Genpact (G) Q2 FY26 earnings call: guidance and Q&A

Given the conscious disruption and 2-point CBS headwind, what is the target growth model for the business, especially for CBS and ATS, compared to the Investor Day targets? Also, what about the sustainability of ATS growth?

Management reiterated confidence in the long-term growth targets articulated at Investor Day, emphasizing that clients seek solutions, not just specific service classifications. They highlighted the strong demand signals in both ATS and Core Business Services, with record bookings and pipeline. The flywheel effect from core to Advanced Tech, leading to Agentic Operations, is creating strong momentum and durable, richer revenues, supporting continued ATS acceleration.

“Overall, we feel exceptionally good about how we are ramping the business, not just in Advanced Tech, but also Core Business Services, because this is how the flywheel is delivering, which starts from core and Data & AI advisory, partner solutions and landing and Agentic Operations, which we are building and delivering on a new category.”

asked by Bryan Bergin · answered by Balkrishan Kalra

With record bookings, backlog growth, and a strong pipeline, how much visibility does this provide into 2027 growth?

Management did not provide specific 2027 guidance but indicated that the record bookings and backlog from the first half of 2026, including 12 large deals (double last year), provide good line of sight for driving results this year and into next year. The strong momentum in annuitized Advanced Tech business further contributes to durable revenue.

“So I'm not going to really talk about 2027 specifically. Let me just build up on how we're thinking about our guide this year and you can extrapolate that into next year.”

asked by Bryan Bergin · answered by Michael Weiner

Can you explain the margins of the non-strategic work being transitioned and how they compare to other offerings? Also, how does token pricing impact Agentic workflow margins?

The non-strategic work represents a very small, undifferentiated portion of the business that did not meet the criteria for durable value, ROI, and TAM alignment, implying lower margins. For Agentic Solutions, Genpact leverages scale and compounding learning, with annuitized recurring revenues and minimum volume commits. Margins are expected to gain from declining technology costs and decreased labor costs as agents handle more workflow. Token economics are managed through dynamic switching and model flexibility.

“As far as token economics is concerned, it is also how we are building the architecture that allows dynamic switching, model flexibility without any client disruption. And I think there is a strong, I will say, token FinOps that we have. So we procure well. There isn't overall underprovisioning or what have you.”

asked by Margaret Nolan · answered by Balkrishan Kalra

Is the ATS acceleration driven by new products/services or accelerating demand for existing ones? Should we expect continued acceleration in ATS growth?

Yes, continued acceleration in ATS growth is expected due to the flywheel effect, which builds on the strength of Genpact's core process intelligence and domain expertise. This opens new workloads and allows Genpact to own more of the client's transformation journey, from foundational work to data modernization and enterprise architecture, leading to exponential effects from scalable agentic solutions.

“Yes. Short answer, yes, you should expect it to accelerate. And I think it is the flywheel effect that we are talking about. And the flywheel builds actually from the strength of our core, the deep process intelligence, domain expertise, decades of operational excellence.”

asked by Surinder Thind · answered by Balkrishan Kalra

Employees were down while revenue grew, indicating significant efficiency gains. What are the dynamics of this decoupling? Also, what type of work would never leave CBS, and what percentage of the business is that?

Genpact is taking a disciplined approach to headcount, making significant investments in Advanced Tech and reskilling its workforce. The goal is to become a leaner, highly productive talent base powered by solutions, not linear hiring, with ATS revenue per headcount being double the company average. While some work is transitioning out of CBS, foundational work (data, process) for new large deals continues to fill the CBS bucket. The company is building solutions to move clients more quickly to Advanced Tech, but the starting point for many clients still requires core foundational work.

“Look, I think we are taking a very disciplined approach to headcount. But I won't say that we are at any inflection point. I'll just say we are getting started. We are making significant investments in Advanced Tech and we'll continue to do that.”

asked by David Koning · answered by Balkrishan Kalra

What surprised management about the ATS growth rates accelerating so much beyond original expectations (mid-teens to at least 25%)?

The positive surprise is how well Agentic Solutions are resonating with both existing and, more importantly, new clients, enabling Genpact to capture new TAM. The company has won business from peers due to its machine-processed, human-validated agentic solutions. The flywheel effect, driven by investments in Data & AI, acquisitions like XponentL, and partner ecosystems, is also contributing significantly to this acceleration.

“I think the -- what is positive surprise, Bryan, I would say, is how it is resonating with both existing, but more importantly, new clients and how we've been able to capture the new TAM in a number of instances, we picked it up from a few of our peers because we now have this agentic solution, which is more machine processed and human validated, wrapped in responsible AI.”

asked by Bryan Keane · answered by Balkrishan Kalra