XX.X EPS to average an the fourth non-GAAP per million be share a non-GAAP that tax approximately the fourth due XX% the income close. Accordingly, impact from less mid-quarter to diluted other quarter of to expense foreign XX the of interest the approximately with Note $X.XX count This million We to outstanding for of assumes rate expect than quarter of shares. range share the movements. EPS no post a and shares a share. the fourth currency as expectation is count average future of quarter in $X.XX for close expect be weighted in net $XX unpredictability the timing effective of share expense and result million

the with $XXX costs the and business for robust to million generate cash We to in expect the continue flow to be flows the cash in transaction organization quarter. any range $XXX of excluding to combined million fourth free integration

not any Also does outlook the fluctuations. acquisitions. included are combination foreign with costs future business currency or from not in Our guidance and Webhelp include the transaction integration associated impacts future

expect We billion combined the full to approximately the $XXX in revenue million continue pro year full XXXX, for $X.X combined EBITDA a year to and Webhelp $X.X of for billion on approximately fiscal $X with operations forma organization nearly yielding generate revenue nearly the billion the in basis of and adjusted EBITDA XXXX.

full earnings per year. second digits appreciation and the high to after expect year in of We first in mid- close accretion share the double-digit -- single accretion

our the to in has further expect XXXX for our quarter results from $XX Latin million into in on year to and client call. In for synergies marquee combination clients also and $XXX and Webhelp fourth increasing after year presence growing providers plan We list America in diversifying markets, platform value global creation, X. X growth leading realize our million CX joined provide in guidance Africa. closing, Europe, significantly a bringing to synergies growing We first in closing, the

that and companies reach both been adequately global range of have capabilities couldn't additional and independently. support serve for services Our enhancing high-value clients expanded

create union we highly a that have customer strong seamless. our creates a forward the value excited to about line this offering future. And business We and will We're prior At integration growth unique this resilient for the point, will open engagement more the make integrating of which track We complementary the business Webhelp. in with cycles. it combination combination keep please will the Latif, and success questions. look record believe combinations, through

America. from [Operator Ruplu Bhattacharya Instructions] the of Bank question comes of Our first line of

simplify wondering operating margin quarter the contribution is revenues, Andre, can if what kind you of -- was for and from if you Webhelp can I EBITDA. fourth

lot sure details, got but of all I'm that. gave a You of I not

what how the quarter? in is fourth specify the operating please core the is doing income you much revenue business contribution, can contribution? So And

Yes.

So happy that, to Ruplu. do

with So revenue. start I'll

So perspective, from pre-Webhelp a the are much revenue guidance. operations line with legacy Concentrix the prior very in

full X% was for the for Ruplu, to guidance full prior grow year, the to the year. So X%

from And line so with will be Concentrix in be contribution that operations that the the -- will guidance.

certainly the and will expected, quarter. here kind growth in accretive be as we that overall fourth to So that. Webhelp of covers it the rate

transaction, So that. really, perspective. a close, the that's when the From the non-GAAP if very, and very were both EBITDA you back of go an a profiles to from X perspective businesses OI margin perspective, we margin announced

a the as little the guidance, you in OI that included about past apply can sides. Depreciation at of XX.X% -- -- so percentage Webhelp, we've much can non-GAAP pretty talked midpoint, And both is revenue. bit to pretty you this the much bit a higher margin, for that in little a

So coming XX And from the move you QX. margin as roll margin again, XXXX. EBITDA might improvement XX, synergies points in, a adjusted very to or basis start perspective earnest in see we then higher expect so as in margin from side. significant complementary into But Webhelp

for again, I you based then below contribution what what from are below-the-line fourth any well on in expenses? Can just other imply fourth clarify, said, was the would the in the to income? And just I about like you you as is costs. quarter? about $XXX items expense that to talk on And the us estimate Webhelp interest fiscal said revenue the remind be for quarter going can think like operating integration XQ? that also the is there you What there as million mean,

Yes.

So little give exact are estimate hard integration quarter an a a to on. costs in

matching synergy X So about they be X overall, the number. integration what the costs said those is would we for

somewhat and in $XX $XX believe, total costs, year, with in loaded million second. million integration the so roughly or first in million the $XXX front So I

X that, -- that equate to that think months, of $XX million, in and in you're think line of So there. will probably

it missed the I contribution. -- question, your of part other oh, The revenue

higher $XXX than Webhelp is think that. million. you're little a at The contribution from low I

one, to I'll maybe ask last maybe And my Chris. Okay. one for

about on talked -- projects. working some AI generative you AI So

I now, Do to of mean, can based impact this, when we about past, XX% like of I want Chris, think volumes So -- get impacted. the experience on you the said XX% think you the clients understand you mean, in have generative to AI.

has you impact projects? I at And all I thought this varies that case? do any think end doing mean should your this think how about by market now these way point that at if the quantify mean, cycle? in changed of you're And how we that? more to use

there. Ruplu, so different couple a of points

by new I it. what what offsetting curating technologies generative And that And net both we running some these seeing anything dramatically deploy talk can talked are technologies, of goes increase think not talked of be is from of the the that little from that's when new getting remarks, kind that areas regardless a new it. revenue basis, practices. What's where content the for revenue we implementation along streams but AI that's by seeing prepared RPA what flows AI bit, deploying that about our as and with probably that. platforms coming XX% we're we've to we're design, in in XX% that we're yearly the generative these we're that that and a of even automated, or more on can with coming as else doing new new about transactions is than own we're net that deploying or we along

focused well offsetting we're taking the any on what clients. within as share revenue that as more clearly headwinds is So

is faster we're that we some generative of at are able than moment what can think the right to clients it. AI our actually deploy seeing I deploy

entire from from kind across mitigation a might in see called sense. get including as that scale. to And the cost if so automation, the Webhelp operating starting benefits get we benefits think structure number our perspective a makes in those from of offsets And and seeing I impact that we're to new any that out cost the we'll enterprise, revenue are hopefully, to that -- which that's we from have scalability we them combination, additional coming any

next of Our comes of the line Instructions] Redburn question Davies [Operator Atlantic. from Oliver

I guess questions. a couple of

guidance the firstly, kind for terms Just in you of legacy Concentrix held business. of growth revenue the

pretty what volumes? it as on can And So were has said that most of similar accelerated quarter. of about terms I client you looks following seeing in front? from sectors changed care I like looking possible or talk last offshore kind the quarter a in decision, client guess guess, other just underlying you new where that, of you're the And to the to anything health still on

so Oliver, seeing first other of I'll consumer, your to budgeting answer are is spending, electronic we're it, question, call things consumer discretionary. somewhat subscription what new that continued for devices, kind

some stable what those to see if is we continue tends that larger sense. the our volumes depressed of beginning So the makes But across at we more depressed more the steadily year of becoming clients. volume now saw It's versus it where fluctuate. to

comment, from new such clients, robust And consumers we're structure. just as despite verticals wins those the for offshoring, volume back talked quite future travel, at. strategic perspective. From sort We of out, my primarily being part, services putting doing And new most and verticals, that we care see a their we're are vertical, as health net banking, before, areas, of the well very nearshoring cost net about overall growth in the because expectation travel, services. even some managing an called quite in are cutting seeing we've focused into still financial into comments the about on we've

cost-effective or the at starts moment. structure. just environment, much whether be that transactions cost ramps of most existing the at very, right a offshore. to tending very, -- pretty and few be shore are the onshore so deals It's at not higher out fact, majority in very of Very in clients clients' few done all and starts nearshore starting And are budgets new

by maybe just the looks be Great. Andre Okay. capital. driven for working And free flow, just one cash on it then to

that you the terms just could reasons in So comment flow? of for free cash on

Andre, coming you're through. not

that. a second. We about Sorry muted ourselves for

on So time the of and a Oli, focus quarter a largely in our the improvements. and which just flow And from you're improvement from drove on collected is right. The improvement time, really working days outstanding. in X-day roughly tackling out getting sales on that's free prior blocking coming bills capital cash

an feel team just getting we always but cash by very, We're flow really think of $X.X it's sustainable you Webhelp move hitting confident we quarters. the guide Feel and collected. we very without on It's X more the how at the really execution in guide just look So if done really a definitely billion it's year. good free the increased beginning that the on for to And been of through that. out set fourth to focus cash or do the quarter as track forward. that good and out free year at focus, very about the getting them bills this we've about flow generate

stand [Operator which Scotiabank. Goyal our for question Instructions] next by of line Divya from the of comes We

which on So provided. Andre, the addressed part you question, of you've briefly guide my was the that

guidance macro been that what's QX? the we going addressed perform should terms say, continued, level we there the alongside across with on going the of forward, impact? should I in some the how transformation is obviously, overall And how expect provided see Chris to confidence that's slowdown noted can macro What So in the for business. of you the business that considering, AI

of was sorry -- about. some what I into talking that conversation because the take don't it that why ties I AI Divya, Actually, we're

the we've saw what in seasonality what couple QX, of based on a business at of last primarily look is the been historically kind we has we've stated guidance we that for points When before So of our out stripped it. to different year. QX, that

from come talking clients we're to we're seeing And volumes, so of we're that looking flatness perspective through. at a sort their our and seasonality when

clients are As from of through continuing on kind in those a seen steady is I last And volumes we're and have number of business also last we that decreased kind expected the seeing they've rate of based trailing quarter. of consumer the weeks mentioned, for of demand. as what sort been have

models the for we're are as those as into AI doing generative kind then services AI the on consulting, doing we're managing the as an we're production. generative looking out additive the concepts, third pulling well. And seeing and where they we we're through from perspective, proof of So business, revenue at doing come to now, to a we're that of our start getting to models implementations, building the as element QX right

that And going so sorry, outside fourth and the our been and in of or impact that sold, the that's expected that's phase. already we're now billing booked revenue has quarter implementation really we -- into no been

That's helpful.

following trying I this benefits, you thought have customers? any margin across pressure you Just conversely are any seeing here, the process to automation bring that understand, given pricing on wanted the or to been

Yes.

our business, it see we've that's continues do to talked in pricing XX% transactional we as business. highly And about although of So pressure decline. it, about the

think you in was If it February, it XX%. back about about

the And are XX%. is of commodity-based it's to goal that part drive quite In business. And there our continue down are for very it's who the segment certainly it -- Now down. business, people obviously to to part revenue. It's of to that ramp. chasing easy

pricing the pricing to from Our perspective. focused doing, preferences and business focused on that environment. to security, services, quality win it we're Clients it work goes from you're but it In stable work. outcomes. They're going the a worry how just much that pure they're They're on more by service, of the of work consistency focus a on that focused the focused seeing compliance on services away more more actually you're higher-value you're if the not about deliver the on the are doing. higher-value of

within internally, And expect stability putting those therefore, what for strategy. clients. we're to will And is putting where we we're execute on technology, where as is automation sort we on so that continue this continue in that, our margin supporting driving better that of in efficiencies our

As Instructions] does to further call. in questions this appear you Thank your no participation. queue, for conference be conclude there today's [Operator

disconnect. now may You