Good day, ladies and gentlemen, and welcome to the 2025 Fourth Quarter Genpact Limited Earnings Conference Call. My name is Carmen, and I will be your conference moderator for today. We will conduct a question and answer session towards the end of this conference call. As a reminder, this call is being recorded for replay purposes. The replay of the call will be archived and made available on the IR section of Genpact's website. I would now like to turn the call over to Krista Bessinger, Head of Investor Relations at Genpact. Please proceed.

Thank you, operator. Good afternoon, everyone, and welcome to Genpact's Q4 2025 Earnings Conference Call. We hope you have had a chance to read our earnings press release posted on the Investor Relations section of our website genpact.com. Today, we have with us Balkrishan Kalra, President and CEO, and Michael Weiner, Chief Financial Officer. BK will start with an overview of our results, and then Mike will cover our financial performance in greater detail before we take your questions. Please note that during this call, we will make forward-looking statements, including statements about our business outlook, strategies, and long-term goals. These comments are based on our plans, predictions, and expectations as of today, which may change over time. Actual results could differ materially due to a number of important risks and uncertainties, including the risk factors in our 10-Ks and 10-Q filings with the SEC. During this call, we will discuss certain non-GAAP financial measures. We have reconciled those to the most directly comparable GAAP financial measures in our earnings press release. These non-GAAP measures are not intended to be a substitute for our GAAP results. More details on our constant currency growth rates can also be found in our earnings press release and fact sheet, which are posted to our investor relations website. And finally, this call in its entirety is being webcast from our Investor Relations website, and an audio replay and transcript will be available on our website in a few hours. And with that, I would like to turn it over to BK.

Hello, everyone. And thank you for joining us today. We delivered a strong close to a record year for Genpact. Focused execution, accelerating innovation, and broad-based demand drove $5.08 billion in revenue, up 6.6% for 2025. Advanced Technology Solutions revenue grew 17% to $1.2 billion, now accounting for 24% of our total revenue. We also delivered another year of healthy margin expansion. Gross margin expanded 60 basis points, and adjusted operating income margin improved 40 basis points, even with our significant investments for long-term growth. Adjusted diluted EPS increased 11% faster than revenue for the fifth year in a row. In 2025, we built a strong foundation to drive sustainable, long-term growth, with a deliberate focus on rapidly scaling data AI and domain-driven identity solutions to reimagine how clients operate. The shape of our business is meaningfully changing as a result. Our performance, pipeline, and prospects are increasingly higher quality and strategically aligned with our prioritization of advanced technology solutions and agentic-led work. We delivered over $5.5 billion in new bookings, with healthy growth in advanced technology solutions, which now account for more than a third of total bookings. We won 16 large deals and continue to make progress with the next generation of market disruptors. We are in a very strong position as we enter 2026. Demand is healthy and growing. Our inflows and pipelines are robust, and our backlog has never been higher as more clients see Genpact as a long-term strategic partner to transform their mission-critical operations. 2025 was a year of intentional disruption and tremendous achievement. As I look back, I am most proud of what we have built, launched, and scaled with our agentic solutions. We are fundamentally reshaping how businesses operate, and we are doing so at speed. Last February, we launched AP Capture,…

Good afternoon, everyone, and thank you for joining us today. We delivered a strong fourth quarter that exceeded our expectations, underscoring the progress we have made throughout the fiscal year. As we consistently execute across our businesses, momentum from Genpact Next Strategy continues to build, demonstrating our strategic investments are paying off. In the fourth quarter, total revenue increased 5.6% to $1.319 billion. Advanced technology solutions revenue, which includes data and AI, digital technologies, advisory, and agentic, increased 15% to $323 million, with particular strength in data and AI. Our advanced technology solutions continue to create incremental value for our clients and generate higher value revenue for Genpact, delivering more than two times the revenue per headcount compared to the company average. This revenue is also growing more than two times faster than Genpact's overall revenue, with roughly 70% annuitized revenue and 70% from non-FTE models. Advanced Technology Solutions is high quality, sticky, and most importantly, strategically aligned to our future direction. Our rapid acceleration in AgenTeq reflects the strong foundation and client trust we have built over the years, as well as our leadership in advancing AI-led transformation. As BK mentioned, we closed over $200 million in AgenTeq contracts across new and existing clients in 2025, with more than 40% of awarded contract value coming from new clients. Within existing AP clients rotating to AgenTeq-led, we continue to see revenue and margin improvement driven by higher volumes, increased scope, or both, demonstrating the expansive opportunity of our AgenTeq investment. Core business services, which includes digital operations, decision support services, and technology services, grew 2.9% to $996 million in the fourth quarter, reflecting continued client trust and demand for our domain and industry expertise. Growth in core was offset by softness in decision support services as we continue to work…

Before turning to Q&A, I want to extend my thanks to an incredible leader. Krista Bessinger is transitioning to a new role at Genpact in 2026. Krista, you have made a significant impact here at Genpact. Thank you. Thank you for your partnership. And I look forward to working with you in your new advisory role. With that, I also want to welcome Kyle Wickstrom as our head of investor relations and the newest member of our Genpact leadership council. Kyle joined us from Microsoft last spring with over twenty years of experience in various finance roles in technology. We are very excited to have her on board. And now let me hand it over for Q&A.

Thank you so much. And as a reminder, to ask a question, simply press 11 on your telephone and wait for your name to be announced. To remove yourself, press 11 again. One moment while we compile the Q&A roster. Our first question comes from the line of Bryan Bergin with TD Cowen. Please proceed.

Hi, guys. Good afternoon. Thank you. Maybe just given the material pressure on the from announcements from Anthropic and others, maybe we just start off with whether anything has changed for you on the ground in contracting conversations, whether you see any instances of clients seeking to try to do more themselves. You know? I guess I am curious. Where do you see type in the market being just that versus where there may be some validity to the risks that some of the traditional models face?

Sure, Bryan. Thanks. Let me take that. Look. I would say that we are incredibly excited with what is happening in Silicon Valley because it is accelerating our pivot. It is helping us drive outcomes for our clients faster. And whenever any of these tech shifts happen, it is always nuanced as to how it will apply to various different companies, and we clearly see this as a tailwind for us. We see that in our pipeline. We see that in our conversations. And if I just step back and maybe this is oversimplifying, Bryan, I see this as two main AI focus areas. One is, let us say, research AI, and the other one is task-oriented AI. You are probably referring to is more, you know, what is getting more attention these days in research AI, which is helping us accelerate our work. Where BCommon is more in task-oriented AI, and that is where we are building this agentic operations. We execute specific tasks within a process and making sure we are bringing in AI into the entire system of work, looking at the data, looking at the context, in these complex end-to-end business processes, which are unique to every industry. So fundamentally, if I see it from the operator lens as we speak to many Fortune 500 companies, not just the Frontier AI companies, we see our relevance increase. And we are seeing that, again, how our agentic operations are taken up, how data and AI are taken up. And what I would say is we are only seeing our pivot accelerate and only excited with this.

Okay. Understood. And my follow-up will be on ATS. You had nice solid growth here again in the fourth quarter, 15%. Now you are calling for an acceleration off of that level. So I want to test just the fact driving that confidence. I heard plenty of activity in your prepared script. Just give us a sense of maybe ATS bookings growth and is there an acceleration of work that is coming out of CBS? And into ATS? Anything that is kind of mechanically migrating between the two? Thanks.

I will answer it in two parts. And, Mike, feel free to give you a color. Point number one, I think we are beginning to see getting into a lot more conversations where we were originally not invited to, and I often have said that we are meeting where clients are, and, increasingly, we see that we can take them to where they want to be in a much faster manner. So we are, be it in large deals or mega deals, we are beginning to see into the conversation where we were earlier not invited, and that we see in our pipeline. Second, I think just from a core business services standpoint, we continue to see a very, very healthy demand because that is where we see last-mile advantage. That is where we have run mission-critical operations at scale. And that is where, you know, we understand the complexities and bring the process and technology conversation in one go. And fundamentally, what we have seen just agentic contracts grow, including with new clients, you know, 40% of the booking coming in from new clients or this contract value. You know, we are really excited. And even for the rotation, we see incremental revenue growth and gross margin growth.

Yeah. So if you may just double click on that for a quick second. So just if you really want to just think about it from that perspective in the sense of how do we view ourselves in terms of ATS growth at the rate that we are projecting in the high teens for 2026. It is really driven by the two things BK alluded to. First, momentum we have seen in the AgenTeq ramp-up has been notable. Right? We put forth we had a TCV of approximately $200 million in bookings. Where we ended the year, and that is going to accelerate more as you roll out additional AgenTeq related solutions. That will help pivot some of the revenue from the core business services. And a few comments on that, as we talked about in our prepared remarks, the quality and sustainability of that revenue is incredibly important to us. It is highly sticky and continues to grow at a measured pace. It is recurring annual revenue if you want to think about it from that perspective.

I think maybe you know, what I am really excited about is how the shape of our business is changing. The pace at which it is changing. And more than a third of the booking is advanced technology solutions. And the majority of deals that in AgenTeq are obviously non-FTE, but driving consistent rec. Annual revenue streams. So the new commercial model is taking hold in a significant way.

Okay. Understood. Thank you.

Alright. Thank you. One moment for our next question. Comes from the line of Maggie Nolan with William Blair. Please proceed.

You mentioned, I think, 40% of your TCV for the AP suite was new clients. I think that number was maybe closer to 30% last quarter. Are there patterns in who is adopting this? You know, are they different than the typical clients that would have engaged with Genpact or BPO in general in the past? And then can you give us some data on how you are thinking about addressable market growth as you roll out these solutions?

Thanks, Maggie.

Look, I think it clearly points to significantly expanding our total addressable market. And as I have said that we have not seen takeoff of any solution in Genpact history at the pace that we are seeing this. And many of these new clients are obviously net new to Genpact. But a number of them are also our existing clients who are not using finance, but they have now begun to use our finance stack. So, fundamentally, it is the enterprise client. It is mid-market client. It is our existing clients who are not using finance using us for finance. So a combination of all of that is really enhancing. And this is also in many ways getting us into the core foundational work that we need to do for many of these clients.

Okay. Thank you. And then have you noticed any improvements in the sales cycle or ramp times in the last ninety days or so, particularly in large deals, and I am curious what is contemplated in the full-year guidance with respect to those variables. And you sort of alluded to large deals in January being quite strong or those baked into the guide.

Look. I think large deals have their correct. Some move at a very accelerated pace. And some take much longer. And especially as we bring more technology and process and data and all of these skills together, especially for larger awards. It does not move in neat ninety-day increments. But, really, thrilled with the number of these conversations, the pipeline, across cohorts, including large deals is at record levels.

Sure. May I have anything to add on to that, BK? So, Maggie, thanks for the question. Alright. You know, let me just bring this up a little. We are really confident in our guide at 7% on a full-year basis. So we look at everything that look at all deals. We probably weight them as we move forward and in our business. But a few things I want to just quickly talk. We think about the 7% number for us. We look at it in an absolute dollar perspective. Right? So we grew last year a little over six and a half percent and roughly the same number a year ago. So it is not a Herculean effort for us to grow at that rate for next year. But I would also like to just point out that our committed revenue is in line with historical averages. Which is about 75-ish percent. And again, this is all built off of a significant backlog which is at record levels, which takes into account 2025. Bookings as well as an exceptionally strong 2023 and 2024. So we feel really good about that on a go-forward basis. And specifically regarding your question, all deals are probability-weighted into how we look at the guide on a prospective basis.

Thank you. Congrats.

Thank you. Thank you. Our next question comes from the line of Surinder Thind with Jefferies. Please proceed.

Thank you. I would like to touch base on the margins starting with the gross margins and the expectations of 50 basis points of expansion. Can you walk me through the levers that you are using there, and then what is the potential to kind of continue that trajectory as we look further out into '27 and '28?

Maybe I will start, and Mike, feel free to comment on it. Look, fundamentally, it is a shift to advanced technology solutions, which is giving a higher value to our clients. And it is a higher value revenue for Genpact. And we have been talking about it for a bit, and now I think it is picking up the momentum. We see that come through apart from the disciplined operational capabilities that we are driving. But it is more from advanced technology solutions. And, you know, I will not like to opine on what will happen in 2027-2028, but fundamentally, our trajectory is clear as we have demonstrated over the last couple of years and increased the margin by 90 bps or 100 bps over the last two years. And we are very clear that it will certainly grow further in this year as we have guided the street.

Yeah. Two just quick add-ons to that, Surinder. So when you know, as BK alluded to, right, at the increased mix from ATS, right, particularly that, you know, we see these non-FTE commercial models really support our margin in that business. In addition to it, if you think of our margin in totality or the AOI margin we lay out, remember that grew 40 basis points year over year. That is net of significant investments made in our organization. So we feel very good about our margin trajectory on a go-forward basis.

That is helpful. And I guess as a point of clarification, what I was trying to tease out here is this idea that is this predominantly a mix shift benefit that you are receiving or are there other benefits that you can get from just from the delivery footprint and you know, the AI advances that we are seeing. I was just trying to understand that component here.

Yeah. So correct. So the mix shift component, the nature of the work we do in ATS, we just alluded to is one component of it. But if you are thinking about it from a client zero perspective, which is how we think about our organization, and using AI and everything and how we are training our internal organization. Yeah, that has helped perpetuate the growth and the efficiencies that we are seeing in our own business. Remember, we come to the term client zero because we are embedding technologies in everything that we do. Right? I disproportionately focus on functional areas, and I have seen that technology pay off. Right? And we are using that we are using some of that benefit to invest in the future of our organization. So I think it is both things. I think you are correct.

That is helpful.

And then following up on the comment about this is all net of the you are making a lot of investments, and so, obviously, you are still seeing some good adjusted operating income margin expansion. You kind of use the terminology that you are investing aggressively in strategic areas. Can you elaborate on that in the sense of can you do more, and is it how do you balance the level that you want here? Because when we look at you know, other I will use the extreme example is just you know, the hyperscalers. You know, their CapEx spend this year is coming in much, much higher than anybody is anticipating. So it always seems like there is the ability to invest more. How are you drawing that line?

So I will kick it off on here, Ravi. So remember, what we are doing, there is not a tremendous amount of CapEx associated when we talk about investments. In totality. Right? We do run a very disciplined process in the organization. Right? We look at the ROIs and the strategic implications of every one of the investments that we do. Right? Is there always a greater ask that we are willing to do? We evaluate that on a quarterly basis. We do it in a very disciplined fashion. Right? But what I will say is from an investment perspective and things partnerships, which was called out in quarters past to training, we are not pulling back from that by any stretch. You know? We are investing quite a bit of the operating leverage of the business in the future strategic investments and a whole core whole course of things.

And I think there are clear areas of our investments, Surinder, that we have laid out. Partnerships we have laid out, we continue to invest more and more in that. We have laid out in building the talent. We are increasing that more and more. You know, I talked about agentic ops and so on and so forth. This is all the product investments and the engineering investments that we have done. Sales investments, and the front-end investments we are doing. So we are changing the business. That is what I mentioned. The shape of the business is changing very fast. And may I say we are no longer the company that we were two years ago. And really proud as to the speed and the pace at which we are moving.

Thank you.

Thank you. One moment for our next question, please. And it comes from David Conning with Baird. Please proceed.

Yeah. Hey, guys. Great job. I guess my first question is really on pricing. And our clients, it seems like coming to you at an increasing pace. That is great. Are they coming with greater expectations of the ability to drive more efficiencies? Are you having to change dynamics, like, faster kind of efficiency gains in their contracts or anything changing in the dynamic of the backdrop?

Maybe I will take first and feel free to opine you know, overall might look fundamentally how I will think about it is yes, aspirations are high. Overall aspiration of whatever everybody is reading, and therefore, what can happen in their businesses is high. And so is true in pricing as well. But what we are able to so I will say it in two parts. First thing is think of it as simple as p times q. And in p times q, yes, we are giving in more productivity to our clients. But our costs are offsetting at a much faster pace, and that is what you see in gross margin. And as far as our top line is concerned, we are getting you know, a bigger share or, you know, more scope that for the same body of work, we are able to that is what we reported that in AgenTeq you know, our revenue growth is much higher than what we reported in June. So I think there is that is why we are saying that we are creating higher value solutions for our clients. And we are gaining in the process. The second piece I will also say is how we are working with our partners and leveraging partner ecosystem as well as embedding solutions at the last mile and they are repeatable in nature. And therefore, I think we are gaining as a leverage point there as well. Mike?

Yeah. I you know, the way I think about it is it just I look at our gross margins. Right? And I look at the gross margin expansion that we have and the gross margin expansion that we are guiding for. Right? I think that is really the best measure on how we are doing this. Right? So, yes, as BK alluded to in the beginning of his comments, there is always productivity asks. Right? We have seen nothing dramatically change from the past. But it is always been there and it is not going to go away. And I think our ability to navigate through that thus far and what we are projecting has been quite impressive.

Yeah. Construction-based structures are taking hold, so that is giving us more leverage.

Yeah. Okay. And that is great. I guess and a follow-up question. When a company, let us say, they are brand new to outsourcing. They have not thought of AI too much yet. They are in the forefront of thinking about it. Who do they first turn to? Is it you guys? Is it, you know, the you know, one of the bigger tech companies? Like, are you at the kind of the tip of the spear like Genpact's our first call to, like, start this all out, or who do they go to?

Look. I think, this is what I was referring in one of my earlier comments that over last year or so, we have begun to see and sit on the table where we were usually not invited. Because we are bringing the process technology, data, you know, and how to run mission-critical operations at scale, all in one dialogue, all in one conversation. And that is really accelerating our pipeline, and, you know, you see the progress thereof. And you know, we are talking about advanced technology solutions growing 17%. And we are saying for next year, our view is it will grow on top of 17% this year, another 17% at least. So we see that in our pipeline. We see that in our momentum. And, yes, I think we are getting invited. Where we were not earlier invited, so feel really thrilled about that.

Yeah. Alright. Thanks. Nice job.

Thank you. Our next question comes from the line of Puneet Jain with JPMorgan. Please proceed.

Hey, thanks for taking my question. I wanted to follow-up on agentic solutions when you offer, like, AgenTeq operations or AP solutions. Who is the decision maker within client organizations? Is it like, the business managers? Or the CIO office? Who is driving the charge towards embracing the Genetic AI within your clients?

Yeah. Look. I think it is always a combination of both. When we were just talking about running mission-critical operation, obviously, the business wise is much bigger. Fundamentally, now as you need to intersect and need to weave in all of these agents into their complex system roadmap. Clearly, their CIO or CDIO, they are an integral part of the equation. And therefore, you know, that is the other piece where we are getting invited when a CIO, CDIOs looks at how we are thinking about agentic operations, how agents combined with human expertise how overall underpinned with responsible AI governance, our all of the framework we are getting invited in more and more dialogue.

And then on the last deals, that you have closed this year, what is driving that increase of the trend? Like, are these like deals typically rebadging comp? Like, do these deals have rebadging components? Meaning that they are coming from clients in-house operations? Are these AI-led deals? What type of work are you typically seeing in those deals?

Look, operations and maybe you are referring to talent transfer and others. Been an integral part of our model. And there is nothing special about that. Clearly, what is special is that you know, a lot more of our clients have begun to see that bringing you know, we have been running these mission-critical operations. Sometimes they are running themselves. But how we are bringing agentic operations in those mission-critical operations. Therefore, some of those demands, spigots are opening up more. And, you know, we are getting invited into even GCC conversations. That, hey. Why do not you take up the center? And run it for us? Because that is not what their expertise is in there. That expertise has begun to shine more and more.

Got it. Thank you.

Thank you. And our last question will come from the line of Bradley Clark with BMO Capital Markets.

Hey. Thanks. Just one for me. Just so I think it is clear that, you know, trend with your business are strong right now and in the BPO industry with really strong pipeline, expected acceleration in ATS. And I guess I want to shift focus to, like, long, like, long-term durability, like, the demand of customers needing help, you know, implementing a lot of different solutions, your own solutions like your IP solution into these processes that had previously done mostly manual labor. And I guess we want to understand, like, what is the tail of these types of projects or services for clients? Are you, like, once you help them implement the solution, whether it be, you know, your AP agent, the solution or a third-party agentic solution. You know, how did growth come after that?

Look, I think these are, you know, I am talking is more from an operator lens you know, what we see every single day. And fundamentally, it is, you know, when I am talking about API centric solution or for that matter, record to report or insurance, these are just very initial solutions that are taking hold. And please understand each of these solutions are building recurring annual revenues for Genpact. And that is what the commercial model is. And these are clearly as we see it, shaping the business in a very significantly different ways. And like I mentioned in my previous comment, more and more of our clients especially mega deals, they have begun to see that the benefit of agentic operations, especially running finance, supply chain, some mid-offices, claims operation, underwriting operations, banking operations. It is how we bring in agents with human expertise in a responsible AI framework so that they get enabled at the front end. They can gain market share, and they can focus where they need to focus. So we really see this as a long-term change. That is building a long-term business for us in a meaningful way. Thank you.

Thank you so much. And this will end our Q&A session. I will pass it back to management for final comments.

Thank you. Thank you, Carmen. Look. I just want to take the opportunity and thank all of the employees, you know, across the globe, you know, who make, you know, what Genpact is becoming possible. So my deepest thanks to all of them, and, most importantly, to our clients who are choosing Genpact. And also to our shareholders for their ongoing support. 2025 was an incredible year. Set us up for even better credible year in '26 and beyond. And I look forward to showing you more and more of that, and I really do want to thank you all. Thank you.

Concludes our conference. Thank you for participating. You may now disconnect.